After a regulatory action has been completed, Executive Order 12866 requires agencies 

to identify the substantive changes between the draft submitted to Office of Information 

and Regulatory Affairs (OIRA) for review and the action subsequently announced, and to 

identify those changes made at the suggestion or recommendation of OIRA. The 

document below provides more information.
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CRE NOPR ECS OMB Compare.docx

[6450-01-P] 

DEPARTMENT OF ENERGY

10 CFR Part 431 

[Docket Number EERE-2010-BT-STD-0003] 

RIN: 1904-AC19

Energy Conservation Program: Energy Conservation Standards for Commercial 

Refrigeration Equipment

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

ACTION: Notice of proposed rulemaking and public meeting.

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 commercial refrigeration equipment.

(CRE). 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. In this notice, DOE proposes 

amended energy conservation standards for commercial refrigeration equipment. The 

notice also announces a public meeting to receive comment on these proposed standards 

and associated analyses and results.
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DATES: DOE will hold a public meeting on [Day of week, Month, Day, Year], from 9 

a.m. to 4 p.m., in Washington, DC. The meeting will also be broadcast as a webinar. See 

section VII, “Public Participation,” for webinar registration information, participant 

instructions, and information about the capabilities available to webinar participants. 

DOE will accept comments, data, and information regarding this notice of 

proposed rulemaking (NOPR) before and after the public meeting, but no later than

[INSERT DATE 60 DAYS AFTER DATE OF PUBLICATION IN THE FEDERAL 

REGISTER]. See section VII, “Public Participation,” for details.

ADDRESSES: The public meeting will be held at the U.S. Department of Energy, 

Forrestal Building, Room [NUMBER], 1000 Independence Avenue, SW., Washington, 

DC 20585. To attend, please notify Ms. Brenda Edwards at (202) 586-2945. Persons can 

attend the public meeting via webinar. For more information, refer to section VII, Public 

Participation. 

Any comments submitted must identify the NOPR for Energy Conservation 

Standards for Commercial Refrigeration Equipment and provide docket number EERE2010-BT-STD-0003 and/or regulatory information number (RIN) 1904-AC19. 

Comments may be submitted using any of the following methods: 

1. Federal eRulemaking Portal: www.regulations.gov. Follow the instructions for 

submitting comments. 
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2. Email: CRE-2010-STD-0003@ee.doe.gov. 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.

Written comments regarding the burden-hour estimates or other aspects of the 

collection-of-information requirements contained in this proposed rule may be submitted 

to Office of Energy Efficiency and Renewable Energy through the methods listed above 

and by email to TBD@omb.eop.gov. 

For detailed instructions on submitting comments and additional information on 

the rulemaking process, see section VII 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 
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containing information that is exempt from public disclosure, may not be publicly 

available. 

A link to the docket webpage can be found at: 

http://www.regulations.gov/#!docketDetail;D=EERE-2010-BT-STD-0003. This webpage 

will contain a link to the docket for this notice on the regulations.gov site. The 

regulations.gov webpage will contain simple instructions on how to access all documents, 

including public comments, in the docket. See section VII 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, or participate in the public meeting, contact Ms. Brenda 

Edwards at (202) 586-2945 or by email: Brenda.Edwards@ee.doe.gov. 

FOR FURTHER INFORMATION CONTACT: 

Mr. Charles Llenza, 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) 586-2192. Email: 

commercial_refrigeration_equipment@EE.Doe.Gov . 

Ms. Jennifer Tiedeman, U.S. Department of Energy, Office of the General 

Counsel, GC-71, 1000 Independence Avenue, SW., Washington, DC 20585-0121. 

Telephone: (202) 287-6111. Email: Jennifer.Tiedeman@hq.doe.gov.
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SUPPLEMENTARY INFORMATION:

Table of Contents

I. Summary of the Proposed Rule

A. Benefits and Costs to Customers

B. Impact on Manufacturers

C. National Benefits

II. Introduction

A. Authority

B. Background

1. Current Standards

2. History of Standards Rulemaking for Commercial Refrigeration Equipment

III. General Discussion

A. Test Procedures and Normalization Metrics

1. Test Procedures

2. Normalization Metrics

B. Technological Feasibility

1. General

2. Maximum Technologically Feasible Levels

C. Energy Savings

1. Determination of Savings

2. Significance of Savings

D. Economic Justification

1. Specific Criteria

a. Economic Impact on Manufacturers and Commercial Customers

b. Life-Cycle Costs

c. Energy Savings

d. Lessening of Utility or Performance of Equipment

e. Impact of Any Lessening of Competition

f. Need of the Nation to Conserve Energy

g. Other Factors

2. Rebuttable Presumption

IV. Methodology and Discussion of Comments

A. General Rulemaking Issues

1. Statutory Authority

2. January 2009 Final Rule Equipment

3. Normalization Metrics

4. Treatment of Blast Chillers, Thawing Cabinets, Prep Tables, Salad Bars, and 

Buffet Tables

5. Dedicated Remote Condensing Units

6. Small Units

7. Consideration of Impact of Amended Standards

8. CO2 Cascade Systems
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9. Coverage of Existing Cases Undergoing Refurbishments or Retrofits

10. Components Shipped as After-Market Additions

11. Definition of Hybrid Equipment

12. Coverage of Commercial Refrigeration Equipment with Drawers

B. Test Procedures

C. Market and Technology Assessment

1. Equipment Classes

a. Equipment Classification

b. Application Temperature Equipment

c. Open Cases

d. Service Over Counter Equipment

2. Technology Assessment

a. Technologies Applicable to All Equipment

b. Technologies Relevant Only to Equipment with Doors

c. Technologies Applicable Only to Equipment without Doors

d. Self-Contained Equipment Technologies

D. Screening Analysis

E. Engineering Analysis

1. Representative Equipment for Analysis

a. Representative Unit Selection

b. Baseline Models

2. Design Options

3. Refrigerants

4. Cost Assessment Methodology

a. Teardown Analysis

b. Cost Model

c. Manufacturer Production Cost

d. Cost-Efficiency Relationship

e. Manufacturer Markup

f. Shipping Costs

g. Manufacturer Interviews

5. Energy Consumption Model

a. Energy Consumption Model Results

b. Anti-Sweat Heater Power

c. Evaporator Fan Motor Power

d. Condenser Energy Consumption

e. Evaporator Coil Design

F. Markups Analysis

1. Baseline and Incremental Markups

2. Distribution Channel Market Shares

G. Energy Use Analysis

H. Life-Cycle Cost Analysis

1. Effect of Current Standards

2. Equipment Cost

3. Installation, Maintenance, and Repair Costs

a. Maintenance and Repair Costs by Efficiency Level
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b. Maintenance and Repair Cost Annualization

c. Maintenance Cost Estimates

d. Refrigerant Costs

e. Repair Costs

4. Annual Energy Consumption

5. Energy Prices

6. Energy Price Projections

7. Equipment Lifetime

8. Discount Rates

9. Compliance Date of Standards

10. Base-Case and Standards-Case Efficiency Distributions

11. Inputs to Payback Period Analysis

12. Rebuttable-Presumption Payback Period

I. National Impact Analysis – National Energy Savings and Net Present Value

1. Shipments

a. VOP.RC.L Shipments

b. Shipments by End User Type

c. Shipments Forecasts

2. Forecasted Efficiency in the Base Case and Standards Cases

3. National Energy Savings

4. Net Present Value of Customer Benefit

5. Benefits from Effects of Amended Standards on Energy Prices

J. Customer Subgroup Analysis

K. Manufacturer Impact Analysis

1. Overview

2. Government Regulatory Impact Model

a. Government Regulatory Impact Model Key Inputs

b. Government Regulatory Impact Model Scenarios

3. Discussion of Comments

a. Testing and Certification

b. Cumulative Regulatory Burden

c. Small Manufacturers

d. Manufacturer Markup

4. Manufacturer Interviews

a. Enforcement

b. Certification and Compliance Costs

c. Disproportionate Impact on Small Businesses

d. Potential Loss of Product Utility and Decrease in Food Safety

L. Employment Impact Analysis

M. Utility Impact Analysis

N. Emissions Analysis

O. Monetizing Carbon Dioxide and Other Emissions Impacts

1. Social Cost of Carbon

a. Monetizing Carbon Dioxide Emissions

b. Social Cost of Carbon Values Used in Past Regulatory Analyses

c. Current Approach and Key Assumptions
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2. Valuation of Other Emissions Reductions

P. Regulatory Impact Analysis

V. Analytical Results

A. Trial Standard Levels

1. Trial Standard Level Formulation Process and Criteria

2. Trial Standard Level Equations

B. Economic Justification and Energy Savings

1. Economic Impacts on Commercial Customers

a. Life-Cycle Cost and Payback Period

b. Life-Cycle Cost Subgroup Analysis

2. Economic Impacts on Manufacturers

a. Industry Cash-Flow Analysis Results

b. Impacts on Direct Employment

c. Impacts on Manufacturing Capacity

d. Impacts on Subgroups of Manufacturers

e. Cumulative Regulatory Burden

3. National Impact Analysis

a. Amount and Significance of Energy Savings

b. Net Present Value of Customer Costs and Benefits

c. Employment Impacts

4. Impact on Utility or Performance of Equipment

5. Impact of Any Lessening of Competition

6. Need of the Nation to Conserve Energy

7. Other Factors

C. Proposed Standard

VI. Procedural Issues and Regulatory Review

A. Review Under Executive Orders 12866 and 13563

B. Review Under the Regulatory Flexibility Act

1. Description and Estimated Number of Small Entities Regulated

2. Description and Estimate of Compliance Requirements

3. Duplication, Overlap, and Conflict with Other Rules and Regulations

4. Significant Alternatives to the Rule

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

VII. Public Participation

A. Attendance at the Public Meeting

B. Procedure for Submitting Prepared General Statements for Distribution

C. Conduct of the Public Meeting
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D. Submission of Comments

E. Issues on Which DOE Seeks Comment

1. Primary and Secondary Equipment Classes

2. Design Option and Core Case Costs

3. Offset Factors

4. Extension of Standards

5. Types of Refrigerant Analyzed

6. Distribution Channel Market Shares and Markups

7. Market Shares of Efficiency Levels

8. Maintenance and Repair Costs at Higher Efficiency Levels.

9. Impact of Amended Standards on Future Shipments

10. Small Businesses

VIII. Approval of the Office of the Secretary

I. Summary of the Proposed Rule 

Title III, Part C of the Energy Policy and Conservation Act of 1975 (EPCA), Pub. 

L. 94-163 (42 U.S.C. 6311-6317, as codified), added by Pub. L. 95-619, Title IV, section

441(a), established the Energy Conservation Program for Certain Industrial Equipment, a 

program covering certain industrial equipment, which includes the commercial 

refrigeration equipment that is the focus of this notice.1,2

 

1 For editorial reasons, upon codification in the U.S. Code, Part C was re-designated Part A-1.

EPCA specifies that any new or 

amended energy conservation standard that DOE prescribes for the equipment covered 

shall be designed to achieve the maximum improvement in energy efficiency that the 

Secretary of Energy (Secretary) determines is technologically feasible and economically 

justified. (42 U.S.C. 6295(o)(2)(A) and 6316(e)(1)) Furthermore, EPCA mandates that 

the new or amended standard must result in significant conservation of energy. (42 

U.S.C. 6295(o)(3)(B) and 6316(e)(1)) In accordance with these and other statutory 

criteria discussed in this notice, DOE proposes to adopt amended energy conservation 

2 All references to EPCA in this document refer to the statute as amended by the American Energy 

Manufacturing Technical Corrections Act (AEMTCA), Pub. L. 112-210 (Dec. 18, 2012).
10

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standards for commercial refrigeration equipment. The proposed standards, which consist 

of maximum daily energy consumption (MDEC) values as a function of either 

refrigerated volume or total display area (TDA), are shown in Table I.1. DOE proposes 

that the standards proposed in this NOPR, if adopted, would apply to all equipment listed 

in Table I.1 that is manufactured in, or imported into, the United States on or after 3 years 

following the publication date of the final rule, or January 1, 2016.. (42 U.S.C. 

6313(c)(56)(C)) For the NOPR analysis, DOE assumed a publication date in 2014 for this

final rule and a compliance date in 2017 for the amended standards established by the 

final rule.

Table I.1 Proposed Energy Conservation Standards for Commercial Refrigeration 

Equipment (Assumes Compliance Beginning January 1, 2016)in 2017

Equipment Class†* Propos

ed 

Standa

rd 

Level*, 

****, †

E

q

ui

p

m

en

t 

Cl

as

s

†

P

r

o

p

os

e

d 

St

a

n

d

a

r

d 

L

e

v

el

VCT.RC.L

0.43 x×

TDA + 

2.03

V

O

P.

R

C.

I

2.

6

8 

x 

T

D

A 

+ 

8.

0

8

VOP.RC.M

0.76 

x61 ×

S

V

2.

1

Comment [A1]: Revision requested by OIRA.

Deleted Cells

Deleted Cells
11

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TDA + 

3.7603

O. R

C. L

1 

x TD

A 

+ 

6. 36

SVO.RC.M

0.77 x63 ×

TDA + 

2.9441

SV

O. R

C. I

2. 6

8 

x TD

A 

+ 

8. 08

HZO.RC.L

0.57 x×

TDA + 

6.88

HZ

O. R

C. I

0. 7

2 

x TD

A 

+ 

8. 74

HZO.RC.M

0.35 x×

TDA + 

2.88

VO

P. S

C. L

4. 2

1 

x TD

A 

+ 1

1. 4

VCT.RC.M

0.08 x×

TDA + 

0.72

VO

P. S

C. I

5. 3

5 

x TD

A 

+ 1

4. 48

VOP.RC.L

2.11 x×

TDA + 

SV4. 1
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6.36 O. S

C. L

2 

x TD

A 

+ 1

0. 93

SOC.RC.M

0.49 x39 ×

TDA + 

0.108

SV

O. S

C. I

5. 2

3 

x TD

A 

+ 1

3. 88

VOP.SC.M

1.68 x51 ×

TDA + 

4.5409

HZ

O. S

C. I

2. 4

4 

x TD

A 

+ 

9. 0

SVO.SC.M

1.64 x5 × TDA 

+ 

4.353.9 9

SO

C. R

C. L

1. 0

2 

x TD

A 

+ 

0. 22

HZO.SC.L

1.92 x×

TDA + 

7.08

SO

C. R

C. I

1. 1

9 

x TD

A 

+ 

0. 26

HZO.SC.M

0.75 x×

TDA + 

SO1. 6
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5.44 C. S

C. I

7 

x TD

A 

+ 

0. 36

HCT.SC.I

0.49 x×

TDA + 

0.37

VC

T. R

C. I

0. 5

1 

x TD

A 

+ 

2. 37

VCT.SC.I

0.52 x×

TDA + 

2.56

HC

T. R

C. M

0. 1

4 

x TD

A 

+ 

0. 11

VCS.SC.I

0.35 x×

V + 

0.81

HC

T. R

C. L

0.

3 

x TD

A 

+ 

0. 23

VCT.SC.M

0.04 x×

V + 

1.07

HC

T. R

C. I

0. 3

5 

x TD

A 

+ 

0. 27

VCT.SC.L

0.22 x×

V + 

1.21

VC

S. R

0.

1 

x 

V 
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C. M+ 

0. 24

VCS.SC.M

0.03 x×

V + 

0.53

VC

S. R

C. L

0. 2

1 

x 

V 

+ 

0. 5

VCS.SC.L

0.13 x×

V + 

0.43

VC

S. R

C. I

0. 2

5 

x 

V 

+ 

0. 58

HCT.SC.M

0.02 x×

V + 

0.51

HC

S. S

C. I

0. 3

5 

x 

V 

+ 

0. 81

HCT.SC.L

0.11 x×

V + 0.6

HC

S. R

C. M

0.

1 

x 

V 

+ 

0. 24

HCS.SC.M

0.02 x×

V + 

0.37

HC

S. R

C. L

0. 2

1 

x 

V 

+ 

0. 5

HCS.SC.L

0.12 x×

V + 

0.42

HC

S. R

C. I

0. 2

5 

x 

V 

+ 

0. 58
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PD.SC.M

0.03 x×

V + 

0.83

SOC.SC.M

0.32 × TDA + 

0.53

* “TDA” is the total display area of the case, as measured in the Air-Conditioning, Heating, and 

Refrigeration Institute (AHRI) Standard 1200-2010, appendix D.

** “V” is the volume of the case, as measured in American National Standards Institute (ANSI) /

Association of Home Appliance Manufacturers (AHAM) Standard HRF-1-2004. † Equipment class designations consist of a combination (in sequential order separated by periods) 

of: (1) An equipment family code (VOP = vertical open, SVO = semivertical open, HZO =

horizontal open, VCT = vertical transparent doors, VCS = vertical solid doors, HCT = horizontal 

transparent doors, HCS = horizontal solid doors, SOC = service over counter, or PD = Pull-down); 

(2) an operating mode code (RC = remote condensing or SC = self-contained); and (3) a rating 

temperature code (M = medium temperature (38±2 °F), L = low temperature (0±2 °F), or I = icecream temperature (-15±2 °F)). For example, ‘‘VOP.RC.M’’ refers to the ‘‘vertical open, remote 

condensing, medium temperature’’ equipment class. See discussion in chapter 3 of the NOPR TSD 

for a more detailed explanation of the equipment class terminology.VOP.RC.I

2.68 × TDA + 

8.08

SVO.RC.L

2.11 × TDA + 

6.36

SVO.RC.I

2.68 × TDA + 

8.08

HZO.RC.I

0.72 × TDA + 

8.74

VOP.SC.L

3.79 × TDA + 

10.26

VOP.SC.I

4.81 × TDA + 

13.03

SVO.SC.L

3.77 × TDA + 

10.01

SVO.SC.I

4.79 × TDA + 

12.72

HZO.SC.I

2.44 × TDA + 

9.0

SOC.RC.L

0.83 × TDA + 

0.18

SOC.RC.I

0.97 × TDA + 

0.21

SOC.SC.I

1.35 × TDA + 

0.29

VCT.RC.I

0.51 × TDA + 

2.37

HCT.RC.M

0.14 × TDA + 

0.11

HCT.RC.L

0.3 × TDA + 

0.23

HCT.RC.I

0.35 × TDA + 

0.27

VCS.RC.M 0.1 × V + 0.24

VCS.RC.L 0.21 × V + 0.5

VCS.RC.I

0.25 × V + 

0.58

HCS.SC.I

0.35 × V + 

0.81

HCS.RC.M 0.1 × V + 0.24

HCS.RC.L 0.21 × V + 0.5

Inserted Cells
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HCS.RC.I

0.25 × V + 

0.58

SOC.SC.L

0.67 × TDA + 

1.12

* Equipment class designations consist of a combination (in sequential order separated by periods) of: (1) an equipment family code 

(VOP = vertical open, SVO = semivertical open, HZO = horizontal open, VCT = vertical transparent doors, VCS = vertical solid 

doors, HCT = horizontal transparent doors, HCS = horizontal solid doors, SOC = service over counter, or PD = pull-down); (2) an 

operating mode code (RC = remote condensing or SC = self-contained); and (3) a rating temperature code (M = medium temperature 

(38±2 °F), L = low temperature (0±2 °F), or I = ice-cream temperature (-15±2 °F)). For example, “VOP.RC.M” refers to the “vertical 

open, remote condensing, medium temperature” equipment class. See discussion in chapter 3 of the NOPR technical support 

document (TSD) for a more detailed explanation of the equipment class terminology.

** “TDA” is the total display area of the case, as measured in the Air-Conditioning, Heating, and Refrigeration Institute (AHRI) 

Standard 1200-2010, appendix D.

† “V” is the volume of the case, as measured in American National Standards Institute (ANSI) / Association of Home Appliance 

Manufacturers (AHAM) Standard HRF-1-2004.

A. Benefits and Costs to ConsumersCustomers

Table I.2 presents DOE’s evaluation of the economic impacts of the proposed 

standards on consumerscustomers of commercial refrigeration equipment, as measured 

by the average life-cycle cost (LCC) savings3 and the median payback period (PBP).4

Table I.2 Impacts of Proposed Standards on ConsumersCustomers of Commercial 

Refrigeration Equipment

The average LCC savings are positive for all equipment classes under the standard 

proposed by DOE.. in this notice. At TSL 4, the percentage of customers who experience 

net benefits or no impacts ranges from 59 to 100 percent, and customers experiencing a 

net cost range from 0 to 41 percent. Chapter 11 presents the LCC subgroup analysis on 

groups of customers that may be disproportionately affected by the proposed standard. 

Equipment Class* Average LCC Savings

20102012$

Median PBP

Years

VOP.RC.M $453.061,493.72 2.413.91

VOP.RC.L $264.331,129.51 6.592.22

VOP.SC.M $214.15691.27 2.234.39

VCT.RC.M $1,038.12108.13 3.732.70

 

3 Life-cycle cost (LCC) of commercial refrigeration equipment is the cost to consumerscustomers of 

owning and operating the equipment over the entire life of the equipment. Life-cycle cost savings are the 

reductions in the life-cycle costs due to amended energy conservation standards when compared to the lifecycle costs of the equipment in the absence of amended energy conservation standards. Further discussion 

of the LCC analysis can be found in Chapter 8 of the TSD. 4 Payback period (PBP) refers to the amount of time (in years) it takes the consumerscustomers to recover 

the increased installed cost of equipment associated with new or amended standards through savings in 

operating costs. Further discussion of the PBP can be found in Chapter 8 of the TSD. 

Comment [A2]: Revision requested by OIRA.
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VCT.RC.L $539.92797.91 4.431.64

VCT.SC.M $717.99641.05 2.8354

VCT.SC.L $1,969.24342.84 1.440.96

VCT.SC.I $370431.88 3.171.97

VCS.SC.M $125.10131.80 1.8075

VCS.SC.L $214.03220.83 1.1915

VCS.SC.I $140.59152.69 2.5042

SVO.RC.M $331.411,008.46 3.364.50

SVO.SC.M $308.07491.99 2.084.75

SOC.RC.M $119.60494.51 2.844.41

HZO.RC.M** $0.00 NA

HZO.RC.L** $0.00 NA

HZO.SC.M $24.3528.78 6.5240

HZO.SC.L** $0.00 NA

HCT.SC.M $235.72253.60 3.0908

HCT.SC.L $458.84368.92 1.5547

HCT.SC.I $38.0242.48 4.4228

HCS.SC.M $9.118.68 4.2628

HCS.SC.L $80.72.70 2.6757

PD.SC.M $351.49310.43 2.8227

SOC.SC.M $739.75 2.99

* Values have been shown only for primary equipment classes, which are equipment 

classes that have significant volume of shipments and, therefore, were directly analyzed. 

See chapter 5 of the NOPR TSD, Engineering Analysis, for a detailed discussion of 

primary and secondary equipment classes. 

** For equipment classes HZO.RC.M, HZO.RC.L, and HZO.SC.L, no efficiency levels 

above the baseline were found to be economically justifiable. Therefore, the proposed 

standards for these equipment classes are the same as the current standards. As a result, 

LCC savings for these equipment classes are shown as zero. The PBP values are 

indeterminate and are shown as “NA.”

B. Impact on Manufacturers

The industry net present value (INPV) is the sum of the discounted cash flows to 

the industry from the base year (20102013) through the end of the analysis period 

(20452046). Using a real discount rate of 10 percent,5

 

5 This is the rate used to discount future cash flows in the Manufacturer Impact Analysis. A discount rate of 

10% was calculated based on SEC filings and feedback from manufacturer interviews about the current 

cost of capital in the industry. For more information, refer to Chapter 12 of the NOPR TSD.

DOE estimates that the INPV for 

manufacturers of commercial refrigeration equipment is $869.31,162.0 million in 

20102012$. Under the proposed standards, DOE expects that manufacturers may lose 

upthe industry net present value to 10.28decrease by 3.95 percent of their INPV, or

approximately $89.3to 7.97 percent. Total industry conversion costs are expected to total 

Comment [A3]: Revision requested by OIRA.
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$87.5 million.. 

C. National Benefits

DOE’s analyses indicate that the proposed standards for commercial refrigeration 

equipment would save a significant amount of energy over . The lifetime savings for 

commercial refrigeration equipment purchased in the 30 years (2016–2045)―an 

estimated -year period that begins in the year of the compliance with amended standards 

(2017–2046) amount to 1.0010.636 quadrillion British thermal units (quads) of 

cumulative). The average annual energy. In addition, DOE expects the energy savings 

from the proposed standards to eliminate the need for approximately 0.22 gigawatts 

(GW) savings over the life of generating capacity by 2045.commercial refrigeration 

equipment purchased in 2017 through 2046 is 0.04 quads.

6

The cumulative national net present value (NPV) of total consumercustomer costs 

and savings of the proposed standards for commercial refrigeration equipment in 

20102012$ ranges from $1.023606 billion (at a 7-percent discount rate) to $2.7184.067

billion (at a 3-percent discount rate 7

 

6 Total U.S. commercial sector energy (source energy) used for refrigeration in 2010 was 1.21 quads. 

Source: U.S. Department of Energy–Office of Energy Efficiency and Renewable Energy. Buildings Energy 

Data Book, Table 3.1.4, 2010 Commercial Energy End-Use Splits, by Fuel Type (Quadrillion Btu). 

2012. (Last accessed April 23, 2013.) 

). This NPV expresses the estimated total value to 

customers of future operating cost savings minus the estimated increased installed costs 

for equipment purchased in the period from 2016–20452017–2046, discounted to 

20112013. 

http://buildingsdatabook.eren.doe.gov/TableView.aspx?table=3.1.4

7 These discount rates are used in accordance with the Office of Management and Budget (OMB) guidance 

to Federal agencies on the development of regulatory analysis (OMB Circular A-4, September 17, 2003), 

and section E, “Identifying and Measuring Benefits and Costs,” therein. Further details are provided in 

section V.B.3.

Comment [A4]: Revision requested by OIRA.

Comment [A5]: Revision requested by OIRA.

Comment [A6]: Revision requested by OIRA.
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The proposed standards are expected to have significant environmental benefits. 

The energy saved would be in the form of electricity and, as stated above, DOE expects 

The energy savings from the proposed standards to eliminate the need for approximately 

0.22 GW of generating capacity by 2045. These savings would result in cumulative 

greenhouse gas (GHG) emission reductions of 50.9154.88 million metric tons (MMt)8 of 

carbon dioxide (CO2) in the period from 2016–2045. During this period, the proposed 

standards are expected to result in emissions reductions of 12.99), 265.9 thousand tons of 

methane, 1.1 thousand tons of nitrous oxide, 70.1 thousand tons of sulfur dioxide (SO2), 

81.1 thousand tons of NOx and 0.1 tons of mercury (Hg)9, 10. 

The value of the CO2 reductions is calculated using a range of values per metric 

ton of CO2 (otherwise known as the Social Cost of Carbon, or SCC) developed by a 

recent Federal interagency process. The derivation of the SCC values is discussed in 

section IV.O emissions are forecasted to increase by 0.26 tons.

11

 

8 A metric ton is equivalent to 1.1 U.S. short tons. Results for NOx and Hg are presented in short tons.

. DOE estimates that the 

net present monetary value of the CO2 emissions reduction would be between $0.1831

and $2.864.55 billion, expressed in 2010$ and discounted to 2011.. DOE also estimates 

9 DOE calculated emissions reductions relative to the Annual Energy Outlook (AEO) 2013 Reference case, 

which generally represents current legislation and environmental regulations for which implementing 

regulations were available as of December 31, 2012. 10 DOE also estimated CO2 and CO2 equivalent (CO2eq) emissions that occur through 2030 (CO2eq 

includes greenhouse gases such as CH4 and N2O). The estimated emissions reductions through 2030 are 16 

million metric tons CO2, 1,687 thousand tons CO2eq for CH4, and 72.27 thousand tons CO2eq for N2O. 11 DOE calculates emissions reductions relative to the most recent version of the Annual Energy Outlook

(AEO) Reference Case forecast. Because the AEO 2011 NEMS that DOE is using for this rulemaking 

assumes the implementation of the Clean Air Interstate Rule (CAIR), 70 FR 25162 (May 12, 2005), DOE 

has not been able to take into account the effects of its replacement, the Transport Rule (76 FR 48208 (Aug. 

8, 2011)) for today’s NOPR analysis
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the net present monetary value of the NOx emissions reduction, expressed in 2010$ and 

discounted to 2011, is would be between $1.98.8 and $1990.7 million at a 7-percent 

discount rate, and between $3.419.1 and $35.1196.2 million at a 3-percent discount 

rate.12

Table I.3 summarizes the national economic costs and benefits expected to result 

from the proposed standards for commercial refrigeration equipment.

 

12 DOE is aware of multiple Federal agency efforts to determine the appropriate range of values used in 

evaluating the potential economic benefits of reduced Hg emissions. DOE has decided to await further 

guidance regarding consistent valuation and reporting of Hg emissions before it once again monetizes Hg 

in its rulemakings. DOE is currently investigating valuation of avoided Hg and SO2 emissions.
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Table I.3 Summary of National Economic Benefits and Costs of Proposed 

Commercial Refrigeration Equipment Energy Conservation Standards

Category Present Value

million 2012$ Discount Rate

Benefits

Operating Cost Savings

2,695 7%

6,034 3%

CO2 Reduction Monetized Value (at $12.9/Metric Ton)* 308 5%

CO2 Reduction Monetized Value (at $40.8/Metric Ton)* 1,504 3%

CO2 Reduction Monetized Value (at $62.2/Metric Ton)* 2,452 2.5%

CO2 Reduction Monetized Value (at $117.0/Metric Ton)* 4,552 3%

NOX Reduction Monetized Value (at $2639/Ton)**

50 7%

108 3%

Total Benefits† 4,249 7%

7,646 3%

Costs

Incremental Installed Costs 1,089 7%

1,967 3%

Net Benefits

Including CO2 and NOx Reduction Monetized Value 3,160 7%

5,679 3%

* The interagency group selected four sets of SCC values for use in regulatory analyses. Three sets of values are based on the 

average SCC from the integrated assessment models, at discount rates of 2.5, 3, and 5 percent. The fourth set, which 

represents the 95th percentile SCC estimate across all three models at a 3-percent discount rate, is included to represent 

higher-than-expected impacts from temperature change further out in the tails of the SCC distribution. The values in 

parentheses represent the SCC in 2015. The SCC time series incorporate an escalation factor.

** The value represents the average of the low and high NOX values used in DOE’s analysis.

† Total Benefits for both the 3% and 7% cases are derived using the CO2 reduction monetized value series corresponding to 

average SCC with 3-percent discount rate.

The benefits and costs of today’s proposed standards, for commercial 

refrigeration equipment sold in 2016–20452017–2046, can also be expressed in terms of 

annualized values. The annualized monetary values are the sum of (1) the annualized 

national economic value of the benefits from the customer operation of equipment that 

meets the proposed standards (consisting primarily of operating cost savings from using 

less energy, minus increases in equipment installed cost, which is another way of 

representing consumercustomer NPV); and (2) the annualized monetary value of the 

Comment [A7]: Revision requested by OIRA.
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benefits of emission reductions, including CO2 emission reductions.13 The value of the 

CO2 reductions, otherwise known as the Social Cost of Carbon (SCC), is calculated using 

a range of values per metric ton of CO2 developed by a recent Federal interagency 

process. The derivation of the SCC values is discussed in section .

Although combining the values of operating savings and CO2 emission reductions 

provides a useful perspective, two issues should be considered. First, the national 

operating savings are domestic U.S. consumercustomer monetary savings that occur as a 

result of market transactions, while the value of CO2 reductions is based on a global 

value. Second, the assessments of operating cost savings and CO2 savings are performed 

with different methods that use different time frames for analysis. The national operating 

cost savings is measured over the lifetimes of commercial refrigeration equipment

shipped from 2016 to 2045.in 2017–2046. The SCC values, on the other hand, reflect the 

present value of some future climate-related impacts resulting from the emission of 1 ton 

of CO2 in each year. These impacts continue well beyond 2100. 

Table I.4 shows the annualized values for today’s benefits and costs of the 

proposed standards. All monetary values belowThe results of the primary estimate are as 

 

13 DOE used a two-step calculation process to convert the time-series of costs and benefits into annualized 

values. First, DOE calculated a present value in 2013, the year used for discounting the NPV of total 

consumer costs and savings, for the time-series of costs and benefits using discount rates of 3 and 7 percent 

for all costs and benefits except for the value of CO2 reductions. For the latter, DOE used a range of 

discount rates, as shown in Table I.4 The process that DOE used to convert the 30 year time-series of costs 

and benefits into annualized values is explained in section .. From the present value, DOE then calculated 

the fixed annual payment over a 30-year period (2017 through 2046) that yields the same present value. 

The fixed annual payment is the annualized value. Although DOE calculated annualized values, this does 

not imply that the time-series of cost and benefits from which the annualized values were determined is a 

steady stream of payments.
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follows. Table I.4 shows the primary, low net benefits, and high net benefits scenarios. 

The primary estimate is the estimate in 2010$.which the operating cost savings were 

calculated using the Annual Energy Outlook 2013 (AEO2013) Reference Case forecast 

of future electricity prices. The other two estimates, low net benefits estimate and high 

net benefits estimate, are based on the low and high electricity price scenarios from the 

AEO2013 forecast. At a 7-percent discount rate for benefits and costs, the cost in the 

primary estimate14 of the standards proposed in today’s notice is $9282 million per year 

in increased equipment costs. The annualized benefits are $203 million per year in 

reduced equipment operating costs, $75 million in CO2 reductions (note that DOE used a 

3-percent discount rate, along with the corresponding SCC series value of $22.3/ton in 

2010that uses a 3-percent discount rate , to calculate the monetized value of CO2

emissions reductions.) The annualized benefits are $208 million per year in reduced 

equipment operating costs, $56 million in CO2 reductions, and $1.18), and $3.75 million 

in reduced NOx emissions. In this case, the annualized net benefit amounts to $173199

million. At a 3-percent discount rate for all benefits and costs, the cost in the primary 

estimate of the amended standards proposed in today’s notice is $25397 million per year 

in increased equipment costs. (Note that DOE used a 3-percent discount rate along with 

the corresponding SCC series value of $22.3/ton in 2010 to calculate the monetized value 

of CO2 emissions reductions.) The benefits are $92The benefits are $299 million per year 

in reduced operating costs, $5675 million in CO2 reductions, and $1.145.33 million in 

reduced NOx emissions. In this case, the net benefit amounts to $218281 million per year. 

 

14 Primary estimate in Table I.3 is the estimate in which the operating cost savings were calculated using 

the Annual Energy Outlook 2011 (AEO2011) Reference Case forecast of future electricity prices. 
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DOE also calculated the low net benefits and high net benefits estimates by 

calculating the operating cost savings and incremental installed costs at the AEO 

2011AEO2013 low economic growth case and high economic growth case scenarios, 

respectively. These scenarios do not change the monetized emissions reductions values. 

The net benefits and costs for low and high net benefits estimates were calculated in the 

same manner as the primary estimate by using the corresponding values of operating cost 

savings and incremental installed costs. 

Table I.4 Annualized Benefits and Costs of Proposed Standards for Commercial 

Refrigeration Equipment 

Discount 

Rate

Primary 

Estimate* 

million 20102012$

Low Net Benefits 

Estimate*

million 

20102012$

High Net Benefits 

Estimate*

million 20102012$

Benefits

Operating Cost Savings 7% 208203 197 218212

3% 253299 237288 266314

CO2 Reduction Monetized 

Value (at $412.9/Metric 

Ton)**

5% 1519 1519 1519

CO2 Reduction Monetized 

Value (at $22.340.8/Metric 

Ton)**

3% 5675 5675 5675

CO2 Reduction Monetized 

Value (at $36.5562.2/Metric 

Ton)**

2.5% 86114 86114 86114

CO2 Reduction Monetized 

Value (at $67.6117.0/Metric 

Ton)**

3% 169225 169225 169225

NOx Reduction Monetized 

Value (at $2,543639/Ton)**

7% 1.183.75 1.183.75 1.183.75

3% 1.145.33 1.145.33 1.145.33

Total Benefits (Operating 

Cost Savings, CO2

Reduction and NOx

Reduction)†

7% 265281 254275 275290

3% 310379 294368 323394

Costs

Total Incremental Installed 

Costs

7% 9282 9384 9280

3% 9297 92100 9295

Net Benefits Less Costs

Total Benefits Less 

Incremental Costs 

7% 173199 161191 183210

3% 218281 202268 231299

** This table presents the annualized costs and benefits associated with equipment shipped in 2017 −2046. These results include 

benefits to consumers which accrue after 2046 from the products purchased in 2017 −2046.The primary, low, and high estimates 

utilize forecasts of energy prices from the Annual Energy Outlook 2011 (AEO2011)AEO2013 Reference Case, Low 

Economic Growth Case, and High Economic Growth Case, respectively. In addition, incremental equipment costs reflect a medium 

Comment [A8]: Revision requested by OIRA.
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decline rate for projected product price trends in the Primary Estimate, a low decline rate for projected equipment price trends in the 

Low Benefits Estimate, and a high decline rate for projected equipment price trends in the High Benefits Estimate. The methods used 

to derive projected price trends are explained in Appendix 10B.

** These The interagency group selected four sets of SCC values represent global for use in regulatory analyses. Three sets of 

values (in 2010$) ofare based on the social cost of CO2 emissions in 2010 under several scenarios. The values 

average SCC from the three integrated assessment models, at discount rates of $4.90, $22.302.5, 3, and $36.55 per ton are 

the averages of SCC distributions calculated using 5-5 percent, 3-percent, and 2.5-percent discount rates, 

respectively. The value of $67.6 per ton. The fourth set, which represents the 95th percentile SCC estimate across all three 

models at a 3-percent discount rate, is included to represent higher-than-expected impacts from temperature change further out in the 

tails of the SCC distribution calculated using a 3-percent discount rate. See section for details. For NOx, an 

average value ($2,543). The values in parentheses represent the SCC in 2015. The SCC time series incorporate an escalation 

factor. The value for NOX is the average of the low ($451) and high ($4,635) values was used in DOE’s analysis. 

† Total monetary Benefits for both the 3-percent and 7-percent cases utilizeare derived using the central estimate of social 

cost of NOx and CO2 emissions calculated at aseries corresponding to average SCC with 3-percent discount rate

(averaged across three integrated assessment models (IAMs)), which is equal to $22.3/ton in (in 2010$).. In 

the rows labeled “7% plus CO2 range” and “3% plus CO2 range,” the operating cost and NOX benefits are calculated using the labeled 

discount rate, and those values are added to the full range of CO2 values.

DOE has tentatively concluded that the proposed standards meet the requirements

found in EPCA by representing maximum improvement in energy efficiency that is 

technologically feasible and economically justified, and would result in significant 

conservation of energy. (42 U.S.C. 6295 (o), 6316(e)) DOE further notes that 

technologies used to achieve these standard levels are already commercially available for 

the equipment classes covered by today’s proposal. Based on the analyses described 

above, DOE has tentatively concluded that the benefits of the proposed standards to the 

Nation (energy savings, positive NPV of consumercustomer benefits, consumercustomer

LCC savings, and emission reductions) would outweigh the burdens (loss of INPV for 

manufacturers and LCC increases for some consumerscustomers). 

DOE also considered more-stringent and less-stringent energy use levels as trial 

standard levels (TSLs), and is still considering them in this rulemaking. However, DOE 

has tentatively concluded that the potential burdens of the more-stringent energy use 

levels would outweigh the projected benefits. Based on consideration of the public 

comments DOE receives in response to this notice and related information collected and 

Comment [A9]: Revision requested by OIRA.

Comment [A10]: Revision requested by OIRA.
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analyzed during the course of this rulemaking effort, DOE may adopt energy use levels 

presented in this notice that are either higher or lower than the proposed standards, or 

some combination of level(s) that incorporate the proposed standards in part. 

II. Introduction 

The following section briefly discusses the statutory authority underlying today’s 

proposal, as well as some of the relevant historical background related to the 

establishment of standards for commercial refrigeration equipment.

A. Authority

Title III, Part C of EPCA, Pub. L. 94-163 (42 U.S.C. 6311-6317, as codified), 

added by Pub. L. 95-619, Title IV, section 441(a), established the Energy Conservation 

Program for Certain Industrial Equipment, a program covering certain industrial 

equipment, which includes the commercial refrigeration equipment that is the focus of 

this notice.15,16

 

15 For editorial reasons, upon codification in the U.S. Code, Part C was re-designated Part A-1.

EPCA prescribes energy conservation standards for commercial 

refrigeration equipment (42 U.S.C. 6313(c)(2)–(34)), and directs DOE to conduct 

rulemakings to establish new and amended standards for commercial refrigeration 

equipment. (42 U.S.C. 6313(c)(4)–(56)) (DOE notes that under 42 U.S.C. 6295(m) and 

6316(e)(1) the agency must periodically review its already established energy 

conservation standards for covered equipment. Under this requirement, the next review 

16 All references to EPCA in this document refer to the statute as amended through the American Energy 

Manufacturing Technical Corrections Act (AEMTCA), Pub. L. 112-210 (Dec. 18, 2012).
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that DOE would need to conduct must occur no later than 6 years from the issuance of a 

final rule establishing or amending a standard for covered equipment.)

Pursuant to EPCA, DOE’s energy conservation program for covered equipment 

generally consists of four parts: (1) testing; (2) labeling; (3) the establishment of Federal 

energy conservation standards; and (4) certification and enforcement procedures. For 

commercial refrigeration equipment, DOE is responsible for the entirety of this program. 

Subject to certain criteria and conditions, DOE is required to develop test procedures to 

measure the energy efficiency, energy use, or estimated annual operating cost of each 

type or class of covered equipment. (42 U.S.C. 6314) Manufacturers of covered 

equipment must use the prescribed DOE test procedure as the basis for certifying to DOE 

that their equipment complies with the applicable energy conservation standards adopted 

under EPCA and when making representations to the public regarding the energy use or 

efficiency of that equipment. (42 U.S.C. 6315(b), 6295(s), and 6316(e)(1)) Similarly, 

DOE must use these test procedures to determine whether that equipment complies with 

standards adopted pursuant to EPCA. The DOE test procedure for commercial 

refrigeration equipment currently appears at title 10 of the Code of Federal Regulations 

(CFR) part 431, subpart C.

DOE must follow specific statutory criteria for prescribing amended standards for 

covered equipment. As indicated above, any amended standard for covered equipment 

must be designed to achieve the maximum improvement in energy efficiency that is 

technologically feasible and economically justified. (42 U.S.C. 6295(o)(2)(A) and 
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6316(e)(1)) Furthermore, DOE may not adopt any standard that would not result in the 

significant conservation of energy. (42 U.S.C. 6295(o)(3) and 6316(e)(1)) DOE also may 

not prescribe a standard: (1) for certain equipment, including commercial refrigeration 

equipment, if no test procedure has been established for the product; or (2) if DOE 

determines by rule that the proposed standard is not technologically feasible or 

economically justified. (42 U.S.C. 6295(o)(3)(A)–(B) and 6316(e)(1)) In deciding 

whether a proposed standard is economically justified, DOE must determine whether the 

benefits of the standard exceed its burdens. (42 U.S.C. 6295(o)(2)(B)(i) and 6316(e)(1)) 

DOE must make this determination after receiving comments on the proposed standard, 

and by considering, to the greatest extent practicable, the following seven factors:

1. The economic impact of the standard on manufacturers and consumers of the 

equipment subject to the standard;

2. The savings in operating costs throughout the estimated average life of the 

covered equipment in the type (or class) compared to any increase in the price, 

initial charges, or maintenance expenses for the covered equipment that are 

likely to result from the imposition of the standard; 

3. The total projected amount of energy, or as applicable, water, savings likely to 

result directly from the imposition of the standard;

4. Any lessening of the utility or the performance of the covered equipment 

likely to result from the imposition of the standard;

5. The impact of any lessening of competition, as determined in writing by the 

U.S. Attorney General (Attorney General), that is likely to result from the 

imposition of the standard;
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6. The need for national energy and water conservation; and 

7. Other factors the Secretary considers relevant.

(42 U.S.C. 6295(o)(2)(B)(i)(I)–(VII) and 6316(e)(1)) 

EPCA, as codified, also 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 covered equipment. (42 U.S.C. 6295(o)(1) and 6316(e)(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) and 6316(e)(1))

Further, EPCA, as codified, establishes a rebuttable presumption that a standard is 

economically justified if the Secretary finds that the additional cost to the consumer of 

purchasing a product complying with an energy conservation standard level will be less 

than three times the value of the energy savings during the first year that the consumer 

will receive as a result of the standard, as calculated under the applicable test procedure. 

(See 42 U.S.C. 6295(o)(2)(B)(iii) and 6316(e)(1)) Section III.D.2 presents additional 

discussion about the rebuttable presumption payback period.
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Additionally, 42 U.S.C. 6295(q)(1) and 6316(e)(1) specify requirements when 

promulgating a standard for a type or class of covered equipment that has two or more 

subcategories that may justify different standard levels. DOE must specify a different 

standard level than that which applies generally to such type or class of equipment for 

any group of covered products that has the same function or intended use if DOE 

determines that products within such group (A) consume a different kind of energy from 

that consumed by other covered equipment within such type (or class); or (B) have a 

capacity or other performance-related feature that other equipment within such type (or 

class) do not have and such feature justifies a higher or lower standard. (42 U.S.C. 

6295(q)(1) and 6316(e)(1)) In determining whether a performance-related feature 

justifies a different standard for a group of equipment, DOE must consider such factors as 

the utility to the consumer of the feature and other factors DOE deems appropriate. Id. 

Any rule prescribing such a standard must include an explanation of the basis on which 

such higher or lower level was established. (42 U.S.C. 6295(q)(2) and 6316(e)(1))

Federal energy conservation requirements generally supersede State laws or 

regulations concerning energy conservation testing, labeling, and standards. (42 U.S.C. 

6297(a)–(c) and 6316(e))

 

DOE has also reviewed this regulation pursuant to Executive Order 13563, issued 

on January 18, 2011. 76 FR 3281. Executive Order 13563 is supplemental to and 

explicitly reaffirms the principles, structures, and definitions governing regulatory review 
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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

(OIRA) 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 today’s 

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.
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Consistent with Executive Order 13563, and the range of impacts analyzed in this 

rulemaking, the energy efficiency standard proposed herein by DOE achieves maximum 

net benefits.

B. Background

1. Current Standards

The current energy conservation standards for commercial refrigeration 

equipment were established by two different legislative actions and one DOE final rule. 

EPCA, as amended by the Energy Policy Act of 2005 (EPACT 2005), established 

standards for self-contained commercial refrigerators and freezer with solid or transparent 

doors, self-contained commercial refrigerator-freezers with solid doors, and selfcontained commercial refrigerators designed for pull-down applications. (42 U.S.C. 

6313(c)(2)–(3)) On January 9, 2009, DOE published a final rule (January 2009 final rule) 

prescribing current standards for commercial refrigeration equipment. 74 FR at 1092. 

Specifically, this final rule completed the first amended standards rulemaking for 

commercial refrigeration equipment by establishing standards for equipment types 

enumeratedspecified in 42 U.S.C. 6313(c)(4)5), and for which EPCA did not prescribe 

standards in 42 U.S.C. 6313(c)(2)-(3).)–(3). These types consisted of commercial icecream freezers; self-contained commercial refrigerators, commercial freezers, and 

commercial refrigerator-freezers without doors; and remote condensing commercial 

refrigerators, commercial freezers, and commercial refrigerator-freezers. More recently, 

the American Energy Manufacturing Technical Corrections Act (AEMTCA), Pub. L. 

Comment [A11]: Revision requested by OIRA.
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112-210 (Dec. 18, 2012), amended section 342(c) of EPCA to establish a new standard 

for self-contained service over counter medium temperature commercial refrigerators 

(this class is known as SOC.SC.M per DOE’s equipment class nomenclature). (42 U.S.C. 

6313(c)(4)) As a result, DOE’s current energy conservation standards for commercial 

refrigeration equipment include the following: standards established by EPCA for 

commercial refrigeration equipment manufactured on or after January 1, 2010; standards 

established in the January 2009 final rule for commercial refrigeration equipment 

manufactured on or after January 1, 2012; and standards established by AEMTCA for 

SOC.SC.M equipment manufactured on or after January 1, 2012. 

Table II.1 and Table II.2 present DOE’s current energy conservation standards for 

commercial refrigeration equipment set by EPCA and the January 2009 final rule, 

respectively. The AEMTCA standard for SOC.SC.M equipment manufactured on or after 

January 1, 2012 is prescribed as 0.6 × TDA + 1.0. (42 U.S.C. 6313(c)(4))

Table II.1 Commercial Refrigeration Equipment Standards Prescribed by EPCA – 

Compliance Required Beginning on January 1, 2010

Category

Maximum Daily Energy 

Consumption

kWh/day* 

Refrigerators with solid doors 0.10 V** + 2.04

Refrigerators with transparent doors 0.12 V + 3.34

Freezers with solid doors 0.40 V + 1.38

Freezers with transparent doors 0.75 V + 4.10

Refrigerators/freezers with solid doors the greater of 0.27 AV† - 0.71 or 0.70

Self-contained refrigerators with transparent doors 

designed for pull-down temperature applications 0.126V + 3.51

* kilowatt-hours per day

** Where “V” means the chilled or frozen compartment volume in cubic feet as defined in the Association of Home 

Appliance Manufacturers Standard HRF-1-1979. 10 CFR 431.66

† Where “AV” means that adjusted volume in cubic feet measured in accordance with the Association of Home 

Appliance Manufacturers Standard HRF-1-1979. 10 CFR 431.66 

 Comment [A12]: Revision requested by OIRA.
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Table II.2 Commercial Refrigeration Equipment Standards Established in the 

January 2009 Final Rule – Compliance Required Beginning on January 1, 2012

Equipment Class†* Standard Level *,****,†

kWh/day

Equipment 

Class†

Standard 

Level *,**

kWh/day

VOP.RC.M 0.82 × TDA + 4.07 VCT.RC.I 0.66 ×

TDA + 

3.05

SVO.RC.M 0.83 × TDA + 3.18 HCT.RC.M 0.16 ×

TDA + 

0.13

HZO.RC.M 0.35 × TDA + 2.88 HCT.RC.L 0.34 ×

TDA + 

0.26

VOP.RC.L 2.27 × TDA + 6.85 HCT.RC.I 0.4 ×

TDA + 

0.31

HZO.RC.L 0.57 × TDA + 6.88 VCS.RC.M 0.11 × V 

+ 0.26

VCT.RC.M 0.22 × TDA + 1.95 VCS.RC.L 0.23 × V 

+ 0.54

VCT.RC.L 0.56 × TDA + 2.61 VCS.RC.I 0.27 × V 

+ 0.63

SOC.RC.M 0.51 × TDA + 0.11 HCS.RC.M 0.11 × V 

+ 0.26

VOP.SC.M 1.74 × TDA + 4.71 HCS.RC.L 0.23 × V 

+ 0.54

SVO.SC.M 1.73 × TDA + 4.59 HCS.RC.I 0.27 × V 

+ 0.63

HZO.SC.M 0.77 × TDA + 5.55 SOC.RC.L 1.08 ×

TDA + 

0.22

HZO.SC.L 1.92 × TDA + 7.08 SOC.RC.I 1.26 ×

TDA + 

0.26

VCT.SC.I 0.67 × TDA + 3.29 VOP.SC.L 4.37 ×

TDA + 

11.82

VCS.SC.I 0.38 × V + 0.88

HCT.SC.I 0.56 × TDA + 0.43

SVO.RC.L 2.27 × TDA + 6.85

VOP.RC.I 2.89 × TDA + 8.7

SVO.RC.I 2.89 × TDA + 8.7

HZO.RC.I 0.72 × TDA + 8.74

VCT.RC.I 0.66 × TDA + 3.05

HCT.RC.M 0.16 × TDA + 0.13

HCT.RC.L 0.34 × TDA + 0.26

HCT.RC.I 0.4 × TDA + 0.31

VCS.RC.M 0.11 × V + 0.26

VCS.RC.L 0.23 × V + 0.54

VCS.RC.I 0.27 × V + 0.63

HCS.RC.M 0.11 × V + 0.26

HCS.RC.L 0.23 × V + 0.54

HCS.RC.I 0.27 × V + 0.63

Deleted Cells

Deleted Cells

Deleted Cells
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SOC.RC.L 1.08 × TDA + 0.22

SOC.RC.I 1.26 × TDA + 0.26

VOP.SC.L 4.37 × TDA + 11.82

VCS.SC.I 0.38 

× V 

+ 

0.88

VOP.SC.I 5.55 × TDA + 15.02

HCT.SC.I 0.56 

×

TDA 

+ 

0.43

SVO.SC.L 4.34 × TDA + 11.51

SVO.RC.L 2.27 

×

TDA 

+ 

6.85

SVO.SC.I 5.52 × TDA + 14.63

VOP.RC.I 2.89 

×

TDA 

+ 

8.7

HZO.SC.I 2.44 × TDA + 9.

SVO.RC.I 2.89 

×

TDA 

+ 

8.7

SOC.SC.I 1.76 × TDA + 0.36

HZO.RC.I 0.72 

×

TDA 

+ 

8.74

HCS.SC.I 0.38 × V + 0.88

* TDA is the total display area of the case, as measured in ANSI/Air-Conditioning and Refrigeration Institute (ARI) Standard 1200-2006, appendix D. ** V is the volume of the case, as measured in AHAM Standard HRF-1-2004. †

* Equipment class designations consist of a combination (in sequential order separated by periods) of: (1) an equipment family code (VOP = vertical open, SVO = semivertical open, HZO 

= horizontal open, VCT = vertical transparent doors, VCS = vertical solid doors, HCT = horizontal transparent doors, HCS = horizontal solid doors, or SOC = service over counter); (2) an 

operating mode code (RC = remote condensing or SC = self-contained); and (3) a rating temperature code (M = medium temperature (38 °F), L = low temperature (0 °F), or I = ice-cream 

temperature (-15 °F)). For example, “VOP.RC.M” refers to the “vertical open, remote condensing, medium temperature” equipment class.

** TDA is the total display area of the case, as measured in ANSI/Air-Conditioning and Refrigeration Institute (ARI) Standard 1200-2006, appendix D.

† V is the volume of the case, as measured in AHAM Standard HRF-1-2004.

2. History of Standards Rulemaking for Commercial Refrigeration Equipment 

EPCA, as amended by EPACT 2005, prescribes energy conservation standards for 

certain self-contained commercial refrigeration equipment designed for holding 

temperatures17

 

17 EPCA defines the term “holding temperature application” as a use of commercial refrigeration equipment 

other than a pull-down temperature application, except a blast chiller or freezer. (42 U.S.C. 6311(9)(B))

 (i.e., commercial refrigerators, freezers, and refrigerator-freezers with 

Comment [A13]: Revision requested by OIRA.

Deleted Cells

Deleted Cells

Deleted Cells
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transparent and solid doors designed for holding temperature applications) and selfcontained commercial refrigerators with transparent doors designed for pull-down 

temperature applications.

18 Compliance with these standards was required as of January 

1, 2010. (42 U.S.C. 6313(c)(2)−(3)) DOE published a technical amendment final rule on 

October 18, 2005 codifying these standards into subpart C of part 431 under title 10 of 

the Code of Federal Regulations (CFR). 70 FR at 60407. 

In addition, EPCA requires DOE to set standards for additional commercial 

refrigeration equipment that is not covered by 42 U.S.C. 6313(c)(2)−(3), namely:

commercial ice-cream freezers; self-contained commercial refrigerators, freezers, and 

refrigerator-freezers without doors; and remote condensing commercial refrigerators, 

freezers, and refrigerator-freezers. (42 U.S.C. 6313(c)(45)) DOE published a final rule 

establishing these standards on January 9, 2009 (74 FR at1092), and manufacturers must 

comply with these standards starting on January 1, 2012. (42 U.S.C. 6313(c)(45)(A)) 

EPCA requires DOE to conduct a subsequent rulemaking to determine whether to 

amend the standards established under 42 U.S.C. 6313(c), which includes both the 

standards prescribed by EPACT 2005 and those prescribed by DOE in the January 2009 

final rule. (42 U.S.C. 6313(c)(56)) If DOE decides as part of this ongoing rulemaking to 

amend the current standards, DOE must publish a final rule establishing any such 

amended standards by January 1, 2013. Id. 

 

18 EPCA defines the term “pull-down temperature application” as a commercial refrigerator with doors that, 

when fully loaded with 12 ounce beverage cans at 90 °F, can cool those beverages to an average stable 

temperature of 38 °F in 12 hours or less. (42 U.S.C. 6311(9)(D)) 
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To satisfy this requirement, DOE initiated the current rulemaking on April 30, 

2010 by publishing on its website its “Rulemaking Framework for Commercial 

Refrigeration Equipment.” (The Framework document is available at: 

www1.eere.energy.gov/buildings/appliance_standards/commercial/pdfs/cre_framework_

04-30-10.pdf.) DOE also published a notice in the Federal Register announcing the 

availability of the Framework document, as well as a public meeting to discuss the 

document. The notice also solicited comment on the matters raised in the document. 75 

FR 24824 (May 6, 2010). The Framework document described the procedural and 

analytical approaches that DOE anticipated using to evaluate energy conservation 

standards for commercial refrigeration equipment, and identified various issues to be 

resolved in the rulemaking.

DOE held the Framework public meeting on May 18, 2010, at which it: (1) 

presented the contents of the Framework document; (2) described the analyses it planned 

to conduct during the rulemaking; (3) sought comments from interested parties on these 

subjects; and (4) in general, sought to inform interested parties about, and facilitate their 

involvement in, the rulemaking. Major issues discussed at the public meeting included: 

(1) the scope of coverage for the rulemaking; (2) potential updates to the test procedure 

and appropriate test metrics (being addressed in a concurrent rulemaking); (3) 

manufacturer and market information, including distribution channels; (4) equipment 
38

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classes, baseline units,

19, and design options to improve efficiency; (5) life-cycle costs to 

consumerscustomer, including installation, maintenance, and repair costs; and (6) any 

consumercustomer subgroups DOE should consider. At the meeting and during the 

comment period on the Framework document, DOE received many comments that helped 

it identify and resolve issues pertaining to commercial refrigeration equipment relevant to 

this rulemaking. These are discussed in subsequent sections of this notice. 

DOE then gathered additional information and performed preliminary analyses to 

help review energy conservation standards for this equipment. This process culminated in 

DOE’s notice of another public meeting to discuss and receive comments regarding the 

tools and methods DOE used in performing its preliminary analysis, as well as the 

analyses results. 76 FR 17573 (March 30, 2011) (the March 2011 notice). DOE also 

invited written comments on these subjects and announced the availability on its website 

of a preliminary analysis technical support document (preliminary analysis TSD). Id. 

(The preliminary analysis TSD is available at:

www.regulations.gov/#!documentDetail;D=EERE-2010-BT-STD-0003-0030.) Finally, 

DOE sought comments concerning other relevant issues that could affect amended

energy conservation standards for commercial refrigeration equipment, or that DOE 

should address in this NOPR. 76 FR at 17575 (March 30, 2011).

The preliminary analysis TSD provided an overview of DOE’s review of the

standards for commercial refrigeration equipment, discussed the comments DOE received 

 

19 Baseline units consist of units possessing features and levels of efficiency consistent with the leastefficient equipment currently available and widely sold on the market. 
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in response to the Framework document, and addressed issues including the scope of 

coverage of the rulemaking. The document also described the analytical framework that 

DOE used (and continues to use) in considering amended standards for commercial 

refrigeration equipment, including a description of the methodology, the analytical tools, 

and the relationships between the various analyses that are part of this rulemaking. 

Additionally, the preliminary analysis TSD presented in detail each analysis that DOE 

had performed for this equipment up to that point, including descriptions of inputs, 

sources, methodologies, and results. These analyses were as follows:

• A market and technology assessment addressed the scope of this rulemaking, 

identified existing and potential new equipment classes for commercial 

refrigeration equipment, characterized the markets for this equipment, and 

reviewed techniques and approaches for improving its efficiency;

• A screening analysis reviewed technology options to improve the efficiency of 

commercial refrigeration equipment, and weighed these options against 

DOE’s four prescribed screening criteria;

• An engineering analysis estimated the manufacturer selling prices (MSPs) 

associated with more energy efficient commercial refrigeration equipment; 

• An energy use analysis estimated the annual energy use of commercial 

refrigeration equipment; 

• A markups analysis converted estimated MSPs derived from the engineering 

analysis to consumercustomer purchase prices;

• A life-cycle cost analysis calculated, for individual consumerscustomers, the 

discounted savings in operating costs throughout the estimated average life of 
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commercial refrigeration equipment, compared to any increase in installed 

costs likely to result directly from the imposition of a given standard;

• A payback period analysis estimated the amount of time it would take 

consumerscustomers to recover the higher purchase price of more energy

efficient equipment through lower operating costs;

• A shipments analysis estimated shipments of commercial refrigeration 

equipment over the time period examined in the analysis; 

• A national impact analysis (NIA) assessed the national energy savings (NES), 

and the national NPV of total consumercustomer costs and savings, expected 

to result from specific, potential energy conservation standards for 

commercial refrigeration equipment; and

• A preliminary manufacturer impact analysis (MIA) took the initial steps in 

evaluating the potential effects on manufacturers of amended efficiency 

standards. 

The public meeting announced in the March 2011 notice took place on April 19, 

2011 (April 2011 preliminary analysis public meeting). At the April 2011 preliminary 

analysis public meeting, DOE presented the methodologies and results of the analyses set 

forth in the preliminary analysis TSD. Interested parties provided comments on the 

following issues: (1) equipment classes; (2) technology options; (3) energy modeling; (4) 

installation, maintenance, and repair costs; (5) markups and distributions chains; (6) 

commercial refrigeration equipment shipments; and (7) test procedures. The comments 

received since publication of the March 2011 notice, including those received at the April 
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2011 preliminary analysis public meeting, have contributed to DOE’s proposed 

resolution of the issues in this rulemaking as they pertain to commercial refrigeration 

equipment. This NOPR responds to the issues raised by the commenters. (A parenthetical 

reference at the end of a quotation or paraphrase provides the location of the item in the 

public record.)

In December 2012, AEMTCA established new standards for SOC.SC.M 

equipment with a compliance date of January 1, 2012. (42 U.S.C. 6313(c)(4)) The 

SOC.SC.M equipment had previously been classified under the category self-contained 

commercial refrigerators with transparent doors for which standards were established by 

EPACT 2005. (42 U.S.C. 6313(c)(2)) The standard established by AEMTCA for 

SOC.SC.M equipment reduces the stringency of the standard applicable to this 

equipment.

AEMTCA also directs DOE to determine, within three years of enactment of the 

new SOC.SC.M standard, whether this standard should be amended. (42 U.S.C. 

6313(c)(4)(B)(i)) If DOE determines that the standard should be amended, then DOE 

must issue a final rule establishing an amended standard within this same three-year

period. (42 U.S.C. 6313(c)(4)(B)(ii))

III. General Discussion
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A. Test Procedures and Normalization Metrics

1. Test Procedures

On December 8, 2006, DOE published a final rule in which it adopted American 

National Standards Institute (ANSI) / Air-Conditioning and Refrigeration Institute (ARI) 

Standard 1200-2006, “Performance Rating of Commercial Refrigerated Display

Merchandisers and Storage Cabinets,” as the DOE test procedure for this equipment. 71 

FR at 71340, 71369–70. ANSI/ARI Standard 1200-2006 requires performance tests to be 

conducted according to the American Society of Heating, Refrigerating, and AirConditioning Engineers (ASHRAE) Standard 72-2005, “Method of Testing Commercial 

Refrigerators and Freezers.” The standard also contains rating temperature specifications 

of 38 °F (+/-2 °F) for commercial refrigerators and refrigerator compartments, 0 °F (+/-2 

°F) for commercial freezers and freezer compartments, and -5 °F (+/-2 °F) for 

commercial ice-cream freezers. During the 2006 test procedure rulemaking, DOE 

determined that testing at a -15 °F (±2 °F) rating temperature was more representative of 

the actual energy consumption of commercial freezers specifically designed for ice-cream 

application. 71 FR at 71357 (Dec. 8, 2006). Therefore, in the test procedure final rule, 

DOE adopted a -15 °F (±2 °F) rating temperature for commercial ice-cream freezers, 

rather than the -5 °F (±2 °F) prescribed in the ANSI/ARI Standard 1200-2006. In 

addition, DOE adopted ANSI/Association of Home Appliance Manufacturers (AHAM) 

Standard HRF-1-2004, “Energy, Performance, and Capacity of Household Refrigerators, 

Refrigerator-Freezers, and Freezers,” for determining compartment volumes for this 

equipment. 71 FR at 71369–70 (Dec. 8, 2006). 
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On XXXX XX, 201XFebruary 21, 2012, DOE published a test procedure final 

rule (201X2012 test procedure final rule) in which it adopted several amendments to the 

DOE test procedure. This included an amendment to incorporate by reference the 

ANSI/AHRIANSI/ Air-Conditioning, Heating, and Refrigeration Institute (AHRI)

Standard 1200-2010, “Performance Rating of Commercial Refrigerated Display 

Merchandisers and Storage Cabinets,” as the DOE test procedure for this equipment. 

XX77 FR at XXXXX.10292, 10314 (Feb. 21, 2012). The 201X2012 test procedure final 

rule also included an amendment to incorporate by reference the updated ANSI/AHAM

Standard HRF-1-2008, “Energy, Performance, and Capacity of Household Refrigerators, 

Refrigerator-Freezers, and Freezers,” for determining compartment volumes for this 

equipment. 

In addition, the 201X2012 test procedure final rule included several amendments 

designed to address certain energy efficiency features that were not accounted for by the 

previous DOE test procedure, including provisions for measuring the impact of night 

curtains20

 

20 Night curtains are devices made of an insulating material, typically insulated aluminum fabric, designed 

to be pulled down over the open front of the case to decrease infiltration and heat transfer into the case 

when the merchandizing establishment is closed. 

and lighting occupancy sensors and scheduled controls. XX77 FR at XXXX

(XXXX 201X).10296–98 (Feb. 21, 2012). In the 201X2012 test procedure final rule, 

DOE also adopted amendments to allow testing of commercial refrigeration equipment at 

temperatures other than one of the three rating temperatures previously specified in the 

test procedure. Specifically, the 201X2012 test procedure final rule allows testing of 

commercial refrigeration equipment at its lowest application product temperature. The 
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201X, for equipment that cannot be tested at the prescribed rating temperature. The 2012

test procedure final rule also allows manufacturers to test and certify equipment at the 

more-stringent rating temperatures and ambient conditions required by NSF for food 

safety testing. XX77 FR at XXXX (XXXX 201X).10305 (Feb. 21, 2012). (The NSF was 

founded in 1944 as the National Sanitation Foundation, and is now referred to simply as 

NSF.)

The test procedure amendments established in the 20112012 test procedure final 

rule are required to be used in conjunction with any amended standards promulgated as a 

result of this energy conservation standard rulemaking. As such, use of the amended test 

procedure to show compliance with DOE energy conservation standards or make 

representations with respect to energy consumption of commercial refrigeration 

equipment is required on the compliance date of any revised energy conservation 

standards established as part of this rulemaking. XX77 FR XXXX (XXXX 2011at 10308

(Feb. 21, 2012).

DOE has initiated a test procedure rulemaking for commercial refrigeration 

equipment to address many issues raised by stakeholders since the publication of the 

2012 test procedure final rule. This rulemaking will address the following issues:

• a number of new definitions related to commercial refrigeration equipment, 

• a description of the proper configuration and use of energy management 

systems, 
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• clarifications on the use of calculation methods, appropriate reporting 

requirements, and determination of the lowest application product 

temperature, 

• incorporation of Interpretations 1 through 5 to AHRI 1200-2010, and

• updates and clarifications regarding the compliance dates of test procedure 

amendments adopted in the 2012 test procedure final rule by reorganizing the 

test procedure in two different appendices.

The issues that will be addressed in the test procedure rulemaking are consistent 

with the analysis in this NOPR. 

2. Normalization Metrics

Both the January 2009 final rule and EPACT 2005 contain energy conservation 

standards for respective covered types of commercial refrigeration equipment, expressed 

in the form of equations developed as a function of unit size. This use of normalization 

metrics allows for a single standard-level equation developed for an equipment class to 

apply to a broad range of equipment sizes offered within that class by manufacturers. In 

the aforementioned commercial refrigeration equipment standards, the two normalization 

metrics used are refrigerated compartment volume, as determined using AHAM HRF-1-

2004, and TDA, as determined using ANSI/ARI 1200-2006. In particular, the EPACT 

2005 standards utilize volume as the normalization metric for all equipment types, with 

the exception of refrigerator-freezers with solid doors, for which it specifies adjusted 

volume. (42 U.S.C. 6313(c)(2)) The January 2009 final rule, meanwhile, utilized TDA as 
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the normalization metric for all equipment with display capacity while specifying volume 

as the metric for solid-door (VCS and HCS) equipment. (42 U.S.C. 6313(c)(2))74 FR at 

1093 (Jan. 9, 2009).

At the May 2010 Framework public meeting, interested parties raised several 

questions regarding the potential normalization metrics that could be used in amended 

standards. DOE also received stakeholder feedback pertaining to this issue following the 

publication of the Framework document. In the preliminary analysis, DOE suggested that 

it would consider retaining the normalization metrics in this rulemaking for the respective 

classes to which they were applied in EPCA (42 U.S.C. 6313(c)(2)–(3)) and the January 

2009 final rule. 74 FR at 1093 (Jan. 9, 2009). In chapter 2 of the preliminary analysis 

TSD, DOE presented its rationale for the continued use of TDA for equipment with 

display areas addressed in the January 2009 final rule and the continued use of volume as 

the metric for solid-door remote condensing equipment and ice-cream freezers, as well as 

for the equipment covered by EPACT 2005 standards. DOE did not receive any 

information or data while conducting the NOPR analyses that would alter this position, 

and thus DOE proposes continued use of the existing normalization metrics in today’s 

notice. 

B. Technological Feasibility

1. General

In each standards rulemaking, DOE conducts a screening analysis, which is based 

on information that the Department has gathered on all current technology options and 
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prototype designs that could improve the efficiency of the products or equipment that are 

the subject of the rulemaking. As the first step in such analysis, DOE develops a list of 

design options for consideration, in consultation with manufacturers, design engineers, 

and other interested parties. DOE then determines which of these options for improving 

efficiency are technologically feasible. DOE considers a design option to be 

technologically feasible if it is used by the relevant industry or if a working prototype has 

been developed. Technologies incorporated in commercially available equipment or in 

working prototypes will be considered technologically feasible. 10 CFR 430, subpart C, 

appendix A, section 4(a)(4)(i) Although DOE considers technologies that are proprietary, 

it will not consider efficiency levels that can only be reached through the use of 

proprietary technologies (i.e., a unique pathway), which could allow a single 

manufacturer to monopolize the market.

Once DOE has determined that particular design options are technologically 

feasible, it further evaluates each of these design options in light of the following

additional screening criteria: (1) practicability to manufacture, install, or service; (2) 

adverse impacts on product utility or availability; and (3) adverse impacts on health or 

safety. 10 CFR part 430, subpart C, appendix A, section 4(a)(4)(ii)–(iv) Chapter 4 of the 

NOPR TSD discusses the results of the screening analyses for commercial refrigeration 

equipment. Specifically, it presents the designs DOE considered, those it screened out, 

and those that are the bases for the TSLs considered in this rulemaking.
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2. Maximum Technologically Feasible Levels

When DOE proposes to adopt (or not adopt) an amended or new energy 

conservation standard for a type or class of covered equipment such as commercial 

refrigeration equipment, it determines the maximum improvement in energy efficiency 

that is technologically feasible for such equipment. (See 42 U.S.C. 6295(p)(1) and 

6316(e)(1)) Accordingly, in the preliminary analysis, DOE determined the maximum 

technologically feasible (“max-tech”) improvements in energy efficiency for commercial 

refrigeration equipment in the engineering analysis using the design parameters that

passed the screening analysis. 

As indicated previously, whether efficiency levels exist or can be achieved in 

commonly used equipment is not relevant to whether they are considered max-tech 

levels. DOE considers technologies to be technologically feasible if they are incorporated 

in any currently available equipment or working prototypes. Hence, a max-tech level 

results from the combination of design options predicted to result in the highest 

efficiency level possible for an equipment class, with such design options consisting of 

technologies already incorporated in commercial equipment or working prototypes. DOE 

notes that it reevaluated the efficiency levels, including the max-tech levels, when it 

updated its results for this NOPR. See chapter 5 of the NOPR TSD for the results of the 

analyses, and a list of technologies included in max-tech equipment. Table III.1 shows 

the max-tech levels determined in the engineering analysis for commercial refrigeration 

equipment. 
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Table III.1 “Max-Tech” Levels for Commercial Refrigeration Equipment Primary 

Classes

Equip

ment 

Class

“Max-Tech” 

Level

kWh/day

Equip

ment 

Class

“MaxTech” 

Level

kWh/day

VCT.R

C.L

0.41 x× TDA 

+ 1.93

VOP.

RC.I

2.63 x 

TDA + 

7.95

VOP.R

C.M

0.6 x× TDA 

+ 2.99

SVO.

RC.L

2.07 x 

TDA + 

6.26

SVO.R

C.M

0.62 x× TDA 

+ 2.38

SVO.

RC.I

2.63 x 

TDA + 

7.95

HZO.R

C.L

0.55 x× TDA 

+ 6.7

HZO.

RC.I

0.7 x TDA 

+ 8.5

HZO.R

C.M

0.34 x× TDA 

+ 2.83

VOP.S

C.L

3.77 x 

TDA + 

10.2

VCT.R

C.M

0.07 x× TDA 

+ 0.66

VOP.S

C.I

4.78 x 

TDA + 

12.95

VOP.R

C.L

2.07 x× TDA 

+ 6.26

SVO.S

C.L

3.76 x 

TDA + 

9.96

SOC.R

C.M

0.39 x× TDA 

+ 0.08

SVO.S

C.I

4.77 x 

TDA + 

12.65

VOP.S

C.M

1.5 x× TDA 

+ 4.06

HZO.S

C.I

2.42 x 

TDA + 

8.93

SVO.S

C.M

1.5 x× TDA 

+ 3.97

SOC.R

C.L

0.82 x 

TDA + 

0.18

HZO.S

C.L

1.91 x× TDA 

+ 7.03

SOC.R

C.I

0.96 x 

TDA + 

0.21

HZO.S

C.M

0.74 x× TDA 

+ 5.35

SOC.S

C.I

1.34 x 

TDA + 

0.29

HCT.S

C.I

0.36 x× TDA 

+ 0.28

VCT.

RC.I

0.48 x 

TDA + 

2.26

VCT.S

C.I

0.5 x× TDA 

+ 2.44

HCT.

RC.M

0.1 x TDA 

+ 0.08

VCS.S

C.I

0.33 x× V + 

0.76

HCT.

RC.L

0.22 x 

TDA + 

0.17

VCT.S

C.M

0.03 x× V + 

0.97

HCT.

RC.I

0.26 x 

TDA + 

0.2

VCT.S

C.L

0.21 x× V + 

1.16

VCS.R

C.M

0.1 x V + 

0.22

VCS.S

C.M

0.02 x× V + 

0.41

VCS.R

C.L

0.2 x V + 

0.46

VCS.S

C.L

0.11 x× V + 

0.38

VCS.R

C.I

0.23 x V + 

0.54

HCT.S 0.01 x× V + HCS.S 0.33 x V + 

Deleted Cells

Deleted Cells
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C.M 0.38 C.I 0.76

HCT.S

C.L

0.08 x× V + 

0.45

HCS.R

C.M

0.1 x V + 

0.22

HCS.S

C.M

0.01 x× V + 

0.18

HCS.R

C.L

0.2 x V + 

0.46

HCS.S

C.L

0.07 x× V + 

0.24

HCS.R

C.I

0.23 x V + 

0.54

PD.SC.

M

0.03 x× V + 

0.72

SOC.S

C.M 0.32 × TDA + 0.53

C. Energy Savings

1. Determination of Savings

DOE uses the NIA model to estimate the NES over the period from 2016–

2045.For each TSL, DOE projected energy savings from the products that are the 

subjects of this rulemaking, purchased during the 30-year period that begins in the year of 

compliance with amended standards (2017–2046). The savings are measured over the 

entire lifetime of products purchased in the 30-year period.21

IV.I

DOE used the NIA model to 

estimate the NES for equipment purchased over the period 2017–2046. The model 

forecasts total energy use over the analysis period for each representative equipment class 

at efficiency levels set by each of the five considered TSLs. DOE then compares the 

energy use at each TSL to the base-case energy use to obtain the NES. The NIA model is 

described in section of this notice and in chapter 10 of the NOPR TSD.

DOE used its national impact analysis (NIA) spreadsheet model to estimate 

 

21 In the past, DOE presented energy savings results for only the 30-year period that begins in the year of 

compliance. In the calculation of economic impacts, however, DOE considered operating cost savings 

measured over the entire lifetime of products purchased during the 30-year period. DOE has chosen to 

modify its presentation of national energy savings to be consistent with the approach used for its national 

economic analysis.

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energy savings from amended standards for the products that are the subject of this 

rulemaking. The NIA spreadsheet model (described in section IV.I of this notice) 

calculates equipment energy savings in kilowatt-hours of site energy. Site , which is the 

energy is the electrical energydirectly consumed at building sites by commercial 

refrigeration units. However, when presentingproducts at the locations where they are 

used. For electricity, DOE reports national energy savings in the contextterms of the 

national level, DOE convertssavings in the site energy to source energy, which is the 

energy that is used to generate and transmit electricity the site electricity. To calculate 

this quantity, DOE derives annual conversion factors from the model used to prepare the 

Energy Information Administration’s (EIA) Annual Energy Outlook (AEO).

DOE has begun to also estimate full-fuel-cycle (FFC) energy savings. 76 FR 

51282 (Aug. 18, 2011), as amended at 77 FR 49701 (August 17, 2012). The FFC metric 

includes the energy consumed at the sitein extracting, processing, and transporting 

primary fuels, and thus presents a more complete picture of the impacts of energy 

efficiency standards. DOE’s approach is based on calculation of an FFC multiplier for 

each of the energy types used by covered products. 

2. Significance of Savings

EPCA prohibits DOE from adopting a standard that would not result in significant 

additional energy savings. (42 U.S.C. 6295(o)(3)(B),(v) and 6316(e)(1)) While the term 

“significant” is not defined in EPCA, the U.S. Court of Appeals for the District of 

Columbia in Natural Resources Defense Council v. Herrington, 768 F.2d 1355, 1373 
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(D.C. Cir. 1985), indicated that Congress intended significant energy savings to be 

savings that were not “genuinely trivial.” The estimated energy savings in the 30-year 

analysis period for the TSLs considered in this rulemaking range from 0.274236 to 

1.302278 quads (see section V.B.2 for additional details); therefore, DOE considers them 

significant within the meaning of section 325 of the Act.

D. Economic Justification

1. Specific Criteria

As discussed in section II.A, EPCA provides seven factors to be evaluated in 

determining whether a potential energy conservation standard is economically justified. 

(42 U.S.C. 6295(o)(2)(B)(i) and 6316(e)(1)) The following sections generally discuss 

how DOE is addressing each of those seven factors in this rulemaking. For further details 

and the results of DOE’s analyses pertaining to economic justification, see sections IV

and V of today’s notice.

a. Economic Impact on Manufacturers and Commercial ConsumersCustomers

In determining the impacts of a potential new or amended energy conservation 

standard on manufacturers, DOE first determines its quantitative impacts using an annual 

cash flow approach. This includes both a short-term assessment (based on the cost and 

capital requirements associated with new or amended standards during the period 

between the announcement of a regulation and the compliance date of the regulation) and 

a long-term assessment (based on the costs and marginal impacts over the 30-year 

analysis period). The impacts analyzed include INPV (which values the industry based on

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expected future cash flows), cash flows by year, changes in revenue and income, and 

other measures of impact, as appropriate. Second, DOE analyzes and reports the potential 

impacts on different types of manufacturers, paying particular attention to impacts on 

small manufacturers. Third, DOE considers the impact of new or amended standards on 

domestic manufacturer employment and manufacturing capacity, as well as the potential 

for new or amended standards to result in plant closures and loss of capital investment. 

Finally, DOE takes into account cumulative impacts of other DOE regulations and nonDOE regulatory requirements on manufacturers.

For individual consumerscustomers, measures of economic impact include the 

changes in LCC and the PBP associated with new or amended standards. The LCC, 

which is also separately specified as one of the seven factors to be considered in 

determining the economic justification for a new or amended standard, (42 U.S.C. 

6295(o)(2)(B)(i)(II), and 6316(e)(1)), is discussed in the following section. For 

consumerscustomers in the aggregate, DOE also calculates the NPV from a national 

perspective of the economic impacts on consumerscustomers over the analysis period 

used in a particular rulemaking. For a description of the methodology used for assessing 

the economic impact on consumerscustomers, see sections IV.H and IV.I; for results, see 

sections V.B.1 and V.B.2 of this notice. Additionally, chapters 8 and 10 and the 

associated appendices of the NOPR TSD contain a detailed description of the 

methodology and discussion of the results. For a description of the methodology used to 

assess the economic impact on manufacturers, see section IV.K; for results, see section 

V.B.2 of this notice. Additionally, chapter 13 of the NOPR TSD contains a detailed 
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description of the methodology and discussion of the results. 

b. Life-Cycle Costs

The LCC is the sum of the purchase price of equipment (including the cost of its 

installation) and the operating costs (including energy and maintenance and repair costs) 

discounted over the lifetime of the equipment. The LCC savings for the considered 

efficiency levels are calculated relative to a base-case scenario, which reflects likely 

trends in the absence of new or amended standards. DOE carried out the LCC analysis for 

this rulemaking by analyzing the LCC impacts on those consumerscustomers who 

purchase the equipment in the year in which compliance with the new standard is 

required. To account for uncertainty and variability in specific inputs, such as equipment 

lifetime and discount rate, DOE uses a range of values, each with its own probability of 

selection. In addition to identifying distribution of consumercustomer impacts, DOE 

evaluates the LCC impacts of potential standards on identifiable subgroups of 

consumerscustomers who may be disproportionately affected by a new national standard. 

For the results of DOE’s analyses related to the LCC, see section V.B.1 of this notice and 

chapter 8 of the NOPR TSD; for LCC impacts on identifiable subgroups, see section 

V.B.1 of this notice and chapter 11 of the NOPR TSD. 

c. Energy Savings

While significant conservation of energy is a statutory requirement for imposing 

an energy conservation standard, EPCA also requires DOE, in determining the economic 

justification of a standard, to consider the total projected energy savings that are expected 
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to result directly from the standard. (42 U.S.C. 6295(o)(2)(B)(i)(III) and 6316(e)(1)) 

DOE uses NIA spreadsheet results in its consideration of total projected savings. For the 

results of DOE’s analyses related to the potential energy savings, see section VI.B.3 of 

this notice and chapter 10 of the NOPR TSD.

d. Lessening of Utility or Performance of Equipment

In establishing classes of equipment, and in evaluating design options and the 

impact of potential standard levels, DOE seeks to develop standards that would not lessen 

the utility or performance of the equipment under consideration. None of the TSLs 

presented in today’s NOPR would reduce the utility or performance of the equipment 

considered in the rulemaking. (42 U.S.C. 6295(o)(2)(B)(i)(IV) and 6316(e)(1)) During 

the screening analysis, DOE eliminated from consideration any technology that would 

adversely impact consumercustomer utility. For the results of DOE’s analyses related to 

the potential impact of amended standards on equipment utility and performance, see 

section IV.D of this notice and chapter 4 of the NOPR TSD.

e. Impact of Any Lessening of Competition

EPCA directs DOE to consider the impact of any lessening of competition, as 

determined in writing by the Attorney General, that is likely to result from standards.the 

imposition of a standard. (42 U.S.C. 6295(o)(2)(B)(i)(V) Specifically, it directs the 

Attorney General of the United States (Attorney General) to determine in writing the 

impact, if any, of any lessening of competition likely to result from a proposed standard 

and to transmit such determination to the Secretary, not later than 60 days after the 
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publication of a proposed rule, together with an analysis of the nature and extent of such 

impact. (42 U.S.C. 6295(o)(2)()B)(i)(V), (ii) and 6316(e)(1)) For the results of DOE’s 

analysis related to lessening of competition, see section V.B.5 of this notice. 

f. Need of the Nation to Conserve Energy

Another factor that DOE must consider in determining whether a new or amended 

standard is economically justified is the need for national energy and water conservation. 

(42 U.S.C. 6295(o)(2)(B)(i)(VI) and 6316(e)(1)) The energy savings from new or 

amended standards are likely to provide improvements to the security and reliability of 

the Nation’s energy system. Reductions in the demand for electricity may also result in 

reduced costs for maintaining the reliability of the Nation’s electricity system. DOE 

conducts a utility impact analysis to estimate how new or amended standards may affect 

the Nation’s needed power generation capacity. 

Energy savings from amended standards for commercial refrigeration equipment 

are also likely to result in environmental benefits in the form of reduced emissions of air 

pollutants and GHGs associated with energy production (i.e., from power plants). For a 

discussion of the results of the analyses relating to the potential environmental benefits of 

the amended standards, see sections IV.N, IV.O and V.B.6 of this notice. DOE reports 

the expected environmental effects from the proposed standards, as well as from each 

TSL it considered for commercial refrigeration equipment, in the environmental 

assessmentemissions analysis contained in chapter 1513 of the NOPR TSD. DOE also 

reports estimates of the economic value of emissions reductions resulting from the 
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considered TSLs. in chapter 14 of the NOPR TSD. 

g. Other Factors

EPCA allows the Secretary, in determining whether a new or amended standard is 

economically justified, to consider any other factors that the Secretary deems to be 

relevant. (42 U.S.C. 6295(o)(2)(B)(i)(VII) and 6316(e)(1)) In developing the TSLs set 

forth in this notice, DOE has also considered the comments submitted by interested 

parties. For the results of DOE’s analyses related to other factors, see section V.B.7 of 

this notice.

2. Rebuttable Presumption

As set forth in 42 U.S.C. 6295(o)(2)(B)(iii) and 6316(e)(1), EPCA provides for a 

rebuttable presumption that an energy conservation standard is economically justified if 

the additional cost to the consumercustomer of equipment that meets the new or amended 

standard level is less than three times the value of the first-year energy (and, as 

applicable, water) savings resulting from the standard, as calculated under the applicable 

DOE test procedure. DOE’s LCC and PBP analyses generate values that calculate the 

PBP for consumerscustomers of potential new and amended energy conservation 

standards. These analyses include, but are not limited to, the 3-year PBP contemplated 

under the rebuttable presumption test. However, DOE routinely conducts a full economic 

analysis that considers the full range of impacts to the consumercustomer, manufacturer, 

Nation, and environment, as required under 42 U.S.C. 6295(o)(2)(B)(i) and 6316(e)(1). 

The results of these analyses serve as the basis for DOE to evaluate the economic 

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justification for a potential standard level definitively (thereby supporting or rebutting the 

results of any preliminary determination of economic justification). The rebuttable 

presumption payback calculation is discussed in section IV.H.12 of this notice and 

chapter 8 of the NOPR TSD. 

IV. Methodology and Discussion of Comments

A. General Rulemaking Issues

During the April 2011 preliminary analysis public meeting and in subsequent 

written comments, stakeholders provided input regarding general issues pertinent to the 

rulemaking, such as issues of scope of coverage and DOE’s authority in setting standards. 

These issues are discussed in this section. 

1. Statutory Authority

In the preliminary analysis, DOE stated its position that EPCA prevents the 

setting of both energy performance standards and prescriptive design requirements (see 

chapter 2 of the preliminary analysis TSD22

 

22 U.S. Department of Energy–Office of Energy Efficiency and Renewable Energy. Preliminary Technical Support 

Document (TSD): Energy Conservation Program for Certain Commercial and Industrial Equipment:

). DOE also stated its intent to amend the 

energy performance standards for commercial refrigeration equipment, and not to set 

prescriptive design requirements at this time (see chapter 2 of the preliminary analysis 

TSD). In a written comment, Earthjustice opined that DOE misread EPCA in suggesting 

that DOE does not have authority to establish design requirements for commercial 

Commercial Refrigeration Equipment. Chapter 2. Analytical Framework, Comments from Interested Parties, and DOE 

Responses. March 2011. Washington, D.C. www.regulations.gov/#!documentDetail;D=EERE-2010-BT-STD-0003-

0030
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refrigeration equipment. More specifically, Earthjustice asserted that DOE’s 

interpretation of 42 U.S.C. 6311(18) ignores that EPCA uses the plural form in 

compelling this rulemaking to amend energy conservation “standards.” Further, 

Earthjustice stated, even if DOE were only authorized to promulgate a single standard or 

single design requirement in any one rulemaking, nothing in EPCA indicates that prior 

establishment of performance standards would foreclose the issuance of design 

requirements in a subsequent rulemaking, provided that those design requirements 

achieved the maximum technologically feasible and economically justified energy 

savings. (Earthjustice, No. 35 at pp. 4–5)23

EPCA defines the phrase “energy conservation standard” as a performance 

standard that prescribes a minimum level of energy efficiency or a maximum quantity of 

energy use for a product or as a design requirement for a product. (42 U.S.C. 

6311(18)(A)–(B)) Therefore, based on a clear reading of EPCA, DOE must use either a 

performance standard or a design (prescriptive) requirement in prescribing energy 

conservation standards. It has been DOE’s longstanding interpretation that the term 

“standard” means either a performance standard or a design requirement, and that the 

plural term “standards” refers to the setting of a collective group of standards across all 

covered equipment or product classes. Thus, it is not DOE’s interpretation of EPCA that 

the statute’s use of the plural term “standards,” in referring to a collective group of 

 

23 A notation in this form provides a reference for information that is in the docket of DOE’s rulemaking to 

develop energy conservation standards for commercial refrigeration equipment (Docket No. EERE-2010-

BT-STD-0003), which is maintained at www.regulations.gov. This notation indicates that the statement 

preceding the reference is document number 35 in the docket for the commercial refrigeration equipment 

energy conservation standards rulemaking, and appears at pages 4–5 of that document. 
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equipment classes, grants DOE the authority to set both prescriptive and performance 

standards for a given class within that group. In the case of commercial refrigeration 

equipment, all of the equipment that is the subject of this rulemaking is currently covered 

either by a statutorily mandated performance standard or by a performance standard set 

by DOE in the January 2009 final rule. (42 U.S.C 6313(c)(1)–(3);4)); 74 FR at 1093 (Jan. 

9, 2009). In this rulemaking, DOE is considering amendments to these performance 

standards for commercial refrigeration equipment, and is therefore not considering design 

requirements at this time. 

2. January 2009 Final Rule Equipment

At the April 2011 preliminary analysis public meeting, AHRI stated that in 2005 

when the legislation that was to become EPACT 2005 was drafted, the drafters’ intent 

was not for DOE to start a rulemaking on remote cases in 2010. According to AHRI, the

drafters’ intent was that DOE start the rulemaking on self-contained units. AHRI pointed 

out that manufacturers would have to redesign products (those covered by the 2009 DOE 

final rule) twice in a 4-year period, first to meet the 2009 DOE standards in 2012, and 

then again to meet the 2013 standards in 2016. AHRI asked DOE to factortake that 

redesign into the equationaccount, a situation AHRI described as unprecedented. (AHRI, 

Public Meeting Transcript, No. 31 at pp. 204–05) AHRI elaborated on this situation in its 

written comment, expressing its belief that DOE’s decisionit is illogical that DOE 

decided to analyze equipment types for which standards haveexist, but with which 

manufacturers are not yet become effective is illogicalrequired to comply. AHRI stated

that the intent of Congress was never to require DOE to start a rulemaking on this 
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equipment, and questioned how DOE could possibly assess whether amended standards 

are appropriate before the January 2009 final rule standards become effective. AHRI

andreach the stage where manufacturers must comply. AHRI urged DOE to focus on selfcontained refrigerators and freezers with doors in this rulemaking. (AHRI, No. 43 at pp. 

1–2) 

Similarly, Zero Zone expressed disappointment with the fact that the current 

rulemaking was initiated before the standards compliance date of January 1, 2012 

specified in the January 2009 final rule. Zero Zone went on to state that waiting until 

after this compliance date to initiate a rulemaking would have allowed DOE to determine 

the accuracy of its models and the impacts on industry. (Zero Zone, No. 37 at p. 1) 

The EPACT 2005 amendments to EPCA require DOE to conduct a rulemaking to 

determine whether to amend the standards for commercial refrigeration equipment 

established under 42 U.S.C. 6313(c), which covers both the standards prescribed by 

EPACT 2005 and the standards set by DOE in the January 2009 final rule. (42 U.S.C. 

6313(c)(56)) If DOE determines that these standards should be amended, DOE must 

publish a final rule establishing such amended standards by January 1, 2013. Id. 

Regarding AHRI’s comment, DOE is thus compelled by statute to conduct this 

rulemaking with a scope of coverage including the equipment specified in both EPACT 

2005 and in the January 2009 final rule. In response to Zero Zone’s comments 

concerning the burden imposed by amended standards, DOE has considered 

manufacturer impacts in the MIA, as required by 42 U.S.C. 6295(o)(2)(B)(i)(I) and 
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6316(e)(1). DOE has also used its manufacturer interviews as a forum to discuss and 

receive feedback on the inputs to and accuracy of its models. 

3. Normalization Metrics

In chapter 2 of the preliminary analysis TSD, DOE stated its proposal to retain the 

current normalization metrics for all equipment classes and requested comment from 

interested parties. Traulsen agreed with DOE’s tentative plan to use cabinet volume as the 

normalization metric for “appropriate” equipment, but noted that there are other 

(unspecified) design factors that need to be considered. (Traulsen, No. 45 at p. 2) Zero 

Zone stated that evaluation of the normalization metrics should take place after the 

January 2009 final rule compliance date. (Zero Zone, No. 37 at p. 4) 

During the NOPR analyses, DOE took into account stakeholder input when 

reviewing normalization metrics for covered equipment. DOE agrees with Traulsen that 

volume is the appropriate normalization metric for most self-contained equipment 

classes, and considered the applicable design factors in its engineering analysis.. With 

respect to the comment by Zero Zone, the timing of this proceeding made it difficult for 

significant amounts of data on sales and other factors to be acquired after the January 

2009 final rule compliance date of January 1, 2012. DOE took into account information 

regarding the size and composition of the commercial refrigeration equipment market 

obtained through manufacturer interviews, market research publications, and other 

sources during the NOPR stage. 
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4. Inadvertent Coverage of Certain Equipment

4. Treatment of Blast Chillers, Thawing Cabinets, Prep Tables, Salad Bars, and Buffet 

Tables

In its written comment, Traulsen expressed concern that DOE may inadvertently 

include equipment such as prep tables, blast chillers, and thawing cabinets in standards it 

develops. (Traulsen, No. 45 at p. 1) During the ongoing rulemaking, DOE also received 

several inquiries from interested parties regarding the coverage, under current or 

amended energy conservation standards, of salad bars, buffet tables, and other 

refrigerated holding and serving equipment. 

EPCA, in its definition of “commercial refrigerator, freezer, and refrigeratorfreezer,” states that such equipment must display or store merchandise or other perishable 

materials horizontally, vertically, or semi-vertically, and must be designed for pull-down 

temperature applications or holding temperature applications, among other factors. (42 

U.S.C. 6311(9)(A)) Moreover, 42 U.S.C. 6311(9) defines “holding temperature 

application” as specifically omitting blast chillers or freezers, and specifies that “pulldown temperature application” refers solely to equipment designed to cool 12 ounce 

beverage cans from 90 to 38 °F in 12 hours or less. Due to its specificity,Thus, blast 

chillers and thawing cabinets do not meet the relevant statutory definition precludes 

coverage of blast chillers by standards set for pull-down or holding temperature 

applications. , and will not be addressed in this rulemaking. 

With regard to buffetprep tables, chef bases, and prep with open bins or trays, 
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salad bars, and buffet tables, DOE does not currently have energy conservation standards 

that cover this equipment. DOE notes that some of this equipment is designed for the 

temporary placement of food during preparation, cooking, or service, rather than longterm storage or retailing, and may operate very differently from the commercial 

refrigeration equipment considered in this rulemaking. Moreover, DOE’s current test 

procedure does not include a provision for the testing of this equipment.provisions for 

testing this type of equipment. For example, some types of foodservice equipment (such 

as salad bars, buffet tables, and prep tables) do not have doors, drawers, or openings 

typical of conventional commercial refrigeration equipment. While DOE has the 

authority to set standards for other types of commercial refrigeration equipment (42 

U.S.C. 6313(c)(45)(B)), this rulemaking is not currently considering standards for 

equipment types other than those covered by DOE’s existing standards. 10 CFR 431.66 

5. Dedicated Remote Condensing Units

Several stakeholders inquired whether equipment consisting of a refrigerated case 

served by a single, dedicated remote condensing unit that serves only that unit would be 

covered under DOE’s proposed standards. True Manufacturing (True) stated that smaller 

units are more likely to have such a condensing unit, and that continuous cases24 are 

almost exclusively rack condensing systems25

 

24 In most supermarket and large food retail settings, multiple display cases from a manufacturer are 

attached together into a single continuous lineup without internal partitions; these are referred to as 

“continuous cases..”

due to the energy savings gained in the 

long term by rejecting heat outside of the building. (True, Public Meeting Transcript, No. 

25 Rack condensing systems utilize a “rack” of multiple compressors and a condenser that serves to deliver 

liquid refrigerant to a number of different pieces of equipment served by the single rack. For example, most 

supermarkets have one or more compressor racks to serve their display cases, walk-in coolers and freezers, 

and other equipment. 
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31 at pp. 268–69) Southern Store Fixtures stated that it is very difficult for the company 

to predict whether a given case that it builds will ultimately be connected to an individual 

condensing unit or to a compressor rack. (Southern Store Fixtures, Public Meeting 

Transcript, No. 31 at p. 268) Zero Zone commented that 20 to 40 percent of the units it 

sells are served by dedicated condensing units, and that the remainder are served by 

racks, noting that businesses such as convenience stores and dollar stores use dedicated 

condensing units in the interest of simplicity. (Zero Zone, Public Meeting Transcript, No. 

31 at p. 269) In its written comment, Earthjustice referenced Zero Zone’s statement that 

20 to 40 percent of remote condensing commercial refrigeration equipment is served by 

dedicated remote condensing units, and stated that because there is a significant market 

share for such equipment, DOE should explore standards that address the performance of 

such units. (Earthjustice, No. 35 at p. 4) 

DOE understands that some stakeholders are concerned that shipments of 

equipment utilizing dedicated remote condensing units may comprise a nontrivial portion 

of the market. However, neither the ASHRAE 72 method of test nor the AHRI 1200DOE

test procedure containsdoes not contain a methodology for testing such condensing units.

CurrentlyDOE anticipates working with the industry in the future to develop testing 

methodologies that can be used in future commercial refrigeration equipment

rulemakings. For this current rulemaking, display cases connected to dedicated remote 

condensers will be treated like any other piece of remote condensing equipment under the 

DOE test procedure, with the energy of the remote condensing unit calculated as 

specified in AHRI 1200 and added to the measured energy consumption of the display 
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case. As there is no industry-accepted method of test for dedicated remote condensers, 

DOE proposes to continue to treat equipment utilizing this condensing unit configuration 

in the same manner as all other display cases connected to remote condensers. 

Also, as Southern Store Fixtures noted, it is often difficult or impossible for the 

display case manufacturer to know ahead of time whether a given case will be attached to 

a dedicated remote condensing unit or a remote condensing rack by an end user. In some 

cases, the dedicated condensing unit is produced by a separate manufacturer and 

purchased independently. As Zero Zone stated, the majority of remote condensing cases 

are still sold to be connected to a remote condensing rack system that serves multiple 

pieces of equipment. Thus, DOE believes that comparing remote condensing cases based 

on the calculated performance of a typical remote condensing rack, in the manner 

prescribed by AHRI 1200, is a consistent way to compare performance of remote 

condensing display cases. 

In chapter 2 of the preliminary analysis TSD, DOE discussed the potential of 

addressing coverage of remote condensers in a separate future rulemaking. DOE believes 

that, should any such action take place in the future, such a proceeding would be the 

appropriate venue in which to investigate dedicated remote condensers. 

6. Small Units

Traulsen stated that it believes that smaller units are effectively prohibited under 

current DOE regulations, and that it recognizes that legislative change is the proper 
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avenue for resolution of this issue. (Traulsen, No. 45 at p. 5)

DOE understands manufacturer concerns regarding the performance of small 

units, and took steps to account for them in its analyses. In its engineering analysis, DOE 

selected specifications for units that it found to be representative of typical, high sales 

volume models for each of the equipment classes directly analyzed. These selections 

were based on market and industry research, and the representative unit specifications 

were presented to manufacturers for their feedback and input during manufacturer 

interviews. The representative units were then used as one analysis point in developing 

the standard-level equations for their respective classes. DOE also developed “offset 

factors” that form the second analysis point used in developing the linear equations that 

represent the equipment standards. The purpose of the offset factor is to account for 

energy consumption end effects inherent in equipment of all sizes so that certain groups 

of units, including small units, would not be disadvantaged by the standard-level 

equations. An exampleTo understand how the offset accounts for size effects, consider 

the energy consumption of a single lighting fixture—a feature common to all sizes within 

a certain class is a single lighting fixture present in allof VCT display cases. The 

development of offset factors resulted in energy allowances at zero case volume or TDA, 

thus preventing even the smallest cases from being disadvantaged by the standards. The 

procedure that DOE used to develop the offset factors implicitly assumes that small units 

are relatively less efficient than larger units, particularly in the case of the smallest-sized 

equipment. Therefore, DOE believes that its analysis adequately accounts for smaller 

units. A detailed discussion of offset factors can be found in chapter 5 of the NOPR TSD. 
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7. Consideration of Impact of Amended Standards

Traulsen stated that there are many niches of commercial refrigeration equipment 

that are essential to manufacturers and customers, and that setting overly aggressive 

standards may lead to inadvertent equipment design obsolescence. Traulsen thus urged 

DOE to take a conservative approach when setting mandatory standards. (Traulsen, No. 

45 at p. 1) 

DOE performed an MIA, as required by 42 U.S.C. 6295(o)(2)(B)(i)(I) and 

6316(e)(1), in which it assessed both the qualitative issues of concern to manufacturers 

and the quantitative potential impacts to the commercial refrigeration equipment industry. 

These impacts were weighed and taken into consideration during the selection of the 

proposed standard level in an effort to minimize adverse impacts on the industry. DOE 

also notes it considers the design configurations offered in the commercial refrigeration 

equipment market in its analysis and selection of equipment classes. As required by 

EPCA, DOE does not set standards that eliminate equipment designs that deliver unique 

utility or features for consumers. (42 U.S.C. 6295(o)(4) and 6316(e)(1)) 

8. CO2 Cascade Systems

Hussmann stated that, in California, Title 2426

 

26 “Title 24” refers to Title 24, part 6 of the California Code of Regulations, and includes California’s 

energy efficiency standards for residential and nonresidential buildings. This is available at: 

allows the use of CO2 cascade 

www.energy.ca.gov/title24/. 
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systems,

27 and that compliance with both Title 24 and amended DOE standards could 

make development of a CO2 cascade system difficult. (Hussmann, Public Meeting 

Transcript, No. 31 at p. 153) True stated that there is no DOE test procedure for cascade 

systems, and that there has been no consideration of cascade systems in the standardssetting process. (True, Public Meeting Transcript, No. 31 at p. 154) 

DOE agrees with True that secondary coolant systems, including CO2 cascade 

systems, are not being addressed in this rulemaking, partially due to the lack of an 

industry-accepted method of test for this type of equipment. DOE articulated its rationale

in the preliminary analysis TSD chapter 2 and maintains the position in this notice. 

9. Coverage of Existing Cases Undergoing Refurbishments or Retrofits

During the NOPR analysis period, DOE received a stakeholder inquiry as to 

whether the Department’s energy conservation standards apply only to new equipment 

manufactured or imported after the compliance date, or to existing equipment undergoing 

retrofits and refurbishments as well.

DOE wishes to clarify that energy conservation standards apply only to new 

equipment, and not to previously installed equipment undergoing retrofits or 

refurbishments. As DOE stated in its Certification, Compliance and Enforcement final 

rule published on March 7, 2011, manufacturers and private labelers must certify to DOE 

 

27 A cascade system is a type of secondary-loop refrigeration cycle that uses a higher-temperature 

refrigerant to condense the secondary refrigerant, in this case carbon dioxide, which is then used to cool the 

refrigerated space.
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that any covered equipment meets the applicable standard before distributing that 

equipment into U.S. commerce. DOE’s authority covers newly manufactured equipment 

and does not extend to rebuilt and refurbished equipment. 76 FR 12422, 12426 and 12437 

(March 7, 2011). 

10. Components Shipped as After-Market Additions

DOE has received inquiries regarding open commercial refrigerated display cases 

that may be shipped with doors to be installed in the field. Stakeholders have sought 

guidance on whether equipment that is produced and shipped in this manner would be 

subject to the standards applicable to an open case or subject to the standards applicable 

to a closed case.

DOE’s response to the issue of components shipped as after-market additions will 

be addressed in the on-going test procedure rulemaking.

11. Definition of Hybrid Equipment

During the NOPR analysis period, DOE received a comment regarding the 

definition of hybrid equipment. Specifically, the stakeholder inquired about the proper 

definition of commercial hybrid refrigerator-freezer and the applicable standards. 

DOE’s response to the issue of hybrid equipment will be addressed in the ongoing test procedure rulemaking.

Comment [A14]: Revision requested by OIRA.

Comment [A15]: Revision requested by OIRA.

Comment [A16]: Revision requested by OIRA.

Comment [A17]: Revision requested by OIRA.
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12. Coverage of Commercial Refrigeration Equipment with Drawers

DOE has received several comments from interested parties regarding the 

coverage of commercial refrigeration equipment units with drawers. Specifically, 

interested parties inquired if commercial refrigeration equipment units with drawers were 

covered under the existing and proposed energy conservation standards for commercial 

refrigeration equipment and, so, (1) which equipment families they belong to; and (2) 

what the test procedure requirements are for these units.

DOE’s response to the issue of commercial refrigeration equipment with drawers 

will be addressed in the on-going test procedure rulemaking.

 

B. Test Procedures

DOE received several comments that pertain only to the test procedure 

rulemaking. DOE responded to these and similar comments in the 201X2012 test 

procedure final rule. XX77 FR XXXX (XXXX, 2011at 10298, 10300, and 10307 (Feb. 

21, 2012). Specifically, DOE received comments from multiple interested parties that 

many cases are installed with remote lighting controls that are operated at the aisle or 

store level (Southern Store Fixtures, Public Meeting Transcript, No. 31 at pp. 190–91, 

194; Zero Zone, Public Meeting Transcript, No. 31 at p. 196; California Investor Owned 

Utilities, No. 42 at p. 4) and, according to the Northwest Energy Efficiency Alliance 

(NEEA), that cases wired uniquely to receive a remote energy management system 

should receive credit in the DOE test procedure. (NEEA, Public Meeting Transcript, No. 

Comment [A18]: Revision requested by OIRA.

Comment [A19]: Revision requested by OIRA.
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31 at p. 195) DOE also received comments from interested parties that an accepted test 

method for secondary coolant systems, especially those with two-phase flow, had not 

been developed and validated. (True, Public Meeting Transcript, No. 31 at pp. 162–64; 

Southern Store Fixtures, Public Meeting Transcript, No. 31 at pp. 164–65; AHRI, Public 

Meeting Transcript, No. 31 at pp. 165–66) Because these comments pertain only to the 

test procedure for commercial refrigeration equipment and not the potential standards or 

analysis discussed in this rulemaking, DOE addressed these comments in the 201X2012

test procedure final rule and has not addressed them further here. DOE did receive one 

comment that related to both the test procedure and the proposed energy conservation 

standard, which is addressed below. 

NEEA stated that DOE’s efforts to conduct a robust standards analysis are 

hindered by DOE’s failure to resolve some test procedure issues and the fact that test 

procedure limitations have resulted in the removal of some technologies from 

consideration. Among these issues, according to NEEA, are the inability of the test 

procedure to measure savings from anti-sweat heater controls and the screening out of 

variable-speed and variable-capacity components based on the perceived limitations of 

the test procedure. (NEEA, No. 36 at p. 1) 

DOE recognizes stakeholders’ desire tothat the DOE test procedure better 

measure the performance of variable-speed and variable-capacity devices. However, in 

the 20112012 test procedure final rule, DOE stated that testing of part-load technologies 

would significantly increase the burden on manufacturers to test and certify equipment 
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and is not justified given the minimal efficiency gains achieved by this equipment. XX77

FR XXXX (XXXX, 2011at 10308 (Feb. 21, 2012). As such, DOE maintained that the 

fluctuations in refrigeration load experienced by equipment undergoing the DOE test 

procedure are sufficiently representative of average use, and that the establishment of 

additional test requirements would impose an undue burden on manufacturers. When 

evaluating amended energy conservation standards, DOE bases its engineering analysis 

on the energy efficiency of a unit as tested by the DOE test procedure. DOE has assessed

the potential energy savings associated with technologies as tested under the test 

procedure established in DOE’s 20112012 test procedure final rule and considered

technologies based on the factors prescribed by EPCA. (42 U.S.C. 6295(o)(2)(B)(i) and 

6316(e)(1)) 

C. Market and Technology Assessment

When beginning an energy conservation standards rulemaking, DOE develops 

information that provides an overall picture of the market for the equipment concerned, 

including the purpose of the equipment, the industry structure, and market characteristics. 

This activity includes both quantitative and qualitative assessments based primarily on 

publicly available information (e.g., manufacturer specification sheets, industry 

publications) and data submitted by manufacturers, trade associations, and other 

stakeholders. The subjects addressed in the market and technology assessment for this 

rulemaking include: (1) quantities and types of equipment sold and offered for sale; (2) 

retail market trends; (3) equipment covered by the rulemaking; (4) equipment classes; (5)

manufacturers; (6) regulatory requirements and non-regulatory programs (such as rebate 
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programs and tax credits); and (7) technologies that could improve the energy efficiency 

of the equipment under examination. DOE researched manufacturers of commercial 

refrigeration equipment and made a particular effort to identify and characterize small 

business manufacturers. See chapter 3 of the NOPR TSD for further discussion of the 

market and technology assessment.

1. Equipment Classes

In evaluating and establishing energy conservation standards, DOE generally 

divides covered equipment into classes by the type of energy used, or by capacity or other 

performance-related feature that justifies a different standard for equipment having such a 

feature. (42 U.S.C. 6295(q) and 6316(e)(1)) In deciding whether a feature justifies a 

different standard, DOE must consider factors such as the utility of the feature to users. 

Id. DOE normally establishes different energy conservation standards for different 

equipment classes based on these criteria.

Commercial refrigeration equipment can be divided into various equipment 

classes categorized by specific physical and design characteristics that affect. These 

characteristics impact equipment efficiency, determine the kind of merchandise that the 

equipment can be used to display, and affect how the customer can access that 

merchandise. Key physical and design characteristics of commercial refrigeration 

equipment are the operating temperature, the presence or absence of doors (i.e., closed 

cases or open cases), the type of doors used (transparent or solid), the angle of the door or 
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air curtain28

1. Operating Temperature 

 (horizontal, semivertical, or vertical), and the type of condensing unit 

(remote condensing or self-contained). The following list shows the key characteristics of 

commercial refrigeration equipment that DOE developed as part of the January 2009 final 

rule (74 FR at 1099–1100 (Jan. 9, 2009)), and used during the Framework and 

preliminary analysis for this rulemaking: 

• Medium temperature (38 °F, refrigerators) 

• Low temperature (0 °F, freezers) 

• Ice-cream temperature (-15 °F, ice-cream freezers) 

2. Door Type 

• Equipment with transparent doors 

• Equipment with solid doors 

• Equipment without doors 

3. Orientation (air-curtain or door angle) 

• Horizontal 

• Semivertical 

• Vertical 

4. Type of Condensing Unit 

• Remote condensing 

• Self-contained 

 

28 An air curtain is a continuously moving stream of air, driven by fans, which exits on one side of the 

opening in an open refrigerated case and re-enters on the other side via an intake grille. The function of the 

air curtain is to cover the opening in the case with this sheet of air, which minimizes the infiltration of 

warmer ambient air into the refrigerated space. 
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Additionally, because EPCA specifically sets a separate standard for refrigerators 

with a self-contained condensing unit designed for pull-down temperature applications 

and transparent doors, DOE plans to create a separate equipment class for this equipment. 

(42 U.S.C. 6313(c)(3)) DOE included this equipment in the form of a separate family 

with a single class (PD.SC.M) for the preliminary analysis. A total of 49 equipment 

classes were created, and these are listed in chapter 3 of the NOPR TSD using the 

nomenclature developed in the January 2009 final rule. 74 FR at 1100 (Jan. 9, 2009). 

During the April 2011 preliminary analysis public meeting and in subsequent 

written comments, a number of stakeholders addressed issues related to proposed 

equipment classes and the inclusion of certain types of equipment in the analysis. These 

topics are discussed in this section. 

a. Equipment Classification

Several stakeholders commented on the general equipment classification structure 

used by DOE in the preliminary analysis. Traulsen stated that, with respect to the 

currently defined classes of equipment, there are sub-categoriessubcategories DOE failed 

to specify, including upright units (1-, 2-, and 3-section; reach-in; pass-through; roll-in; 

and roll-through) and undercounter units (categorized by length in inches). (Traulsen, No. 

45 at p. 1) On the other hand, Zero Zone approved of DOE’s proposed equipment classes, 

as presented in the preliminary analysis TSD. (Zero Zone, No. 37 at p. 4) AHRI stated

that the equipment class nomenclature developed by DOE in the January 2009 final rule 
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was appropriate. (AHRI, No. 43 at p. 2) 

In response to Traulsen’s comment, DOE recognizes that there are subcategories 

of equipment within certain equipment families and classes, each with varying 

geometries. However, DOE believes that the equipment classes it has developed and 

modeled are broad enough to account for the variety of equipment incorporated within 

each of them, including the unit types described in Traulsen’s comment. In performing its 

engineering analysis, DOE selected representative unit sizes and feature sets for modeling 

so as to best represent a typical unit for each given class. Regarding the comments from 

Zero Zone and AHRI, DOE has retained the equipment classes and nomenclature adopted 

in the January 2009 final rule (74 FR 1092,at 1100 (Jan. 9, 2009)) and used in the 

Framework document and preliminary analysis for this NOPR. 

b. Application Temperature Equipment

DOE received feedback on the subject of application temperature equipment29

 

29 Application temperature equipment is equipment that is designed to operate at temperatures distinctly 

different from the DOE rating temperatures of 38 °F, 0 °F, and -15 °F. Examples include wine chillers and 

candy cases, which operate in the range of 45 to 60 °F. 

at 

the April 2011 preliminary analysis public meeting and in written comments. NEEA 

stated that the difference between DOE rating temperatures and application temperatures 

can be significant, and commented that allowing formanufacturers to demonstrate that

equipment to meetmeets a standard defined by rating temperature standard while testedby 

testing at (presumably higher) application temperaturetemperatures would equate to a 

very lenient standard for such equipment. (NEEA, Public Meeting Transcript, No. 31 at 
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pp. 26–27) NEEA added that, for such equipment, the difference between ambient 

conditions and internal conditions would be much lower than for equipment maintaining 

a temperature of 38 °F, and that daily energy use for this equipment would be lower as 

well. Thus, while NEEA agreed that cabinets should be tested at the lowest temperature 

they can achieve, NEEA stated that, if the standard for such cabinets is set equal to the 

level of energy use of cabinets designed to hold 38 °F, that equipment may be much less 

efficient than what could be cost-effectively possible were separate standards set for the 

equipment. (NEEA, No. 36 at p. 2) NEEA further asked why DOE was not 

settingproposing to set separate standards for application temperature equipment. (NEEA, 

Public Meeting Transcript, No. 31 at pp. 26–27) NEEA stated that, while DOE has 

dismissed concerns regarding application temperature equipment because it is roughly 2

percent of the market, NEEA has heard from manufacturers that it is a growing market 

segment and added that 2 percent is, in its opinion, a nontrivial portion of the market. 

(NEEA, No. 36 at pp. 1–2) 

Moreover, NEEA asserted that DOE failed to acknowledge the differences 

between high-temperature equipment (e.g., floral cases) and ice storage cabinets, and 

suggested two new equipment classes for these products: one for equipment with cabinet 

temperature greater than 40 °F and one for ice storage cabinets that can operate outdoors 

and are designed to hold temperatures between 20 and 30 °F. (NEEA, No. 36 at p. 2; 

NEEA, Public Meeting Transcript, No. 31 at pp. 26–27) NEEA further opined that ice 

storage cabinets in particular are often used in environments not well represented by the 

test procedure conditions, namely outdoor environments. NEEA added that to allow the 
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test procedure to not represent the operating conditions of this equipment would violate 

42 U.S.C. 6295(2). (NEEA, No. 36 at pp. 1–2) 

True stated that, during the test procedure public meeting, interested parties 

suggested that the lowest application temperature should include ice storage and be in the 

mid-twenties. (True, Public Meeting Transcript, No. 31 at p. 177) Traulsen commented 

that it did not have an issue with testing equipment at internal temperatures that are 

higher than the rating temperatures, such as 50 °F or 10 °F. However, Traulsen expressed 

concern regarding equipment that is designed to run at internal temperatures that are 

lower than the rating temperature, or ambient temperatures that are higher than the test 

ambient temperature. Specifically, Traulsen stated that this equipment inherently uses 

more energy at the design conditions (often very high ambient temperatures and relative 

humidities) and may also use more energy at the designated rating conditions (the 

temperature and relative humidity values specified by ASHRAE 72-2005) as well. 

Traulsen provided the examples of a piece of equipment designed to hold ice cream at -

40 °F and a unit designed for 105 °F ambient conditions. (Traulsen, No. 45 at p. 2) 

In the 201X2012 test procedure final rule, DOE adopted provisions that allow for 

the testing of commercial refrigeration equipment that cannot operate at its prescribed 

rating temperature at the “lowest application product temperature.” DOE defined “lowest 

application product temperature” as “the integrated average temperature closest to the 

specified rating temperature for a given piece of equipment achievable and repeatable, 

such that the integrated average temperature of a given unit is within ±2 °F of the 
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reported lowest application product temperature for that basic model.” DOE also applied 

this provision to all refrigerators, freezers, and ice-cream freezers. XX77 FR XXXX 

(XXXX, 2011at 10302 (Feb. 21, 2012). 

DOE maintains that units tested at the lowest application product temperature will 

still be required to meet the applicable energy conservation standard based on their 

equipment class. The required standard level will not change based on the different 

ratinginternal temperature ofat which a particular unit is tested. While DOE understands 

that this requirement may result in slightly less stringent standardsmakes it easier for thea

small number of units (that cannot be tested at the prescribed rating temperatures) to meet 

the current standards, DOE does not believe that establishing separate equipment 

categories for these niche types of equipment would be justified because the energy 

savings achievable with such standards would be relatively small. In response to NEEA’s 

suggestion that ice chests designed to operate outdoors be tested at alternate ambient 

conditions, DOE notes that its test procedure prescribes only one ambient condition. DOE 

believes this ambient condition is adequately representative of the operating conditions 

for the majority of commercial refrigeration equipment. Prescribing alternate ambient 

rating conditions for these cases would require establishing a new equipment class for 

this equipment, which DOE believes is not justified given the small shipment volume and 

niche application of this equipmentAdditionally, DOE has seen no evidence that a unit 

designed to perform at stricter conditions than the DOE test procedure (i.e., higher 

ambient temperature and/or humidity) would have difficulty meeting a standard at the 

conditions prescribed in the test procedure. 
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In response to NEEA’s assertion that application temperature equipment is a 

growing commercial refrigeration equipment market segment, DOE has no data to 

substantiate the assertion. DOE has not collected shipments data indicating that such a 

trend exists, nor have manufacturer interviews indicated that this is the case. Application 

temperature equipment represents a niche equipment market, and this equipment has been 

in existence for a long time (e.g., candy cases, wine cases, floral cases). DOE has no 

evidence indicating that this market segment will grow disproportionately to other 

equipment types.

DOE also agrees with Traulsen that testing these units at a higher integrated 

average temperature does not necessarily mean that the unit will use less energy. The 

variability in energy use and the impact of variation in integrated average temperature 

will vary based on case type, geometry, and configuration. This variation would make

setting a consistent standard for high-temperature or intermediate-temperature equipment 

impractical, because any value chosen would not be representative of all cases. 

c. Open Cases

At the April 2011 preliminary analysis public meeting and in written comments, 

numerous stakeholders revisited the issue of DOE’s proposed decision to retain separate 

standards for open and closed cases. Earthjustice first raised the issue, inquiring about the 

evidence behind DOE’s assertion that open cases provide distinct utility with respect to 

features such as unobstructed view and access to product, as well as simplified stocking, 
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cleaning, and maintenance. Earthjustice continued by stating that it wished to renew its

request that DOE continue grouping open and doored cases together, adding that any 

determination of utility is required to be based on substantial evidence. (Earthjustice, 

Public Meeting Transcript, No. 31 at pp. 23, 25) AHRI responded that the distinction 

between the two types of cases was made in the language of EPACT 2005, which was 

developed through negotiations among AHRI and other parties, including advocacy 

groups. (AHRI, Public Meeting Transcript, No. 31 at pp. 24–25) Southern Store Fixtures 

added that open and doored cases are two distinct types of equipment with different 

applications, and that they cannot be combined into a single category. Southern Store 

Fixtures also stated that substantial analysis and evidence would have to be provided in 

order to show that there would be no product loss or sales loss as a result of moving from 

open to doored cases. (Southern Store Fixtures, Public Meeting Transcript, No. 31 at pp. 

28–29) 

In further discussion at the public meeting, Earthjustice stated that it had 

submitted to DOE a study conducted by ASHRAE,30

 

30 Fricke, B.A., and B.R. Becker. Comparison of Vertical Display Cases: Energy and Productivity Impacts 

of Glass Doors Versus Open Vertical Display Cases. December 2009. American Society of Heating, 

Refrigerating and Air-Conditioning Engineers, Atlanta, GA. Report No. RP-1402. 

as well as a Swedish study, 

regardingto support Earthjustice’s assertion that product sales from openare unaffected by 

the presence of door on cases. (Earthjustice, Public Meeting Transcript, No. 31 at p. 29) 

However, Southern Store Fixtures stated that it would dispute the ASHRAE study 

regarding open cases, and that it would articulate its argument later. (Southern Store 

http://rp.ashrae.biz/researchproject.php?rp_id=580
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Fixtures, Public Meeting Transcript, No. 31 at pp. 29–30) 29–30) Additionally, the 

Swedish study was retracted from submission due to copyright issues.

Stakeholders also provided comments regarding the subject of metrics of utility.

Pacific Gas and Electric (PG&E) stated that, in its opinion, sales would be the most 

obvious metric, along with the ability to keep product at the desired temperature. 

However, PG&E asked that DOE elaborate on how it would quantify what constitutes 

utility. (PG&E, Public Meeting Transcript, No. 31 at pp. 30–31) The California Investor 

Owned Utilities (CA IOUs) included a similar request in its written comment, asking that 

DOE clarify what it specifically considers as criteria to justify unique utility. CA IOUs 

also asked that DOE continue to assess options that would enable open cases to consume 

amounts of energy similar to those used by equivalent closed cases. (CA IOUs, No. 42 at 

p. 5) Zero Zone, continuing on the subject of utility, stated that, in its opinion, there may 

have been utility differences between open and doored cases at one time, but since that 

time it believed the market had changed and this difference no longer exists. As a result, 

Zero Zone supported the comments suggesting that DOE combine the open and doored 

display case classes. (Zero Zone, Public Meeting Transcript, No. 31 at p. 32)

The Appliance Standards Awareness Project (ASAP), while not commenting 

specifically on equipment utility, stated that it believed the issue of open versus closed 

cases is very important from an NES perspective, as the preliminary analysis documents 

showed that open cases consume two to three times as much energy as comparable 

doored cases. (ASAP, Public Meeting Transcript, No. 31 at p. 32) CA IOUs agreed with 
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DOE’s assessment that open, low-temperature vertical and semivertical cases represent 

small portions of the market. Further, it pointed out that the California Energy 

Commission (CEC) is proposing to require doors on all upright, low-temperature cases at 

the State level. (CA IOUs, No. 42 at p. 5) 

During the preliminary analysis comment period, Earthjustice submitted a 

detailed comment outlining its position on the issue of open cases. Earthjustice expressed 

its belief that separate standards for open cases are neither warranted nor required by 

EPCA, as well as its opinion that such cases provide no capacity or performance features 

justifying separate standards, once again referencing the previously submitted ASHRAE 

and Swedish studies. Implicitly in response to statements made by AHRI at the public 

meeting, Earthjustice added that EPACT 2005’s codification of standards for equipment 

with doors does not require DOE to maintain separate classes for equipment without 

doors. (Earthjustice, No. 35 at p.1) Earthjustice expressed the belief that DOE’s intention 

to adhere to its previous stance that the presence or absence of doors on cases affects case 

utility ignores the evidence that has been presented in the form of the aforementioned 

ASHRAE and Swedish sales studies, and that EPCA requires DOE’s factual conclusions 

to be supported by substantial evidence which, according to Earthjustice, DOE has not 

provided. (Earthjustice, No. 35 at p. 2)

Earthjustice reiterated its disagreement with DOE’s assertion in the preliminary 

analysis that open cases provide utility in the form of “unobstructed view of and access to 

product,” citing the two sales studies that it believed to conclude otherwise. Earthjustice 
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also disagreed with DOE’s statement that open cases simplify stocking, cleaning, and 

maintenance, questioning how the need to prop a door open would impede stocking a 

case. On the contrary, Earthjustice asserted, reductions in warm air infiltration due to the 

presence of doors would reduce warm air infiltration and fewerthe opportunities for items 

to fall out of the case onto the store floor would reduce , thereby reducing stocking 

burdens and losses due to products damaged during stocking. Furthermore, Earthjustice 

stated that DOE has not suggested shorter life cycles for equipment with doors, 

something it believes would be a logical outcome were the presence of doors to impair 

cleaning and maintenance operations. (Earthjustice, No. 35 at p. 2)

Earthjustice then presented a legal argument, stating that, in maintaining that 42 

U.S.C. 6295(o) prevents the merging of equipment classes for equipment with and 

without doors, DOE has misconstrued the statutory authority for whether separate classes 

are required. Earthjustice asserted that DOE has, in its preliminary analysis TSD, 

attempted to shift the evidentiary burden onto the stakeholders who support equivalent 

standards for the two equipment types. Earthjustice commented that, in dismissing the 

findings of the ASHRAE study, DOE has violated the plain language of EPCA, which 

requires that a preponderance of the evidence must support the position that open cases 

provide a unique feature in order for DOE to conclude that separate equipment classes are 

required. (Earthjustice, No. 35 at pp. 2–3)

Earthjustice suggested that, should DOE decide not to merge classes for open and 

closed cases, DOE should adopt standards reflecting the overlapping applications for the 
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equipment. Earthjustice stated that because equipment with doors is economically 

advantageous on an LCC basis, encouraging a shift to equipment with doors will increase 

the monetary savings from this rulemaking. (Earthjustice, No. 35 at p. 3) By adopting 

highly cost-effective standards for equipment with doors as well as standards that would 

result in LCC increases for open cases, Earthjustice suggested, DOE could encourage 

consumers to purchase cases with transparent doors. Earthjustice stated that DOE has 

taken a market-transforming approach in the past. Specifically, Earthjustice referenced 

the small electric motors rulemaking (75 FR 10874 (March 9, 2010)), in which DOE 

maintained standards for two types of general purpose single-phase motors but tailored 

those standards to encourage the market to shift to one of those types. (Earthjustice, No. 

35 at p,. 3) Similarly, Earthjustice added, in the rulemaking for commercial clothes 

washers (75 FR 1122 (Jan. 8, 2010)), DOE adopted standards set at the max-tech level for 

top-loading washers, but less aggressive standards for front-loading washers, partially to 

encourage the growth of front-loader market share. In conclusion, Earthjustice suggested 

that DOE adopt the max-tech level for equipment without doors and a more economically 

advantageous standard for equipment with doors, thus encouraging the market to shift to 

doored cases. (Earthjustice, No. 35 at pp. 3–4)

DOE understands the concern of some stakeholders regarding the issue of open 

cases. While some stakeholders have reiterated their previous positions on this topic, 

DOE does not believe that any new data has been presented since the Framework 

document public meeting (May 2010) that would warrant a change in DOE’s stance as 

outlined in the preliminary analysis TSD chapter 2.chapter 2 of the preliminary analysis 
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TSD. DOE maintains that to set standards discouraging users from purchasing open cases 

would violate its statutory charge to preserve the availability of features and performance 

characteristics currently on the market. While Earthjustice again cited the ASHRAE 

study and the Swedish study comparing sales from open and closed cases, DOE still 

maintains its position from the preliminary analysis. After having reviewed the ASHRAE 

study, DOE believes that because the data were collected only under very specific 

conditions in a controlled environment and with a limited range of merchandise types, the 

data isare insufficient for broad applicationto drive a conclusion applicable across the

broad wide range of open case applications and end uses. As one example, DOE points 

out that neither study includes fresh produce and packaged meat products in the analysis 

of impact on product sales, and that these are types of merchandise that manufacturers 

have mentioned as benefiting from the use of open cases.

Regarding the questions about the definition of utility raised by Earthjustice and 

PG&E, EPCA states that, in setting or amending standards, the Secretary must consider, 

among other factors, any lessening of the utility or performance of the covered products 

likely from the imposition of the standard. (42 U.S.C. 6295(o)(2)(B)(i)(IV) and 

6316(e)(1)) EPCA further states that :

the Secretary may not prescribe an amended or new standard under this section if 

the Secretary finds (and publishes such finding) that interested persons have established 

by a preponderance of the evidence that the standard is likely to result in the 

unavailability in the United States in any covered product type (or class) of performance 

characteristics (including reliability), features, sizes, capacities, and volumes that are 
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substantially the same as those generally available in the United States at the time of the 

Secretary’s finding. (42 U.S.C. 6295(o)(4) and 6316(e)(1)) 

Thus, while the term “utility” is not specifically defined in EPCA, it is used in 

conjunction with the term “performance”; the statute further prohibits DOE from setting 

standards that result in the unavailability of performance characteristics or features from 

the U.S. market. While sales performance and food safety could comprise two aspects of 

performance, “features” also indicates a reference to design, as well as usable features 

applicable to the end user or consumer. In this case, DOE has determined that 

consumercustomer access to product is a distinct utilityperformance characteristic or 

feature in the case of commercial refrigeration equipment and believes, based on its 

research and discussions with experts and members of industry, that open cases provide 

more convenient access to products than do closed cases, as well as providing other 

measures of utility, such as ease of stocking and cleaning. 

In response to the comment by Earthjustice that DOE violated the plain language 

of EPCA, which requires that a preponderance of the evidence must support the position 

that open cases provide a unique feature in order to conclude that separate equipment 

classes are required, DOE refers to the language found at 42 U.S.C. 6295(o)(4) and 

6316(e)(1). This language states that the Secretary may not issue a 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), or features currently available. One 
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statement suggesting that the elimination of open cases would have this effect 

occurredwas presented at the April 2011 preliminary analysis public meeting, when 

Southern Store Fixtures explicitly stated that open and doored cases are two different 

equipment types, adding that “substantial analysis and evidence would have to be 

provided” to ensure that there would be no detriment to performance by combining the 

classes. (Southern Store Fixtures, Public Meeting Transcript, No. 31 at pp. 28–29) DOE 

has agreed with this stance in its past and current proceedings, as evidenced by the 

retention of separate equipment types for open and closed cases in its analyses. At the

commercial refrigeration equipment test procedure NOPR public meeting, Coca-Cola, a 

major purchaser of display cases, cited internal studies concluding that the presence of 

doors on displays near registers can decrease sales by 35 to 50 percent. (Docket No.

EERE-2010-BT-TP-0034, Coca-Cola, No. 19 at p. 90) These study results stand in 

contrast to the assertion by Earthjustice that the two sales studies it provided show that 

open cases do not provide utility in the form of unobstructed view of and access to 

product. The conflict between the sets of data suggests that, while both conclusions may 

be correct in the specific contexts of the respective studies, in some applications the 

presence of doors on cases can adversely affect sales. Given DOE’s understanding that 

sales is indeed an important metric of utility, DOE believes that to set standards which 

could potentially limit this utility in some applications through the presence of doors 

would be in violation of the language of EPCA.visibility and access to product.

Therefore, elimination of open cases from the market would equate to the unavailability 

of this performance characteristic, in direct violation of (42 U.S.C. 6295(o)(2)(B)(i)(IV) 

and 6316(e)(1)).
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In its manufacturer interviews, DOE spoke with several manufacturers who 

provided anecdotal data regarding the utility of open cases. They pointed to increased 

sales due to “impulse buys,” stating that users of open cases reported generating higher 

revenues out of those cases. Manufacturers also stated that open cases allow for vastly 

easier stocking of high-margin items including produce and meat. The ease of stocking 

these items is particularly important to retailers, because open cases are stocked 

continuously while shoppers are in the store, making simultaneous, unobstructed access 

to the case by both the employee and customer an important utility issue. Manufacturers 

reaffirmed during these interviews that unobstructed view of and access to product, as 

well as simplified stocking, as previously referenced by DOE, were significant attributes 

of open cases. Furthermore, the manufacturers pointed to better accommodation of nonstandard-sized merchandise within these cases. The information that DOE has gathered 

regarding market perceptions at conferences and other venues has indicated that many 

grocery store managers and operators strongly prefer open cases to closed cases, as they 

perceive that product visibility from a distance is a very strong factor in sales. Engineers 

for large chain grocery stores have stated that their efforts to convert even part of the 

grocery store equipment from open cases to closed cases, during store remodeling, have 

been met with opposition from store managers due to their perception that open cases 

lead to higher sales compared to closed cases. This finding is in contrast to the statement 

by Zero Zone that utility differences between open and doored cases no longer exist. The 

statement by Zero Zone also conflicts with the internal study data quoted by Coca-Cola, 

in which that company noted a significant loss in sales due to the presence of doors on 
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display cases in certain settings. As the result of a collective review of the data obtained 

through its public meetings, manufacturer interviews, and conferences, DOE believes that 

its position of setting separate standards for open and closed cases is reasonable and 

based on the distinct performance characteristics of each class, as shown by a 

preponderance of the evidence presented. DOE notes that manufacturers did not cite 

differences in maintenance and cleaning between open and closed cases, but DOE

believes the other utility and performance factors cited, including ease of access to the 

product, increased visibility, and ease of use during operations and maintenance, are 

sufficient to warrant maintenance of two separate equipment classes. 

DOE understands AHRI’s statement that the distinction between case types was 

made in the EPACT 2005 language, which set standards for closed cases and required 

DOE to set standards for open cases (42 U.S.C. 6313(c)), and Earthjustice’s response that 

the codification of separate standards does not require DOE to maintain different classes. 

However, DOE is restricted by EPCA from prescribing energy conservation standards in 

any manner that would lessen utility to the consumercustomer or result in the 

unavailability of performance characteristics or features currently on the market. (42 

U.S.C. 6295(o)(2)(B)(IV), 6295(o)(4), and 6316(e)(1)) Therefore, DOE continues to 

consider open and doored cases to be two distinct equipment types due to the evident 

performance and feature differences between them. 

DOE acknowledges ASAP’s factual statement that open cases have been shown 

to consume more energy than doored cases and CA IOU’s assertion that open, low-
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temperature cases composecomprise a small market share. However, independent of 

these factors, as mentioned previouslystated above, DOE is forbidden by EPCA from 

setting standards that would result in the unavailability on the market of the performance 

characteristics and features that open cases exhibit. (42 U.S.C. 6295(o)(4) and 

6316(e)(1)) Therefore, DOE, through its analyses, sought to develop separate proposed 

standard levels for open and closed cases that would result in the maximum economically 

justified and technologically feasible energy savings for the respective equipment. 

Regarding Earthjustice’s assertion that DOE failed to suggest shorter life cycles 

for commercial refrigeration equipment with doors, DOE points out that the replacement 

of doors areis one of the itemsfactors contributing to repair costs (see chapter 8 of the 

NOPR TSD). Damage to doors does not necessarily contribute to shortening ofshorten

the life of the entire equipment itself. 

With respect to Earthjustice’s suggestion that DOE force a market shift from open 

to closed cases by adopting cost-effective standards for doored cases but less 

economically attractive standards for open cases, DOE is compelled by EPCA to examine 

the economic and technical justification of all equipment under the same criteria and with 

the same rigor. (42 U.S.C. 6295(o) and 6316(e)(1)) In other words, DOE must 

independently determine the maximum technologically feasible and economically 

justified standard level for each equipment class. Therefore, DOE examined all TSLs

equally using the same quantitative metrics, such as LCC and national NPV, and selected 

a proposed standard level using these criteria. In response to the suggestion that DOE 
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adopt a market-transforming approach in which it would intentionally shift market share 

toward doored cases, DOE believes that to do so would violate the EPCA provision 

barring DOE from setting standards that result in the lessening of utility or unavailability 

of performance characteristics. (42 U.S.C. 6295(o)(4) and 6316(e)(1)) Because DOE has 

determined that open cases present a unique set of performance characteristics and 

features to the market, to set standards discouragingeliminating their manufacture and 

sale would violate 42 U.S.C. 6295(o)(4) and 6316(e)(1). DOE notes that in the 

rulemakings for small electric motors and commercial clothes washers that Earthjustice 

cited, DOE was careful to set standards such that they would not result in the 

unavailability of features or performance characteristics. For example, the commercial

clothes washers final rule, published by DOE on January 8, 2010, states that the amended 

efficiency levels can be met by either top- or front-loading designs. In fact, the clothes 

washers final rule notes that there were vertical-axis top-loading and horizontal-axis 

frontloading washers on the market at the time that already met the higher standard. Thus, 

DOE concluded, consumers would have the same range of clothes washer options, 

including features valued by consumers such as door placement, capacity, water 

temperature, and adjustable load sizes. 75 FR 1122, 1133–34 (Jan. 8, 2010). In the case 

of commercial refrigeration equipment, DOE believes that separate equipment classes are 

necessary to preserve the unique features provided by open refrigerated display cases, 

established by interested parties as discussed above. DOE does not believe it would be 

possible to combine standards classes or arbitrarily set more aggressive standards for 

open cases without violating EPCA provisions regarding utility/product availability. (42 

U.S.C. 6295(o)(2)(B) and 6316(e)(1)) As a result, DOE has maintained the position 
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regarding utility of open cases that it asserted in the January 2009 final rule and in its 

current preliminary analysis and framework document. 74 FR 1092,at 1099 (Jan. 9, 

2009). 

DOE understands that there are other options available in the market to reduce the 

energy consumption of open cases, such as retrofitting doors to open cases, and that 

DOE’s energy conservation standards may not be the only factor related to improving the 

energy efficiency of open cases. DOE believes that, in general, management staff of 

grocery stores is well aware of high energy costs because energy costs consistently figure 

as one of the top five issues in the Food Marketing Institute (FMI) Worry Index,

31 which 

is obtained through surveys of the food retailers regarding the most important issues in 

their businesses that cause them to “worry.” Some stores have retrofitted their open cases 

with transparent doors to achieve substantial savings in energy costs. DOE also 

recognizes that the market for retrofitting open, multi-deck display cases with transparent 

doors is steadily increasing. In addition, the adoption of features such as night curtains 

and more-efficient air curtains are also options available in the market to reduce the 

energy consumption of open cases.

In its NOPR analyses, DOE modeled open and closed display cases separately, 

and has included separate proposed standards for the two types of equipment in this 

notice.

 

31 FMI Research. The Food Retailing Industry Speaks 2011. 2011. Food Marketing Institute, Arlington, 

VA.
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d. Service Over Counter Equipment

AHRI voiced concerns about self-contained service over counter (SOC) 

equipment,

32, stating that DOE incorrectly determined that SOC equipment was covered 

by EPACT 2005 and that this error resulted in an overly stringent standard being applied 

to the equipment. (AHRI, No. 43 at p. 2) AHRI commented that it, working with other 

stakeholders, had proposed legislative language that defines SOC equipment and 

establishes minimum standards for that equipment, which is included in the 

Implementation of National Consensus Appliance Agreements Act of 2011, S. 398, 112th

Cong. (2011). AHRI asked that DOE adopt the definition of SOC equipment that AHRI

had proposed in that legislation, and also asked DOE to use TDA as a normalization 

metric for this equipment. (AHRI, No. 43 at p. 2) 

With respect to the statement by AHRI that DOE has incorrectly determined that 

SOC equipment is within the scope of coverage of EPACT 2005, DOE disagrees, having

determined that SOC.SC.M equipment meets the statutory definition of a self-contained 

commercial refrigerator with transparent doors in 42 U.S.C. 6311(9)(A). EPCA does not 

specify equipment subsets such as SOC equipment beyond defining the terms 

“commercial refrigerator,” “freezer,” and “refrigerator-freezer” and “self-contained 

condensing unit,” among other definitions related to this equipment. (42 U.S.C. 6311(9))

In December 2009, DOE’s Office of Hearings and Appeals (OHA) responded to an 

application for exception relief from a manufacturer of SOC equipment. This 

 

32 “Service over counter” means equipment with sliding or hinged doors in the back intended for use by 

sales personnel for loading and retrieving items for sale, and fixed, sliding or hinged transparent panels in 

the front for displaying merchandise. The equipment has a height no greater than 66 inches and is intended 

to serve as a counter for transactions between sales personnel and customers.
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manufacturer argued that it was entitled to relief because its SOC units could not meet the 

EPACT 2005 standards for self-contained equipment with doors. OHA responded that 

DOE did not have jurisdiction to consider such exceptions for equipment covered by the 

statutorily mandated standards. (Case No. TEE-0066, Dec. 29, 2009) 

DOE understands the concerns of the interested parties regarding SOC.SC.M 

equipment standards. However, DOE cannot, without explicit statutory authority, exempt 

equipment from the standards prescribed by Congress. During the preliminary 

engineering analysis for this rulemaking, DOE foundconfirmed that the EPACT 2005 

standards for SOC.SC.M (42 U.S.C. 6313(c)(2)) could not be achieved at even the maxtech level (see chapter 2, section 2.2.1.5, of the preliminary analysis TSD chapter 2). (42 

U.S.C. 6313(c)(2)) ). Therefore, DOE agrees with AHRI’s comment that the standard set 

by EPACT 2005 was too stringent for equipment belonging to equipment class 

SOC.SC.M. Consequently, DOE had excluded SOC.SC.M equipment from furtherthe 

preliminary analysis as part of this .

33 

In December 2012, during the NOPR analysis for this rulemaking to date. DOE 

has similarly excluded SOC.SC.L, a low-shipments-volume, the American Energy 

Manufacturing Technical Corrections Act (AEMTCA), Pub. L. 112-210 (Dec. 18, 2012)

amended EPCA to establish new standards for self-contained service over counter 

 

33 DOE had also excluded SOC.SC.L, a low-shipments-volume equipment class, from the preliminary

analysis as well, as it too is covered under standards prescribed by EPACT 2005 for freezers with 

transparent doors found at 10 CFR 431.66 (b). Due to its similarity in design, construction, and 

performance to SOC.SC.M equipment, DOE presumed that it too would not be able to meet the standards 

set by EPACT 2005 for self-contained equipment with transparent doors. 
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medium temperature commercial refrigerators. (42 U.S.C. 6313(c)(4)) The amendment 

reduces the stringency of the standard applicable to this equipment class, from the 

analysis as well,. AEMTCA prescribed the standard for SOC.SC.M equipment 

manufactured on or after January 1, 2012 as 0.6 × TDA + 1.0, expressed in kilowatt 

hours per day. (42 U.S.C. 6313(c)(4)(A))

AEMTCA also amended EPCA to direct DOE to determine, within 3 years of

enactment of the new standard for SOC.SC.M, whether the standard should be amended. 

(42 U.S.C. 6313(c)(4)(B)(1) If DOE determines that the standard should be amended,

then DOE must issue a final rule establishing an amended standard within this same 3-

year period. (42 U.S.C. 6313(c)(4)(B))

DOE conducted the analysis for this determination of whether to amend the 

standard for equipment class SOC.SC.M as part of this NOPR analysis. The analysis was 

carried out in a manner similar to that of all the other equipment classes being analyzed

as it too is covered under DOE’spart of the current rulemaking. DOE used the standard 

established by AEMTCA as the baseline efficiency level for equipment class 

SOC.SC.M.34 The results of the analysis indicated that if an amendment to the AEMTCA 

standard for equipment class SOC.SC.M, based on same criteria established for all the 

other equipment classes of the current rulemaking,35

 

34 This approach is similar to that adopted for all the other equipment classes, as explained in section 

would represent a reduction in 

energy consumption of roughly 30 percent as compared to the AEMTCA standard. Based 

IV.H.1. 35 The criteria for trial standard level selection can be found in section V.A.1, and discussion concerning the 

selection of the proposed standard level can be found in section V.C. 
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on this result, DOE has proposed an amended standard for equipment class SOC.SC.M in 

this NOPR (see section I and section V.A.2conservation standards found at ). 

10 CFR 431.66 (b). In response to AHRI’s request that DOE use TDA as a 

normalization metric for this equipment, the January 2009 final rule standards for remote 

condensing SOC equipment were expressed using TDA as a normalization metric. 74 FR 

1092,at 1093 (Jan. 9, 2009). As AHRI suggested, DOE proposes in this NOPR to 

continue to use TDA as the normalization metric for remote condensing SOC equipment.

DOE is also proposing to adopt a definition of the “service over counter” equipment 

family, which is included in this notice.SOC equipment.

DOE is also proposing to adopt a new definition of the “service over counter” 

equipment family, which is included in this notice. DOE based its proposed definition on 

the definition of self-contained service-over-counter refrigerators (SOC.SC.M) found in 

Paragraph (1) of section 4 of AEMTCA. (42 U.S.C. 6313(c)(1)(C)) However, DOE 

proposes to adopt a broader definition of SOC equipment that DOE believes is applicable 

to all of the equipment classes that belong to the SOC equipment family, not just the 

single SOC.SC.M equipment class described by the AEMTCA language. The proposed 

definition can be found in section VIII of this NOPR.

2. Technology Assessment

As part of the market and technology assessment performed for the NOPR 

analysis, DOE developed a comprehensive list of technologies that would be expected to 
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improve the energy efficiency of commercial refrigeration equipment. Chapter 3 of the 

NOPR TSD contains a detailed description of each technology that DOE identified. 

Although DOE identified a complete list of technologies that improve efficiency, DOE 

only considered in its analysis technologies that would impact the efficiency rating of 

equipment as tested under the DOE test procedure. Therefore, DOE excluded several 

technologies from the analysis during the technology assessment because they do not 

improve the rated efficiency of equipment as measured under the specified test 

procedure. Technologies that DOE determined impact the rated efficiency were carried 

through to the screening analysis and are discussed in section IV.D. 

 

a. Technologies Applicable to All Equipment 

In the preliminary analysis market and technology assessment, DOE listed the 

following technologies that would be expected to improve the efficiency of all 

equipment: higher efficiency lighting, higher efficiency lighting ballasts, remote lighting 

ballast location, higher efficiency expansion valves, higher efficiency evaporator fan 

motors, variable-speed evaporator fan motors and evaporator fan motor controllers, 

higher efficiency evaporator fan blades, increased evaporator surface area, low-pressure 

differential evaporators, increased case insulation or improvements, defrost mechanisms, 

defrost cycle controls, vacuum insulated panels, and occupancy sensors for lighting 

controls. Not all of these technologies were considered in the preliminary engineering 

analysis; some were screened out or removed from consideration on technical grounds, as 

described in chapters 3 and 4 of the NOPR TSD. After the publication of the preliminary 

analysis, DOE received numerous stakeholder comments regarding these technologies, 
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discussed below. 

Lighting Technologies

In response to DOE’s request for comment, Southern Store Fixtures questioned 

DOE’s specification for light-emitting diode (LED) lighting because it appeared that 

LEDs had a lower efficacy in terms of lumens per watt compared to T8 fluorescent 

lighting (the standard baseline lighting technology) in DOE’s model. (Southern Store 

Fixtures, Public Meeting Transcript, No. 31 at pp. 59–60) Zero Zone observed that while 

fluorescent lighting is a mature technology, LED lighting is constantly evolving. (Zero 

Zone, Public Meeting Transcript, No. 31 at p. 63) Additionally, Southern Store Fixtures 

suggested that the efficiency of the driver powering the LEDs be explicitly considered, as

it is a key aspect of lighting energy consumption. (Southern Store Fixtures, Public 

Meeting Transcript, No. 31 at p. 62) True noted that light output from LEDs is highly 

directional, and the additional heat load from the LEDs increases the load on the 

compressor, which is less efficient than the lighting system. (True, Public Meeting 

Transcript, No. 31 at pp. 60–61) 

Regarding the comment by Southern Store Fixtures, the output of LED light 

fixtures used in commercial refrigeration equipment is indeed lower in terms of lumens 

per watt when compared to T8 fluorescent bulbs. However, for commercial refrigerated 

display applications, the advantage of LED lighting lies in the directionality of its light 

output. While T8 lighting produces greater output in lumens, much of that light is 

directed toward the ambient space rather than the merchandise to be illuminated, and thus 
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is wasted from a product merchandising perspective. LED lighting, on the other hand, is 

very directional, and the light can be aimed directly at the product on display. This 

difference allows for more conservative sizing of LED fixtures and, as a result, overall 

power consumption is lower compared to T8 fluorescent lamps.

DOE agrees with the comment by Zero Zone that LED lighting is an evolving 

technology. As a result, DOE has taken efforts to update its LED fixture cost estimates 

throughout the rulemaking process, gathering the most current data available from 

publicly available sources as well as from manufacturer interviews. Regarding Southern 

Store Fixtures’ concern about driver power, this power consumption is considered in the 

engineering model and is incorporated into the calculation of calculated daily energy 

consumption (CDEC). Similarly, with respect to True’s comment, the impact of lighting 

on case heat load, and thus compressor power consumption, is accounted for in the 

engineering model through the use of a multiplier to estimate the fraction of light 

produced that is retained inside the case as heat. 

Lighting Controls 

In addition to discussing lighting, stakeholders also commented on the location of 

lighting controls. Southern Store Fixtures observed that certain operators use central 

energy management systems to control the display case lighting, and asked if this 

approach would be considered instead of just the placement of occupancy sensors in 

individual display cases. The company added that when customers ask them to supply a 

case to be controlled by a central energy management system, the lights in the display 
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cases must be wired separately from the other energy-consuming components. (Southern 

Store Fixtures, Public Meeting Transcript, No. 31 at pp. 190–91, 194) Further, Southern 

Store Fixtures pointed out that CEC is considering these central lighting systems in its 

proceedings. (Southern Store Fixtures, Public Meeting Transcript, No. 31 at p. 197) Zero 

Zone stated that it typically wires cases with a separate lighting circuit to allow for 

independent lighting control, while NEEA stated that if a case is wired differently to 

interface with centralized controls, it should be treated identically to a self-contained set 

of controls. (Zero Zone, Public Meeting Transcript, No. 31 at p. 196; NEEA, Public 

Meeting Transcript, No. 31 at p. 195) CA IOUs supported the manufacturer assertion 

made during the April 2011 preliminary analysis public meeting that it is possible to 

distinguish between cases designed for remote energy controls and those that are not. 

(CA IOUs, No. 42 at p. 4) For this reason, the CA IOUs suggested that DOE develop a 

calculation to measure energy savings due to the use of such remote systems in the test 

procedure. (CA IOUs, No. 42 at p. 4) 

DOE acknowledges that there are several ways to implement lighting controls 

(e.g., individual case controls, controls for a case lineup, storewide energy management 

systems), and that allowing certain systems to be included in calculating energy 

consumption may set a precedent for how DOE defines the boundaries of covered 

equipment and what technologies are allocated energy savings for a piece of equipment 

in the test procedure. For example, cases set up to accept remote control systems have a 

dedicated circuit for lights so that the lights can be controlled separately from the rest of 

the case. However, this lighting circuit configuration does not inherently save energy and 
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must be paired with an expensive energy management control system, which is sold 

separately from the piece of commercial refrigeration equipment, is produced by different 

manufacturers, and is not integral to the commercial refrigeration equipment. In addition, 

the existence of an energy management system does not necessarily mean it will be used 

with commercial refrigeration equipment; for example, energy management systems are 

used in many stores and offices to control room lighting and temperature set points. 

DOE acknowledges that remote lighting controls do save energy and may be the 

more commonly used technology to dim or turn off lights. However, energy consumption 

for a piece of commercial refrigeration equipment must be determined using the DOE test 

procedure to measure the energy consumption of a representative unit, as shipped to 

consumerscustomers. Because the remote energy management system is not part of the 

piece of commercial refrigeration equipment as shipped from the manufacturer, but 

rather, is a separate piece of equipment supplied by a separate manufacturer, remote 

energy management controls will not be considered as an energy conservation feature in 

this commercial refrigeration equipment rulemaking. 

Part-Load Technologies

Stakeholders also submitted comments on the subject of part-load and variablecapacity technologies. These are technologies that allow the performance of the system 

components to be varied in response to changes in the load placed on them, such as

changes due to varying ambient conditions or product loading. PG&E requested that 

DOE clarify its stance on part-load technologies, suggesting that there was a disparity 
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between the NOPR DOE published on November 24, 2010, which proposed amendments 

to DOE’s test procedures for commercial refrigeration equipment (November 2010 test 

procedure NOPR, in which (75 FR 71596 (Nov. 24, 2010)) and the screening analysis

presented in chapter 2 of the preliminary analysis TSD. Specifically, in the November 

2010 test procedure NOPR, DOE stated that the proposed test procedure, which relied on 

AHRI Standard 1200 and ASHRAE Standard 72,

36 is able to capture the energy-saving 

effects of some part-load technologies, and the screening analysis presented in chapter 2 

of the preliminary analysis TSD. (76 FR at 71601 (Nov. 24, 2010)). Conversely, in 

whichthe screening analysis in chapter 2 of the preliminary analysis TSD, DOE removed 

some technologies from the analysis and stated that their effects could not be measured 

by the steady-state test procedure. PG&E asked DOE to clarify its stance and asked that, 

if DOE determines that the effects of these technologies can be measured, to include 

them in the screening and engineering analyses. PG&E later reiterated its desire that DOE 

be consistent in its approach toward technologies that maintain energy savings at variable 

ambient conditions or variable load. (PG&E, Public Meeting Transcript, No. 31 at pp. 

51–52, 178) 

Similarly, CA IOUs noted a perceived disparity between DOE’s statement in the 

preliminary analysis TSD chapter 2, where DOE stated that it “believes that the energy 

saving potential of these technologies is already captured to some degree in the current 

test procedure,” and chapter 4, where DOE stated that “[t]echnologies that reduce energy 

use only under transient conditions, such as fluctuations in ambient temperature and 

 

36 ANSI/ASHRAE Standard 72-2005. “Method of Testing Commercial Refrigerators and Freezers.” 2005. 

American Society of Heating, Refrigerating, and Air-Conditioning Engineers, Inc. Atlanta, GA. 
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humidity, periods of product loading, and frequent door openings, will not affect the 

measured CDEC. Therefore, DOE removed from consideration these technologies that do 

not affect or do not reduce CDEC during the tests.” CA IOUs requested clarification of 

DOE’s rationale for eliminating those technologies from consideration, and also 

requested that DOE include in its engineering analysis all technologies that can be 

measured in part by the test procedure, notably those that save energy at variable load or 

under fluctuating ambient conditions. (CA IOUs, No. 42 at p. 2) NEEA expressed its 

opinion that DOE had not yet adequately justified its lack of initiative in examining partload technologies. (NEEA, No. 36 at p. 4) 

Stakeholders questioned the capacityability of the DOE test procedure to reflect 

the performance of part-load technologies. In a written comment submitted jointly, ASAP 

and the Natural Resources Defense Council (NRDC) encouraged DOE to consider 

technologies that improve efficiency under part-load conditions in the engineering 

analysis, stating that DOE referenced in its test procedure NOPR the fact that units tested 

using ASHRAE 72, namely those with doors, experience variation in load due to the door 

opening requirements of the test. ASAP and NRDC mentioned that there is clearly a 

variation in refrigeration load during the test for this equipment, due to the door opening 

requirement. In a written comment submitted jointly, ASAP and NRDC added that, in its 

proposed test procedure, DOE also referred to transient load variation effects inherent in 

the proposed test procedure (76 FR 71596,at 71601 (Nov. 24, 2010)). ASAP and NRDC 

stated that, if single-speed compressors cycle on and off during the test, there is likely 

opportunity for variable-speed compressors to reduce energy consumption by increasing 
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the operating effectiveness of heat exchangers and reducing cycling losses. (ASAP and 

NRDC, No. 34 at pp. 1–2) 

Interested parties also commented that it is important to distinguish between 

steady-state and full-load modes of operation, since equipment experiencing relatively 

constant loads is not necessarily operating at full load. ASAP and NRDC stated that if the 

compressor is cycling, this indicates that the equipment is operating at part load. (ASAP

and NRDC, No. 34 at p. 2) ASAP and NRDC continued, stating that if a commercial 

refrigerator or freezer did operate at full load during a test, then it would not be able to 

maintain the necessary case temperature under the more extreme conditions that it would 

likely encounter in the field, posing a risk to food safety issues. Therefore, ASAP and 

NRDC stated, it is likely that manufacturers design equipment to meet a higher load than 

that experienced during a test, and that technologies that improve part-load performance 

could reduce energy consumption for both open and doored cases. (ASAP and NRDC, 

No. 34 at p. 2) NEEA expressed a similar viewpoint, commenting that the door opening 

provision in ASHRAE 72 leads to load variation and that, even for open cases, it is 

unlikely that the refrigeration system is operating at full capacity during the test period, 

as this would make the system unable to meet load requirements and guarantee food 

safety under more extreme environmental conditions. (NEEA, No. 36 at p. 4) NEEA 

stated that, unless a refrigeration system is sized exactly for its operating load, and that 

load remains constant, there is good reason to examine part-load system performance. 

NEEA added that, since most refrigeration systems must perform under a variety of 

conditions, they will operate cyclically, leaving room for more-efficient operation during 
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times of lower load. NEEA urged DOE to explore the use of variable-speed and variablecapacity components. (NEEA, No. 36 at p. 4)

DOE received comments regarding the treatment and modeling of specific partload technologies. ASAP stated that, in its proposed energy conservation standards for 

residential refrigerators (75 FR 59470 (Sept. 27, 2010)), DOE had included variablespeed compressors as a design option, and that the residential refrigerators test procedure 

was also a steady-state test. ASAP asked why variable-speed compressors were 

considered for residential refrigerators but not for commercial refrigeration equipment. 

(ASAP, Public Meeting Transcript, No. 31 at p. 54) NEEA commented that variablespeed condenser fans and condenser fan motor controllers could enable improved partload performance, and that screening them out due to test procedure limitations is 

shortsighted. (NEEA, No. 36 at p. 3) NEEA added that high-efficiency expansion valves 

are becoming much more prevalent in refrigeration systems, and that they should be 

included in the analysis. NEEA stated that savings associated with high-efficiency 

expansion valves may arise in conjunction with other technologies installed as part of a 

part-load package and that, while these energy savings may be small, this should be 

proven by analysis. (NEEA, No. 36 at p. 3) CA IOUs requested clarification on how 

variable-speed compressors and modulating capacity compressors37

 

37 Variable-speed compressors are able to control the rate at which they operate in order to tailor their 

performance to varying conditions and thus reduce compressor cycling. Modulating capacity compressors, 

most commonly found in larger sizes used in compressor racks, allow for the volume of fluid being 

compressed by the moving pistons (and thus the throughput of the compressor) to be changed in response 

to load variations. 

are covered in this 

rulemaking. CA IOUs stated that such compressor technologies did not appear to have 
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been screened out or listed as an option, and appeared to have been included in the 

engineering analysis TSD chapter under the section discussing higher efficiency 

compressors. (CA IOUs, No. 42 at p. 2) Finally, ASAP and NRDC stated that the model 

used in the engineering analysis should be able to capture the potential benefits of 

technologies that improve part-load performance and that, if this is not the case, DOE 

should consider a different methodology. (ASAP and NRDC, No. 34 at p. 3) 

After receiving these stakeholder comments, DOE reviewed its position on partload and variable-capacity technologies, as articulated in chapter 2 of the preliminary 

analysis and test procedure NOPR publications (75 FR at 71601 (Nov. 24, 2010)). DOE 

agrees there was a disparity between the preliminary analysis, in which DOE reiterated its 

position from the January 2009 final rule that part-load technologies could not be 

captured by the steady-state ASHRAE 72 method of test,

38

 

38 U.S. Department of Energy–Office of Energy Efficiency and Renewable Energy. Preliminary Technical 

Support Document (TSD): Energy Conservation Program for Certain Commercial and Industrial 

Equipment: Commercial Refrigeration Equipment. Chapter 5, Engineering Analysis. March 2011. 

Washington, DC. 

and the test procedure NOPR, 

in which DOE stated that the door opening and night curtain testing portions of the test 

would in fact create part-load conditions. 75 FR at 71601 (Nov. 24, 2010). DOE believes 

that the position presented in the test procedure NOPR is accurate, as the variation in 

operating conditions introduced by door openings and the use of night curtains could 

create an opportunity for part-load technologies to produce quantifiable energy impacts. 

DOE revised its position after reviewing the test procedure established in the 201X2012

test procedure final rule (XX77 FR XXXX)10292 (Feb. 21, 2012)) and the energy 

consumption profile of equipment experiencedobserved during testing conducted using 

www.regulations.gov/#!documentDetail;D=EERE-2010-BT-STD-0003-0030 
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the DOE test procedure. DOE believes the confusion arose due to the way in which the 

industry refers to the ASHRAE 72 method of test is referred to in industry. As mentioned 

above, part load technologies allow a piece of commercial refrigeration equipment to 

respond to changes in refrigeration load that occur due to changes in ambient conditions 

or internal loads on the case. The ASHRAE 72 method of test occurs at oneprescribes a 

single fixed set of ambient conditions, so no major changes in refrigeration load occur 

due toare intentionally introduced through changes in ambient condition. Thus, the 

ASHRAE 72 method of test is often referred to as steady-state. However, as stated in the 

November 2010 test procedure NOPR, commercial refrigeration equipment tested using 

ASHRAE 72 experiences variation in refrigeration load due to door openings, drawing of 

the night curtain, and inherent compressor cycling that occur during the test. 77 FR at

10308 (Feb. 21, 2012). Realizing this, DOE has revised its position and agrees with 

ASAP, NRDC, and NEEA that the nature of the ASHRAE 72 method of test, while 

conducted at fixed ambient operating conditions, is not strictly thermodynamically 

steady-state, as evidenced by compressor cycling and minor fluctuations in internal 

temperatures throughout the duration of the test. DOE also agrees with these stakeholders 

that the presence of compressor cycling demonstrates that commercial refrigeration units 

generally do not operate at full load during the test. From its discussions with 

manufacturers, DOE understands that most equipment can operate at temperatures lower 

than the equipment’s given DOE rating temperature, and thus performance at the test 

procedure conditions would likely not constitute full-capacity operation. 

In response to the stakeholder suggestions that DOE include specific part-load 
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technologies in the NOPR analyses, DOE investigated the technologies referenced by 

these commenters. DOE researched the state of part-load and variable-capacity 

technologies such as fan motor controllers and variable-speed compressors through 

available manufacturer and component supplier literature, as well as through its 

discussions with manufacturers during interviews. DOE found that that many of these 

part-load technologies had not yet been developed for the commercial refrigeration 

equipment industry to the extent that they could be adopted by manufacturers in the near 

future. For example, while variable-speed compressors are indeed, as some stakeholders 

mentioned, prevalent in residential refrigeration applications, their availability for 

commercial application is very limited and is not applicable to many equipment types. 

Some technologies were also removed for functional purposes or because of concerns 

over food safety performance. Others were removed from consideration because they 

would not have measurable impacts under the test procedure. Therefore, while DOE did 

not screen out or preclude the analysis of part-load technologies, DOE did not utilize any 

of these technologies explicitly as design options in its engineering analysis. For further 

discussion of DOE’s examination of these technologies, see chapters 3 through 5 of the 

NOPR TSD. 

 DOE reiterates that the design options that it has chosen for this particular 

analysis, and the design paths used in modeling the proposed standard levels, do not 

constitute a prescriptive design requirement. In other words, DOE does not claim that the 

combinations of design options presented in the engineering analysis form unique paths 

for achieving higher energy efficiency. Manufacturers are free to utilize any design 
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features available to them in order to develop compliant units, provided that those units 

meet all the requirements for testing under the DOE test procedure and other applicable 

regulations. Thus, should manufacturers develop part-load features that produce 

quantifiable reductions in energy consumption under the DOE test procedure, they are 

not prohibited from taking advantage of those features, even if particular technologies 

were not modeled in the analysis for this rulemaking. 

b. Technologies Relevant Only to Equipment with Doors

In chapter 3 of the preliminary analysis TSD, DOE mentioned three technologies

that could apply only to doored equipment: anti-fog films, anti-sweat heater controllers, 

and high-performance doors. Not all of these technologies were considered in the 

preliminary engineering analysis, as some were screened out or removed from 

consideration on technical grounds. The following sections discuss stakeholder comments 

regarding these technologies.

Anti-Fog Films

Zero Zone stated that research by Southern California Edison indicated that antifog films do not allow for the reduction of anti-sweat heat. (Zero Zone, Public Meeting 

Transcript, No. 31 at p. 47) 

DOE reviewed the available literature regarding anti-fog films, and understands 

that these films alone do not necessarily eliminate the need for anti-sweat heaters under 

many conditions, including high ambient humidity, as they cannot prevent condensation 
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from forming on the outside of the case. This shortcoming of anti-fog films can present a 

major problem for consumerscustomers. Discussions with manufacturers have led DOE 

to believe that alternative improvements in door construction provide the capacity to 

reduce anti-sweat heat without the drawbacks mentioned here. Because of these issues, 

DOE did not consider anti-fog films on transparent doors as a design option. For further 

discussion of this subject, see chapter 5 of the NOPR TSD. 

Anti-Sweat Heater Controllers

During the April 2011 preliminary analysis public meeting, Zero Zone stated that 

anti-sweat controllers have the potential to save energy because the controllers would 

allow heaters couldto be designed with extra capacity for more humid climates. (Zero 

Zone, Public Meeting Transcript, No. 31 at p. 53) NEEA, ASAP, and NRDC all 

suggested DOE investigate Zero Zone’s comment further, while the CA IOUs noted it 

may be possible to include a calculation method to address the benefit of these 

controllers. (NEEA, No. 36 at p. 3; ASAP and NRDC, No. 34 at p. 2; CA IOUs, No. 42 at 

pp. 2–4) 

DOE raised the subject of anti-sweat heater controllers during its manufacturer 

interviews for this NOPR. Several manufacturers agreed that, within the context of the 

test procedure, anti-sweat heater controllers will effectively keep the power to anti-sweat 

heaters at the levels necessary for the test conditions. While anti-sweat controllers could 

also modulate the anti-sweat power further in the field to account for more or less 

extreme ambient conditions, a system equipped with anti-sweat heater controllers will not 
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likely exhibit significantly different performance at test procedure conditions than will a 

unit with anti-sweat heaters tuned for constant 75 °F, 55 percent relative humidity 

conditions. Therefore, DOE did not consider anti-sweat heater controllers in the 

engineering analysis, as modeling these devices within the context of the test procedure 

would not yield appreciable energy savings over anti-sweat heaters that are properly sized 

for the test procedure ambient conditions. DOE notes that manufacturers that produce 

cases with anti-sweat heater controls for higher temperature and humidity environments 

may use anti-sweat heater controllers in the test procedure, however. 

High-Performance Doors

Zero Zone also commented on high-performance doors, stating that when they 

were incentivized in California, retail stores used more energy because they had to set 

their air conditioning to a lower set point to avoid condensation. Zero Zone added that 

high-performance doors also sweat under conditions that are less favorable than the 

ASHRAE test conditions, and that DOE should evaluate technologies intended to be used 

for performance under actual conditions, not just under ASHRAE 72 test procedure 

conditions. Zero Zone stated that DOE should remove high-performance doors from the 

analysis. (Zero Zone, No. 37 at pp. 1 and 3) 

During the NOPR engineering analysis, DOE reviewed its data for all design 

options, including high-performance doors. Transparent door performance was discussed 

at manufacturer interviews during the preliminary analysis and NOPR stages of the 

rulemaking, and the glass door designs considered in the engineering analysis are based 
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on door models currently available on the market. The performance of these door designs 

was analyzed using Lawrence Berkeley National Laboratory’s (LBNL’s) WINDOW 5 

software39 in conjunction with the analyses for DOE’s ongoing energy conservation 

standards rule for walk-in coolers and freezers energy conservation standards, an 

equipment type in which the same models of glass display doors are often employed. 

While it is true that extreme conditions could adversely impact glass door performance,

as mentioned by Zero Zone, the performance of the equipment for this analysis was based 

on the standardized ASHRAE 72 test conditions of 75 °F and 55 percent relative 

humidity, ambient conditions that have been accepted by industry, the ASHRAE working 

group, and DOE as being generally representative of the environments typically 

encountered by commercial refrigeration equipment. 

DOE believes that high-performance doors, such as those offered on the market 

by several door manufacturers and analyzed in this rulemaking, have the potential to save 

significant amounts of energy for transparent-door cases. Based on its market research 

and discussions with manufacturers, DOE has concluded that high-performance doors 

meet all the criteria for inclusion in its analysis, and has thus considered them as a design 

option in the engineering analysis. 

c. Technologies Applicable Only to Equipment without Doors

In chapter 3 of the preliminary analysis TSD, DOE mentioned two technologies, 

air-curtain design and night curtains, that could potentially be used to improve the 

 

39 LBNL’s WINDOW 5 software is a program designed for modeling the performance of windows, doors, 

and other fenestration devices. 
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efficiency of commercial refrigeration equipment without doors. Air curtain design was 

not considered in the preliminary engineering analysis, as it was screened out and 

removed from consideration due to the fact thatbecause, according to the information 

available to DOE, advanced air curtain designs are still in research and development 

stages and are not yet applicable toavailable for use in the manufacture of commercial 

refrigeration equipment. The following sections address stakeholder comments regarding 

technologies applicable to equipment without doors. 

Night Curtains

At the April 2011 preliminary analysis public meeting and in written comments, 

DOE received numerous comments from stakeholders regarding night curtains and their 

use in equipment without doors. CA IOUs agreed with DOE’s decision to include night 

curtains in the analysis, but pointed out that such energy savings are only significant if 

the night curtains are properly deployed, and encouraged DOE to review and update its 

assumptions. (CA IOUs, No. 42 at pp. 4–5) Zero Zone also commented on the potential 

of night curtains to conserve energy, and stated that this technology should not be 

included in this rulemaking because there is no reasonable way to estimate how it will 

actually be used and because it cannot be used in 24-hour stores. (Zero Zone, No. 37 at p. 

4) Southern Store Fixtures agreed with respect to these operational challenges, and also 

pointed out that CEC did not consider night curtains due to long PBPs, labor costs, and 

questions about the reliability of energy savings. (Southern Store Fixtures, No. 38 at p. 1; 

Southern Store Fixtures, Public Meeting Transcript, No. 31 at p. 42) 
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Southern Store Fixtures expressed concern that the use of night curtains on open 

cases could create design and operational challenges, potentially resulting in an 

inefficient case with product temperature issues and the potential for noncompliance with 

food safety regulations. (Southern Store Fixtures, No. 38 at p. 1) Southern Store Fixtures 

also noted that major design changes will be needed for cases with night curtains. 

Specifically, the evaporator coil and expansion devices currently used in open cases will 

be significantly oversized for use with night curtains; the number of fans needed and 

airflow characteristics will change; and lighting and temperature controls will need to be 

altered in converting a standard open case to accommodate night curtains. Cases with 

night curtains would also, Southern Store Fixtures stated, require duplication of controls 

to be able to operate with and without the curtains. (Southern Store Fixtures, No. 38 at p. 

1) In summary, Southern Store Fixtures asserted that these issues would require a 

redesign of an open case for compatibility with night curtains and that, when considering 

the potential energy savings associated with the use of a night curtain, DOE should 

include the cost of performing such a redesign in its analysis. (Southern Store Fixtures, 

No. 38 at p. 1) 

During the public meeting, Zero Zone observed that doored and open cases have a 

similar energy profile, and therefore, night curtains could be used as a design option for 

doored equipment as well. (Zero Zone, Public Meeting Transcript, No. 31 at pp. 40–41) 

DOE acknowledges that the use of night curtains may not be consistent in the 

field. However, DOE’s test procedures and energy conservation standards cannot control 
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for equipment application and actual end use. Night curtains are an available technology 

for reducing energy consumption in commercial refrigeration equipment and DOE 

believes that including night curtains in its test procedure and energy conservation 

standards would allow manufacturers to take credit for the energy savings associated with 

this technology. In the 20112012 test procedure final rule, DOE assumed 6 hours as the 

time period that night curtains would be implemented. XX77 FR at XXXX (XXXXX, 

201110310 (Feb. 21, 2012). DOE believes that 6 hours conservatively represents the 

amount of time a night curtain would be drawn in a typical, non-24-hour store, when 

accounting for stocking and the fact that not all night curtains can be deployed at once. In 

addition, 6 hours is consistent with field data and studies that DOE has identified.40,41,42

With respect to Zero Zone’s concern regarding the use of night curtains in 24-

hour stores, DOE is not mandating the use of night curtains, but is simply accounting for 

them as one available energy efficiency technology. In addition, DOE notes that night 

curtains may be used in 24-hour stores during periods of low customer traffic. DOE 

further acknowledges that accounting for the energy savings associated with night 

curtains on open cases would, by definition, result in the setting of a more-stringent 

standard for open cases. DOE believes such a standard may encourage migration to the 

use of more-efficient doored cases for those cases used in contexts where the distinct 

utility of an open case is not required, while preserving the availability of open cases.

 

40 Southern California Edison, Refrigeration and Technology and Test Center, Energy Efficiency Division. 

Effects of the Low Emissivity Shields on Performance and Power Use of a Refrigerated Display Case. 

August 1997. Irwindale, CA. www.econofrost.com/acrobat/sce_report_long.pdf. 41 Faramarzi, R. and Woodworth-Szieper, M. Effects of Low-E Shields on the Performance and Power Use 

of a Refrigerated Display Case. ASHRAE Transactions. 1999. 105(1). 42 Portland Energy Conservation, Inc. Query of Database of GrocerySmart Data. Portland, OR. Received 

October 18, 2011. Last viewed July 23, 2011.
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Regarding Southern Store Fixtures’ comment about the cost-effectiveness of night 

curtains, DOE points out that the LCC analysis and NIA conducted by DOE are 

specifically aimed at assessing the cost-effectiveness of all the design options used to

achieve greater energy efficiency. 

DOE acknowledges Southern Store Fixtures’ concerns regarding the costs 

associated with the need for equipment redesign due to presence of night curtains. After 

discussions with multiple manufacturers, DOE did not incorporate additional material 

costs and redesign costs associated with a secondary set of controls because most 

manufacturers do not implement this design according to information that DOE has 

obtained through market research and manufacturer interviews. DOE recognizes that 

individual manufacturers may select different design options and incur different 

conversion costs than those modeled by DOE. However, DOE attempts in its analysis to 

represent the choices most likely to be selected by the industry.

Southern Store Fixtures also commented that use of night curtains on open cases 

could create design and operational challenges that would result in inefficient cases with 

product temperature issues and the potential for noncompliance with food safety 

regulations. (Southern Store Fixtures, No. 38 at p. 1) DOE acknowledges that, as with 

any new technology, implementation of night curtains on open cases may require slight 

adjustments to equipment design to ensure the case operates efficiently and effectively. 

During manufacturer interviews for the MIA, data was collected by manufacturer (under 
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confidentiality agreements) and, in aggregate, DOE’s resulting conclusion was that night 

curtains would not result in the challenges discussed by Southern Store Fixtures. The 

prevalence of night curtains as retrofit options supports this conclusion as well. Thus, 

DOE believes that modifications can be made that allow open cases to be used with night 

curtains to achieve energy savings and improve temperature control, and has accounted

for the cost to achieve these modifications in the MIA. 

In response to Zero Zone’s comment regarding the use of night curtains on doored 

cases, it is DOE’s understanding that night curtains can be applied to all types of open 

cases (i.e., vertical, semivertical, and horizontal), and that night curtains are most 

effective and commonly used on open cases rather than doored cases. DOE was not able 

to identify any public data regarding the use or potential for energy savings of night 

curtains on doored cases. Lacking a sound technical basis for including night curtains on 

doored cases in its analysis, DOE is hesitant to expand the definition of night curtain, as 

established in the 201X2012 test procedure final rule (XX77 FR XXXX (xxxxx xx 

xxxxat 10296 (Feb. 21, 2012)), to explicitly include doored cases at this time. On January 

6, 2011, DOE held a public meeting to discuss amendments to the DOE test procedure 

for commercial refrigeration equipment proposed in a NOPR DOE published on 

November 24, 2010. 75 FR at 71596. At that January 2011 test procedure NOPR public 

meeting, True stated that it had seen night curtains implemented on doored cases and that 

this does save a minimal amount of energy, but that these minor savings did not justify 

consideration of night curtains in the DOE test procedure. (Docket No. EERE-BT-2010-

TP-0034, True, Public Meeting Transcript, No. 19 at pp. 146–47) DOE agrees with True
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and believes that use of night curtains on doored cases will not significantly impact the 

daily energy consumption of the display case. Therefore, DOE did not incorporate the use 

of night curtains on cases with doors in the 20112012 test procedure final rule. XX77 FR 

XXXX (XXXXX, 2011at 10297 (Feb. 21, 2012). Because night curtains on doored cases 

cannot be accounted for in the DOE test procedure, they are not included as a design 

option in the energy conservation standards analyses. 

Strip Curtains

While not providing specific comments on the included technologies, Earthjustice 

questioned DOE’s grounds for not considering strip curtains43 in the analysis, stating that 

the criteria for considering design options in the analysis should be whether a technology 

is technologically feasible, economically justified, and reduces energy consumption, not 

whether it is currently used by manufacturers. (Earthjustice, Public Meeting Transcript, 

No. 31 at p. 36) Earthjustice stated that DOE should include strip curtains as a design 

option because these devices can be installed by equipment purchasers, and this

illustrates the ease and practicality of their use. (Earthjustice, No. 35 at p. 4) True stated

that manufacturers do not install strip curtains at the factory because consumerscustomers

can often receive a secondary rebate for installing strip curtains at the point of end use. 

(True, Public Meeting Transcript, No. 31 at p. 40) 

While DOE understands that some end users purchase and install strip curtains on 

 

43 Strip curtains consist of a series of strips of transparent, flexible material (usually plastic) that hang down 

and cover the opening of a case without doors. This creates a physical barrier that reduces ambient air 

infiltration into the case while still allowing customers and employees to access the product contained 

inside.
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some open refrigerated display cases, DOE has no information as to the prevalence of use 

of these accessories. DOE has concerns that incorporating strip curtains into its analyses, 

and thus potentially into an amended standard, could impose restrictions similar to 

requiring the use of doors. Doing so would compromise one of the major utility factors of 

an open case. Namely, manufacturers have reported to DOE that the major utility of an 

open case is enhanced product visibility to the customer and easy access to product. 

Installation of a strip curtain would, by definition, inhibit both of these functions. 

Moreover, on technical grounds, strip curtains could potentially interfere with the 

operation of the existing air curtain in cases in which the air curtain is less than vertical. 

Thus, in response to the comment by Earthjustice, the latter issue described above is one 

of technical feasibility, while the former concern, reduction of utility, could make the 

consideration of strip curtains inconsistent with the requirements of EPCA. (42 U.S.C. 

6295(o)(4) and 6316(e)(1)) While some end users may decide to install strip curtains on 

their own accord for their specific applications, DOE does not intend to explore their use 

as applicable to entire equipment classes. 

d. Self-Contained Equipment Technologies 

In chapter 3 of the preliminary analysis, DOE listed several technologies were 

mentioned in the preliminary analysis as relevantthat are applicable only to the selfcontained equipment as part of the preliminary analysis TSD chapter 3classes. One of the 

technologies mentioned in the preliminary market and technology assessment, but not 
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considered for analysis as a design option, was liquid suction heat exchangers44

(LSHXs).45 NEEA commented that it did not see a reason for excluding LSHXs from the 

analysis for systems in which they are likely to be used, and that DOE should include 

them to the extent that the test procedure can be structured to capture their savings.

(NEEA, No. 36 at p. 3) Southern Store Fixtures suggested that DOE investigate why 

CEC decided not to consider LSHXs because of potential refrigerant leaks. (Southern 

Store Fixtures, Public Meeting Transcript, No. 31 at p. 44) 

During the NOPR stage of this rulemaking, DOE further investigated the subject 

of LSHXs as applicable to commercial refrigeration equipment. The information obtained 

by DOE indicated that LSHX performance depends on the specific design of a given 

system, as well as other factors, including refrigerant type, operating temperature, and 

ambient conditions. These factors all combine to determine whether an LSHX will reduce 

the energy consumption of a given system; in some systems, the use of an LSHX will 

actually increase energy consumption by introducing a greater pressure drop within the 

refrigeration circuit. DOE also heard comments from parties during manufacturer 

interviews and conferences concerning potential reliability and leakage issues such as 

those mentioned by Southern Store Fixtures. Because LSHXs may not improve efficiency 

in all systems and may experience reliability issues, DOE did not include LSHXs in its 

 

44 A liquid suction heat exchanger is a device intended to further cool the flow of liquid refrigerant entering 

the expansion valve from the condenser using the flow of gaseous refrigerant leaving the evaporator. The 

exchanger provides sub-cooling for the entering liquid by super-heating the exiting suction vapor. Hotter 

suction vapor is less susceptible to heat gains in the return piping to the compressor. 45 A liquid suction heat exchanger is a device intended to further cool the flow of liquid refrigerant entering 

the expansion valve from the condenser using the flow of gaseous refrigerant leaving the evaporator. The 

exchanger provides sub-cooling for the entering liquid by super-heating the exiting suction vapor. Hotter 

suction vapor is less susceptible to heat gains in the return piping to the compressor.
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analysis. For more discussion of LSHXs, see chapter 3 of the NOPR TSD. 

D. Screening Analysis

DOE uses four screening criteria to determine which design options are suitable 

for further consideration in a standards rulemaking. Namely, design options will be 

removed from consideration if they are not technologically feasible; are not practicable to 

manufacture, install, or service; have adverse impacts on product utility or product 

availability; or have adverse impacts on health or safety. 10 CFR part 430, subpart C, 

appendix A, sections (4)(a)(4) and (5)(b) 

In written comments submitted following the April 2011 preliminary analysis 

public meeting, Zero Zone stated that DOE was correct in screening out a number of 

technologies, as any technology needs to be thoroughly researched and proven reliable

before inclusion for consideration in a standards rulemaking. Zero Zone cited demand 

defrost as an example of an unproven technology that, if included in aits use were 

encouraged by an energy conservation standard, would produce poor results in the field.

(Zero Zone, No. 37 at p. 1) DOE agrees with Zero Zone’s comment, as it is compelled by 

the screening criteria to ensure that any technology considered is feasible to implement; 

practicable to manufacture, install, and service; does not adversely impact utility or 

availability; and would not lead to adverse impacts on health or safety. 

Based on all available information, DOE has concluded that: (1) all of the 

efficiency levels discussed in today’s notice are technologically feasible; (2) equipment at 
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these efficiency levels could be manufactured, installed, and serviced on a scale needed 

to serve the relevant markets; (3) these efficiency levels would not force manufacturers to 

use technologies that would adversely affect product utility or availability; and (4) these 

efficiency levels would not adversely affect consumer health or safety. Thus, the 

efficiency levels that DOE analyzed and discusses in this notice are all achievable 

through technology options that were “screened in” during the screening analysis.

E. Engineering Analysis

The engineering analysis determines the manufacturing costs of achieving 

increased efficiency or decreased energy consumption. DOE historically has used the 

following three methodologies to generate the manufacturing costs needed for its

engineering analyses: (1) the design-option approach, which provides the incremental 

costs of adding to a baseline model design options that will improve its efficiency; (2) the 

efficiency-level approach, which provides the relative costs of achieving increases in 

energy efficiency levels, without regard to the particular design options used to achieve 

such increases; and (3) the cost-assessment (or reverse engineering) approach, which 

provides “bottom-up” manufacturing cost assessments for achieving various levels of 

increased efficiency, based on detailed data as to costs for parts and material, labor, 

shipping/packaging, and investment for models that operate at particular efficiency 

levels. 

As discussed in the Framework document and preliminary analysis, DOE 

conducted the engineering analyses for this rulemaking using a design-option approach 
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for commercial refrigeration equipment. The decision to use this approach was made due 

to several factors, including the wide variety of equipment analyzed, the lack of 

numerous levels of equipment efficiency currently available in the market, and the 

prevalence of relatively easily implementable energy-saving technologies applicable to 

this equipment. More specifically, DOE identified design options for analysis and used a 

combination of industry research and teardown-based cost modeling to determine 

manufacturing costs, then employed numerical modeling to determine the energy 

consumption for each combination of design options employed in increased equipment 

efficiency. DOE selected a set of 24 high-shipment classes, referred to as “primary” 

classes, to analyze directly in the engineering analysis. Additional details of the 

engineering analysis are available in chapter 5 of the NOPR TSD.

1. Representative Equipment for Analysis

a. Representative Unit Selection

In performing its engineering analysis, DOE selected representative units for each 

primary equipment class to serve as analysis points in the development of cost-efficiency 

curves. In selecting these units, DOE researched the offerings of major manufacturers to 

select models that were generally representative of the typical offerings produced within 

the given equipment class. Unit sizes, configurations, and features were based on highshipment-volume designs prevalent in the market. Using this data, a set of specifications 

was developed defining a representative unit for each primary equipment class. These 

specifications include geometric dimensions, quantities of components (such as fans), 

operating temperatures, and other case features that are necessary to calculate energy 
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consumption. Modifications to the units modeled were made as needed to ensure that 

those units were representative of typical models from industry, rather than a specific unit 

offered by one manufacturer. This process created a representative unit for each 

equipment class with typical characteristics for physical parameters (e.g., volume, TDA), 

and minimum performance of energy-consuming components (e.g., fans, lighting).

In its written comment following the preliminary analysis, Traulsen stated that 

DOE’s choice of representative unit sizes for self-contained commercial refrigeration 

equipment with doors was generally suitable for directional purposes, but added that 

factors such as cabinet sizes, door quantities, and door types contribute significantly to 

overall equipment performance. Traulsen cautioned that a failure to factor these variables 

into the analysis could lead to unintended obsolescence of unitsmodels with these 

features. (Traulsen, No. 45 at p. 2) DOE agrees with Traulsen that there are numerous 

design factors that can influence the performance of commercial refrigeration equipment. 

In selecting representative units for analysis, DOE sought unit sizes and configurations 

that generally represented the most commonly sold equipment on the market. The 

geometric features DOE considered included unit volume, height, length and width, 

number of doors, and door orientation. DOE avoided considering any niche features or 

unit configurations that could skew the analysis away from sound representation of the 

majority of units produced within a chosen equipment class. As a result, DOE believes 

that its analysis and resulting proposed standards are applicable and extensible to the 

range of covered equipment in each class. In response to Traulsen’s concern about 

impacts, potential effects, DOE wishes to point out that it is compelled by statute to avoid 
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the elimination of standardsfeatures or utility currently present in equipment on 

manufacturers such asthe market, and that the obsolescence of models or product lines 

were addressed and examined in detail during the MIA interviews. For more information 

on the MIA, see chapter 12 of the NOPR TSD.specific unique equipment types would be 

included in this provision. (42 U.S.C. 6295(o)(2)(B)(IV), 6295(o)(4), and 6316(e)(1)) 

b. Baseline Models

DOE created a set of baseline design specifications for each equipment class 

analyzed directly in the engineering model. Each set of representative baseline unit 

specifications, when combined with the lowest technological level of each design option

applicable to the given equipment class, defines the energy consumption and cost of the 

lowest efficiency equipment analyzed for that class. DOE established baseline 

specifications by reviewing available manufacturer data for equipment manufactured at 

the time of the analysis, and by selecting components and design features that were 

representative of the most basic models being manufactured at the time of the analysis.

Chapter 5 of the NOPR TSD sets forth the specifications that DOE chose for each 

equipment class and discusses baseline models in greater detail.

One complexity involved in developing an engineering baseline was due to the 

timing of the analysis, which was conducted in 2010 and 2011. Because the analysis was 

performed in proximity to the January 2009 final rule compliance date of January 1, 2012 

(74 FR 1092 (Jan. 9, 2009)), and the compliance date for the standards established in 

EPCA of January 1, 2010 (42 U.S.C. 6313(c)(2)–(3)), it was difficult for DOE to 
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establish a market baseline reflecting compliance with any specific set of standards. In 

particular, the equipment covered by the January 2009 final rule was not required to 

comply with amended standards until after the preliminary and NOPR analyses had been 

performed. As a result, DOE retained the engineering baseline and associated 

technologies used in its January 2009 final rule engineering analysis and expanded them

to accommodate the new equipment classes covered by the standards initially established 

by EPCA. (42 U.S.C. 6313(c)(2)–(3)) DOE then added technologies to this baseline to 

develop its cost-efficiency curves. As a result, some of the engineering results represent 

units that are below the standard levels for equipment currently on the market and subject 

to the DOE’s existing standards. 10 CFR 431.66 However, in its LCC and other 

downstream analyses, DOE accounted for this fact by utilizing a standards baseline as the 

minimum efficiency level examined, thereby truncating the engineering design option 

levels so that the lowest efficiency point analyzed corresponded to the current standard 

level with which that particular piece of equipment would have to comply. The exact 

procedure is described in section IV.H.1, and additional details are provided in chapter 8 

of NOPR TSD. 

2. Design Options

After conducting the screening analysis and removing from consideration 

technologies described abovethat did not warrant inclusion on technical grounds, DOE 

included the remaining technologies as design options in the energy consumption model 

for its NOPR engineering analysis levels of performance:: 
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• higher efficiency lighting and occupancy sensors for VOP, SVO, and SOC 

equipment families (horizontal fixtures); 

• higher efficiency lighting and occupancy sensors for VCT and PD equipment 

families (vertical fixtures); 

• improved evaporator coil design; 

• higher efficiency evaporator fan motors; 

• improved case insulation; 

• improved doors for VCT equipment family, low temperature and ice-cream 

temperature (hinged); 

• improved doors for VCT and PD equipment families, medium temperature 

(hinged); 

• improved doors for HCT equipment family, low temperature and ice-cream 

temperature (sliding); 

• improved doors for HCT equipment family, medium temperature (sliding); 

• improved doors for SOC equipment family, medium temperature (sliding); 

• improved condenser coil design (for self-contained equipment only); 

• higher efficiency condenser fan motors (for self-contained equipment only); 

• higher efficiency compressors (for self-contained equipment only); and 

• night curtains (equipment without doors only). 

3. Refrigerants

For the preliminary analysis, DOE considered two refrigerants, 

hydrofluorocarbons (HFCs) R-134a and R-404a, because these are the industry-standard 
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choices for use in the vast majority of commercial refrigeration equipment covered by 

this rulemaking. This selection was consistent with the modeling performed in the 

January 2009 final rule, which was based on industry research and stakeholder feedback

at that time. After the publication of the preliminary analysis, DOE received several 

comments on potential future issues relating to refrigerants for this equipment. Emerson 

noted that possible future EPA actions could prohibit certain refrigerants, which would 

reduce equipment efficiency, and suggested that if EPA is going to use total emissions as 

the basis for Significant New Alternatives Policy (SNAP)46 regulations, then energy 

efficiency must also be considered by the EPA when making those determinations.

However, Emerson conceded that the discussion of potential action by EPA was 

speculative at this point. (Emerson, Public Meeting Transcript, No. 31 at pp. 48, 157–58) 

Similarly, True observed that EPA proposals could result in the banning of R134a and 

R404a, and that while there are replacements for R134a, it would be difficult to replace 

R404a. (True, Public Meeting Transcript, No. 31 at p. 154) However, AHRI remarked 

that it believed that EPA was only considering NRDC’s petition for removal of R134a47

 

46 SNAP is EPA’s program to evaluate and regulate substitutes for the ozone-depleting chemicals that are 

being phased out under the stratospheric ozone protection provisions of the Clean Air Act. For more 

information, please see: 

was only being considered forfrom the list of acceptable substitutes under the SNAP 

program in the context of automotive air-conditioning applications, and that EPA is not 

currently seeking to restrict the use of R134a in the commercial refrigeration industry. 

(AHRI, Public Meeting Transcript, No. 31 at pp. 155–56) True also pointed out that the 

www.epa.gov/ozone/snap/. 47 In May 2010, the Natural Resources Defense Council petitioned the EPA to remove HFC-134a from the 

list of acceptable substitutes under the SNAP program. In February 2011, the EPA concluded that NRDC’s 

petition was complete with respect to the end use of motor vehicle air conditioners, and expressed its intent 

to begin a rulemaking on the topic. For more information, please see: 

www.epa.gov/ozone/downloads/NRDC_petition_responses.pdf.
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removal of HFCs from remote condensing equipment would likely necessitate a total 

system design and a shift toward cascade equipment. (True, Public Meeting Transcript, 

No. 31 at pp. 152–53) However, True stated that 90 percent of its market is for selfcontained equipment, and that 85 percent of its products could be converted to alternative 

refrigerants with minimal cost increases and efficiency losses. (True, Public Meeting 

Transcript, No. 31 at p. 155) 

Commenters also provided information regarding the performance and regulatory 

status of specific alternative refrigerants. True noted that it had tested a large amount of 

isobutene and propane-driven equipment, which exhibited an efficiency gain of 7 to 11 

percent in smaller equipment. True stated that the use of these alternative refrigerants was

not overly cost burdensome because of the recent increase in the cost of HFC 

refrigerants, but that they could not be used on larger equipment because of SNAP 

regulations involving refrigerant charge levels. (True, Public Meeting Transcript, No. 31 

at pp. 151–52, 155) However, True added, the need to address flammability concerns in 

the interest of safety could result in significant cost increases for certain components. 

True further stated that the EPA SNAP program’s discussion of allowing 150-gram 

charge sizescharges of propane as a refrigerant in self-contained commercial applications

would not be a risk factor, as that could prevent use of these refrigerants, and that

propane is not currently excluded from use by most building codes. (True, Public 

Meeting Transcript, No. 31 at p. 152, 159) Emerson asked whether building codes could 

be changed to allow for numerous 150-gram charges within a supermarket. (Emerson, 

Public Meeting Transcript, No. 31 at p. 158) Coca-Cola mentioned that it had selected 
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transcritical48 CO2 as an alternative for applications in the United States, but could not 

provide efficiency data. (Coca-Cola, Public Meeting Transcript, No. 31 at p. 157) NEEA 

noted that Daikin Industries, Ltd., the world’s largest central air conditioner 

manufacturer, was progressing toward using only non-halogen refrigerants in its

products. (NEEA, Public Meeting Transcript, No. 31 at p. 161) AHRI encouraged DOE 

to not assume constant refrigerant prices over the analysis period it considers because 

legislation has been introduced that could result in the unavailability of HFC refrigerants 

and lead to significant price increases. (AHRI, No. 43 at p. 3) 

In its written comments, NEEA provided an alternative viewpoint, stating that it

did not believe refrigerant issues are significant for this rulemaking. This is because, 

according to NEEA, refrigerant issues (referring to past phase-outs of CFCs, HCFCs, and 

other refrigerant types used in the past) have been known for almost 20 years,.

Historically, these issues have included the phase-outs of chlorofluorocarbons (CFCs) 

and HFCs in accordance with manufacturers of many different products having to 

contendthe Montreal Protocol.49

 

48 A transcritical system is one in which the refrigerant changes phase during the course of the refrigeration 

cycle. 

Manufacturers have contended with these issues over 

time, and the pathwaysunderstand the design changes needed to lower impacts being well

understoodadapt to new refrigerants. NEEA added that shifts to different refrigerants will 

have to be made regardless of the course that any one rulemaking takes. Further, NEEA 

pointed to the statements by several manufacturers that a reduction of system efficiency 

due to implementation of new refrigerants should not be assumed. NEEA agreed with 

49 The Montreal Protocol on Substances that Deplete the Ozone Layer is an international treaty that was 

designed to protect the ozone layer by phasing out many ozone depleting substances.
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these manufacturers and suggested that it is likely that these parties will resolve 

refrigerant issues in a way that will not compromise efficiency and that will not be costprohibitive. In conclusion, NEEA stated that refrigerant issues are not new and that the 

outcome of the standards-setting process is not likely to affect how manufacturers resolve 

these issues. (NEEA, No. 36 at pp. 6–7)

While future regulations may cap or eliminate the use of the currently prevalent 

refrigerants, and proposed legislation, such as H.R. 2454, the American Clean Energy 

and Security Act of 2009,50

 

50 Colloquially known as the Waxman-Markey Bill, this legislation (H.R. 2454) would have established an 

emissions cap and trade system in the United States. It was passed by the House of Representatives in June 

2009, but was tabled by the Senate. For more information, please see 

 has included HFC phase-downs, DOE does not speculate on 

the potential future impact of proposed legislation in current rulemaking analyses. 

Additionally, as mentioned above, many low global warming potential (GWP) 

refrigerants, such as CO2 and propane, are being introduced to the market, and use of 

these new refrigerants may influence the cost and efficiency of equipment. However, 

DOE is not in a position to predict future trends of the refrigerants market or the 

performance of alternative refrigerants, and any analysis conducted at this time would be 

speculative. Consequently, DOE is not considering the potential effects of alternative 

refrigerants or current or future legislation on refrigerants within the scope of this 

rulemaking. Instead, DOE will continue to model equipment as currently designed for the 

U.S. market, utilizing the most common HFC refrigerants, R-134A and R-404A, accepted 

and broadly used by the industry. To the extent that there has been experience within the 

industry, domestically or internationally, with the use of alternative low-GWP 

http://thomas.loc.gov/cgibin/bdquery/z?d111:H.R.2454:. 
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refrigerants, DOE requests any available information, specifically cost and efficiency 

information relating to use of alternative refrigerants. DOE acknowledges that there are 

government-wide efforts to reduce emissions of HFCs, and such actions are being 

pursued both through international diplomacy as well as domestic actions. DOE, in 

concert with other relevant agencies, will continue to work with industry and other 

stakeholders to identify safer and more sustainable alternatives to HFCs while evaluating 

energy efficiency standards for this equipment.

4. Cost Assessment Methodology

During the preliminary analysis, DOE developed costs for the core case structure 

of the representative units it modeled, based on cost estimates performed in the analysis 

for the January 2009 final rule. For more information, see chapter 5 of the preliminary 

analysis TSD, pp. 5-3 to 5-8. DOE also developed costs for the design option levels 

implemented, based on publicly available information and price quotes provided during 

manufacturer interviews. These costs were combined in the engineering cost model based 

on the specifications of a given modeled unit in order to yield manufacturer production 

cost (MPC) estimates for each representative unit at each configuration modeled. At the 

preliminary analysis rulemaking stage, DOE’s component cost estimates were based on 

data developed from manufacturer interviews, estimates from the January 2009 final rule, 

and publicly available cost information. During the NOPR analysis, DOE augmented this 

information with data from physical teardowns of commercial refrigeration equipment 

currently on the market. 

Comment [A20]: Revision requested by OIRA.
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During the development of the engineering analysis for this NOPR, DOE 

interviewed manufacturers to gain insight into the commercial refrigeration industry, and 

to request feedback on the engineering analysis methodology, data, and assumptions that 

DOE used. Based on the information gathered from these interviews, along with the 

information obtained through a teardown analysis and public comments, DOE refined the 

engineering cost model. Next, DOE derived manufacturer markups using publicly

available commercial refrigeration industry financial data, in conjunction with 

manufacturer feedback. The markups were used to convert the MPCs into MSPs. Further 

discussion of the comments received and the analytical methodology used is presented in 

the following subsections. For additional detail, see chapter 5 of the NOPR TSD.

a. Teardown Analysis

In the preliminary analysis TSD, DOE expressed its intent to update its core case 

cost estimates, which were at that time developed based on estimates from the January 

2009 final rule, through performing physical teardowns of selected units. These core case 

costs consist of the costs to manufacture the structural members, insulation, shelving, 

wiring, etc., but not the costs associated with the components that could directly affect 

energy consumption, which were considered collectively as design options and served as 

one of many inputs to the engineering cost model. DOE first selected representative units 

for physical teardown based on available offerings from the catalogs of major 

manufacturers. DOE selected units that had sizes and feature sets similar to those of the 

representative units modeled in the engineering analytical model. DOE selected units for 

teardown representing each of the proposed equipment families, with the exception of the 
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HZO family51. The units were then disassembled into their base components, and DOE

estimated the materials, processes, and labor required for the manufacture of each 

individual component. This process is referred to as a “physical teardown.” Using the 

data gathered from the physical teardowns, DOE characterized each component 

according to its weight, dimensions, material, quantity, and the manufacturing processes 

used to fabricate and assemble it. These component data were then hierarchically entered 

into a spreadsheet and organized by system and subsystem levels to produce a 

comprehensive bill of materials (BOM) for each unit analyzed through the physical 

teardown process. 

The physical teardowns allowed DOE to identify the technologies, designs, and 

manufacturing techniques that manufacturers incorporated into the equipment that DOE 

analyzed. The result of each teardown was a structured BOM, incorporating all materials, 

components, and fasteners, classified as either raw materials or purchased parts and 

assemblies, and characterizing the materials and components by weight, manufacturing

processes used, dimensions, material, and quantity. The BOMs from the teardown 

analysis were then modified, and the results used as one of the inputs to the cost model to 

calculate the MPC for each representative unit modeled. The MPCs resulting from the 

teardowns were then used to develop an industry average MPC for each equipment class 

analyzed. See chapter 5 of the NOPR TSD for more details on the teardown analysis.

 

51 The reason why no HZO units were torn down was that the HZO family is the least complex of the 

equipment classes with respect to its construction. DOE felt that there was no additional data which could 

be gained from teardown of this equipment which would not have already been captured by the teardowns 

of other units. 
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b. Cost Model

The cost model for this rulemaking was divided into two parts. The first of these 

was a standalone core case cost model, based on physical teardowns, that was used for 

developing the core case costs for the 24 directly analyzed equipment classes. This cost 

model is a spreadsheet that converts the materials and components in the BOMs from the 

teardowns units into MPC dollar values based on the price of materials, average labor 

rates associated with manufacturing and assembling, and the cost of overhead and 

depreciation, as determined based on manufacturer interviews and DOE expertise. To 

convert the information in the BOMs to dollar values, DOE collected information on 

labor rates, tooling costs, raw material prices, and other factors. For purchased parts, the 

cost model estimates the purchase price based on volume-variable price quotations and 

detailed discussions with manufacturers and component suppliers. For fabricated parts, 

the prices of raw metal materials (e.g., tube, sheet metal) are estimated based on 5-year 

averages calculated from cost estimates obtained from sources including the American 

Metal Market and manufacturer interviews. The cost of transforming the intermediate 

materials into finished parts is estimated based on current industry pricing. 

The function of the cost model described above is solely to convert the results of 

the physical teardown analysis into core case costs. To achieve this, components 

immaterial to the core case cost (lighting, compressors, fans, etc.) were removed from the 

BOMs, leaving the cost model to generate values for the core case costs for each of the 

teardown points. Then, these teardown-based core case BOMs were used to develop a 

“parameterized to allow for the manipulation of features ” computational cost model, 
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which allows a user to virtually manipulate case parameters such as height, length, 

insulation thickness, and number of doors by inputting different numerical values for 

these features to produce new cost estimates. For example, a user could start with the 

teardown data for a two-door case and expand the model of the case computationally to 

produce a cost estimate for a three-door case by changing the parameter representing the 

number of doors. This parameterized model, coupled with the design specifications 

chosen for each representative unit modeled in the engineering analysis, was used to 

develop core case MPC cost estimates for each of the 24 directly analyzed representative 

units. These values served as one of several inputs to the engineering cost model. 

The engineering analytical model, as implemented by DOE in a Microsoft Excel 

spreadsheet, also incorporated the engineering cost model, the second cost modeling tool 

used in this analysis. In the engineering cost model, core case costs developed based on 

physical teardowns were one input, and costs of the additional components required for a 

complete piece of equipment (design options) were another input. The two inputs were 

added together to arrive at an overall MPC value for each equipment class. Based on the 

configuration of the system at a given design option level, the appropriate design option 

costs were added to the core case cost to reflect the cost of the entire system. Costs for 

design options were calculated based on price quotes from publicly available sources and 

discussions with commercial refrigeration equipment manufacturers. Chapter 5 of the 

NOPR TSD describes DOE’s cost model and definitions, assumptions, data sources, and 

estimates.
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Some stakeholders expressed concern with the potential variability in prices that 

served as inputs to the cost model. NEEA suggested that using a forecast of materials 

futures market pricing might be a better approach than using a historical average, and Hill 

Phoenix questioned whether the 2009 cost model had been updated, as its cost structure 

had significantly increased since that time. (NEEA, Public Meeting Transcript, No. 31 at 

pp. 85–86; Hill Phoenix, Public Meeting Transcript, No. 31 at p. 84) Southern Store 

Fixtures agreed with Hill Phoenix, and noted that it would be advisable to use 2011 costs 

for equipment that complies with the January 2009 final rule, instead of a current market 

baseline. (Southern Store Fixtures, Public Meeting Transcript, No. 31 at pp. 86–87) 

Regarding the comments from Hill Phoenix and Southern Store Fixtures, DOE 

has updated all of its cost modeling information. This information includes component 

costs, which were based on public-source data and estimates provided during

manufacturer interviews, and core case costs, which were developed based on DOE’s 

teardown analysis performed during the NOPR stage of the rulemaking. In response to 

Southern Store Fixtures’ comment that DOE should use 2011 costs in its analyses for 

equipment that complies with the January 2009 final rule, DOE believes that materials 

prices depend on broader market conditions and are unlikely to be influenced by 

equipment that complies with the January 2009 final rule. DOE calculates the materials 

cost based on price information gathered from the market, and uses a methodology based 

on the Bureau of Labor Statistics (BLS) Producer Price Indices to account for 

fluctuations in materials prices and processing costs. Regarding NEEA’s suggestion that 

using a forecast of materials futures market pricing might be preferable to using an 
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historical average, DOE believes that such price forecasting is speculative, and therefore 

DOE has continued to use actual prices and averages thereof as the basis for its analyses. 

c. Manufacturer Production Cost 

Once the cost estimates for all the components of each representative unit, 

including the core case cost and design option costs, were finalized, DOE totaled the 

costs in the engineering cost model to calculate the MPC. DOE estimated the MPC at 

each efficiency level considered for each directly analyzed equipment class, from the 

baseline through the max-tech. After incorporating all of the assumptions into the cost 

model, DOE calculated the percentages attributable to each element of total production 

cost (i.e., materials, labor, depreciation, and overhead). DOE used these production cost 

percentages in the MIA (see section IV.K). DOE revised the cost model assumptions 

used for the preliminary analysis based on teardown analysis, updated pricing, and 

additional manufacturer feedback, which resulted in refined MPCs and production cost 

percentages. DOE calculated the average equipment cost percentages by equipment class. 

Chapter 5 of the NOPR TSD presents DOE’s estimates of the MPCs for this rulemaking, 

along with the different percentages attributable to each element of the production costs 

that comprise the total MPC.

d. Cost-Efficiency Relationship

The result of the engineering analysis is a cost-efficiency relationship. DOE 

created a separate relationship for each input capacity associated with each commercial 

refrigeration equipment class examined for this NOPR. DOE also created 24 cost-
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efficiency curves, representing the cost-efficiency relationship for each commercial 

refrigeration equipment class. 

To develop cost-efficiency relationships for commercial refrigeration equipment, 

DOE examined the cost differential to move from one design option to the next for 

manufacturers. DOE used the results of teardowns to develop core case costs for the 

equipment classes modeled, and added those results to costs for design options developed 

from publicly available pricing information and manufacturer interviews. Additional 

details on how DOE developed the cost-efficiency relationships and related results are 

available in the chapter 5 of the NOPR TSD. Chapter 5 of the NOPR TSD also presents 

these cost-efficiency curves in the form of energy efficiency versus MPC. After the 

publication of the preliminary analysis, several stakeholders provided input and feedback 

regarding DOE’s cost estimates, specifically regarding insulation costs, LED lighting

costs, and DOE’s methodology for estimating manufacturer overhead in its cost model.

The following sections address these stakeholder comments and concerns.

Insulation Cost Specifications 

Several stakeholders submitted comments regarding DOE’s estimated costs and 

specifications for insulation. Traulsen observed that DOE’s estimates for the number of 

foaming fixtures52

 

52 Foaming fixtures are pieces of equipment consisting of molds to guide the injection of foamed-in-place 

insulation so that that the foam takes a desired shape once hardened.

present in a manufacturing facility and units per year are high if they 

are meant to represent the production of a base model by an average manufacturer. 

(Traulsen, No. 45 at p. 4) Zero Zone noted that the material costs for increasing foamed-
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in-place panels are not trivial, and that its foam cost associated with adding a half inch of 

insulation to a five-door case is approximately $25. (Zero Zone, No. 37 at p. 3) Zero 

Zone also commented that the engineering costs modeled by DOE do not include any 

redesign costs that are incurred as wall thickness changes, and that foamed-in-place sheet 

metal panels are an integral part of the structural design of cases. However, Zero Zone 

expressed concern that the ability of vacuum insulated panels to perform as structural 

members has not been verified and should be validated before vacuum insulated panels

are included in the analysis. (Zero Zone, No. 37 at p. 3) Zero Zone concluded by stating 

that increased foam panel thickness should be dropped from the analysis because DOE 

had not collected sufficient, accurate cost information regarding this design option. (Zero 

Zone, No. 37 at p. 3) 

DOE considered these comments in revising its implementation of improved 

insulation during the NOPR analyses. Regarding Traulsen’s statement, DOE based its 

estimates of costs and specifications on discussions with manufacturers and site visits of 

manufacturing facilities and, while DOE understands the variability in manufacturing 

practices and equipment utilization that exists across manufacturers and product line 

offerings, DOE believes those estimates are sound. DOE took into account the comment 

from Zero Zone regarding additional foam costs and, in response, accounted for the 

differential cost of additional foam due to changes in wall thickness in its engineering 

analysis for the NOPR. However, regarding Zero Zone’s assertion that redesign costs are 

not accounted for in the engineering analysis, the engineering model does include an 

estimate of engineering cost to account for the design efforts that must be incurred in 
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developing a case with higher wall thickness. DOE has also discussed the implementation 

of vacuum insulated panels with manufacturers, cross-referenced its data with other 

rulemaking analyses in which vacuum insulated panels were used, and revised its data 

accordingly. As a result, DOE believes that its estimates and assumptions for improved 

insulation are valid, and has retained those design options for the NOPR. 

Light-Emitting Diode Cost Specifications

Stakeholders also provided feedback on pricing and performance related to 

DOE’s LED specifications in the engineering model. ASAP and NRDC stated that DOE 

should not assume LED prices remain constant because LEDs are an emerging 

technology and will likely experience a dramatic price decline in the near future. The 

comment cited DOE’s 2011 Solid-State Lighting Research and Development (R&D) 

Multi-Year Program Plan (MYPP),

53

 

53 The DOE Solid-State Lighting Research and Development Multi-Year Program Plan outlines DOE’s 

research goals and planned methodologies with respect to the advancement of solid-state lighting 

technologies in the United States. The complete document is available at: 

which projects that, between 2010 and 2015, prices 

of some LEDs will decrease by 85 percent, while LED lighting will experience a 

significant increase in efficacy during the same period. (ASAP and NRDC, No. 34 at p. 

3) These stakeholders added that it is important for DOE to capture cost decreases not 

only during the analysis period (2016–20452017–2046), but prior to the proposed 

20162017 compliance date for the amended standards considered in this rulemaking as 

well, stating that a price estimate for 20162017 will be needed for the LCC calculations 

to be accurate. TheyASAP and NRDC stated that, according to the DOE solid-state 

lighting documents referenced, if today’s LED prices are held constant through the 

http://apps1.eere.energy.gov/buildings/publications/pdfs/ssl/ssl_mypp2011_web.pdf. 
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20162017 compliance date, the result will be a misrepresentation in the LCC of the value 

of potential LED energy savings; as a result, ASAP and NRDC urged DOE to develop 

cost estimates reflecting this price decline. (ASAP and NRDC, No. 34 at p. 3) NEEA 

referenced the DOE Solid-State Lighting R&D multi-year plan2011 MYPP as well, and 

agreed that it believed that DOE is grossly overestimating the future cost of LED 

lighting. (NEEA, No. 36 at pp. 3–4) 

DOE agrees with these stakeholders that forecasts of the LED lighting industry, 

including those performed by DOE, suggest that LED lighting is an emerging technology 

that will continue to experience significant price decreases in coming years. For this 

reason, to capture the anticipated cost reduction in LED fixtures in the analyses for this 

rulemaking, DOE incorporated price projections from its Solid-State Lighting Program

into its MPC values for the primary equipment classes. The price projections for LED 

case lighting were developed from projections developed for the DOE Solid-State 

Lighting Program 2012 report, Energy Savings Potential of Solid-State Lighting in 

General Illumination Applications 2010 to 2030 (“the energy savings report”).54 In the 

appendix of this report, price projections from 2010 to 2030 were provided in ($/klm) for 

LED lamps and LED luminaires. DOE analyzed the models used in the Solid-State 

Lighting Program work and determined that the LED luminaire projection would serve as 

an appropriate proxy for a cost projection to apply to refrigerated case LEDs.

 

54 Navigant Consulting, Inc., Energy Savings Potential for Solid-State Lighting in General Illumination 

Applications. 2012. Prepared for the U.S. Department of Energy - Office of Energy Efficiency and 

Renewable Energy Building Technologies Office, Washington, D.C.
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The price projections presented in the Solid-State Lighting Program’s energy 

savings report are based on the DOE’s 2011 MYPP. The MYPP is developed based on 

input from manufacturers, researchers, and other industry experts. This input is collected 

by the DOE at annual roundtable meetings and conferences. The projections are based on 

expectations dependent on the continued investment into solid-state lighting by the DOE. 

 

DOE incorporated the price projection trends from the energy savings report into 

its engineering analysis by using the data to develop a curve of decreasing LED prices 

normalized to a base year. That base year corresponded to the year when LED price data 

was collected for the NOPR analyses of this rulemaking from catalogs, manufacturer 

interviews, and other sources. DOE started with this commercial refrigeration equipmentspecific LED cost data and then applied the anticipated trend from the energy savings 

report to forecast the projected cost of LED fixtures for commercial refrigeration 

equipment at the time of compliance with the proposed rule (2017). These 2017 cost 

figures were incorporated into the engineering analysis as comprising the LED cost 

portions of the MPCs for the primary equipment classes. Table IV.1 shows the 

normalized LED price deflators used in this NOPR analysis.

Table IV.1 LED price deflators used in the NOPR analysis.

Year Normalized 

to 2013

Normalized 

to 2017 Year Normalized to 2013

Normalized 

to 2017

2010 2.998 5.652 2021 0.361 0.681

2011 1.799 3.392 2022 0.335 0.631

2012 1.285 2.423 2023 0.312 0.588

2013 1.000 1.885 2024 0.292 0.550

2014 0.819 1.543 2025 0.274 0.517

2015 0.693 1.306 2026 0.259 0.488

2016 0.601 1.133 2027 0.245 0.462

2017 0.530 1.000 2028 0.232 0.438

2018 0.475 0.895 2029 0.221 0.417

2019 0.430 0.810 2030 0.211 0.398
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2020 0.393 0.740 2031-2046* 0.211 0.398

* DOE did not have data available to project prices beyond 2030. Therefore, for the NOPR analysis, it was 

assumed that the LED prices stay constant after 2030.

The LCC analysis (section IV.H) was carried out with the engineering numbers 

that account for the 2017 prices of LED luminaires. The reduction in price of LED 

luminaires from 2018 through 2030 was taken into account in the NIA (section IV.IDOE 

understands the stakeholders’ assertions that some forecasts predict significant decreases 

in LED cost and increases in LED performance in the future. However, these projections 

are uncertain and, in the case of the DOE Solid-State Lighting R&D multi-year plan, are 

based upon tentative research targets that may require significant technical and 

manufacturing innovations to achieve. DOE is not aware of any past rulemaking efforts 

in which the prices and performance of emerging technology components were assumed 

to change drastically during the analysis period, and DOE believes that to speculate that 

LED pricing and performance will do so could adversely affect the accuracy of the 

analyses. Therefore, DOE intends to continue to use current-year cost estimates as the 

basis for all of its analyses. This treatment of LED pricing is consistent with the 

methodology that DOE utilized in its January 2009 final rule. In that rule, DOE used 

aggregated past LED price data from 2007–2008 to arrive at an estimate of pricing at the 

time of the final rule analysis. Please see appendix B of the January 2009 final rule TSD 

for more information. However, DOE did not make any predictions or use any forecasts 

of LED pricing beyond the time at which the analysis took place. DOE intends to 

maintain that stance in this rulemaking as well, basing its modeling of LEDs on cost 

estimates obtained from equipment manufacturers and public sources at the time of the 

analysis. 
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). The cost reductions were calculated for each year from 2018 through 2030 and 

subtracted from the equipment costs in the NIA. The reduction in lighting maintenance 

costs55 due to reduction in LED prices for equipment installed in 2018 to 2030 were also 

calculated and appropriately deducted from the lighting maintenance costs.

Manufacturer Overhead Costs

NEEA commented that, in the DOE rulemaking on distribution transformers, 

manufacturers had stated that they do not apply overhead to material costs, but to labor 

costs only, and that the application of overhead to both of these cost components can 

have a major impact on MPCs, depending on how much of the product cost is attributed 

to each component. (NEEA, Public Meeting Transcript, No. 31 at pp. 70–71) In another 

comment, NEEA elaborated on this statement, adding that during the distribution 

transformers public meeting, manufacturers stated that they do not apply factory 

overhead rates to the cost of materials, but only to labor. NEEA went on to suggest that 

DOE use this methodology to the extent applicable to commercial refrigeration 

equipment, and adjust its cost estimation methods to take this approach into account. 

(NEEA, No. 36 at pp. 4–5) 

In DOE’s cost model for commercial refrigeration equipment, the following three 

overhead components are dependent on labor or materials: utilities, property tax, and 

insurance. The cost of utilities is a function of equipment costs only (no labor included) 

and is calculated using a ratio derived in the past from U.S. Securities and Exchange 

 

55 Discussion related to lighting maintenance costs for commercial refrigeration equipment can be found in 

section IV.H.3, and a more detailed explanation can be found in chapter 8 of the NOPR TSD. 
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Commission (SEC) 10-K forms for appliance manufacturers.

56 The ratios for property tax 

and insurance costs are also based on past 10-K form analysis, but are dependent on 

overall unit costs (i.e., cost of goods sold). Altogether, these three components represent 

only about 3 percent of the total cost of a unit, so whether they are based on labor and 

materials or on labor only, they are unlikely to have a significant effect on MPCs, 

especially on an incremental cost basis. DOE welcomes suggestions on how to improve 

its methodology and hopes that stakeholders can provide DOE with documentation for 

improved insurance, property tax, and utility calculations. In particular, DOE would 

welcome nationwide data on property tax rates based on property, plant, and equipment 

valuations; average power consumption for conditioned as well as unconditioned factory 

spaces; and insurance rates and how they are applied. 

For the distribution transformers energy conservation standards rulemaking, DOE 

did not apply overhead rates to labor—overhead was only applied to direct material 

production costs. For more details on material and labor inputs for distribution 

transformers, see chapter 5 of the TSD for the distribution transformers preliminary 

analysis

(www1.eere.energy.gov/buildings/appliance_standards/commercial/pdfs/transformer_pre

analysis_ch5.pdf). Furthermore, due to the different industries in which distribution 

transformer and commercial refrigeration manufacturers operate, the same cost model 

may not necessarily be applicable to both. 

 

56 A searchable directory of SEC filings is available at: 

www.sec.gov/edgar/searchedgar/companysearch.htmlhttp://www.sec.gov/edgar/searchedgar/companysearc

h.html.
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e. Manufacturer Markup

To account for manufacturers’ non-production costs and profit margin, DOE 

applies a non-production cost multiplier (the manufacturer markup) to the full MPC. The 

resulting MSP is the price at which the manufacturer can recover all production and nonproduction costs and earn a profit. To meet new or amended energy conservation 

standards, manufacturers often introduce design changes to their product lines that result 

in increased MPCs. Depending on the competitive environment for this equipment, some 

or all of the increased production costs may be passed from manufacturers to retailers and 

eventually to consumerscustomers in the form of higher purchase prices. The MSP 

should be high enough to recover the full cost of the equipment (i.e., full production and 

non-production costs) and yield a profit. The manufacturer markup has an important 

bearing on profitability. A high markup under a standards scenario suggests 

manufacturers can readily pass along the increased variable costs and some of the capital 

and equipment conversion costs (one-time expenditures) to consumerscustomers. A low 

markup suggests that manufacturers will not be able to recover as much of the necessary 

investment in plant and equipment.

To calculate the manufacturer markups, DOE used 10-K reports submitted to the 

SEC by the six publicly owned commercial refrigeration equipment companies in the 

United States. (SEC 10-K reports can be found using the search database available at 

www.sec.gov/edgar/searchedgar/webusers.htm.) The financial figures necessary for 

calculating the manufacturer markup are net sales, costs of sales, and gross profit. DOE 
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averaged the financial figures spanning the years from 2004 to 201057

IV.E.4.g

to calculate the 

markups. For commercial refrigeration equipment, to calculate the average gross profit 

margin for the periods analyzed for each firm, DOE summed the gross profit earned 

during all of the aforementioned years and then divided the result by the sum of the net 

sales for those years. DOE presented the calculated markups to manufacturers during the 

manufacturer interviews for the NOPR (see section ). DOE considered 

manufacturer feedback to supplement the calculated markup, and refined the markup to 

better reflect the commercial refrigeration market. DOE developed the manufacturer 

markup by weighting the feedback from manufacturers on a market share basis because 

manufacturers with larger market shares more significantly affect the market average. 

DOE used a constant markup to reflect the MSPs of both the baseline equipment and 

higher efficiency equipment. DOE used this approach because amended standards may 

transform high-efficiency equipment, which currently is considered to be premium 

equipment, into baseline equipment. See chapter 5 of the NOPR TSD for more details 

about the manufacturer markup calculation.

f. Shipping Costs

The final component of the MSP after the MPC and manufacturer markup is the 

shipping cost associated with moving the equipment from the factory to the first point on 

the distribution chain. During interviews, manufacturers stated that the specific party 

(manufacturer or buyer) that incurs that cost for a given shipment may vary based on the 

terms of the sale, the type of account, the manufacturer’s own business practices, and 

 

57 Typically, DOE uses the data for the 5 years preceding the year of analysis. However, in this case 

additional data were available up to 2004. Hence, data from 2004 to 2010 were used for these calculations.
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other factors. However, for consistency, DOE includes shipping costs as a component of 

MSP. In calculating the shipping costs for use in its analysis, DOE first gathered 

estimates of the cost to ship a full trailer of manufactured equipment an average distance 

in the United States, generally representative of the distance from a typical manufacturing 

facility to the first point on the distribution chain. DOE then used representative unit sizes 

to calculate a volume for each unit. Along with the dimensions of a shipping trailer and a 

loading factor to account for inefficiencies in packing, DOE used this cost and volume 

information to develop an average shipping cost for each equipment class directly 

analyzed. 

g. Manufacturer Interviews

Throughout the rulemaking process, DOE has sought and continues to seek 

feedback and insight from interested parties that would improve the information used in 

its analyses. DOE interviewed manufacturers as a part of the NOPR MIA (see section 

IV.K). During the interviews, DOE sought feedback on all aspects of its analyses for 

commercial refrigeration equipment. For the engineering analysis, DOE discussed the 

analytical assumptions and estimates, cost model, and cost-efficiency curves with 

manufacturers. DOE considered all of the information learned from manufacturers when 

refining the cost model and assumptions. However, DOE incorporated equipment and 

manufacturing process figures into the analysis as averages to avoid disclosing sensitive 

information about individual manufacturers’ equipment or manufacturing processes. 

More details about the manufacturer interviews are contained in chapter 12 of the NOPR

TSD.
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5. Energy Consumption Model

The energy consumption model is the second key analytical model used in 

constructing cost-efficiency curves. This model estimates the daily energy consumption, 

calculated using the DOE test procedure, of commercial refrigeration equipment in 

kilowatt-hours at various performance levels using a design-option approach. In this 

methodology, a unit is initially modeled at a baseline level of performance, and higherefficiency technologies, referred to as design options, are then implemented and modeled 

to produce incrementally more-efficient equipment designs. The model is specific to the 

types of equipment covered under this rulemaking, but is sufficiently generalized to 

model the energy consumption of all covered equipment classes. DOE developed the 

energy consumption model as a Microsoft Excel spreadsheet. 

For a given equipment class, the model estimates the daily energy consumption 

for the baseline, as well as the energy consumption of subsequent levels of performance 

above the baseline. The model calculates each performance level separately. For the 

baseline level, a corresponding cost is calculated using the cost model, which is described 

in section IV.E.4.b. For each level above the baseline, the changes in system cost due to 

the implementation of various design options are used to recalculate the cost. 

Collectively, the data from the energy consumption model are paired with the cost model 

data to produce points on cost-efficiency curves corresponding to specific equipment 

configurations. After the publication of the preliminary analysis, DOE received numerous 

stakeholder comments regarding the methodology and results of the energy consumption 
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model. 

a. Energy Consumption Model Results

Zero Zone noted that, while the overall modeling approach is appropriate, the 

results for the VCT.RC.M class are, in its opinion, too restrictive. (Zero Zone, No. 37 at 

p. 1) Similarly, Traulsen believed that DOE’s numbers were slightly high for the 

VCT.SC.L equipment class, and that the incremental energy change may have been

overstated, while the cost was understated, for technologies such as LED lighting, highperformance doors, and vacuum insulated panels. (Traulsen, No. 45 at p. 4) 

In its analyses for the NOPR stage of this rulemaking, DOE reviewed its inputs to 

the engineering cost model and energy consumption model. This included reviewing 

publicly available data from sources such as manufacturer specification sheets and 

catalogs, as well as incorporating information drawn from stakeholder comments and 

manufacturer interviews conducted as part of the MIA process. The process included 

discussion and investigation of specific design options, such as the aforementioned LED 

lighting and vacuum insulated panels. DOE has taken efforts to incorporate all available 

information into its models to produce the most accurate results possible. In response to 

the comments by Zero Zone and Traulsen regarding energy consumption and cost results 

for the VCT.RC.M and VCT.SC.L classes, respectively, DOE has reviewed and updated 

its methodologies during the NOPR analyses to account for the latest information 

available, and is confident that its current results best reflect this information. 
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b. Anti-Sweat Heater Power

Traulsen suggested that DOE investigate whether the anti-sweat power consumed 

by the VCT.SC.L and VCT.SC.I equipment classes can truly be zero when highperformance doors are used, and suggested that DOE review its data. Traulsen added that

it believed that, even with these door types, anti-sweat heaters are often still found on the 

cabinet body, especially in low-temperature equipment, which is prone to condensation 

due to conduction. (Traulsen, No. 45 at pp. 6–7) 

In DOE’s preliminary engineering analysis, anti-sweat heater power values were 

assigned for each of the transparent door configurations based on available data from 

manufacturer specification sheets and data obtained during manufacturer interviews. For 

medium-temperature doors, both commercial refrigeration equipment manufacturer and 

door manufacturer literature indicated that truly energy-free door designs with no antisweat heat are available on the market. This finding was confirmed through discussions 

with commercial refrigeration equipment manufacturers. However, for low- and icecream temperature doors, DOE has found that, as Traulsen stated, anti-sweat heat is still 

required, at a minimum, on the door frame. Table 5.6.9 of the preliminary analysis TSD

chapter 5 lists anti-sweat heater powers of 165 and 80 watts for standard and highperformance doors, respectively, at low and ice-cream temperatures. These values are 

consistent with those that DOE has found through its research, and were retained in the 

NOPR analysis. 
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c. Evaporator Fan Motor Power

Zero Zone observed that, while DOE’s assumptions regarding motor efficiency 

are valid, the evaporator fan specifications used by DOE for freezers of 6 rated watts per 

fan were flawed because freezer fans are generally higher in wattage (i.e., 9 or 12 watts) 

to increase airflow and decrease frost formation. (Zero Zone, No. 37 at p. 2) 

After receiving the comment by Zero Zone, DOE further researched evaporator 

fan motor power values through manufacturer catalogs and discussed the subject in 

manufacturer interviews during the NOPR stage of the rulemaking. The data yielded by 

this effort showed that remote condensing freezer cases do utilize evaporator fan motors 

with rated shaft powers generally closer to 9 watts. As a result, DOE updated the design 

specifications for those representative units in its engineering model to more accurately 

reflect the standard design of those units. 

d. Condenser Energy Consumption

Southern Store Fixtures stated that the energy usage of the condenser is missing 

from the energy consumption model diagram contained in chapter 5 of the preliminary 

analysis TSD (Figure 5.6.1). 

Regarding the comment by Southern Store Fixtures, Figure 5.6.1 of the 

preliminary analysis TSD chapter 5 does include a representation of the condenser fan 

motor energy consumption under the category of component energy consumption. The 

energy usage attributed to the condenser fan, found in self-contained units, is accounted 
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for in the energy consumption model by the compressor duty cycle. For remote 

condensing units, the condenser fan energy consumption is not explicitly calculated; 

instead, remote case compressor energy consumption is calculated based on the energy 

efficiency ratio values given in AHRI 1200. 

e. Evaporator Coil Design

Zero Zone expressed concerns about DOE’s assumptions regarding evaporator 

coils, and noted that reduced fin spacing58 will result in coils that do not function well in 

the field due to excessive frost loading. (Zero Zone, No. 37 at p. 2) Zero Zone also 

observed that the improved evaporator coil described in the preliminary analysis TSD for 

the VCT.RC.M and VCT.RC.L equipment classes would raise evaporator temperatures to 

the same level as the discharge air temperature, which is not feasible. (Zero Zone, No. 37 

at pp. 2–3) Additionally, Zero Zone recommended that DOE conduct performance testing 

before assuming that high-performance coils will work in all situations because, Zero 

Zone asserted, DOE failed to address issues with superheat control for these advanced 

coils, namely that as the evaporating temperature becomes closer to the return air 

temperature, the ability of the expansion valve to maintain a stable superheat is 

decreased. (Zero Zone, No. 37 at p. 3) 

With respect to Zero Zone’s comment on reduction of fin spacing, DOE 

confirmed during manufacturer interviews that excessive frost loading becomes a concern 

once fin spacing is reduced below certain thresholds. As a result, DOE sought to ensure 

 

58 Fin spacing, or fin pitch, refers to the distance between the flat fins that are oriented transverse to the 

direction of airflow across a fin-and-tube heat exchanger. 
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that its coil models reflected coil geometries that are suitable for production and field use 

without incurring such negative secondary effects as increased frost buildup. With respect 

to Zero Zone’s second comment involving the evaporator coil temperatures, the 

referenced statement in the preliminary analysis TSD was intended to be a single 

example, and was incorrectly presented as applying to all equipment classes. The 

engineering model never utilized evaporator temperatures that were physically infeasible 

or impossible to attain.

During its NOPR analyses, DOE performed independent modeling of evaporator 

and condenser coils based on physical teardowns of coils available on the market, 

coupled with numerical modeling of the coil performance. Design parameters were varied 

from the baseline, and the heat transfer performance of the coils was iteratively analyzed

to yield higher efficiency coil designs. Cost modeling was utilized to produce cost 

estimates for the baseline and high-performance coil designs. This analysis served as the 

basis for the coil cost and performance values input into the engineering model. While 

DOE was unable to perform physical testing of its high-performance coil designs, as 

those designs were solely analytically derived and not constructed as prototypes, DOE 

controlled the parameters of its analysis to retain the required conditions for proper 

system performance. DOE believes that this analysis addresses the concerns presented by 

Zero Zone in its comments. For more details on the coil modeling process, see chapter 5 

of the NOPR TSD. 
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F. Markups Analysis

DOE applies multipliers called “markups” to the MSP to calculate the 

consumercustomer purchase price of the analyzed equipment. These markups are in 

addition to the manufacturer markup (discussed in section IV.E.4.e) and are intended to 

reflect the cost and profit margins associated with the distribution and sales of the 

equipment between the manufacturer and end user.. DOE identified three major 

distribution channels for commercial refrigeration equipment, and markup values were 

calculated for each distribution channel based on industry financial data. The overall 

markup values were then calculated by weighted-averaging the individual markups with 

market share values of the distribution channels. See chapter 6 of the NOPR TSD for 

more details on DOE’s methodology for markups analysis. 

DOE received a number of comments regarding markups after the publication of 

the preliminary analysis. 

1. Baseline and Incremental Markups 

Traulsen stated that, in its experience, the initial markup on equipment will be 

consistent with production costs, and that the incremental markups will increase with 

higher levels of product efficiency due to product differentiation. (Traulsen, No. 45 at p. 

4) However, Traulsen also stated that it did not believe that wholesalers differentiate 

markups based on the technologies inherently present in this equipment and that, in its 

experience, wholesalers/resellers will use traditional markup rates regardless of 

equipment’s energy efficiency. (Traulsen, No. 45 at p. 7)
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In general, DOE has found that markup values vary over a wide range according 

to general economic outlook, manufacturer brand value, inventory levels, manufacturer 

rebates to distributors based on sales volume, newer versions of the same equipment 

model introduced into the market by the manufacturers, and availability of cheaper or 

more technologically advanced alternatives. Based on market data, DOE divided 

distributor costs into: (1) direct cost of equipment sales; (2) labor expenses; (3) 

occupancy expenses; (4) other operating expenses (such as depreciation, advertising, and 

insurance); and (5) profit. DOE assumed that, for higher efficiency equipment only, the 

“other operating costs” and “profit” scale with MSP, while the remaining costs scale the 

same way as does the MSP of baseline equipment. In other words, the remaining costs 

stay constant irrespective of equipment efficiency level. Incremental markups were 

applied as multipliers only to the MSP increments (of higher efficiency equipment 

compared to baseline) and not to the entire MSP. This assumption is in line with 

Traulsen’s first comment. Further, while DOE’s use of separate values for baseline and 

incremental markup rates will lead to higher marked-up values for equipment at higher

efficiency levels, the rate of markup will be same for all higher efficiency levels, which is 

consistent with Traulsen’s second comment. 

2. Distribution Channel Market Shares

True stated that national chains are a major part of the glass-doored, selfcontained equipment market. True stated that it serves these via national accounts, adding 

that the market shares of the national accounts channel and the distributor channel that 
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were used for the preliminary analysis of this rulemaking should be reversed. (True, 

Public Meeting Transcript, No. 31 at p. 80) NEEA agreed with True, stating that DOE 

had more or less reversed the market shares of the distribution channels for glass door 

and open self-contained equipment. NEEA also agreed with other commenters who stated 

that DOE’s market channel fractions applied more to specialty and solid-door selfcontained equipment. (NEEA, No. 36 at p. 5) Southern Store Fixtures added that it sells 

many remote condensing units directly to the end users, and that it also sells many selfcontained units directly to supermarket and convenience store chains without using an 

intermediary. (Southern Store Fixtures, Public Meeting Transcript, No. 31 at pp. 80–81) 

Traulsen commented that it believed that DOE’s distribution channel data were 

reasonably accurate, within plus or minus 10 percent. (Traulsen, No. 45 at p. 3) 

DOE agrees with comments from True, NEEA, and Southern Store Fixtures 

regarding market shares for self-contained display cases. Consequently, DOE made the 

distribution channel market shares for all display cases (VOP, SVO, HZO, VCT, HCT, 

SOC, and PD), irrespective of self-contained or remote condensing configuration, equal 

to that of the remote condensing equipment market shares that were proposed in the 

preliminary analysis TSD. DOE kept the market shares of VCS and HCS equipment 

families same as the self-contained equipment market shares proposed in the preliminary 

analysis TSD. The distribution channel market shares used for this NOPR are shown in 

Table IV.2. Chapter 6 and appendix 6A of the NOPR TSD provide complete details of 

the methodology and data used in the estimation of the markups.

Table IV.2 Distribution Channel Market Shares 

Equipment Family National Account Wholesaler Contractor 
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Channel Channel Channel

VOP, SVO, HZO, VCT, HCT, SOC, 

and PD 70% 15% 15%

VCS and HCS 30% 60% 10%

G. Energy Use Analysis

Several stakeholders commented on DOE’s methodology for investigating

secondary impacts of efficiency improvement, as described in the preliminary analysis. 

Southern Store Fixtures agreed with DOE’s conclusion that efficiency improvements in 

self-contained equipment do not have a noticeable impact on building heating and 

cooling loads. Southern Store Fixtures further stated that a kitchen area, with limited 

space and limited equipment, differs from larger settings such as supermarkets, which 

contain a large quantity of self-contained equipment. Southern Store Fixtures asked

whether the impact of large numbers of self-contained units on the heating and cooling 

loads of buildings had been investigated. (Southern Store Fixtures, Public Meeting 

Transcript, No. 31 at pp. 93–94) 

Other stakeholders, however, had questions regarding DOE’s methods. NRDC 

asked why only self-contained units were reviewed for secondary impacts, and whether 

any rack-based units had been reviewed. (NRDC, Public Meeting Transcript, No. 31 at p. 

100) NEEA stated that the placement of multiple cases in a supermarket will affect

heating, ventilation, and air-conditioning (HVAC) loads, and suggested that DOE 

reexamine the subject in a non-restaurant business type.by modeling the performance of 

commercial refrigeration equipment in a business type other than a restaurant, such as a 

grocery store. NEEA added that restaurants typically have high ventilation loads, and 
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opined that, in a space such as a supermarket, where the refrigeration loads approximate 

the ventilation loads, DOE’s results are inaccurate. NEEA added that mechanical 

engineers use DOE-259 to model secondary impacts. (NEEA, Public Meeting Transcript, 

No. 31 at pp. 98–100) 

NEEA continued, stating that self-contained equipment, because it is not perfectly 

efficient, will emit more heat into its surroundings than it absorbs, which could be of 

benefit in the heating season but which is definitely a detriment in the cooling season. 

While the magnitude of these effects will depend on the equipment’s geographic location, 

NEEA expressed its belief that DOE should not ignore this issue. NEEA added that DOE 

should quantify the contributions to space cooling and heating loads being generated by 

self-contained equipment so that stakeholders can make an informed judgment as to their 

significance. (NEEA, No. 36 at p. 5)

In response to NRDC’s comment regarding modeling rack-based units, DOE

points to the January 2009 final rule analysis that presents an extensive energy use 

analysis for remote condensing equipment and self-contained equipment without doors. 

The analysis was carried out by simulating display cases in supermarkets using the DOE2.2 software package. Details of this analysis can be found in chapter 7 of the January 

2009 final rule TSD 

(www1.eere.energy.gov/buildings/appliance_standards/commercial/pdfs/chp_7_cre_ener

 

59 DOE-2 is a widely used and accepted freeware building energy analysis program that can predict the 

energy use and cost for different types of buildings. DOE-2 uses a description of the building layout, 

construction, usage, conditioning systems and utility rates provided by the user, along with weather data, to 

perform an hourly simulation of the building and to estimate utility bills.
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gy_final.pdf). Based on this energy use analysis, DOE concluded that the overall impact 

of the considered design options had only a minor differential impact on the overall 

HVAC energy consumption of supermarkets. Further, DOE concluded that the energy 

consumption model used in the engineering analysis simulated the energy consumption 

of the various equipment classes with adequate accuracy, and therefore DOE used the 

estimates from the engineering analysis for the LCC and subsequent analyses. 

For the current rulemaking, DOE received comments during the May 2010 

Framework document public meeting regarding the proportionally larger share of selfcontained equipment examined in this rulemaking compared to that examined in the 

January 2009 final rule, and the impact of this equipment on building HVAC loads. DOE 

evaluated the impact of self-contained equipment through whole-building simulations 

with a VCT.SC.L freezer in restaurant buildings using the whole-building energy use 

simulation tool EnergyPlus, which is the primary software tool supported by DOE’s 

Building Technologies Program for energy use analysis of buildings. Through these 

simulations, DOE found that the differential impact of efficiency improvements in 

VCT.SC.L equipment on the HVAC loads of restaurant buildings was negligible. Since 

VCT.SC.L energy consumption is one of the highest among the major self-contained 

equipment classes, DOE concluded that the incremental impact of efficiency 

improvements in all self-contained refrigerators and freezers on HVAC loads of 

restaurant buildings is negligible. While it is true, as stated in NEEA’s comment, that 

restaurant building models have higher ventilation loads than other building models, 

DOE does not believedecided, as a matter of policy, that thisit would alternot assess the 
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secondary impacts of amended standards such as the simulation results 

significantlyimpacts of improved equipment efficiency on building HVAC loads. 

Therefore, DOE did not pursue this matter any further in its NOPR analysis. 

In response to NEEA’s comment regarding the equipment’s heat emitted by selfcontained equipment and the geographic location of these units, DOE points to chapter 7 

of the preliminary analysis TSD for complete details of the analysis. The whole-building 

simulations conducted for the preliminary analysis were carried out in 15 different 

climates zones, representing all the major climate zones in the United States, with an 

appropriate weighting factor applied to each climate zone. Further, the analysis was 

carried out over 1 full year (365 days). The results of the preliminary energy use analysis 

were obtained by averaging the energy consumption of the equipment over 1 full year 

and over all the major climate zones in the United States.

DOE understands that the presence of many self-contained refrigeration units may 

have a considerable impact on the HVAC loads of a business establishment, as stated by

Southern Store Fixtures. However, DOE reiterates that the objective of its analysis is to 

assess only the differential impact of equipment efficiency improvements, and not to 

assess the impact of total heat output by a self-contained unit. Moreover, DOE’s energy 

use analysis is concerned with the impact of only one unit of commercial refrigeration 

equipment. As stated above, DOE found that the differential impact of equipment 

efficiency improvements to a VCT.SC.L freezer on the building HVAC loads was 

negligible. 
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As a matter of policy, DOE has determined that it will not carry out studies to 

determine the impact of efficiency improvements to equipment on building HVAC loads

in appliance and commercial equipment standards rulemakings. 

H. Life-Cycle Cost and Payback Period Analysis

DOE conducts LCC analysis to evaluate the economic impacts of potential 

amended energy conservation standards on individual commercial 

consumerscustomers—that is, buyers of the equipment. LCC is defined as the total 

consumercustomer cost over the life of the equipment, and consists of purchase price, 

installation costs, and operating costs (maintenance, repair, and energy costs). DOE 

discounts future operating costs to the time of purchase and sums them over the expected 

lifetime of the piece of equipment. PBP is defined as the estimated amount of time it 

takes consumerscustomers to recover the higher installed costs of more-efficient 

equipment through savings in operating costs. DOE calculates the PBP by dividing the 

increase in installed costs by the average savings in annual operating costs.

As part of the engineering analysis, design option levels were ordered based on

increasing efficiency (decreasedi.e., decreasing energy consumption) and increasing 

MSP. For the LCC analysis, DOE chose a maximum of eight levels, henceforth referred 

to as “efficiency levels,” from the list of engineering design option levels. For equipment 

classes for which fewer than eight design option levels were defined in the engineering 

analysis, all design option levels were used. However, for equipment classes where more 
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than eight design option levels were defined, DOE selected specific levels to analyze in 

the following manner: 

1. The lowest and highest energy consumption levels provided in the engineering 

analysis were preserved.

2. If the difference in reported energy consumptions and reported manufacturer 

price between sequential levels was minimal, only the higher efficiency level 

was selected. 

3. If the energy consumption savings benefit between efficiency levels relative to 

the increased cost was very similar across multiple sequential levels, an 

intermediate level was not selected as an efficiency level.

The first efficiency level (Level 1) in each equipment class is the least efficient 

and the least expensive equipment in that class. The higher efficiency levels (Level 2 and 

higher) exhibit progressive increases in efficiency and cost from Level 1. The highest 

efficiency level in each equipment class corresponds to the max-tech level. DOE treats 

the efficiency levels as “candidate standard levels,” as each higher efficiency level 

represents a potential new standard level. 

The installed cost of equipment to a consumercustomer is the sum of the 

equipment purchase price and installation costs. The purchase price includes MPC, to 

which a manufacturer markup and outbound freight cost are applied to obtain the MSP. 

This value is calculated as part of the engineering analysis (chapter 5 of the NOPR TSD). 

DOE then applies additional markups to the equipment to account for the markups 
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associated with the distribution channels for the particular type of equipment (chapter 6 

of the NOPR TSD). Installation costs varied by State, depending on the prevailing labor 

rates. 

Operating costs for commercial refrigeration equipment are the sum of 

maintenance costs, repair costs, and energy costs. These costs are incurred over the life of 

the equipment and therefore are discounted to the base year (20162017, which is the

effective compliance date of theany amended standards that will beare established as part 

of this rulemaking). The sum of the installed cost and the operating cost, discounted to 

reflect the present value, is termed the life-cycle cost or LCC.

Generally, consumerscustomers incur higher installed costs when they purchase 

higher efficiency equipment, and these cost increments will be partially or wholly offset 

by savings in the operating costs over the lifetime of the equipment. Usually, the savings 

in operating costs are due to savings in energy costs because higher efficiency equipment 

uses less energy over the lifetime of the equipment. Often, the LCC of higher efficiency 

equipment is less than lower efficiency equipment. LCC savings are calculated for each 

efficiency level of each equipment class.

The PBP of higher efficiency equipment is obtained by dividing the increase in 

the installed cost by the decrease in annual operating cost. For this calculation, DOE uses 

the first year operating cost changes as the estimate of the decrease in operating cost, 

noting that the first year operating costs include maintenance and repair costs that are 
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annualized over the entire lifetime of the equipment and the first yearIn addition to

energy costs (calculated using the electricity price forecast for the first year), the annual 

operating cost includes annualized maintenance and repair costs. PBP is calculated for 

each efficiency level of each equipment class.

Apart from MSP, installation costs, and maintenance and repair costs, other 

important inputs for the LCC analysis are markups and sales tax, equipment energy 

consumption, electricity prices and future price trends, expected equipment lifetime, and 

discount rates.

Many inputs for the LCC analysis are estimated from the best available data in the 

market, and in some cases the inputs are generally accepted values within the industry. In 

general, there is uncertainty each input value has a range of values associated with most 

of the inputs, as it is difficult to obtain accurate. While single representative values for 

these inputs.each input may yield an output that is the most probable value for that 

output, such an analysis does not provide the general range of values that can be 

attributed to a particular output value. Therefore, DOE carried out the LCC analysis in 

the form of Monte Carlo simulations,

60

 

60 Monte Carlo simulation is, generally, a computerized mathematical technique that allows for 

computation of the outputs from a mathematical model based on multiple simulations using different input 

values. The input values are varied based on the uncertainties inherent to those inputs. The combination of 

the input values of different inputs is carried out in a random fashion to simulate the different probable 

input combinations. The outputs of the Monte Carlo simulations reflect the various probable outputs that 

are possible due to the uncertaintiesvariations in the inputs.

in which certain inputs were expressed as a range 

of values and probability distributions to account for the uncertainties.ranges of values 

that may be typically associated with the respective input values. The results, or outputs,
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of the LCC analysis are presented in the form of mean and median LCC savings; 

percentages of consumerscustomers experiencing net savings, net cost and no impact in 

LCC; and median PBP. For each equipment class, 10,000 Monte Carlo simulations were 

carried out. The simulations were conducted using Microsoft Excel and Crystal Ball, a 

commercially available Excel add-in used to carry out Monte Carlo simulations. 

LCC savings and PBP are calculated by comparing the installed costs and LCC 

values of standards-case scenarios against those of base-case scenarios. The base-case 

scenario is the scenario in which equipment is assumed to be purchased by 

consumerscustomers in the absence of the proposed energy conservation standards. 

Standards-case scenarios are scenarios in which equipment is assumed to be purchased by 

consumerscustomers after the amended energy conservation standards, determined as part 

of the current rulemaking, go into effect. The number of standards-case scenarios for an 

equipment class is equal to one less than the total number of efficiency levels in that 

equipment class, since each efficiency level above Efficiency Level 1 represents a 

potential amended standard. Usually, the equipment available in the market will have a 

distribution of efficiencies. Therefore, for both base-case and standards-case scenarios, in 

the LCC analysis, DOE assumed a distribution of efficiencies in the market, and the 

distribution was assumed to be spread across all efficiency levels in the LCC analysis

(see NOPR TSD chapter 10).

Recognizing that each building that uses commercial refrigeration equipment is 

unique, DOE analyzed variability and uncertainty in the LCC and PBP results by 
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performing the LCC and PBP calculations for seven types of businesses: 

(1) supermarkets; (2) wholesaler/multi-line retail stores, such as “big-box stores,” 

“warehouses,” and “supercenters”; (3) convenience and small specialty stores, such as 

meat markets and wine, beer, and liquor stores; (4) convenience stores associated with 

gasoline stations; (5) full-service restaurants; (6) limited service restaurants; and (7) other 

foodservice businesses, such as caterers and cafeterias. Different types of businesses face 

different energy prices and also exhibit differing discount rates that they apply to 

purchase decisions.

Expected equipment lifetime is another input for which it is inappropriate to use a

single value for each equipment class.whose value varies over a range. Therefore, DOE 

assumed a distribution of equipment lifetimes that are defined by Weibull survival 

functions.61

Another important factor influencing the LCC analysis is the State in which the 

commercial refrigeration equipment is installed. Inputs that vary based on this factor 

include energy prices and sales tax. At the national level, the spreadsheets explicitly 

modeled variability in the model inputs for electricity price and markups, using 

probability distributions based on the relative shipments of units to different States and 

business types.

Detailed descriptions of the methodology used for the LCC analysis, along with a 

 

61 Weibull survival function is a continuous probability distribution function that is used to approximate the 

distribution of equipment lifetimes of commercial refrigeration equipment. 
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discussion of inputs and results, are presented in chapter 8 and appendices 8A and 8B of 

the NOPR TSD. 

1. Effect of Current Standards

DOE notes that, beginning January 1, 2012, manufacturers will needwere required

to comply with the standards set by the January 2009 final rule.62

 

62 DOE extended the compliance date for manufacturers to submit certification reports tor commercial 

refrigeration equipment until December 31, 2013. 77 FR 76825 (Dec. 31, 2012). DOE emphasizes, 

however, that the testing and sampling requirements for commercial refrigeration equipment are unchanged 

by this extension.

74 FR 1092, 1093 (Jan. 

9, 2009). The market technologyDOE concludes that the efficiency level will be alteredof 

the equipment on the market increased during this time. The engineering analysis for this 

NOPR was first developed in 2012 when compliance with 2011, and therefore the 

engineering design option levels include efficiency levels of equipment available in the 

market in 2011. This means that the engineering efficiency levels were built up starting 

from levels which are below the standards set by the January 2009 final rule. These levels 

were included for analytical purposes, solely to represent the manner in which 

manufacturers may have achieved compliance with the January 2009 final rule standard 

levels, and were not considered in the development of proposed standard levels. The LCC 

analysis and NIA assume the first year for the analyses as 2017. As noted above, the

market in 2017 will be different from that in 2011 in terms of efficiency distribution of 

the equipment, mainly due to the effect of the standards is required. Id.established by the 

January 2009 final rule. Therefore, the current market baseline obtained in(from the year 

2011) used as the starting point for the engineering analysis is not representthe same as

the market baseline in 20162017, when any amended standards prescribed by the current 
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rulemaking are scheduled to go into effect. 

To estimate the state of the market technologybaseline level in 20162017, DOE 

introduced a baseline level termed the “standards baseline.” The energy consumption of 

the standards baseline level of an equipment class is equal to the standard prescribed by 

the January 2009 final rule for that equipment class. 74 FR at 1093. DOE inserted the 

standards baseline into the engineering design option levels by placing it at the 

appropriate level based on the energy consumption of the standards baseline. (Jan. 9, 

2009). The design option levels that are less efficient than the standards baseline were

disregarded, and the more-efficient design option levels were carried forward for 

downstream analyses. A detailed description of this procedure is presented with the aid of 

an example in chapter 8 of NOPR TSD.

At the April 2011 preliminary analysis public meeting, AHRI asked whether DOE 

intended to update the LCC analysis once the standards set in the January 2009 final rule 

became effective in order to change the baseline. (AHRI, Public Meeting Transcript, No. 

31 at pp. 99–100) 

The engineering analysis for this NOPR was first developed in 2011, and updated 

with new information as it became available up to the time of this publication. However, 

DOE continued to use in its engineering baseline characteristics reflecting the 

construction of equipment prior to required compliance with the standards set by the 

January 2009 final rule. As a result, some of the engineering efficiency levels reflect 
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levels which do not correspond to equipment performance currently permitted on the 

market after January 1, 2012. These levels, however, are solely used to reflect the manner 

in which DOE believes manufacturers could have attained the 2009 final rule standard 

levels through implementation of design options, and were not used in the downstream 

analysis for the purposes of calculating standard levels proposed in this NOPR.

Consistent with the methodology described above and explained in detail in 

Chapter 8 of the NOPR TSD, DOE developed a “standards baseline” for use as the 

starting point for its downstream (LCC and PBP, NIA, etc.) analyses. The first 

opportunity to revise the analysis after the January 2009 final rule goes into effect would 

be in January 2012, which would be after the conclusion of the NOPR analysis period for 

this rulemaking. This timeframe is not sufficient for DOE to conduct a full engineering 

analysis to study the full impact of the January 2009 final rule standards on the designs 

available in the commercial refrigeration equipment market. Therefore, DOE will 

continue with its current approach of estimating the predictable effects of the January 

2009 final rule (such as using the January 2009 final rule standards as the baseline 

efficiency level), and reflecting such in the LCC and PBP (as well as upstream 

engineering) analyses to ensure the timely publication of the current rulemaking 

documents.

This standards baseline corresponds to the lowest efficiency level which would be 

compliant with current (January 2009 final rule) standards. From there, higher efficiency 

levels were studied as the basis for developing potential standard levels as proposed in 

today’s NOPR. In response to AHRI’s comment, DOE used updated inputs to the 
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baseline in order to reflect the compliance date of the January 2009 final rule standards 

having passed. This includes updates to the non-standards case efficiency distribution and 

other inputs to the downstream analyses. These inputs were updated based on the most 

recent available information for use in conducting the analysis described in today’s 

NOPR. 

2. Equipment Cost

To calculate consumercustomer equipment costs, DOE multiplied the MSPs 

developed in the engineering analysis by the distribution channel markups, described in 

section IV.F. DOE applied baseline markups to baseline MSPs, and incremental markups 

to the MSP increments associated with higher efficiency levels.

3. Installation, Maintenance, and Repair Costs 

Installation cost includes labor, overhead, and any miscellaneous materials and 

parts needed to install the equipment. The installation costs may vary from one 

equipment class to another, but they do not vary with efficiency levels within an 

equipment class. Costs that do not vary with efficiency levels do not impact the LCC, 

PBP, or NIA results. DOE retained the nationally representative installation cost values 

from the January 2009 final rule of $2,000 for all remote condensing equipment of

$2,000 and $750 for all self-contained equipment of $750, and simply escalated the 

values from 2007$ to 20102012$, resulting in 20102012 installation costs of $2,106299

and $790862, respectively.
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True stated that the average glass-doored merchandiser is moved and installed 

twice in its lifetime, and that self-contained, solid-doored units, which are used in 

commercial kitchens, are moved and installed in different locations at least three times, 

on average, during their lifetimes. Therefore, True suggested that DOE double or triple its

estimated installation cost. (True, Public Meeting Transcript, No, 31 at p. 110) 

Based on the design options for higher efficiency levels, DOE determined that 

installation costs do not vary by efficiency levels within a given equipment class. Costs 

that do not vary with efficiency levels do not impact the LCC, PBP, or NIA results. 

Because doubling or tripling of installation costs would not impact the net results, DOE 

did not alter the installation costs for the NOPR analyses based on True’s comment. 

Maintenance costs are associated with maintaining the operation of the 

equipment. DOE split the maintenance costs into regular maintenance costs and lighting 

maintenance costs. Regular maintenance activities, which include cleaning evaporator

and condenser coils, drain pans, fans, and intake screens; inspecting door gaskets and

seals; lubricating hinges; and checking starter panel, control, and defrost system 

operation, were considered to be equivalent for equipment at all efficiency levels. 

Lighting maintenance costs are the costs incurred to replace display case lighting at 

regular intervals in a preventative fashion. Because lights and lighting configuration 

change with efficiency levels, lighting maintenance costs vary with efficiency levels. As 

stated in section IV.E.4.d, for efficiency levels that incorporate LED lights as a design 

option, the reduction in LED costs beyond 2017 were taken into account when 
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calculating the lighting maintenance costs vary with efficiency levels. 

 

Repair cost is the cost to the consumercustomer of replacing or repairing failed 

components. DOE calculated repair costs based on the typical failure rate of refrigeration 

system components, original equipment manufacturer (OEM) cost of the components, 

and an assumed markup value to account for labor cost. 

a. Maintenance and Repair Costs by Efficiency Level

Traulsen commented that it agreed with DOE that installation and maintenance 

costs would be flat across all efficiency levels. (Traulsen, No. 45 at p. 4) AHRI, however, 

disagreed with DOE’s assumption that repair and maintenance costs would not vary with 

efficiency. AHRI stated that the industry’s experience has been that higher efficiency 

equipment is more expensive to repair and maintain since it uses more sophisticated 

components. AHRI also added that, if repair and maintenance cost data are not available 

by efficiency level, DOE should correlate itrepair and maintenance cost with equipment 

cost. (AHRI, No. 43 at p. 3) 

DOE does not believe that any design option used in the higher efficiency 

equipment forconsidered in this rulemaking would lead to higher costs for regular 

maintenance activities. Repair costs and lighting maintenance costs, on the other hand, 

have been modeled to be proportional to the OEM cost of the components and, 

consequently, are higher for higher efficiency equipment. DOE requested information 

from stakeholders regarding maintenance and repair costs specifically related to any of 
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the design options used for this rulemaking, but did not receive any such information. 

Therefore, DOE retained its current approach of using flat costs for regular maintenance, 

and costs proportional to OEM cost for repair costs and lighting maintenance costs.

Southern Store Fixtures questioned whether DOE would examine the economic 

impact of night curtains and lighting occupancy sensors on equipment cost and operating 

cost. (Southern Store Fixtures, Public Meeting Transcript, No. 31 at pp. 185–86) CA 

IOUs stated that labor costs related to night curtain deployment can be significant. CA 

IOUs urged DOE to review and update its assumptions involving night curtains. (CA 

IOUs, No. 42 at p. 5) 

Equipment costs, which include costs of night curtains and lighting occupancy 

sensors, were covered in the engineering analysis used to obtain the MSP (see section 

IV.E). Based on interactionsdiscussions with specialists in display case retrofits who are 

familiar with lighting occupancy sensor installation and setup, DOE concluded that 

lighting occupancy sensors do not increase maintenance costs of commercial refrigeration 

equipment. With respect to repair or replacement costs, DOE determined that the 

manufacturing processes used today produce highly reliable products, making the failure 

of occupancy sensors relatively rare. Typically, according to the available data, lighting 

occupancy sensors last nearly 15 years, which is longer than the average lifetime of 

commercial refrigeration equipment. Therefore, DOE did not include lighting occupancy 

sensor repair or replacement costs in the LCC analysis. 
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DOE believes that the night curtains currently available in the market are 

designed for easy deployment and retraction. In most instances, it takes less than 15 

seconds per refrigerated display case to deploy or retract a night curtain. DOE believes 

that deployment and retraction of night curtains can be easily assimilated into the 

personnel activities associated with store closing or opening operations, and will not 

amount to an added expense. Therefore, DOE did not add labor costs for night curtain 

deployment and retraction to the LCC analysis or NIA.

b. Maintenance and Repair Cost Annualization

Stakeholders provided feedback on DOE’s methodology in annualizing the costs 

of equipment maintenance and repair. ASAP stated that annualizing lighting maintenance 

costs results in a present value that is greater than it would be if DOE were to model 

lighting replacement costs in the years in which they actually were incurred. (ASAP, 

Public Meeting Transcript, No. 31 at p. 104) NEEA agreed that DOE should try to 

characterize maintenance costs as accurately as possible, modeling truly annual costs on 

an annual basis, and other costs as they occur (i.e., as capital equipment costs). NEEA 

added that it is not appropriate to annualize all costs because, while some costs are truly 

annual or biannual, others are periodic maintenance investments and should be treated as 

such. NEEA referenced the fluorescent lamp ballast rulemaking (Docket No. EE-2007-

BT-STD-0016), in which DOE accounted for lamp replacement costs in the years in 

which they occurred, and urged DOE to adopt a similar methodology in this rulemaking. 

(NEEA, Public Meeting Transcript, No. 31 at p. 105, No. 36 at pp. 5–6) ASAP and 

NRDC echoed this stance in their jointly submitted written comment, stating that, while it 
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is reasonable to annualize costs that are indeed incurred annually or biannually, 

annualizing costs that only occur in certain years could distort the LCC output, resulting 

in a higher present value of annualized costs. ASAP and NRDC also referenced the 

fluorescent ballast rulemaking, and suggested that DOE account for costs similarly in this 

rulemaking’s analyses. (ASAP and NRDC, No. 34 at p. 4) Southern Store Fixtures, 

however, offered a dissenting opinion, adding that it is a common practice in 

supermarkets to have lighting contracts under which a maintenance worker changes the 

lights on a scheduled basis, whether they are broken or not, making lighting costs indeed 

annual. (Southern Store Fixtures, Public Meeting Transcript, No. 31 at p. 107) 

DOE has determined that, if the costs of known items occurring at predictable 

intervals are appropriately discounted when annualized, there will be no impact on LCC 

and NIA results, regardless of whether or not the costs are annualized. Additionally, in 

the commercial refrigeration equipment analyses, repairs and replacements have been 

modeled as a combination of known, expected items, plus others modeled simply as a 

fraction of failed components that are expected to be replaced during equipment lifetime. 

Such a characterization of maintenance and repair costs does not lend itself to explicit 

timing in the analysis.specification of a particular time, during the equipment lifetime, 

when such repairs are likely to occur. Further, the PBP by its very definition cannot be 

calculated unless the costs are annualized. Finally, if multiple explicit repair and 

maintenance line items were tracked individually in the NIA model, the size and 

complexity of the computer model would grow exponentially without a commensurate 

improvement in value. Therefore, DOE has retained its conventional approach of
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annualizing the maintenance and repair costs.

c. Maintenance Cost Estimates

At the April 2011 preliminary analysis public meeting, Coca-Cola stated that its 

largest maintenance cost is condenser cleaning, which is much more expensive than 

lighting maintenance. (Coca-Cola, Public Meeting Transcript, No. 31 at p. 109) NEEA 

commented that, in the case of actual maintenance costs, it agreed with Coca-Cola’s 

assertion that $35 per year, the maintenance cost presented by DOE in its preliminary 

analysis, is too low, based on its intuition regarding the cost of labor and travel to 

maintain equipment. (NEEA, No. 36 at p. 6) 

DOE obtained its annualized maintenance costs for commercial refrigeration 

equipment from RS Means Facilities Maintenance and Repair Cost Data.63

 

63 RS Means Company, Inc. Means Costworks 2010: Facility, Maintenance and Repair Cost Data. 2010. 

Kingston, MA.

RS Means

data provide estimates of the person-hours, labor rates, and materials required to maintain 

commercial refrigeration equipment. While it could be true that an amount of $35 per 

year does not reflect travel and other overhead charges, DOE believes that the value 

reflects the cost incurred for labor if the maintenance were to be performed by in-house 

personnel of the business establishment. In any case, the actual amount allocated to the 

regular maintenance costs has no effect on the LCC analysis or the NIA because 

maintenance costs do not vary based on efficiency levels in any equipment class. DOE 

believes the higher efficiency design options selected for this rulemaking do not result in 

changes to the regular maintenance costs of the commercial refrigeration equipment. 
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Therefore, DOE believes that a value of $35 is reasonably representative of the regular 

maintenance costs for self-contained equipment. 

d. Refrigerant Costs

Southern Store Fixtures stated that DOE should include refrigerant recharge costs 

in its maintenance cost estimates, because EPA and DOE have accepted that there is an 

18-percent refrigerant leakage rate annually, or at least regularly, for rack systems. 

(Southern Store Fixtures, Public Meeting Transcript, No. 31 at p. 108) 

Costs incurred due to refrigerant leakage do not vary with equipment efficiency 

levels. Therefore, these costs will not affect the LCC analysis or NIA results. DOE did 

not take these costs into account for the NOPR analysis. 

e. Repair Costs

Traulsen stated that repair costs would increase commensurate with the purchase 

price of the components to be repaired. This increase, Traulsen added, would be 

consistent with the increase in manufacturing cost due to the implementation of a 

technology. (Traulsen, No. 45 at p. 4) 

DOE modeled repair costs as directly proportional to the OEM cost of the failed 

components. This approach yields higher repair costs for higher efficiency equipment and 

is consistent with Traulsen’s comment.
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Zero Zone stated that it suspected the average lifetime of an LED light is less than 

5 years, and that the cost to replace one will be higher than estimated. This, Zero Zone 

added, is because LEDs continue to evolve and older models are discontinued, meaning 

that replacement of failed LEDs will require a complete relamping to maintain consistent 

product appearance. (Zero Zone, No. 37 at p. 4) 

All major manufacturers of LED lighting solutions for refrigerated display cases 

state that the maintenance-free lifetime for LED lights is 50,000 hours, and some of the 

retailers offer a 5-year warranty. DOE did not find any basis for doubting the assumption 

of a 50,000-hour lifetime for LED lights in refrigerated display cases. Recognizing that 

replacement of LED strip lighting in refrigerated display cases involves higher labor costs 

compared to the simple lamp replacement process of fluorescent tube lights, DOE applied 

a retrofit factor (multiplier) of 1.4 to the LED lamp cost to account for relamping of LED 

lights in display cases. The retrofit factor was estimated based on retrofit costs of some of 

the refrigerated display case LED retrofit projects. The results presented in the 

preliminary analysis used the retrofit factor of 1.4, and DOE used the same factor for its 

NOPR analysis.

4. Annual Energy Consumption

Annual energy consumption of commercial refrigeration equipment is obtained 

from engineering analysis (chapter 5 of the NOPR TSD). 
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5. Energy Prices

DOE calculated average commercial electricity prices using the U.S. Energy

Information Administration’s (EIA’s) Form EIA-826, “Database Monthly Electric Utility 

Sales and Revenue Data.”64 DOE calculated an average national commercial price by (1) 

estimating an average commercial price for each utility company by dividing the 

commercial revenues by commercial sales; and (2) weighting each utility by the number 

of commercial customers it served in that region, across the nation.

6. Energy Price Projections

To estimate energy prices in future years for the preliminary analysis TSD, DOE 

multiplied the average regional energy prices described above by the forecast of annual 

average commercial energy price indices developed in the Reference Case from 

AEO2011AEO2013.

65 AEO2011AEO2013 forecasted prices through 20352040. To 

estimate the price trends after 20352040, DOE assumed the same average annual rate of 

change in prices as from 20262031 to 20352040. 

7. Equipment Lifetime

DOE defines lifetime as the age at which a commercial refrigeration equipment 

unit is retired from service. DOE based expected equipment lifetime on discussions with 

industry experts, and concluded that a typical lifetime of 10 years is appropriate for most 

 

64 U.S. Energy Information Administration. EIA-826 Sales and Revenue Spreadsheets. (Last accessed May 

16, 2012). www.eia.doe.gov/cneaf/electricity/page/eia826.html 65 The spreadsheet tool that DOE used to conduct the LCC and PBP analyses allows users to select price 

forecasts from either AEO’s High Economic Growth or Low Economic Growth Cases. Users can thereby 

estimate the sensitivity of the LCC and PBP results to different energy price forecasts.
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commercial refrigeration equipment in large grocery/multi-line stores and restaurants. 

Industry experts believe that operators of small food retail stores, on the other hand, tend 

to use display cases longer. DOE used 15 years as the average equipment lifetime for 

display cases used in such retail stores. DOE reflects the uncertainty of equipment 

lifetimes in the LCC analysis for both equipment markets as probability distributions, as 

discussed in section 8.2.3.5 of the TSD.

Traulsen stated that 10 years is an acceptable estimate for the lifetime of selfcontained equipment, and that it is not uncommon for some applications to have a 20-

year lifetime. However, Traulsen added that smaller units subject to more frequent human 

interaction, such as undercounter units, would likely have shorter lifetimes, such as 7 

years. Traulsen also stated that price point could indicate potential lifetime. (Traulsen, 

Public Meeting Transcript, No. 31 at p. 4) AHRI commented that properly installed and 

maintained equipment typically has a much longer lifetime than the actual period of time

the end use customers retain it, and that this is entirely dependent on the specific business 

models of and competitive demands on different users. However, AHRI added that the 

10-year lifetime used by DOE is an appropriate average value. (AHRI, No. 43 at p. 3) 

NEEA concurred, stating that it generally agreed with the inputs to the Crystal Ball 

simulations that DOE used. In particular, NEEA stated that it was comfortable with the 

assumed equipment lifetimes and distributions thereof, and that, while much of the 

equipment does indeed last longer, at that point the equipment becomes used equipment 

and is not directly applicable to the rulemaking except for purposes of estimating 

shipments. (NEEA, No. 36 at p. 6)

Comment [A21]: Revision requested by OIRA.

Comment [A22]: Revision requested by OIRA.
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DOE appreciates the comments supporting the assumption of averagepreviously 

submitted and welcomes further input on the equipment lifetimes for the LCC analysis 

and NIA.

8. Discount Rates

In calculating the LCC, DOE applies discount rates to estimate the present value 

of future operating costs. to the customers for commercial refrigeration equipment. The 

discount rate is the rate at which future expenditures are discounted to establish their 

present value. to the customer. 66 DOE derived the discount rates for the commercial 

refrigeration equipment analysis by estimating the cost of capital for a large number of 

companies similar to those that could purchase commercial refrigeration equipment and 

then sampling them to characterize the effect of a distribution of potential customer 

discount rates. The cost of capital is commonly used to estimate the present value of cash 

flows to be derived from a typical company project or investment. Most companies use 

both debt and equity capital to fund investments, so their cost of capital is the weighted 

average of the cost to the company of equity and debt financing. 

DOE estimated the cost of equity financing by using the Capital Asset Pricing 

 

66 The LCC analysis estimates the economic impact on the individual customer from that customer’s own 

economic perspective in the year of purchase and therefore needs to reflect that individual’s own perceived 

cost of capital. By way of contrast DOE’s analysis of national impact requires a societal discount rate. 

These rates used in that analysis are 7 percent and 3 percent, as required by OMB Circular A-4, September 

17, 2003. 

Comment [A23]: Revision requested by OIRA.

Comment [A24]: Revision requested by OIRA.

Comment [A25]: Revision requested by OIRA.

Comment [A26]: Revision requested by OIRA.

Comment [A27]: Revision requested by OIRA.

Comment [A28]: Revision requested by OIRA.

Comment [A29]: Revision requested by OIRA.
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Model (CAPM).67 The CAPM, among the most widely used models to estimate the cost 

of equity financing, assumes that the cost of equity is proportional to the amount of 

systematic risk associated with a company. The cost of equity financing tends to be high 

when a company faces a large degree of systematic risk, and it tends to be low when the 

company faces a small degree of systematic risk.

9. Compliance Date of Standards

EPCA prescribes that DOE must review and determine whether to amend 

performance-based standards for commercial refrigeration equipment by January 1, 2013. 

(42 U.S.C. 6313(c)(56)(A)) In addition, EPCA requires that theany amended standards 

established in this rulemaking must apply to equipment that is manufactured on or after 3 

years after the final rule is published in the Federal Register unless DOE determines, by 

rule, that a 3-year period is inadequate, in which case DOE may extend the compliance 

date for that standard by an additional 2 years. (42 U.S.C. 6313(c)(56)(C)) Based on these 

criteria, DOE assumedreasoned due to the cumulative regulatory burden of the recently 

implemented 2009 CRE final rule and of the upcoming walk-in cooler and freezer rule, 

which both affect the same industry that the most likely compliance date for the standards

set by this rulemaking would be, at the earliest, in 20162017. Therefore, DOE calculated 

the LCC and PBP for commercial refrigeration equipment under the assumption that 

compliant equipment would be purchased in 2016,2017. DOE seeks comment on 

whether it should extend the year when compliance with the amended standard is 

requireddate as authorized, and, if so, by how long. 

 

67 Harris, R.S. Applying the Capital Asset Pricing Model. UVA-F-1456. Available at SSRN: 

http://ssrn.com/abstract=909893. 

Comment [A30]: Revision requested by OIRA.

Comment [A31]: Revision requested by OIRA.

Comment [A32]: Revision requested by OIRA.

Comment [A33]: Revision requested by OIRA.

Comment [A34]: Revision requested by OIRA.
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10. Base-Case and Standards-Case Efficiency Distributions

To accurately estimate the share of affected consumerscustomers who would 

likely be impacted by a standard at a particular efficiency level, DOE’s LCC analysis 

considers the projected distribution of efficiencies of equipment that consumerscustomers

purchase under the base case (that is, the case without new or amended energy efficiency 

standards). DOE refers to this distribution of equipment efficiencies as a base-case 

efficiency distribution. 

DOE’s methodology to estimate market shares of each efficiency level within 

each equipment class is a cost-based method consistent with the approaches that were 

used in the EIA’s National Energy Modeling System (NEMS)

68 and in the Canadian 

Integrated Modeling System (CIMS)69,70 for estimating efficiency choices within each 

equipment class. DOE then extrapolated future scenarios of the equipment efficiency for 

the base case and amended standards cases using the same cost-based method. The 

difference in equipment efficiency between the base case and amended standards case 

was the basis for determining the reduction in unit energy consumption resulting from 

amended standards.

Traulsen commented that it believed that DOE’s estimates of shipment-weighted 

 

68 U.S. Energy Information Administration. National Energy Modeling System Commercial Model 

(2004 Version). 2004. Washington, DC. 69 The CIMS Model was originally known as the Canadian Integrated Modeling System, but as the model is 

now being applied to other countries, the acronym is now used as its proper name.

70 Energy Research Group / M.K. Jaccard & Associates. Integration of GHG Emission Reduction Options 

using CIMS. 2000. Vancouver, B.C. 

www.emrg.sfu.ca/media/publications/Reports%20for%20Natural%20Resources%20Canada/Rollup.pdf
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market share are skewed toward the higher performance levels. Traulsen added that it

believed that DOE has overestimated the value that end users place on energy efficiency. 

(Traulsen, No. 45 at p. 7) 

DOE recognizes Traulsen’s concern, but at this time has no data to more 

accurately define the market shares by efficiency level within each equipment class. No 

data on shipments by efficiency level of either self-contained or remote condensing 

equipment classes are known to DOE or were provided by industry or other 

stakeholders. Currently, there is also no extensive database of available efficiency levels 

by model that could be used to provide a proxy for efficiency levels for shipped 

equipment, an approach that has been used in rulemakings for other products when 

efficiency data on shipped products was lacking. The methodology used for this analysis 

was identical to that used in the January 2009 final rule analysis. See chapter 10 of the 

TSD for the January 2009 final rule, available at: 

www1.eere.energy.gov/buildings/appliance_standards/commercial/pdfs/chp_10_cre_ship

mts_final.pdf. If the model may overstate this value, it will result in greater 

fractionoverstates the share of shipments at the base-case scenario to be at higher 

efficiency levels, which may slightly understate in the base case scenario, it results in 

analysis erring on the side of lower NES and NPV. values. 

11. Inputs to Payback Period Analysis

Payback period is the amount of time it takes the consumercustomer to recover 

the higher purchase cost of more energy efficient equipment as a result of lower operating 
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costs. Numerically, the PBP is the ratio of the increase in purchase cost to the decrease in 

annual operating expenditures. This type of calculation is known as a “simple” PBP

because it does not take into account changes in operating cost over time or the time 

value of money; that is, the calculation is done at an effective discount rate of zero 

percent. PBPs are expressed in years. PBPs greater than the life of the equipment mean 

that the increased total installed cost of the more-efficient equipment is not recovered in 

reduced operating costs over the life of the equipment.

The inputs to the PBP calculation are the total installed cost to the 

consumercustomer of the equipment for each efficiency level and the average annual 

operating expenditures for each efficiency level in the first year. The PBP calculation 

uses the same inputs as the LCC analysis, except that electricity price trends and discount 

rates are not used. 

12. Rebuttable-Presumption Payback Period

Sections 325(o)(2)(B)(iii) and 345(e)(1)(A) of EPCA, (42 U.S.C.

6295(o)(2)(B)(iii) and 42 U.S.C. 6316(e)(1)(A)), establish a rebuttable presumption 

applicable to commercial refrigeration equipment. The rebuttable presumption states that 

a new or amended standard is economically justified if the Secretary finds that the 

additional cost to the consumer of purchasing a product complying with an energy 

conservation standard level will be less than three times the value of the energy savings 

during the first year that the consumer will receive as a result of the standard, as 

calculated under the applicable test procedure. This rebuttable presumption test is an 

Comment [A35]: Revision requested by OIRA.
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alternative way of establishing economic justification.

To evaluate the rebuttable presumption, DOE estimated the additional cost of 

purchasing more-efficient, standards-compliant equipment, and compared this cost to the 

value of the energy saved during the first year of operation of the equipment. DOE 

interprets that the increased cost of purchasing standards-compliant equipment includes 

the cost of installing the equipment for use by the purchaser. DOE calculated the 

rebuttable presumption payback period (RPBP), or the ratio of the value of the increased 

installed price above the baseline efficiency level to the first year’s energy cost savings. 

When the RPBP is less than 3 years, the rebuttable presumption is satisfied; when the 

RPBP is equal to or more than 3 years, the rebuttable presumption is not satisfied. Note 

that this PBP calculation does not include other components of the annual operating cost 

of the equipment (i.e., maintenance costs and repair costs).

While DOE examined the rebuttable-presumption criterion, it also considered 

whether the standard levels considered are economically justified through a more detailed 

analysis of the economic impacts of these levels pursuant to 42 U.S.C. 6295(o)(2)(B)(i). 

The results of this analysis served as the basis for DOE to evaluate the economic 

justification for a potential standard level definitively (thereby supporting or rebutting the 

results of any preliminary determination of economic justification). 

I. National Impact Analysis – National Energy Savings and Net Present Value

The NIA assesses the NES and the NPV of total consumercustomer costs and 
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savings that would be expected as a result of amended energy conservation standards. 

The NES and NPV are analyzed at specific efficiency levels for each equipment class of 

commercial refrigeration equipment. DOE calculates the NES and NPV based on 

projections of annual equipment shipments, along with the annual energy consumption 

and total installed cost data from the LCC analysis. For the NOPR analysis, DOE 

forecasted the energy savings, operating cost savings, equipment costs, and NPV of 

consumercustomer benefits for equipment sold from 20162017 through 20452046—the 

year in which the last standards-compliant equipment is shipped during the 30-year 

analysis period. 

DOE evaluates the impacts of the amended standards by comparing base-case 

projections with standards-case projections. The base-case projections characterize 

energy use and consumercustomer costs for each equipment class in the absence of any 

amended energy conservation standards. DOE compares these projections with 

projections characterizing the market for each equipment class if DOE adopted thewere 

to adopt an amended standard at specific energy efficiency levels for that equipment 

class. For the standards cases, DOE considered a “roll-up” scenario, in which DOE 

assumed that equipment efficiencies that do not meet the standard level under 

consideration would “roll-up” to meet the amended standard level, and those already 

above the proposed standard level would remain unaffected. 

DOE uses a Microsoft Excel spreadsheet model to calculate the energy savings 

and the national consumercustomer costs and savings from each TSL. The NOPR TSD 
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and other documentation that DOE provides during the rulemaking help explain the 

models and how to use them, and interested parties can review DOE’s analyses by 

interacting with these spreadsheets. The NIA spreadsheet model uses average values as 

inputs (as opposed to probability distributions of key input parameters from a set of 

possible values).

For the current analysis, the NIA used projections of energy prices and 

commercial building starts from the AEO2011AEO2013 Reference Case. In addition, 

DOE analyzed scenarios that used inputs from the AEO2011AEO2013 Low Economic 

Growth and High Economic Growth Cases. These cases have lower and higher energy 

price trends, respectively, compared to the Reference Case. NIA results based on these 

cases are presented in chapter 10 of the NOPR TSD.

A detailed description of the procedure to calculate NES and NPV, and inputs for 

this analysis are provided in chapter 10 of the NOPR TSD. 

1. Shipments

Complete historical shipments data for commercial refrigeration equipment could 

not be obtained from a single source; therefore, DOE used data from multiple sources to 

estimate historical shipments. The major sources were 2005 shipments data provided by 

ARI as part of its comments submitted in response to the January 2009 final rule

Framework document, ARI 2005 Report (Docket No. EERE-2006-BT-STD-0126, ARI, 

No. 7, Exhibit B at p. 1); Commercial Refrigeration Equipment to 2014 by Freedonia 
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Group, Inc.71; 2008 Size and Shape of Industry by the North American Association of 

Food Equipment Manufacturers72; and Energy Savings Potential and R&D Opportunities 

for Commercial Refrigeration prepared by Navigant Consulting, Inc. for DOE.73 Exact 

shipments numbers and assumptions have been withheld because some of the sources 

cited above are not public documents and are available only for purchase.

Historical linear feet of shipped units depicts the annual amount of commercial 

refrigeration equipment capacity shipped, and is an alternative way to express shipments 

data. DOE determined the linear feet shipped for any given year by multiplying each unit 

shipped by its associated average length, and then summing all the linear footage values.

Table IV.3 presents the representative equipment class lengths used for the conversion of 

per-unit shipments to linear footage within each equipment class.

 

71 Freedonia Group, Inc. Commercial Refrigeration Equipment to 2014. 2010. Cleveland, OH. Study 2261. 

www.freedoniagroup.com/Commercial-Refrigeration-Equipment.html 72 North American Association of Food Equipment Manufacturers. 2008 Size and Shape of Industry. 2008. 

Chicago, IL.

73 Navigant Consulting, Inc. Energy Savings Potential and R&D Opportunities for Commercial 

Refrigeration. 2009. Prepared by Navigant Consulting, Inc. for the U.S. Department of Energy, 

Washington, DC.
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Table IV.3 Equipment Linear Dimensions Assumed for Shipments Analysis

Equipment 

Class

Assumed 

Length

ft

Basis

VOP.RC.M 10 Average of 8 ft and 12 ft, manufacturer interviews

VOP.RC.L 10 Average of 8 ft and 12 ft, manufacturer interviews

VOP.SC.M 4 Baseline equipment used for engineering analysis

SVO.RC.M 10 Average of 8 ft and 12 ft, manufacturer interviews

SVO.SC.M 4 Baseline equipment used for engineering analysis

HZO.RC.M 10 Average of 8 ft and 12 ft, manufacturer interviews

HZO.RC.L 10 Average of 8 ft and 12 ft, manufacturer interviews

HZO.SC.M 4 Baseline equipment used for engineering analysis

HZO.SC.L 4 Baseline equipment used for engineering analysis

VCT.RC.M 10 Average of 3-door and 5-door (30 in. per door), manufacturer interviews

VCT.RC.L 10 Average of 3-door and 5-door (3 in. per door), manufacturer interviews

VCT.SC.M 4 Engineering estimate*

VCT.SC.L 3.5 Average of 1-door and 2-door freezer

VCT.SC.I 5 Baseline equipment used for engineering analysis

VCS.SC.M 4 Engineering estimate*

VCS.SC.L 3.5 Average of 1-door and 2-door freezer

VCS.SC.I 5 Baseline equipment used for engineering analysis

HCT.SC.M 3.0 Engineering estimate*

HCT.SC.L 3.0 Engineering estimate*

HCT.SC.I 3.4 Baseline equipment used for engineering analysis

HCS.SC.M 4.0 Engineering estimate*

HCS.SC.L 5.0 Engineering estimate*

SOC.RC.M 8 Average of 4 ft, 8ft8 ft, 12 ft, all common equipment lengths

PD.SC.M 2.5 Baseline equipment used for engineering analysis

SOC.SC.M 5 Engineering estimate*

* For equipment classes that exhibit a wide range of equipment lengths in the market, DOE assumed a value for equipment length 

based on its best engineering judgment. 

DOE converted the estimated 2009 shipments data in each equipment class to 

percentages of total shipped linear feet of commercial refrigeration equipment for use in 

the shipments model. This established the commercial refrigeration equipment market 

share attributed to each equipment class. DOE calculated the percentpercentage of 

shipped linear footage by dividing the linear footage shipped for each equipment class by 

the overall linear footage shipped for all commercial refrigeration equipment covered in 

this rulemaking.

Table IV.4 summarizes DOE’s estimated division of historical annual shipments 
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into new and replacement categories by building type. The distributions shown in Table 

IV.4 result from several discrete steps. First, equipment types were identified by the type 

of business they generally serve. For example, vertical open cases with remote 

compressors are associated with large grocers and multi-line retail stores. Remote 

condensing equipment is generally associated with retail stores whichthat sell high 

volumes of perishable goods, while self-contained units are associated with foodservice 

and convenience or small food sales stores. When there was no strong association 

between the building type and equipment class, equipment was distributed across broader 

classes. Second, a ratio of new versus replacement equipment was developed based on 

commercial floor space estimates (floor space estimates are discussed below). Using the 

expected useful life of commercial refrigeration equipment and commercial floor space 

stock, additions, and retirements, ratios were developed that yielded a ratio of new versus 

replacement stock for use in this analysis. Using these and related factors (e.g., the 

division of foodservice into the three building types—limited service restaurants, fullservice restaurants, and other), DOE distributed commercial refrigeration equipment 

shipments among building types and new versus replacement shipments, as shown in 

Table IV.34. 

Table IV.4 Estimated Distribution of 2009 Linear Feet of Commercial Refrigeration 

Equipment Shipments Among New vs. Replacement Equipment

Building Type Replacement New Total

Large Grocery / Multi-Line Retail 31.130.5% 8.06% 39.1%

Small Grocery / Convenience 14.96% 3.84.1% 18.7%

Limited Service Restaurants 9.04% 3.73% 12.7%

Full Service Restaurants 9.48% 3.84% 13.2%

Other 11.612.1% 4.72% 16.3%

Total 76.04% 24.023.6% 100.0%

Table IV.5 shows the forecasted square footage of new construction used to scale 
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annual new commercial refrigeration equipment shipments. As the data in Table IV.5

show, forecasted square footage additions to the building stocks vary from year to year, 

with the first few years of the analyzed period exhibiting lower levels of growth due to 

predicted lingering impacts of the U.S. economic recession. The forecasted commercial 

refrigeration equipment shipments therefore show some variability as well, tracking the 

forecasted square footage floor space additions. The growth rates over the last 10 years of 

the AEOAEO2013 forecast (20262031 through 20352040) were used to extend the AEO

forecast out until the year 20452046 to develop the full 30-year forecast needed for the 

national impacts analysisNIA. 

Table IV.5 AEO2011 AEO2013 Forecast of New Food Sales and Foodservice Square 

Footage 

Year

New Construction

million ft2

Foodservice Food Sales

2009 49.47247.715 35.61234.070

20112012 39.32031.455 28.16222.149

20162017 51.60449.076 37.18034.496

2020 53.02647.617 38.15933.447

2025 57.48747.522 41.38433.416

2030 59.74853.630 42.94637.836

2035 62.72355.536 45.03239.107

2040 55.814 39.243

Annual Growth 

Factor, 2026–

20352031–2040

2.5541% 2.4327% 

Source: U.S. Department of Energy–Energy Information Administration,

Annual Energy Outlook 2011,2013.

DOE then estimated the annual linear footage shipped for each of the 24 primary

equipment classes. The shipments analysis relies on the 24 primary equipment classes to 

represent the commercial refrigeration equipment market. Table IV.6 shows the fraction 

of the linear footage shipped by each of these 24 equipment classes.
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Table IV.6 Percent of Shipped Linear Feet of Commercial Refrigeration Equipment

Equipment 

Class

Percentage of Linear 

Feet Shipped*

VOP.RC.M 11.59%

VOP.RC.L 0.61%

VOP.SC.M 0.82%

SVO.RC.M 9.30%

SVO.SC.M 1.23%

HZO.RC.M 1.43%

HZO.RC.L 4.49%

HZO.SC.M 0.11%

HZO.SC.L 0.22%

VCT.RC.M 0.87%

VCT.RC.L 12.11%

VCT.SC.M 5.46%

VCT.SC.L 0.27%

VCT.SC.I 0.30%

VCS.SC.M 22.11%

VCS.SC.L 11.25%

VCS.SC.I 0.07%

HCT.SC.M 0.07%

HCT.SC.L 0.43%

HCT.SC.I 0.48%

HCS.SC.M 5.01%

HCS.SC.L 0.65%

SOC.RC.M 2.34%

PD.SC.M 8.58%

SOC.SC.M 0.17%

* The percentages in this column do not sum to 100%

percent because shipments of secondary equipment 

classes and certain other equipment classes that were 

not analyzed in this rulemaking were not included.

The amount of new and existing commercial floor space is the main driver for 

commercial refrigeration equipment shipments, and is appropriately one of the basic 

inputs into the shipments model. The model divides commercial space into two 

components: space from new construction floor space and space from existing floor 

space. 

DOE took the projected floor space construction after the year 2009 from the 
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NEMS projection underlying AEO2010AEO2013.

74 DOE extracted annual estimates of 

new floor space additions from an AEO2010AEO2013 data file (kdbout) for the period 

from 2009 through 2035 period2040. As stated earlier, the last 10 years of the AEO

forecast were used to develop growth rates used to extend the forecast to 20452046. 

The totalDetailed description of new length of display case area is the estimated 

total procedure to calculate future shipments is presented in linear feet for 2009, divided 

between the food sales and foodservice sectors and multiplied by indexes of new 

construction of square feet for each building type. The index for each building type was 

developed by dividing floor space projections in each future year by the prior year’s 

value. All existing display space is presumed to be replaced when demolished. 

chapter 9 of NOPR TSD. Comments related to shipment analysis received during 

the April 2011 preliminary analysis public meeting are listed below, along with DOE’s 

responses to the comments.

a. VOP.RC.L Shipments

At the April 2011 preliminary analysis public meeting, Southern Store Fixtures 

stated that vertical open freezers represent far less than the figure of 1.9 percent of the 

commercial refrigeration equipment shipments that DOE included in the preliminary 

analysis TSD. (Southern Store Fixtures, Public Meeting Transcript, No. 31 at p. 123) In a 

written comment, NEEA referenced this statement by Southern Store Fixtures, urging 

 

74 U.S. Energy Information Administration. Annual Energy Outlook 2010. 20102013. 2013. Washington, 

DC. DOE/EIA-0383(20102013).
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DOE to ensure the accuracy of its shipments data for the VOP.RC.L equipment class, but 

stating that it generally agreed with DOE’s shipments analysis. (NEEA, No. 36 at p. 6)

Shipments estimates for VOP.RC.L were not explicitly stated in the AHRIARI

2005 shipments dataReport. DOE assumed that these shipments numbers were likely 

grouped with those of VOP.RC.M. For the preliminary analysis, DOE allocated a portion 

of VOP.RC.M shipments to the VOP.RC.L equipment class. In response to the comments 

from Southern Store Fixtures and based on new anecdotal evidence, DOE reduced the 

portion of the reported AHRI VOP.RC.M shipments which(obtained from the ARI 2005 

Report) that it allocated to the VOP.RC.L equipment class.

b. Shipments by End User Type

Southern Store Fixtures stated that the shipments estimates presented in the 

preliminary analysis for new equipment for large supermarkets and smaller markets did 

not appear to reflect the assumption of 10- and 15-year equipment lifetimes. Specifically, 

Southern Store Fixtures pointed out that the replacement shipment numbers were much 

higher than the new shipments in the small grocery store segment. Southern Store 

Fixtures pointed out that because the equipment life in small grocery stores is 15 years, 

compared to 10 years in large grocery stores, the ratio of replacement shipments to new 

shipments for small grocery stores should be smaller than the same ratio for large grocery 

stores. (Southern Store Fixtures, Public Meeting Transcript, No. 31 at p. 124) 

Small grocery stores and convenience stores house many self-contained units. In 
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many stores, self-contained units comprise most of the refrigeration load, when the 

refrigeration from walk-in cold rooms is discounted (as it does not belong in the 

commercial refrigeration equipment rulemaking). In the current rulemaking, all selfcontained units are assumed to have an average lifetime of 10 years. Therefore, the ratio 

of replacement shipments to new shipments in small grocery stores and convenience 

stores is dictated largely by the 10-year lifetime of self-contained units, and is relatively 

less impacted by the 15-year lifetime of remote condensing display cases, which form a 

much smaller share of the commercial refrigeration equipment found in small grocery 

and convenience stores. DOE believes that this factor explains the apparent discrepancy 

highlighted in the comment by Southern Store Fixtures.

Traulsen expressed the belief that DOE’s values for projected shipments for the 

foodservice building type, as well as its projected shipments by equipment class, were 

low. (Traulsen, No. 45 at p. 4)

DOE calculated future shipments numbers based on forecasted square footage of 

new construction, obtained from the AEO2011AEO forecast and historical shipments 

data. The ratio of floor space occupied by commercial refrigeration equipment to the total 

commercial floor space is much smaller in foodservice buildings than in food sales 

buildings such as grocery stores. Further, DOE converted the historical shipment 

numbers from number of units into number of linear feet by multiplying the number of 

units by the average linear feet of equipment. Commercial refrigeration equipment used 

in the foodservice industry is overwhelmingly dominated by self-contained equipment, 
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which, on an average, has a shorter length compared to the remote condensing equipment 

found in grocery stores. A combination of these factors results in the shipments numbers 

(in linear feet) to foodservice buildings being much lower than shipments numbers to 

food sales buildings. However, in terms of number of units shipped, the proportion of 

shipments to foodservice buildings is much higher as compared to shipments to food 

sales buildings. 

c. Shipments Forecasts

Traulsen commented that overly aggressive performance standards are likely to 

add costs that will be passed along to the consumercustomer, resulting in stunted market 

growth and retention of less-efficient units. Traulsen estimated that equipment prices 

have increased 1–2 percent based on variable manufacturing cost increases alone as a 

result of the need to comply with the standards set by EPACT 2005. (Traulsen, No. 45 at 

p. 6)

DOE does not have detailed information on the historical shipments data of 

various types of commercial refrigeration equipment by equipment classes. As described 

in earlier in this section, DOE extracted shipments data from certain publications and 

estimated the shipments by equipment class. The ARI 2005 report only contains

shipments data for the year 2005. With the available shipments data for commercial 

refrigeration equipment, it difficult to determine the impact of price increases on future 

shipments. 
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Regarding display cases, which are predominantly used in supermarkets and 

grocery stores, DOE believes that replacement of display cases is largely performed 

during store remodeling, and that the major driving factor behind remodeling is the need 

to improve aesthetics. Decisions regarding store remodeling are influenced by many 

factors, including overall future economic outlook and availability of capital, and DOE 

believes that equipment price increases do not figure as the major factor. DOE recognizes 

that, on the other hand, foodservice establishments may be more sensitive to equipment 

prices. The equipment that is predominantly used in this sector is composed of

refrigerators and freezers with solid doors. DOE estimates an approximate increase inThe

MSP increases related to the higher efficiency refrigerators and freezers were estimated 

as part of 6 to 8 percent based on the engineering analysis, and were found to be 6 to 8 

percent of the baseline MSPs. The effect of amended DOE standards could be that

foodservice establishments extend the life of their existing equipment. DOE expects that 

this effect will result in a slight dip in shipments only in the early years after amended

standards go into effect because the old equipment will have to be replaced eventually. 

The effect of such a dip will not have a significant impact on the NIA, which is carried 

out over a 30-year period. Extending the life of the existing equipment may also result in 

higher maintenance and repair costs that may offset part or all of the apparent

consumercustomer savings. 

DOE welcomes stakeholder input in this regard, as the information currently 

available to DOE is not sufficient to determine the impact of price increases on future 

shipments of commercial refrigeration equipment.
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2. Forecasted Efficiency in the Base Case and Standards Cases

The method for estimating the market share distribution of efficiency levels is 

presented in section IV.H.9, and a detailed description can be found in chapter 11 of the 

NOPR TSD. To estimate efficiency trends in the standards cases, DOE uses a “roll-up” 

scenario in its standards rulemakings. Under the roll-up scenario, DOE assumes that

equipment efficiencies in the base case that do not meet the standard level under 

consideration would “roll up” to meet the new standard level, and equipment efficiencies 

above the standard level under consideration would be unaffected. Table IV.7 shows the 

shipment-weighted market shares by efficiency level in the base-case scenario.
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Table IV.7 Shipment-Weighted Market Shares by Efficiency Level, Base Case

Equipment 

Class

Shipment-Weighted Market Shares by Efficiency Level*,**

Level 1 Level 2 Level 3 Level 4 Level 5 Level 6 Level 7 Level 8

VOP.RC.M 25.424.3

%

25.124.0

%

24.323.4

%

23.013.4

%

112.8% 2.0.4% 0.0%NA 0.0%NA

VOP.RC.L 28.526.0

%

28.426.1

%

2723.2% 14.322.4

%

1.52.2% 0.0%NA 0.0%NA 0.0%NA

VOP.SC.M 23.719.1

%

23.519.0

%

23.218.8

%

2218.1% 311.3% 3.110.7

%

3.1.0% 0.0%NA

VCT.RC.M 25.618.8

%

24.118.8

%

16.715.9

%

16.015.5

%

15.714.8

%

1.914.5

%

0.01.7% 0.0%NA

VCT.RC.L 31.419.5

%

22.820.4

%

22.120.0

%

21.619.4

%

2.119.0

%

0.01.8% 0.0%NA 0.0%NA

VCT.SC.M 18.816.7

%

17.64% 14.415.5

%

14.113.0

%

11.812.6

%

11.47% 10.411.5

%

1.67%

VCT.SC.L 14.910.5

%

15.813.3

%

16.34% 14.516.2

%

12.714.4

%

12.514.2

%

11.613.1

%

1.72.0%

VCT.SC.I 20.016.4

%

17.518.1

%

17.38% 15.19% 14.815.5

%

14.08% 1.45% 0.0%NA

VCS.SC.M 13.71% 15.014.9

%

15.0% 14.915.0

%

14.56% 13.814.0

%

12.46% 0.78%

VCS.SC.L 12.91% 15.21% 15.3% 15.34% 14.13% 13.79% 13.03% 0.56%

VCS.SC.I 17.016.7

%

17.016.8

%

17.4% 17.0% 15.816.0

%

15.24% 0.67% 0.0%NA

SVO.RC.M 25.824.5

%

25.824.5

%

2322.2% 22.113.2

%

2.312.6

%

3.0.7% 0.0%NA 0.0%NA

SVO.SC.M 23.819.5

%

23.719.5

%

22.218.5

%

21.618.0

%

3.710.8

%

3.510.1

%

1.43.7% 0.0%NA

SOC.RC.M 2117.7% 21.717.8

% 

21.717.8

% 

21.014.5

% 

6.014.1

% 

5.512.7

% 

2.5.4% 0.0%NA

HZO.RC.M 79.378.4

% 

20.721.6

% 

0.0%NA 0.0%NA 0.0%NA 0.0%NA 0.0%NA 0.0%NA

HZO.RC.L 87.186.2

%

12.913.8

%

0.0%NA 0.0%NA 0.0%NA 0.0%NA 0.0%NA 0.0%NA

HZO.SC.M 25.74% 25.64% 25.10% 21.79% 1.92.4% 0.0%NA 0.0%NA 0.0%NA

HZO.SC.L 73.371.8

% 

26.728.2

% 

0.0%NA 0.0%NA 0.0%NA 0.0%NA 0.0%NA 0.0%NA

HCT.SC.M 15.614.8

% 

16.015.4

% 

16.115.6

% 

16.015.7

% 

12.713.4

% 

12.28% 10.311.0

% 

1.24%

HCT.SC.L 13.512.3

% 

1413.3% 14.513.6

% 

14.415.8

% 

15.16% 14.515.0

% 

12.613.2

% 

1.02%

HCT.SC.I 25.96% 26.025.8

% 

25.21% 22.03% 0.91.1% 0.0%NA 0.0%NA 0.0%NA

HCS.SC.M 17.42% 17.65% 17.32% 16.98% 15.9% 13.23% 2.1.9% 0.0%NA

HCS.SC.L 16.517.2

%

17.25% 17.32% 17.116.8

%

16.56% 14.25% 1.35% 0.0%NA

PD.SC.M 19.214.0

% 

16.917.2

% 

15.016.1

% 

14.715.8

% 

1415.3% 10.111.0

% 

8.9.7% 1.0.9% 

SOC.SC.M 14.7% 15.1% 15.1% 15.0% 12.5% 12.1% 11.0% 4.6%

* A value of 0.0%“NA” means that no market share was calculated for this efficiency level. For example, the VOP.RC.M equipment 

class only had six possible efficiency levels, so no market share was allotted to Efficiency Levels 7 and 8.

** Shares may not add to 100 percent exactly due to rounding. 
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3. National Energy Savings

For each year in the forecast period, DOE calculates the NES for each potential 

standard level by multiplying the stock of equipment affected by the energy conservation 

standards by the estimated per-unit annual energy savings. DOE typically considers the 

impact of a rebound effect, introduced in the energy use analysis, in its calculation of 

NES for a given product. A rebound effect occurs when users operate higher efficiency 

equipment more frequently and/or for longer durations, thus offsetting estimated energy 

savings. However, DOE used a rebound factor of 1, or no effect, for commercial 

refrigeration equipment because it is operates 24 hours a day, and therefore there is no 

potential for a rebound effect. 

Major inputs to the calculation of NES are annual unit energy consumption, 

shipments, equipment stock, a site-to-source conversion factor, and a full fuel cycle

factor. 

The annual unit energy consumption is the site energy consumed by a commercial 

refrigeration unit in a given year. Because the equipment classes analyzed represent 

equipment sold across a range of sizes, DOE’s “unit” in the NES is actually expressed as 

a linear foot of equipment in an equipment class, and not an individual unit of 

commercial refrigeration equipment of a specific size. DOE determined annual forecasted 

shipment-weighted average equipment efficiencies that, in turn, enabled determination of 

shipment-weighted annual energy consumption values.
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The commercial refrigeration equipment stock in a given year is the total linear 

footage of commercial refrigeration equipment shipped from earlier years (up to 15 years

earlier, depending on the type of equipment) that is in use in that year. The NES 

spreadsheet model keeps track of the total linear footage of commercial refrigeration 

units shipped each year. For purposes of the NES and NPV analyses conducted for the 

NOPR, DOE assumed that, based on 15-year and 10-year average equipment lifetimes,

approximately 6.67 and 10 percent, respectively, of the existing commercial refrigeration 

units are retired in each year. DOE assumes that, for units shipped in 20452046, any units 

still remaining at the end of 20552060 will be replaced. 

DOE uses a multiplicative factor called site-to-source conversion factor to convert 

site energy consumption (at the commercial building) into has historically presented NES 

in terms of primary or source energy consumption (the energy at the energy generation 

site required to convert and deliver the site energy). These site-to source conversion 

factors account for the energy used at power plants to generate electricity and losses in 

transmission and distribution, as well as for natural gas losses from pipeline leakage and 

energy used for pumping. For electricity, the conversion factors vary over time due to 

projected changes in generation sources (that is, the power plant types projected to 

provide electricity to the country). The factors that DOE developed are marginal values, 

which represent the energy savings. In response of the system to an incremental decrease 

in consumption associated with amended energy conservation standards.

In the preliminary analysis, DOE used annual site-to-source conversion factors 
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based on the version of NEMS that corresponds to AEO2008.

75 For today’s NOPR, DOE 

updated its conversion factors based on the U.S. energy sector modeling using the 

NEMS-BT version that corresponds to AEO2011 and which provides national energy 

forecasts through 2035. For the period from 2035–2045, DOE used the same conversion 

factors as that of the year 2035.

Section 1802 of EPACT 2005 (Pub. L. 109-58) directed DOE to contract a study 

with the National Academy of Science (NAS) to examine whether the goals of energy 

efficiency standards are best served by measuring the amount of energy consumed and 

the impact of efficiency improvements at the actual point-of-use or through the use of the 

full-fuel-cycle (FFC), which would begin at the source of energy production. NAS 

appointedto the recommendations of a committee on “Point-of-Use and Full-Fuel-Cycle 

Measurement Approaches to Energy Efficiency Standards” to conduct the study, which 

was completed in May 2009. 76 The NAS committee defined FFC energy consumption as 

including, in addition to site energy use, the following: energy consumed in the 

extraction, processing, and transport of primary fuels such as coal, oil, and natural gas; 

energy losses in thermal combustion in power generation plants; and energy losses in 

transmission and distribution to homes and commercial buildings. 

In evaluating the merits of using point-of-use and FFC appointed by the National 

 

75 For preliminary analysis estimates, DOE typically does not perform analyses using NEMS. Rather, DOE 

relies on existing estimates considered appropriate for the analysis. The site-to-source values DOE 

considered most appropriate were those used in the prior commercial refrigeration rulemaking. 76 The National Academies, Board on Energy and Environmental Systems. Letter to Dr. John Mizroch, 

Acting Assistant Secretary, DOE, Office of EERE from James W. Dally, Chair. Committee on Point-ofUse and Full-Fuel-Cycle Measurement Approaches to Energy Efficiency Standards. May 15, 2009. A free 

copy of the study can be downloaded at: www.nap.edu/catalog.php?record_id=12670.
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Academy of Science, DOE announced its intention to use full-fuel-cycle (FFC) measures, 

the NAS committee noted that DOE uses what the committee referred to as “extended 

site” energy consumption to assess the impact of energy use on the economy, energy 

security, and environmental quality. The extended site measure of energy consumption 

includes the energy consumed during the generation, transmission, and distribution of 

electricity, but, unlike the FFC measure, does not include the energy consumed in 

extracting, processing, and transporting primary fuels. A majority of the NAS committee 

concluded that extended site energy consumption understates the total energy consumed 

to make an appliance operational at the site. As a result, the NAS committee 

recommended that DOE consider shifting its analytical approach over time to use an FFC

measure of energy consumption when assessing national and environmental impacts, 

especially with respect to the calculation of GHG emissions. The NAS committee also 

recommended that DOE provide more comprehensive information to the public through 

labels of energy use and greenhouse gas and other means, such as an enhanced website. 

For those appliances that use multiple fuels (such as water heaters), the NAS committee 

indicated that measuring FFC energy consumption would provide a more complete 

picture of energy consumed and permit comparisons across many different appliances, as 

well as an improved assessment of impacts.

In response to the NAS committee recommendations, DOE issued, on August 20, 

2010, a notice of proposed policy proposing to incorporate an FFC analysis into the 

methods it uses to estimate the likely impacts of proposed energy conservation standards 

on energy useemissions in the national impact analyses and emissions. 75 FR at 51423. 
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Specifically, DOE proposed to use FFC measures of energy and GHG emissions, rather 

than the primary (extended site) energy measures it currently uses. Additionally, DOE 

proposed to work collaboratively with the Federal Trade Commission (FTC) to make 

FFC energy and GHG emissions data available to the public to enable consumers to make 

cross-class comparisons. On October 7, 2010, DOE held an informal public meeting to 

discuss and receive comments on its planned approach. The notice, a transcript of the 

public meeting, and all public comments received by DOE are available at: . DOE intends 

to develop a final policy statement on these subjects and then to begin implementing that 

policy analyses included in future energy conservation standards rulemakings and other 

activities.. 76 FR 51281 (August 18, 2011) While DOE stated in that notice that it 

intended to use the Greenhouse Gases, Regulated Emissions, and Energy Use in 

Transportation (GREET) model to conduct the analysis, it also said it would review 

alternative methods, including the use of NEMS. After evaluating both models and the 

approaches discussed in the August 18, 2011 notice, DOE published a statement of 

amended policy in the Federal Register in which DOE explained its determination that 

NEMS is a more appropriate tool for its FFC analysis and its intention to use NEMS for 

that purpose. 77 FR 49701 (August 17, 2012). DOE received one comment, which was 

supportive of the use of NEMS for DOE’s FFC analysis.77 

The approach used for today’s NOPR, and the FFC multipliers that were applied, 

are described in appendix 10D of the NOPR TSD. NES results are presented in both 

primary and FFC savings in section V.B.3.a. 

 

77 Docket ID: EERE-2010-BT-NOA-0028, comment by Kirk Lundblade.
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4. Net Present Value of ConsumerCustomer Benefit

The inputs for determining the NPV of the total costs and benefits experienced by 

consumerscustomers of the commercial refrigeration equipment are: (1) total annual 

installed cost; (2) total annual savings in operating costs; and (3) a discount factor. DOE 

calculated net national customer savings for each year as the difference in installation and 

operating costs between the base-case scenario and standards-case scenarios in terms of

installation and operating costs. DOE calculated operating cost savings over the life of 

each piece of equipment shipped in the forecast period. 

DOE multiplied monetary values in future years by the discount factor to 

determine the present value of costs and savings. DOE estimated national impacts using

both a 3-percent and a 7-percent real discount rate as the average real rate of return on 

private investment in the U.S. economy. These discount rates are used in accordance with 

the Office of Management and Budget (OMB) guidance to Federal agencies on the 

development of regulatory analysis (OMB Circular A-4, September 17, 2003), and 

section E, “Identifying and Measuring Benefits and Costs,” therein. DOE defined the 

present year as 20112013 for the NOPR analysis. The 7-percent real value is an estimate 

of the average before-tax rate of return to private capital in the U.S. economy. The 3-

percent real value represents the “societal rate of time preference,” which is the rate at 

which society discounts future consumption flows to their present. 
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5. Benefits from Effects of Amended Standards on Energy Prices

The reduction in electricity consumption associated with amended standards for 

commercial refrigeration equipment could reduce the electricity prices charged to 

consumerscustomers in all sectors of the economy, and thereby reduce electricity 

expenditures. In chapter 2 of the preliminary analysis TSD, DOE explained that, because 

the power industry is a complex mix of fuel and equipment suppliers, electricity 

producers, and distributors, it did not plan to estimate the value of potentially reduced 

electricity costs for all consumerscustomers associated with new or amended standards 

for refrigeration products. 

For this rulemaking, DOE used NEMS-BT to assess the impacts of the reduced 

need for new electric power plants and infrastructure projected to result from amended 

standards. In NEMS-BT, changes in power generation infrastructure affect utility revenue 

requirements, which in turn affect electricity prices. DOE estimated the impact on 

electricity prices associated with each considered TSL. Although the aggregate benefits 

for electricity users are potentially large, there may be negative effects on some involved 

in electricity supply, particularly power plant providers and fuel suppliers. DOE has 

concluded that, at present, it should not give significant weighting to this factor

(aggregate benefit to customers due to reductions in electricity prices) in its consideration 

of the justification of the amended standards because there is uncertainty about the extent 

to which the benefits to electricity users from reduced electricity prices would represent a 

transfer from those involved in electricity supply to electricity consumerscustomers. DOE 

is continuing to investigate the extent to which electricity price changes projected to 
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result from amended standards represent a net gain to society.

J. ConsumerCustomer Subgroup Analysis

In analyzing the potential impact of new or amended standards on commercial 

consumerscustomers, DOE evaluates the impact on identifiable groups (i.e., subgroups) 

of consumerscustomers, such as different types of businesses that may be 

disproportionately affected. Based on data from the 2007 U.S. Economic Census and size 

standards set by the U.S. Small Business Administration (SBA), DOE determined that a 

majority of convenience stores and restaurants fall under the definition of small 

businesses (see chapter 11 of NOPR TSD for details). Small businesses typically face

higher electricity prices and higher cost of capital. In general, the lower the cost of 

electricity and higher the cost of capital, the more likely it is that an entity would be 

disadvantaged by the requirement to purchase higher efficiency equipment. Table IV.8

and Table IV.9 present average commercial electricity prices by business type and 

discount rates by building types, respectively. 

Comparing the small grocery and convenience store category to the convenience 

store with gas station category, both face the same cost of capital, but convenience stores 

with gas stations generally incur lower electricity prices. Therefore, convenience stores 

with gas stations were chosen for LCC subgroup analysis in the food-retail segment.

In the foodservice segment, limited service restaurants and full-service restaurants 

have similar electricity price and discount rates, with limited service restaurants paying 
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slightly lower electricity rates and full-service restaurants facing a slightly higher cost of 

capital. DOE chose to study full-service restaurants for the LCC subgroup analysis in the 

foodservice segment because a higher percentage of full-service restaurants tend to be 

operated by independent small business concerns, as compared to a majority of fast-food 

restaurants which are owned by or affiliated with national restaurant chains. 

DOE estimated the impact on the identified consumercustomer subgroups using 

the LCC spreadsheet model. The standard LCC and PBP analysesanalysis (described in 

section IV.H) includes various types of businesses that use commercial refrigeration 

equipment. For the LCC subgroup analysis, it was assumed that the subgroups analyzed 

do not have access to national commercial refrigeration equipment purchasing accounts 

and, consequently, face a higher distribution channel markup. Further, electricity rates 

and discount rates differ among these subgroups. Details of the data used for LCC 

subgroup analysis and results are presented in chapter 11 of the NOPR TSD.

Table IV.8 Derived Average Commercial Electricity Price by Business Type

Business Type Electricity Price 

cents/kWh

Ratio of Electricity 

Price to Average Price 

for all Commercial 

Buildings

Grocery store/food market 0.07222 0.910

Convenience store * 0.08583 1.082

Convenience store with gas station 0.07722 0.973

Multi-line retail ** 0.07262 0.915

Limited service restaurant 0.07962 1.003

Full service restaurant 0.08467 1.067

Other foodservice 0.07664 0.966

All commercial buildings 0.07936 1.000

Source: Commercial Buildings Energy Consumption Survey 2003

* This group is assumed to include convenience stores without gas stations, specialty stores (such as meat markets), 

and beer, wine, and liquor stores.

** This group is assumed to include mainly large multi-line retailers and supercenters that sell both grocery and nongrocery items.

Table IV.9 Derivation of Real Discount Rates by Building Type 

Building Type Major Chain Local or Governmental No. 
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Description Non-Chain Obs.†

WACC* 

Percent

of

Stock

Small Firm 

Premium**

Percent

of

Stock

Muni 

Bond 

Rate

Percent

of 

Stock

Discount 

Rate

Large Grocery

3.564.16

% 100% 0.0% 0% 0% 0% 3.564.16% 1318

Small Grocery & 

Convenience

3.974.20

% 50% 2.51.9% 50% 10% 0% 5.2719% 45

Gas Station With 

Convenience Store

3.974.20

% 50% 2.51.9% 50% 10% 0% 5.2719% NA

Multi-Line Retail 4.0133% 100% 0.0% 0% 0% 0% 4.0133% 36

Restaurant - Limited 

Service

4.815.29

% 50% 2.51.9% 50% 10% 0% 6.1229% 2021

Restaurant - Full 

Service 5.2061% 50% 2.51.9% 50% 10% 0% 6.5162% 3024

Restaurant - Other 

Foodservice 5.2061% 25% 2.51.9% 25% 12.34% 50% 3.944.48% NA

Source: Pacific Northwest National Laboratory (PNNL) Weighted Average Cost of Capital (WACC) calculations applied to firms 

sampled from the Damodaran Online web site (http://pages.stern.nyu.edu/~adamodar/New_Home_Page/papers.html). Assumptions for 

weighting factors for convenience and foodservice reflect lack of reliable data sources. The estimate of inflation used to translate 

nominal rates to real rates is based on a 40-year (1971-–2010) average gross domestic product deflator (3.832 percent).

*WACC stands for weighted-average cost of capital. See chapter 8 of the NOPR TSD for additional details.

**Small Firm Premium refers to higher premium paid by smaller firms that face higher risks of loss of invested capital. Source: Small 

Business Administration data on loans between $10,000 and $99,000 compared to AAA Corporate Rates. 

http://www.sba.gov/advocacy/7540/6282. Data compiled 6/20/2013. † “NA” means no Damodaran observations available.

K. Manufacturer Impact Analysis

1. Overview

DOE performed an MIA to estimate the financial impact of amended energy 

conservation standards on manufacturers of commercial refrigeration equipment and to 

calculate the impact of such standards on employment and manufacturing capacity. The 

MIA has both quantitative and qualitative aspects. The quantitative part of the MIA 

primarily relies on the Government Regulatory Impact Model (GRIM), an industry cashflow model with inputs specific to this rulemaking. The key GRIM inputs are data on the 

industry cost structure, product costs, shipments, and assumptions about markups and 

conversion expenditures. The key output is the INPV. Different sets of markup scenarios 

will produce different results. The qualitative part of the MIA addresses factors such as 

equipment characteristics, impacts on particular subgroups of firmsmanufacturers, and 
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important market and product trends. The complete MIA is outlined in chapter 12 of the 

NOPR TSD.

DOE conducted the MIA for this rulemaking in three phases. In Phase 1 of the 

MIA, DOE prepared a profile of the commercial refrigeration equipment industry that 

includes a top-down cost analysis of manufacturers used to derive preliminary financial 

inputs for the GRIM (e.g., sales general and administration (SG&A) expenses; research 

and development (R&D) expenses; and tax rates). DOE used public sources of 

information, including company SEC 10-K filings, corporate annual reports, the U.S. 

Census Bureau’s Economic Census, and Hoover’s reports. 

In Phase 2 of the MIA, DOE prepared an industry cash-flow analysis to quantify 

the impacts of an amended energy conservation standard. In general, more-stringent 

energy conservation standards can affect manufacturer cash flow in three distinct ways: 

(1) by creating a need for increased investment; (2) by raising production costs per unit; 

and (3) by altering revenue due to higher per-unit prices and possible changes in sales 

volumes. 

In Phase 3 of the MIA, DOE conducted structured, detailed interviews with a 

representative cross-section of manufacturers. During these interviews, DOE discussed 

engineering, manufacturing, procurement, and financial topics to validate assumptions 

used in the GRIM and to identify key issues or concerns. See section IV.K.4 for a 

description of the key issues manufacturers raised during the interviews.
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Additionally, in Phase 3, DOE evaluated subgroups of manufacturers that may be 

disproportionately impacted by amended standards, or that may not be accurately 

represented by the average cost assumptions used to develop the industry cash-flow 

analysis. For example, small manufacturers, niche players, or manufacturers exhibiting a 

cost structure that largely differs from the industry average could be more negatively 

affected. 

DOE identified one subgroup, small manufacturers, for separate impact analyses. 

DOE applied the small business size standards published by the SBA to determine 

whether a company is considered a small business. 65 FR 30836, 30848 (May 15, 2000), 

as amended at 65 FR 53533, 53544 (Sept. 5, 2000) and codified at 13 CFR part 121. To 

be categorized as a small business under North American Industry Classification System 

(NAICS) 333415, “Air-Conditioning and Warm Air Heating Equipment and Commercial 

and Industrial Refrigeration Equipment Manufacturing,” a commercial refrigeration 

manufacturer and its affiliates may employ a maximum of 750 employees. The 750-

employee threshold includes all employees in a business’s parent company and any other 

subsidiaries. Based on this classification, DOE identified at least 3132 commercial 

refrigeration equipment manufacturers that qualify as small businesses. The commercial 

refrigeration equipment small manufacturer subgroup is discussed in chapter 12 of the 

NOPR TSD and in section VI.B.1 of this notice.
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2. Government Regulatory Impact Model 

DOE uses the GRIM to quantify the changes in the commercial refrigeration 

equipment industry cash flow due to amended standards that result in a higher or lower 

industry value. The GRIM analysis uses a standard, annual cash-flow analysis that 

incorporates manufacturer costs, markups, shipments, and industry financial information 

as inputs, and models changes in costs, investments, and manufacturer margins that 

would result from new and amended energy conservation standards. The GRIM 

spreadsheet uses the inputs to arrive at a series of annual cash flows, beginning with the 

base year of the analysis, 20102013 in this case, and continuing to 20452046. DOE 

calculated INPVs by summing the stream of annual discounted cash flows during this 

period. For commercial refrigeration equipment manufacturers, DOE used a real discount 

rate of 10 percent. DOE’s discount rate estimate was derived from industry financials and 

then modified according to feedback during manufacturer interviews. 

The GRIM calculates cash flows using standard accounting principles and 

compares changes in INPV between a base case and various TSLs (the standards cases). 

The difference in INPV between the base case and a standards case represents the 

financial impact of the amended standard on manufacturers. As discussed previously, 

DOE collected the information on the critical GRIM inputs from a number of sources, 

including publicly available data and interviews with a number of manufacturers 

(described in the next section). The GRIM results are shown in section V.B.2.a. 

Additional details about the GRIM can be found in chapter 12 of the NOPR TSD.
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a. Government Regulatory Impact Model Key Inputs

Manufacturer Production Costs

Manufacturing a higher efficiency product is typically more expensive than 

manufacturing a baseline product due to the use of more complex components, which are 

more costly than baseline components. The changes in the MPCs of the analyzed 

products can affect the revenues, gross margins, and cash flow of the industry, making 

these product cost data key GRIM inputs for DOE’s analysis.

In the MIA, DOE used the MPCs for each considered efficiency level calculated 

in the engineering analysis, as described in section IV.C and further detailed in chapter 5 

of the NOPR TSD. In addition, DOE used information from its teardown analysis, 

described in section IV.E.4.a, to disaggregate the MPCs into material, labor, and 

overhead costs. To calculate the MPCs for equipment above the baseline, DOE added 

incremental material, labor, overhead costs from the engineering cost-efficiency curves to 

the baseline MPCs. These cost breakdowns and equipment markups were validated with 

manufacturers during manufacturer interviews.

Base-Case Shipments Forecast

The GRIM estimates manufacturer revenues based on total unit shipment 

forecasts and the distribution of these values by efficiency level. Changes in sales 

volumes and efficiency mix over time can significantly affect manufacturer finances. For 

this analysis, the GRIM uses the NIA’s annual shipment forecasts derived from the 

shipments analysis from 20102013, the base year, to 20452046, the end of the analysis 
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period. See chapter 9 of the NOPR TSD for additional details.

Product and Capital Conversion Costs

Amended energy conservation standards will cause manufacturers to incur 

conversion costs to bring their production facilities and product designs into compliance. 

For the MIA, DOE classified these conversion costs into two major groups: (1) product 

conversion costs and (2) capital conversion costs. Product conversion costs are 

investments in research, development, testing, marketing, and other non-capitalized costs 

necessary to make product designs comply with a new or amended energy conservation 

standard. Capital conversion costs are investments in property, plant, and equipment 

necessary to adapt or change existing production facilities such that new product designs 

can be fabricated and assembled. 

To evaluate the level of capital conversion expenditures manufacturers would 

likely incur to comply with amended energy conservation standards, DOE used 

manufacturer interviews to gather data on the level of capital investment required at each 

efficiency level. DOE validated manufacturer comments through estimates of capital 

expenditure requirements derived from the product teardown analysis and engineering 

model described in section IV.E.4. 

DOE assessed the equipment conversion costs at each level by integrating data 

from quantitative and qualitative sources. DOE considered feedback regarding the 

potential costs of each efficiency level from multiple manufacturers to determine 
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conversion costs such as R&D expenditures and certification costs. Manufacturer data 

were aggregated to better reflect the industry as a whole and to protect confidential 

information. 

In general, DOE assumes that all conversion-related investments occur between 

the year of publication of the final rule and the year by which manufacturers must comply 

with an amended standard. The investment figures used in the GRIM can be found in 

section V.B.2.a of this notice. For additional information on the estimated product 

conversion and capital conversion costs, see chapter 12 of the NOPR TSD.

b. Government Regulatory Impact Model Scenarios

Markup Scenarios

As discussed above, MSPs include direct manufacturing production costs (i.e., 

labor, material, and overhead estimated in DOE’s MPCs) and all non-production costs 

(i.e., SG&A, R&D, and interest), along with profit. To calculate the MSPs in the GRIM, 

DOE applied markups to the MPCs estimated in the engineering analysis and then added 

in the cost of shipping. Modifying these markups in the standards case yields different 

sets of impacts on manufacturers. For the MIA, DOE modeled two standards-case 

markup scenarios to represent the uncertainty regarding the potential impacts on prices 

and profitability for manufacturers following the implementation of amended energy 

conservation standards: (1) a preservation of gross margin percentage markup scenario; 

and (2) a preservation of operating profit markup scenario. These scenarios lead to 

different markups values that, when applied to the inputted MPCs, result in varying 
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revenue and cash flow impacts. 

Under the preservation of gross margin percentage scenario, DOE applied a single 

uniform “gross margin percentage” markup across all efficiency levels. As production 

costs increase with efficiency, this scenario implies that the absolute dollar markup will 

increase as well. Based on publicly available financial information for manufacturers of 

commercial refrigeration equipment and comments from manufacturer interviews, DOE 

assumed the non-production cost markup—which includes SG&A expenses, R&D

expenses, interest, and profit—to be 1.42. Because this markup scenario assumes that 

manufacturers would be able to maintain their gross margin percentage markups as 

production costs increase in response to an amended energy conservation standard, the 

scenario represents a high bound to industry profitability under an amended energy 

conservation standard.

In the preservation of operating profit scenario, manufacturer markups are set so 

that operating profit 1 year after the compliance date of the amended energy conservation 

standard is the same as in the base case. Under this scenario, as the cost of production and 

the cost of sales go up, manufacturers are generally required to reduce their markups to a 

level that maintains base-case operating profit. The implicit assumption behind this 

markup scenario is that the industry can only maintain its operating profit in absolute 

dollars after compliance with the amended standard is required. Therefore, operating 

margin in percentage terms is squeezed (reduced) between the base case and standards 

case. DOE adjusted the manufacturer markups in the GRIM at each TSL to yield 
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approximately the same earnings before interest and taxes in the standards case in the 

year after the compliance date of the amended standards as in the base case. This markup 

scenario represents a low bound to industry profitability under an amended energy 

conservation standard.

 

3. Discussion of Comments

During the April 2011 preliminary analysis public meeting, interested parties 

commented on the assumptions and results of the preliminary analysis TSD. Oral and 

written comments addressed several topics, including testing and certification, 

cumulative regulatory burden, small manufacturers, and manufacturer markups. 

a. Testing and Certification

At the public meeting and in written comments, several stakeholders expressed 

concern to DOE regarding the potential burden of testing. 

Traulsen stated that certification, compliance, and enforcement (CC&E) is its

most significant cost item in terms of internal resources in the form of time and direct 

expenses. Traulsen further explained that, with respect to the manufacturer impacts, the 

three most important topics are CC&E, testing burden, and compliance with other

(unspecified) certifications. (Traulsen, No. 45 at pp. 4–5) NEEA expressed the opinion 

that the most significant issue associated with manufacturer impacts is testing and 

compliance for a wide array of equipment offerings, especially given the large number of 

variations on single models. AHRI also stated that the CC&E requirements put in place 
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by DOE have the potential to bankrupt the industry due to the excessive number of tests 

required. (AHRI, No. 43 at p. 3) True added that it believed there are economies of scale 

in testing commercial refrigeration equipment units. (True, Public Meeting Transcript, 

No. 31 at p. 151) True also stated that the testing and regulatory burden, including 

tooling, fixturing, and setup costs imposed on small production runs is an issue for large 

manufacturers as well as small manufacturers. (True, Public Meeting Transcript, No. 31 

at pp. 206, 210) NEEA expressed agreement with manufacturers that testing each 

variation would create a significant potential burden, especially on small manufacturers. 

(NEEA, No. 36 at p. 7) In addition, Southern Store Fixtures stated that it would be 

difficult to produce information to estimate the compliance testing burden on 

manufacturers, as the certification and compliance requirements had not yet been 

finalized. (Southern Store Fixtures, Public Meeting Transcript, No. 31 at pp. 149–50) 

Southern Store Fixtures added that it is impossible to determine potential impacts of 

testing and certification on manufacturers until the definition of a basic model is clarified. 

(Southern Store Fixtures, No. 38 at p. 1) 

DOE recognizes industry concerns regarding CC&E testing requirements. 

Although CC&E costs are not directly analyzed in the GRIM because they do not vary 

with different standard levels, the CC&E burden is identified as a key issue and as a 

cumulative regulatory burden in the MIA. DOE intends to address these manufacturer 

concerns in ongoing CC&E rulemakings. Moreover, DOE is currently considering 

alternative efficiency determination methods (AEDMs) for commercial refrigeration

equipment. 76 and issued a notice of proposed rulemaking on Alternative Efficiency 
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Determination Methods and Alternative Rating Methods in May 2012. 77 FR 

21673(April 18, 201132038 (May 31, 2012). AEDMs are computer modeling tools used 

to establish a model’s efficiency rating in lieu of testing. More information about the 

AEDM rulemaking can be found at: 

www1.eere.energy.gov/buildings/appliance_standards/certification_enforcement.html.- 

While the GRIM does not account for DOE certification costs, it does account for 

product industry certification (i.e., Underwriters Laboratories (UL) and NSF testing) and 

research and development costs in its analysis of product conversion costs, which are 

associated with a change in standards. The change in INPV, the primary output of the 

GRIM, reflects the possible increase in industry certification costs and is considered by 

DOE when proposing a standard.

b. Cumulative Regulatory Burden

Numerous stakeholders commented on the cumulative regulatory burden tied to 

DOE efficiency standards. Some stakeholders expressed concern regarding potential 

conflicts with other certification programs. Traulsen stated that the redundancy of testing 

required by other Federal programs (such as EPA ENERGY STAR ®),78

 

78 ENERGY STAR is a joint program of EPA and DOE that helps the Nation save money and protect the environment 

through energy efficient products and practices. More information can be found at: 

potentially 

involves conflicting criteria, increases cost, and that cross-references to databases with 

inconsistent tests, classes, and enforcement requirements adds further complications. 

Traulsen estimated that the financial burden associated with meeting both DOE and EPA 

www.energystar.gov.
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ENERGY STAR requirements has been greater than 0.5 percent of revenue, and that it 

would be beneficial to reconcile the differences between DOE and EPA standards. 

(Traulsen, No. 45 at pp. 5–6) NEEA stated that the burden of certifications and associated 

testing is inherent in the manufacturing industry, and that this burden should have little to 

do with the current standards rulemaking. However, NEEA added, any steps that can be 

taken to harmonize test methods and procedures between certifications should be taken. 

(NEEA, No. 36 at p. 7) 

DOE realizes that the cumulative effect of multiple regulations on an industry 

may significantly increase the burden faced by manufacturers that need to comply with 

regulations and certification programs from different organizations and levels of 

government. However, DOE notes that certain standards, such as ENERGY STAR, are 

optional for manufacturers.

AHRI stated that there are several legislative and regulatory activities that could 

significantly burden manufacturers of commercial refrigeration equipment, including the 

DOE CC&E program and the upcoming amended energy conservation standards for 

walk-in coolers and freezers. AHRI also added that climate change bills could have a 

significant negative impact on the availability and price of HFC refrigerants. (AHRI, No. 

43 at p. 4) 

DOE estimates the present value of the total benefits over the analysis period 

(2010-2040) of the EPACT 2005 standards for CRE to be $2.3 billion and the costs to be 
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$0.32 billion, in 2012 dollars and using a discount rate of 7 percent. DOE estimates the 

present value of total benefits over the analysis period (2012-2042) of the DOE 2009 

standards for CRE to be $3.97 billion and the costs to be $1.52 billion, in 2012 dollars

and using a 7 percent discount rate. Additionally, in the energy conservation standard 

NOPR for walk-in coolers and freezers, DOE estimates the net present value of the total 

benefits over the analysis period (2017-2046) to be $21.6 billion and the costs to be $3.7 

billion, in 2012% and using a discount rate of 7 percent. 

DOE takes into account the cumulative cost of multiple Federal regulations on 

manufacturers, including CC&E, in the cumulative regulatory burden (CRB) section of 

its analysis. The CRB can be found in section V.B.2.e of this document. The CRB review

also recognizes the additional burden faced by manufacturers that produce both 

commercial refrigeration equipment and walk-in coolers and freezers. However, DOE 

does not analyze the quantitative impacts of standards that have not yet been finalized, 

such as those for walk-ins. Likewise, DOE does not analyze the impacts of potential 

climate change bills because any impacts would be speculative in the absence of final 

legislation. 

AHRI also stated that California is currently working on new regulations as part 

of Title 24 that will likely establish new prescriptive requirements on commercial 

refrigeration equipment beginning in 2013. AHRI added that other States on the West 

Coast are following California’s actionslead and are likely to implement similar 

regulations in the near future. AHRI suggested that DOE account for these developments

Comment [A36]: Revision requested by OIRA.

Comment [A37]: Revision requested by OIRA.
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in its analysis. (AHRI, No. 43 at p. 4) Finally, AHRI commented that several States have 

enacted their own climate change legislation, including regulations established by the 

California Air Resources Board (CARB) to limit GHGs and reduce the usage of high 

GWP refrigerants such as HFCs. AHRI stated that CARB will implement these 

regulations in 2011. (AHRI, No. 43 at p. 4)

According to the California Code of Regulations, title 24, part 6, any appliance 

for which there is a California standard established in the Appliance Efficiency 

Regulations may be installed only if the manufacturer has certified to the CEC, as 

specified in those regulations, that the appliance complies with the applicable standard 

for that appliance. California’s appliance efficiency regulations require that the MDEC 

(in kilowatt-hours) for commercial refrigerators manufactured on or after January 1, 2010 

does not exceed the following:

• Refrigerators with solid doors: 0.10V + 2.04

• Refrigerators with transparent doors: 0.12V + 3.34 

• Freezers with solid doors: 0.40V + 1.38 

• Freezers with transparent doors: 0.75V + 4.10

• Refrigerator/freezers with solid doors: the greater of 0.27AV–0.71 or 0.70

• Refrigerators with self-condensing unit designed for pull-down temperature 

applications: 0.126V + 3.51

Since these standards are identical to the ones prescribed in EPACT 2005 and the 

efficiency levels set by the current rulemaking will either exceed or be equivalent to the 
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EPACT 2005 levels, DOE does not expect the Title 24 regulations to create a cumulative 

regulatory burden on manufacturers. California also has started a rulemaking proceeding 

to adopt changes to the building energy efficiency standards contained in the California 

Code of Regulations, title 24, part 6, but the CEC is currently in the pre-rulemaking stage 

and any new standards will not be published until 2013. DOE has not evaluated the 

impacts of the 2013 rule because any analysis would be speculative in the absence of 

final legislationregulations. 

CARB is currently limiting the in-State use of high-GWP refrigerants in nonresidential refrigeration systems through its Refrigerant Management Program, effective 

January 1, 2011.79

 

79California Air Resources Board. Refrigerant Management Program Final Regulation. 2011. (Last 

accessed March 16, 2012.) 

According to this new regulation, facilities with refrigeration systems 

that have a refrigerant capacity exceeding 50 pounds must repair leaks within 14 days of 

detection, maintain on-site records of all leak repairs, and keep receipts of all refrigerant 

purchases. The regulation applies to any person or company that installs, services, or 

disposes of appliances with high-GWP refrigerants. Refrigeration systems with a 

refrigerant capacity exceeding 50 pounds typically belong to food retail operations with 

remote condensing racks that store refrigerant serving multiple commercial refrigeration 

equipment units within a business. However, commercial refrigeration equipment units in 

food retail establishments are usually installed and serviced by refrigeration contractors, 

not manufacturers. As a result, although these CARB regulations apply to refrigeration 

technicians and owners of facilities with refrigeration systems, they are unlikely to 

represent a regulatory burden for commercial refrigeration manufacturers.

www.arb.ca.gov/cc/reftrack/reftrackrule.html. 
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The cumulative regulatory burden on manufacturers of commercial refrigeration 

equipment is discussed in further detail in chapter 12 of the NOPR TSD.

c. Small Manufacturers

During the April 2011 preliminary analysis public meeting, Southern Store 

Fixtures stated that the impact of research, development, and testing is greater on smaller 

manufacturers because, while they may have the same number of models in their product 

lines as do larger manufacturers, they produce fewer units of each model. (Southern Store 

Fixtures, Public Meeting Transcript, No. 31 at p. 150) Similarly, Zero Zone stated that 

amended standards have large impacts on small companies. For example, Zero Zone uses 

foamed-in-place urethane panels. If it were to become necessary to use thicker foam, 

Zero Zone stated, the company could face capital conversion expenditures of roughly 

$250,000. (Zero Zone, Public Meeting Transcript, No. 31 at p. 199) 

DOE agrees that amended standards may have disproportionate impacts on 

smaller manufacturers. As a result, the DOE conducts a small business analysis to assess 

those impacts, the results of which are set forth in section VI.B of this notice. 

Stakeholders also commented on DOE’s classification of small manufacturers. 

NEEA suggested that DOE review its characterizations of small and large manufacturers, 

as it believed there to be disparities between the listed company sizes and market shares 

in DOE’s classifications. (NEEA, Public Meeting Transcript, No. 31 at p. 160) Emerson 
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stated that manufacturers’ sizes should be characterized by their operations in the market. 

According to Emerson, some manufacturers are part of larger companies, but the fact that 

they are owned by larger companies does not change the potential for impacts on their 

employment levels or risk of going out of business. (Emerson, Public Meeting Transcript, 

No. 31 at p. 207)

DOE requested feedback regarding the accuracy of its list of small businesses 

during its interviews with manufacturers. Since the publication of the preliminary 

analysis TSD, DOE has revised the list based on responses received from manufacturers. 

Furthermore, DOE understands that manufacturers that are owned by large parent 

companies may not be protected from the potential impacts of amended standards. 

However, in its analysis of small businesses, DOE also takes into account that 

manufacturers that belong to large parent companies are more likely to have better access 

to capital and engineering resources than manufacturers that have no parent company or 

have parent companies with a total size of less than 750 employees.

A detailed discussion of the impact of the proposed standards on small 

manufacturers can be found in chapter 12 of the NOPR TSD.

d. Manufacturer Markup

Southern Store Fixtures expressed concern that research and development was 

considered part of the manufacturer markup. The company also asked whether sales, 

marketing, and engineering costs were included in this markup as well, and suggested 
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that all of these expenses should be considered indirect costs instead. (Southern Store 

Fixtures, Public Meeting Transcript, No. 31 at pp. 71–72) 

DOE incorporates all non-production costs, including sales, marketing, and R&D, 

in its manufacturer markup. Although manufacturers’ accounting practices may vary, 

DOE uses this standard model to approximate the cost structure of the commercial 

refrigeration industry as a whole. A detailed explanation of the manufacturer markup can 

be found in section V.B.2 of this notice and in chapter 5 of the NOPR TSD.

4. Manufacturer Interviews

DOE interviewed manufacturers representing over 90 percent of food retail sales 

and over 60 percent of foodservice sales. These interviews were in addition to those DOE 

conducted as part of the engineering analysis. The information gathered during these 

interviews enabled DOE to tailor the GRIM to reflect the unique financial characteristics 

of the commercial refrigeration industry. All interviews provided information that DOE 

used to evaluate the impacts of potential amended energy conservation standards on 

manufacturer cash flows, manufacturing capacities, and employment levels.

During the manufacturer interviews, DOE asked manufacturers to describe their 

major concerns about this rulemaking. The following sections describe the most 

significant issues identified by manufacturers. DOE has also included additional concerns 

in chapter 12 of the NOPR TSD.
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a. Enforcement

Interviewed manufacturers expressed concern about the enforcement of an 

amended energy efficiency standard for commercial refrigeration equipment. 

Manufacturers believe that insufficient enforcement will lead to market distortions, as 

companies that make the necessary investments to meet amended standards and 

compliance requirements would be at a distinct pricing disadvantage to unscrupulous 

competitors that do not fully comply. The manufacturers requested that DOE take the 

enforcement action necessary to maintain a level playing field and to eliminate noncompliant products from the market.

b. Certification and Compliance Costs

Nearly all manufacturers expressed concern over CC&E costs. In particular, 

confusion over the definition of “basic model” and the implementation of AEDMs is 

making it difficult for some manufacturers to anticipate their total testing needs and total 

testing costs. 

Manufacturers are concerned that CC&E requirements for commercial 

refrigeration equipment do not take into account the customized nature of the commercial 

refrigeration equipment industry. Manufacturers stated that their industry has a high level 

of end-user specification and low production volumes compared to other industries, such 

as residential refrigeration. As a result, the strictest interpretations of the CC&E 

requirements could lead to hundreds of thousands of tests per company. Additional 

clarification of how basic models and AEDMs apply to the commercial refrigeration 
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equipment industry would help manufacturers understand the testing investments that 

will be necessary. DOE is aware of the current confusion and continues to work with 

industry to improve the CC&E process and AEDM rules to address these concerns. 

c. Disproportionate Impact on Small Businesses

Manufacturers noted that small businesses will be disproportionately impacted 

whenby certification and compliance requirements compared to larger businesses. One 

manufacturer indicated that small and large manufacturers of the same equipment tend to 

have similar numbers of basic models, but large manufacturers offer a broader suite of 

products based on those basic models and have higher sales. Therefore, the manufacturer 

expressed concern that small manufacturers will be at a disadvantage because they will 

need to spread both industry certification and conversion costs over a smaller number of 

shipments. 

Also, small manufacturers indicated they have fewer resources with which to 

manage CC&E requirements. As a result, they will be forced to focus on compliance 

rather than on innovation. Small manufacturers believe that their large competitors will 

have greater resources to continue innovating while meeting amended energy 

conservation standards requirements. 

d. Potential Loss of Product Utility and Decrease in Food Safety

A majority of Manufacturers expressed concern about the potential impact of

amended energy conservation standards on product performance. Specifically, 
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manufacturers serving the foodservice industry were concerned about negative impacts 

on food safety, while manufacturers serving the food retail industry were concerned 

about negative impacts on merchandising design.

One manufacturer of commercial refrigeration equipment for the foodservice 

industry summarized the challenge of amended energy conservation standards as “the 

design trade-off between product price, energy efficiency, and food safety.” In the 

foodservice industry, refrigeration equipment must maintain safe food temperatures 

despite frequent door openings in challenging environments, such as kitchens with high 

temperatures and high humidity. The infiltration of warm, moist air places an additional 

burden on the refrigeration equipment and increases energy usage. Manufacturers 

expressed concern that more-efficient equipment would have trouble maintaining food 

safety in extreme, but not uncommon, conditions. 

Manufacturers in the food retail market design their equipment to optimally 

present merchandise. Some manufacturers were concerned that amended energy 

conservation standards would limit their ability to tailor their commercial refrigeration 

equipment for specific merchandise. Specifically, manufacturers noted that the highly 

directional light from LED bulbs provides poor light for display case applications where 

the product is presented in multiple layers, such as prepared food display cases. 

Additionally, manufacturers noted that higher efficiency designs generally have less 

airflow (due to reduced fan power consumption). They stated that this reduction in 

airflow could result in less desirable presentation of meats and in increased icing on 
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products. In general, more-efficient standards limit manufacturer options for optimizing 

the presentation features of products. Food retail customers such as supermarkets make 

purchasing decisions based on the various presentation features of commercial 

refrigeration equipment offered by different manufacturers. 

L. Employment Impact Analysis

Employment impacts are one of the factors that DOE considers in selecting an 

efficiency standard. Employment impacts include direct and indirect impacts. Direct 

employment impacts are any changes that affect employment of commercial refrigeration 

equipment manufacturers, their suppliers, and related service firms. Indirect impacts are 

those changes in employment in the larger economy that occur because of the shift in 

expenditures and capital investment caused by the purchase and operation of moreefficient commercial refrigeration equipment. Direct employment impacts are analyzed as 

part of the MIA. Indirect impacts are assessed as part of the employment impact analysis. 

 

Indirect employment impacts from amended commercial refrigeration equipment 

standards consist of the net jobs created or eliminated in the national economy, other than 

in the manufacturing sector being regulated, as a consequence of (1) reduced spending by 

end users on electricity; (2) reduced spending on new energy supply by the utility 

industry; (3) increased spending on the purchase price of new commercial refrigeration 

equipment; and (4) the effects of those three factors throughout the Nation’s economy. 

DOE expects the net monetary savings from amended standards to stimulate other forms 

of economic activity. DOE also expects these shifts in spending and economic activity to 
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affect the demand for labor.

 

In developing this analysis in the NOPR, DOE estimated indirect national 

employment impacts using an input/output model of the U.S. economy, called ImSET 

(Impact of Sector Energy Technologies), developed by DOE’s Building Technologies 

Program. ImSET is a personal computer-basedan economic analysis model that 

characterizes the interconnections among 188 sectors of the economy as national 

input/output structural matrices, using data from the U.S. Department of Commerce’s 

1997 Benchmark U.S. input/output table.80 The ImSET model estimates changes in 

employment, industry output, and wage income in the overall U.S. economy resulting 

from changes in expenditures in various sectors of the economy. DOE estimated changes 

in expenditures using the NIA model. ImSET then estimated the net national indirect 

employment impacts that amended commercial refrigeration equipment efficiency 

standards could have on employment by sector. 

For more details on the employment impact analysis and its results, see chapter 

1416 of the NOPR TSD and section V.B of this notice.

M. Utility Impact Analysis

The utility impact analysis estimates theseveral important effects on the utility 

industry of the adoption of new or amended standards. For this analysis, DOE used the 

NEMS-BT model to generate forecasts of electricity consumption, electricity generation 

 

80 U.S. Department of Commerce, Bureau of Economic Analysis. Benchmark Input-Output Accounts. 

1997. U.S. Government Printing Office: Washington, DC.

Field Code Changed
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by plant type, and electric generating capacity by plant type, that would result from each 

considered TSL. DOE conductedobtained the impact analysisenergy savings inputs 

associated with efficiency improvements to considered products from the NIA. DOE 

conducts the utility impact analysis as a scenario that departeddeparts from the latest 

AEO Reference Case. In other wordsthe analysis for today’s rule, the estimated impacts 

of an amended standardstandards are the differences between values forecasted by 

NEMS-BT and the values in the AEO2011AEO2013 Reference Case. Chapter 13For 

more details on the utility impact analysis, see chapter 15 of the NOPR TSD presents 

results of the utility impact analysis. 

N. EmissionEmissions Analysis

In the emissionemissions analysis (EA),, DOE estimated the reduction in power 

sector emissions of CO2, NOx, and Hg using the NEMS-BT computer model. In the EA, 

NEMS-BT is run similarly to the AEO NEMS, except that sulfur dioxide (SO2) and Hg 

from amended energy conservation standards for commercial refrigeration equipment

energy use is reduced by the amount of energy saved (by fuel type) due to each TSL. The 

inputs of NES come from the NIA spreadsheet model, while the output is the forecasted 

physical emissions. The net benefit of each TSL in today’s proposed rule is the difference 

between the forecasted. In addition, DOE estimates emissions estimated by NEMS-BT at 

each TSLimpacts in production activities (extracting, processing, and the AEO2011

Reference Case. NEMS-BT tracks CO2transporting fuels) that provide the energy inputs 

to power plants. These are referred to as “upstream” emissions using a detailed module 

that provides results with broad coverage of all sectors and inclusion of interactive 
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effects. For today’s NOPR, DOE used the AEO2011. For the final rule, DOE intends to 

revise the. Together, these emissions account for the full-fuel-cycle (FFC). In accordance 

with DOE’s FFC Statement of Policy (76 FR 51282 (Aug. 18, 2011)) 77 FR 49701 

(August 17, 2012), the FFC analysis using the most current includes impacts on 

emissions of methane (CH4) and nitrous oxide (N2O), both of which are recognized as 

greenhouse gases. 

DOE conducted the emissions analysis using emissions factors that were derived 

from data in EIA’s Annual Energy Outlook 2013 (AEO 2013), supplemented by data 

from other sources. DOE developed separate emissions factors for power sector 

emissions and upstream emissions. The method that DOE used to derive emissions 

factors is described in chapter 13 of the NOPR TSD.

EIA prepares the Annual Energy Outlook using the National Energy Modeling 

System (NEMS). Each annual version of NEMS incorporates the projected impacts of 

existing air quality regulations on emissions. AEO 2013 generally represents current 

legislation and environmental regulations, including recent government actions, for 

which implementing regulations were available as of December 31, 2012. 

SO2 emissions from affected electric generating units (EGUs) are subject to 

nationwide and regional emissions cap-and-trade programs, and DOE has preliminarily 

determined that these programs create uncertainty about the potential amended standards’ 

impact on SO2 emissions.. Title IV of the Clean Air Act sets an annual emissions cap on 

SO2 for affected EGUs in the 48 contiguous States (42 U.S.C. 7651 et seq.) and the 
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District of Columbia (D.C.). SO2 emissions from 28 eastern States and D.C. were also 

limited under the Clean Air Interstate Rule (CAIR; 70 FR 25162 (May 12, 2005)), which 

created an allowance-based trading program. CAIR was remanded to the U.S. 

Environmental Protection Agency (EPA) by the U.S. Court of Appeals for the District of 

Columbia (D.C. Circuit) (but it remained in effect. See North Carolina v. EPA, 550 F.3d 

1176 (D.C. Cir. 2008)), it remained in effect temporarily, consistent with the D.C. 

Circuit’s earlier opinion in); North Carolina v. EPA, 531 F.3d 896 (D.C. Cir. 2008). On 

July 6, 20102011, EPA issued the Transport Rule proposal, a replacement for CAIR (75 

FR 45210 (Aug. 2, 2010)), and on July 6, 2011 EPA issued the final Transport Rule, 

titled, the Cross-State Air Pollution Rule. (CSAPR). 76 FR 48208 (Aug. 8, 2011). ().

Because the AEO2011 NEMSOn August 21, 2012, the D.C. Circuit issued a decision to 

vacate CSAPR. See EME Homer City Generation, LP v. EPA, 696 F.3d 7, 38 (D.C. Cir. 

2012). The court ordered EPA to continue administering CAIR. The AEO 2013

emissions factors used for today’s NOPR assumes the implementation of CAIR, DOE has 

not been able to take into account the effects of the Transport Rule for this 

rulemakingassume that CAIR remains a binding regulation through 2040. .81

The attainment of emissions caps is typically flexible among EGUs and is 

enforced through the use of emissions allowances and tradable permits. Under existing 

 

81 DOE notes that future iterations of the NEMS-BT model will incorporate any changes necessitated by 

issuance of the Transport Rule. On December 30, 2011, the D.C. Circuit stayed the new rules while a panel 

of judges reviews them, and told EPA to continue administering CAIR. See EME Homer City Generation, 

LP v. EPA, Order, No. 11-1302, Slip Op. at *2 (D.C. Cir. Dec. 30, 2011). On August 21, 2012, the D.C. 

Circuit issued a decision to vacate CSAPR. See EME Homer City Generation, LP v. EPA, No. 11-1302, 

2012 WL 3570721 at *24 (D.C. Cir. Aug. 21, 2012). The court again ordered EPA to continue 

administering CAIR. AEO2012 had been finalized prior to both these decisions, however. DOE 

understands that CAIR and CSAPR are similar with respect to their effect on emissions impacts of energy 

efficiency standards.
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EPA regulations, any excess SO2 emissions allowances resulting from the lower 

electricity demand caused by the impositionadoption of a new or amended efficiency 

standard could be used to permit offsetting increases in SO2 emissions by any regulated 

EGU. However, if the new or amended standards resulted in a permanent increase in the 

quantity of unused emissions allowances, In past rulemakings, DOE recognized that there 

would be an overall reduction in SO2 emissions resulting from the standards. While there 

remains somewas uncertainty about the ultimate effects of amended efficiency standards 

on SO2 emissions covered by the existing cap-and-trade system, the NEMS-BT modeling 

system that DOE uses to forecast emissions reductions currently indicatesbut it concluded

that no physicalnegligible reductions in power sector SO2 emissions would occur as a 

result of standards.

Beginning in 2015, however, SO2 emissions will fall as a result of the AEO2011

NEMS Mercury and Air Toxics Standards (MATS) for power plants, which were 

announced by EPA on December 21, 2011. 77 FR 9304 (Feb. 16, 2012). In the final 

MATS rule, EPA established a standard for hydrogen chloride as a surrogate for acid gas 

hazardous air pollutants (HAP), and also established a standard for SO2 (a non-HAP acid 

gas) as an alternative equivalent surrogate standard for acid gas HAP. The same controls

are used for today’s NOPRto reduce HAP and non-HAP acid gas; thus, SO2 emissions

will be reduced as a result of the control technologies installed on coal-fired power plants 

to comply with the MATS requirements for acid gas. AEO2013 assumes the 

implementation of that, in order to continue operating, coal plants must have either flue 

gas desulfurization or dry sorbent injection systems installed by 2015. Both technologies, 
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which are used to reduce acid gas emissions, also reduce SO2 emissions. Under the 

MATS, NEMS shows a reduction in SO2 emissions when electricity demand decreases 

(e.g., as a result of energy efficiency standards). Emissions will be far below the cap that 

would be established by CAIR 2005, which, so it is unlikely that excess SO2 emissions 

allowances resulting from the lower electricity demand would be needed or used to 

permit offsetting increases in SO2 emissions by any regulated EGU. Therefore, DOE 

believes that efficiency standards will reduce SO2 emissions in 2015 and beyond.

CAIR established a cap on NOx emissions in 28 eastern States and the District of 

Columbia. With CAIR in effect, the proposed amended Energy conservation standards 

for commercial refrigeration equipment are are expected to have little or no physical 

effect on NOx emissions in those States covered by CAIR, for the same reasons that they 

may have little effect on SO2 emissions. because excess NOx emissions allowances 

resulting from the lower electricity demand could be used to permit offsetting increases 

in NOx emissions. However, the proposed standards would be expected to reduce NOx

emissions in the 22 States not affected by CAIR. For these 22 states, DOE is using the 

NEMS-BT to estimatethe caps, so DOE estimated NOx emissions reductions from the 

proposed standards considered in today’s NOPR for these States. 

Similar to emissions of SO2 and NOx, future emissions of Hg would have been 

subject to emissions caps. In May 2005, EPA issued the Clean Air Mercury Rule 

(CAMR). 70 FR 28606 (May 18, 2005). CAMR would have permanently capped 

emissions of mercury for new and existing coal-fired power plants in all states by 2010. 
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However, on February 8, 2008, the D.C. Circuit issued a decision in New Jersey v. 

Environmental Protection Agency, 517 F.3d 574 (D.C. Cir. 2008), in which it vacated 

CAMR. EPA has decided to develop emissions standards for power plants under section 

112 of the Clean Air Act, consistent with the D.C. Circuit’s opinion on CAMR. See . 

Pending EPA’s forthcoming revisions to the rule, DOE is excluding CAMR from its 

emission analysis . In the absence of CAMR, an amended DOE standard would likely 

reduce Hg emissions and DOE used NEMS-BT to estimate these reductions. However, 

DOE continues to review the impact of rules that reduce energy consumption on Hg 

emissions, and may revise its assessment of Hg emission reductions in future 

rulemakings.

The MATS limit mercury emissions from power plants, but they do not include 

emissions caps and, as such, DOE’s energy conservation standards would likely reduce 

Hg emissions. DOE estimated mercury emissions factors based on AEO2013, which 

incorporates the MATS.

After the preliminary analysis, two stakeholders provided comments pertinent to 

the emissions analysis. NRDC stated that, given that supermarket rack-based commercial 

refrigeration equipment units have leakage rates of 15 to 30 percent and use HFC 

refrigerants with GWPs in the range of 2,000 to 3,400, direct emissions can be as large as 

the indirect emissions due to energy use. NRDC added that DOE or EPA should review 

emissions due to leakage. (NRDC, Public Meeting Transcript, No. 31 at p. 173) CA IOUs 

stated that refrigerant emissions and leakage may have a significant GWP, and suggested 
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that DOE include in its environmental impact analysis estimates of changes in refrigerant 

emissions, and their effects on total GHG emissions and GWP. CA IOUs pointed to the 

CEC analysis as a potential starting point for DOE to use in including refrigerants in the 

environmental impact analysis. (CA IOUs, No. 42 at p. 6) 

DOE appreciates the comments by stakeholders regarding the emissions analysis 

of refrigerants. DOE’s emission analysis strictly adheres to the interagency guidance and 

methodologies that has been outlined in this section. Currently, the guidance does not 

permit the assessment of direct emissions such as refrigerant leakage. Therefore, DOE 

did not assess the impact of refrigerant leakage in today’s NOPR. 

DOE also adds that the design options used for efficiency improvement of 

commercial refrigeration equipment in this rulemaking are not expected to impact 

refrigerant leakage rates. Consequently, the proposed standards would not affect 

refrigerant emissions. If stakeholders believe that the proposed standards would lead to 

an increase or a decrease in refrigerant emissions, then supporting arguments may be 

submitted for DOE’s consideration during the NOPR public meeting or comment period.

 

O. Monetizing Carbon Dioxide and Other Emissions Impacts

As part of the development of the proposed standards in this NOPR, DOE 

considered the estimated monetary benefits likely to result from the reduced emissions of 

CO2 and NOx that are expected to result from each of the TSLs considered. In order to 

make this calculation analogous to the calculation of the NPV of the expected 

Comment [A38]: Revision requested by OIRA.

Comment [A39]: Revision requested by OIRA.

Comment [A40]: Revision requested by OIRA.

Comment [A41]: Revision requested by OIRA.

Comment [A42]: Revision requested by OIRA.
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consumercustomer benefit, DOE considered the reduced emissions expected to result 

over the lifetime of equipment shipped in the forecast period for each TSL. This section 

summarizes the basis for the monetary values used for each of these emissions and 

presents the values considered in this NOPR.

For today’s NOPR, DOE is relying on a set of values for the SCC that was 

developed by a Federal interagency process. 82 A summary of The basis for these values 

is summarized below, and a more detailed description of the methodologies used is 

provided as an appendix to chapter 1714 of the NOPR TSD.

1. Social Cost of Carbon

The SCC is an estimate of the monetized damages associated with an incremental 

increase in carbon emissions in a given year. It is intended to include (but is not limited 

to) changes in net agricultural productivity, human health, property damages from 

increased flood risk, and the value of ecosystem services. Estimates of the SCC are 

provided in dollars per metric ton of carbon dioxide. A domestic SCC value is meant to 

reflect the value of damages in the United States resulting from a unit change in carbon

dioxide emissions, while a global SCC value is meant to reflect the value of damages 

worldwide.

 

82 As part of the interagency process that developed these SCC estimates, technical experts from numerous 

Federal agencies met on a regular basis to consider public comments, explore the technical literature in 

relevant fields, and discuss key model inputs and assumptions. The main objective of this process was to 

develop a range of SCC values using a defensible set of input assumptions grounded in the existing 

scientific and economic literatures. In this way, key uncertainties and model differences transparently and 

consistently inform the range of SCC estimates used in the rulemaking process.
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Under section 1(b) of Executive Order 12866, agencies must, to the extent 

permitted by law, “assess both the costs and the benefits of the intended regulation and, 

recognizing that some costs and benefits are difficult to quantify, propose or adopt a 

regulation only upon a reasoned determination that the benefits of the intended regulation 

justify its costs.” The purpose of the SCC estimates presented here is to allow agencies to 

incorporate the monetized social benefits of reducing CO2 emissions into cost-benefit 

analyses of regulatory actions that have small, or “marginal,” impacts on cumulative 

global emissions. The estimates are presented with an acknowledgement of the many 

uncertainties involved and with a clear understanding that they should be updated over 

time to reflect increasing knowledge of the science and economics of climate impacts.

As part of the interagency process that developed these SCC estimates, technical 

experts from numerous agencies met on a regular basis to consider public comments, 

explore the technical literature in relevant fields, and discuss key model inputs and 

assumptions. The main objective of this process was to develop a range of SCC values 

using a defensible set of input assumptions grounded in the existing scientific and 

economic literatures. In this way, key uncertainties and model differences transparently 

and consistently inform the range of SCC estimates used in the rulemaking process.

a. Monetizing Carbon Dioxide Emissions

The SCC is an estimate of the monetized damages associated with an incremental 

increase in carbon emissions in a given year. It is intended to include (but is not limited 

to) changes in net agricultural productivity, human health, property damages from 
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increased flood risk, and the value of ecosystem services. Estimates of the SCC are 

provided in dollars per metric ton of carbon dioxide. When attempting to assess the 

incremental economic impacts of carbon dioxide emissions, the analyst faces a number of 

serious challenges. A report from the National Research Council83 points out that any 

assessment will suffer from uncertainty, speculation, and lack of information about (1) 

future emissions of GHGs; (2) the effects of past and future emissions on the climate 

system, (3) the impact of changes in climate on the physical and biological environment, 

and (4) the translation of these environmental impacts into economic damages. As a 

result, any effort to quantify and monetize the harms associated with climate change will 

raise serious questions of science, economics, and ethics and should be viewed as 

provisional. 

Despite the serious limits of both quantification and monetization, SCC estimates 

can be useful in estimating the social benefits of reducing carbon dioxide emissions. 

Consistent with the directive in Executive Order 12866 quoted above, the purpose of the 

SCC estimates presented here is to make it possible for Federal agencies to incorporate 

the social benefits from reducing carbon dioxide emissions into cost-benefit analyses of 

regulatory actions, such as this one, that have small, or “marginal,” impacts on 

cumulative global emissions.CO2 emissions. Most Federal regulatory actions can be 

expected to have marginal impacts on global emissions. For such policies, the agency can 

estimate the benefits from reduced (or costs from increased) emissions in any future year 

by multiplying the change in emissions in that year by the SCC value appropriate for that 

 

83 National Research Council. Hidden Costs of Energy: Unpriced Consequences of Energy Production and 

Use. 2009. National Academies Press: Washington, DC. 
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year. The net present value of the benefits can then be calculated by multiplying each of 

these future benefits by an appropriate discount factor and summing across all affected 

years. This approach assumes that the marginal damages from increased emissions are 

constant for small departures from the baseline emissions path, an approximation that is 

reasonable for policies that have effects on emissions that are small relative to cumulative 

global CO2 emissions. For policies that have a large (non-marginal) impact on global 

cumulative emissions, there is a separate question of whether the SCC is an appropriate 

tool for calculating the benefits of reduced emissions. This concern is not applicable to 

this notice, however.

At the time of the preparation of this notice, the most recent interagency estimates 

of the potential global benefits resulting from reduced CO2 emissions in 2010, expressed 

in 2010$, were $4.9, $22.3, $36.5, and $67.6 per metric ton avoided. For emissions 

reductions that occur in later years, these values grow in real terms over time. 

Additionally, the interagency group determined that a range of values from 7 percent to 

23 percent should be used to adjust the global SCC to calculate domestic effects,84

It is important to emphasize that the interagency process is committed to updating 

these estimates as the science and economic understanding of climate change and its 

impacts on society improves over time. Specifically, the interagency group has set a 

although preference is given to consideration of the global benefits of reducing CO2

emissions.

 

84 It is recognized that this calculation for domestic values is approximate, provisional, and highly 

speculative. There is no a priori reason why domestic benefits should be a constant fraction of net global 

damages over time.
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preliminary goal of revisiting the SCC values within 2 years, or at such time as 

substantially updated models become available, and to continue to support research in 

this area. In the meantime, the interagency group will continue to explore the issues 

raised by this analysis and consider public comments as part of the ongoing interagency 

process.

b. Social Cost of Carbon Values Used in Past Regulatory Analyses

To date, Economic analyses for Federal regulations have used a wide range of 

values to estimate the benefits associated with reducing CO2 emissions. The model year 

2011 Corporate Average Fuel Economy final rule, the U.S. Department of Transportation 

(DOT) used both a “domestic” SCC value of $2 per metric ton of CO2 and a “global” 

SCC value of $33 per metric ton of CO2 for 2007 emission reductions (in 2007$), 

increasing both values at 2.4 percent per year.85 DOT also included a sensitivity analysis 

at $80 per metric ton of CO2. See Average Fuel Economy Standards Passenger Cars and 

Light Trucks Model Year 2011, 74 FR 14196 (Mar. 30, 2009) (Final Rule); Final 

Environmental Impact Statement Corporate Average Fuel Economy Standards, Passenger 

Cars and Light Trucks, Model Years 2011–2015 at 3–90 (Oct. 2008) (available at: ). 86

 

85 Throughout this section, references to tons of CO2 refer to metric tons.

A 

domestic SCC value is meant to reflect the value of damages in the United States 

resulting from a unit change in carbon dioxide emissions, while a global SCC value is 

meant to reflect the value of damages worldwide.

86 See Average Fuel Economy Standards Passenger Cars and Light Trucks Model Year 2011, 74 FR 14196 

(March 30, 2009) (Final Rule); Final Environmental Impact Statement Corporate Average Fuel Economy 

Standards, Passenger Cars and Light Trucks, Model Years 2011-2015 at 3-90 (Oct. 2008) (Available at: 

www.nhtsa.gov/fuel-economy).
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A 2008 regulation proposed by DOT assumed a domestic SCC value of $7 per 

metric ton of CO2 (in 2006$) for 2011 emission reductions (with a range of $0-$14 for 

sensitivity analysis), also increasing at 2.4 percent per year. See Average Fuel Economy 

Standards, Passenger Cars and Light Trucks, Model Years 2011–2015, 73 FR 24352 

(May 2, 2008) (Proposed Rule); Draft Environmental Impact Statement Corporate 

Average Fuel Economy Standards, Passenger Cars and Light Trucks, Model Years 2011–

2015 at 3–58 (June 2008) (available at: ).8788 A regulation for packaged terminal air 

conditioners and packaged terminal heat pumps finalized by DOE in October of 2008 

used a domestic SCC range of $0 to $20 per metric ton CO2 for 2007 emission reductions 

(in 2007$). 73 FR 58772, 58814 (Oct. 7, 2008) In addition, EPA’s 2008 Advance Notice 

of Proposed Rulemaking on Regulating Greenhouse Gas Emissions Under the Clean Air 

Act identified what it described as “very preliminary” SCC estimates subject to revision. 

See Regulating Greenhouse Gas Emissions Under the Clean Air Act, 73 FR 44354 (July 

30, 2008). EPA’s global mean values were $68 and $40 per metric ton CO2 for discount 

rates of approximately 2 percent and 3 percent, respectively (in 2006$ for 2007 

emissions).

In 2009, an interagency process was initiated to offer a preliminary assessment of 

 

87 See Average Fuel Economy Standards, Passenger Cars and Light Trucks, Model Years 2011-2015, 73 

FR 24352 (May 2, 2008) (Proposed Rule); Draft Environmental Impact Statement Corporate Average Fuel 

Economy Standards, Passenger Cars and Light Trucks, Model Years 2011-2015 at 3-58 (June 2008) 

(Available at: www.nhtsa.gov/fuel-economy) 88 See Average Fuel Economy Standards, Passenger Cars and Light Trucks, Model Years 2011-2015, 73 

FR 24352 (May 2, 2008) (Proposed Rule); Draft Environmental Impact Statement Corporate Average Fuel 

Economy Standards, Passenger Cars and Light Trucks, Model Years 2011-2015 at 3-58 (June 2008) 

(Available at: www.nhtsa.gov/fuel-economy).
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how best to quantify the benefits from reducing carbon dioxide emissions. To ensure 

consistency in how benefits are evaluated across Federal agencies, the Administration 

sought to develop a transparent and defensible method, specifically designed for the 

rulemaking process, to quantify avoided climate change damages from reduced CO2

emissions. The interagency group did not undertake any original analysis. Instead, it 

combined SCC estimates from the existing literature to use as interim values until a more 

comprehensive analysis could be conducted. The outcome of the preliminary assessment 

by the interagency group was a set of five interim values: global SCC estimates for 2007 

(in 2006$) of $55, $33, $19, $10, and $5 per metric ton of CO2. These interim values 

represented the first sustained interagency effort within the U.S. government to develop 

an SCC for use in regulatory analysis. The results of this preliminary effort were 

presented in several proposed and final rules and were offered for public comment in 

connection with proposed rules, including the joint EPA-DOT fuel economy and CO2

tailpipe emission proposed rules.. 

c. Current Approach and Key Assumptions

Since the release of the interim values, the interagency group reconvened on a 

regular basis to generate improved SCC estimates, which were considered in this NOPR 

for the proposed standard levels. Specifically. Specially, the group considered public 

comments and further explored the technical literature in relevant fields. The interagency 

group relied on three integrated assessment models commonly used to estimate the SCC: 

the FUND, DICE, and PAGE models.89

 

89 The models are described in appendix 16A of the NOPR TSD.

These models are frequently cited in the peer-
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reviewed literature and were used in the last assessment of the Intergovernmental Panel 

on Climate Change. Each model was given equal weight in the SCC values that were 

developed. 

Each model takes a slightly different approach to model how changes in 

emissions result in changes in economic damages. A key objective of the interagency 

process was to enable a consistent exploration of the three models, while respecting the 

different approaches to quantifying damages taken by the key modelers in the field. An 

extensive review of the literature was conducted to select three sets of input parameters 

for these models: climate sensitivity, socio-economic and emissions trajectories, and 

discount rates. A probability distribution for climate sensitivity was specified as an input 

into all three models. In addition, the interagency group used a range of scenarios for the 

socio-economic parameters and a range of values for the discount rate. All other model 

features were left unchanged, relying on the model developers’ best estimates and 

judgments.

The interagency group selected four sets of SCC values for use in regulatory 

analyses. Three sets of values are based on the average SCC from the three IAMs, at 

discount rates of 2.5, 3, and 5 percent. The fourth valueset, which represents the 95th

percentile SCC estimate across all three models at a 3-percent discount rate, was included 

to represent higher than expected impacts from temperature change further out in the tails 

of the SCC distribution. The values grow in real terms over time. Additionally, the 

interagency group determined that a range of values from 7 percent to 23 percent should 
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be used to adjust the global SCC to calculate domestic effects,90

Table IV.10

although preference is 

given to consideration of the global benefits of reducing CO2 emissions. For 

emissions (or emission reductions) that occur in later years, these values grow in real 

terms over time, as depicted in . presents the values in the 2010 interagency group 

report,91

Table IV.10 Cost of CO2 Annual SCC Values from 2010 Interagency Report, 2010–

2050 (in 2007$ dollars per metric ton)

which is reproduced in appendix 14A of the NOPR TSD.

Year

Discount Rate

5% 3% 2.5% 3%

Average Average Average 95th

percentile

2010 4.7 21.4 35.1 64.9

2015 5.7 23.8 38.4 72.8

2020 6.8 26.3 41.7 80.7

2025 8.2 29.6 45.9 90.4

2030 9.7 32.8 50.0 100.0

2035 11.2 36.0 54.2 109.7

2040 12.7 39.2 58.4 119.3

2045 14.2 42.1 61.7 127.8

2050 15.7 44.9 65.0 136.2

The SCC values used for today’s notice were generated using the most recent 

versions of the three integrated assessment models that have been published in the peerreviewed literature.

92 Table IV.11 shows the updated sets of SCC estimates in 5-year 

increments from 2010 to 2050. The full set of annual SCC estimates between 2010 and 

2050 is reported in appendix 14A of the TSD. The central value that emerges is the 

 

90 It is recognized that this calculation for domestic values is approximate, provisional, and highly 

speculative. There is no a priori reason why domestic benefits should be a constant fraction of net global 

damages over time.

91 Social Cost of Carbon for Regulatory Impact Analysis Under Executive Order 12866. Interagency 

Working Group on Social Cost of Carbon, United States Government, February 2010. 

www.whitehouse.gov/sites/default/files/omb/inforeg/for-agencies/Social-Cost-of-Carbon-for-RIA.pdf. 92 Technical Update of the Social Cost of Carbon for Regulatory Impact Analysis Under Executive Order 

12866. Interagency Working Group on Social Cost of Carbon, United States Government. May 2013.

http://www.whitehouse.gov/sites/default/files/omb/inforeg/social_cost_of_carbon_for_ria_2013_update.pdf

 
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average SCC across models at the 3 percent discount rate. However, for purposes of 

capturing the uncertainties involved in regulatory impact analysis, the interagency group 

emphasizes the importance of including all four sets of SCC values.

Table IV.11 Annual SCC Values from 2013 Interagency Report, 2010–2050 (in 2007

dollars per metric ton)

Year

Discount Rate

5% 3% 2.5% 3%

Average Average Average 95th

percentile

2010 11 33 52 90

2015 12 38 58 109

2020 12 43 65 129

2025 14 48 70 144

2030 16 52 76 159

2035 19 57 81 176

2040 21 62 87 192

2045 24 66 92 206

2050 27 71 98 221

It is important to recognize that a number of key uncertainties remain, and that 

current SCC estimates should be treated as provisional and revisable since they will 

evolve with improved scientific and economic understanding. The interagency group also 

recognizes that the existing models are imperfect and incomplete. The 2009 National 

Research Council report mentioned above points out that there is tension between the 

goal of producing quantified estimates of the economic damages from an incremental ton 

of carbon and the limits of existing efforts to model these effects. There are a number of 

concerns and problems that should be addressed by the research community, including 

research programs housed in many of the Federal agencies participating in the 

interagency process to estimate the SCC. The interagency group intends to periodically 

review and reconsider those estimates to reflect increasing knowledge of the science and 

economics of climate impacts, as well as improvements in modeling.
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DOE recognizes the uncertainties embedded in the estimates of the SCC used for 

cost-benefit The interagency group intendsanalyses. As such, DOE and others in the U.S. 

Government intend to periodically review and reconsider those estimates to reflect 

increasing knowledge of the science and economics of climate impacts, as well as 

improvements in modeling. In this context, statements recognizing the limitations of the 

analysis and calling for further research take on exceptional significance.

In summary, in considering the potential global benefits resulting from reduced 

CO2 emissions, DOE used the most recent values identified byfrom the 2013 interagency 

process,report adjusted to 20102012$ using the gross domestic productGDP price 

deflator values for 2008 through 2010.. For each of the four cases specifiedsets of SCC 

values, the values used for emissions in 20102015 were $412.9, $22.3, $36.540.8, $62.2, 

and $67.6117 per metric ton avoided93 (values expressed in 2010$).94

 

To monetize the 

CO2 emissions reductions expected to result from newly amended standards for 

commercial refrigeration equipment,2012$). DOE used thederived values identifiedafter 

2050 using the relevant growth rates for the 2040-2050 period in Table A1 of the “Social 

Cost of Carboninteragency update.

DOE multiplied the CO2 emissions reduction estimated for each year by the SCC 

 

93 The interagency report presents SCC values through 2050. DOE derived values after 2050 using the 3-

percent per year escalation rate used by the interagency group.

94 Table A1 presents SCC values through 2050. For DOE’s calculation, it derived values after 2050 using 

the 3-percent per year escalation rate used by the interagency group.
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value for Regulatory Impact Analysis Under Executive Order 12866,” which is 

reprintedthat year in appendix 16A of the NOPR TSD, appropriately adjusted to 

20010$.each of the four cases. To calculate a present value of the stream of monetary 

values, DOE discounted the values in each of the four cases using the specific discount 

rate that had been used to obtain the SCC values in each case.

2. Valuation of Other Emissions Reductions

DOE investigated the potential monetary benefit of reduced NOx emissions from 

the TSLs potential standards it considered. As noted above, DOE has taken into account 

how new or amended energy conservation standards would reduce NOx emissions in 

those 22 States that are not affected by the CAIRemissions caps. DOE estimated the 

monetized value of NOx emissions reductions resulting from each of the TSLs considered 

for today’s NOPR based on environmental damage estimates found in the relevant 

scientific literature. Available estimates suggest a very wide range of monetary values, 

ranging from $370 per ton to $3,800 per ton of NOx from stationary sources, measured in 

2001$ (equivalent to a range of $451ranging from $468 to $4,635809 per ton in 

20102012$).95 In accordance with OMB guidance, 96 DOE conducted two calculations of 

the calculated a range of monetary benefits derived using each of the economic values 

used for NOX, one using a and real discount raterates of 3 percent and another using a 

real discount rate of 7 percent.

97

 

95 For additional information, refer to U.S. Office of Management and Budget, Office of Information and 

Regulatory Affairs, 2006 Report to Congress on the Costs and Benefits of Federal Regulations and 

Unfunded Mandates on State, Local, and Tribal Entities, Washington, DC. 

 

96 OMB, Circular A-4: Regulatory Analysis (Sept. 17, 2003). 97 OMB, Circular A-4: Regulatory Analysis (Sept. 17, 2003).
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DOE is aware of multiple agency efforts to determine the appropriate range of 

values used in evaluating the potential economic benefits of reduced Hg emissions. DOE 

has decided to await further guidance regarding consistent valuation and reporting of Hg 

emissions before it once again monetizes Hg emissions in its rulemakings.DOE is 

evaluating appropriate monetization of avoided SO2 and Hg emissions in energy 

conservation standards rulemakings. It has not included monetization in the current 

analysis 

P. Regulatory Impact Analysis

DOE prepared a regulatory impact analysis (RIA) for this rulemaking, which is 

described in chapter 16 of the NOPR TSD. The RIA is subject to review by OIRA in the 

OMB. The RIA consists of (1) a statement of the problem addressed by this regulation 

and the mandate for Government action; (2) a description and analysis of policy 

alternatives to this regulation; (3) a qualitative review of the potential impacts of the 

alternatives; and (4) the national economic impacts of the proposed standard.

The RIA assesses the effects of feasible policy alternatives to amended

commercial refrigeration equipment standards and provides a comparison of the impacts 

of the alternatives. DOE evaluated the alternatives in terms of their ability to achieve 

significant energy savings at reasonable cost, and compared them to the effectiveness of 

the proposed rule. 
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DOE identified the following major policy alternatives for achieving increased 

commercial refrigeration equipment efficiency:

• no new regulatory action

• commercial customer tax credits

• commercial customer rebates

• voluntary energy efficiency targets

• bulk government purchases

• early replacement

DOE qualitatively evaluated each alternative’s ability to achieve significant 

energy savings at reasonable cost and compared it to the effectiveness of the proposed 

rule. DOE assumed that each alternative policy would induce commercial customers to 

voluntarily purchase at least some higher efficiency equipment at any of the TSLs. In 

contrast to a standard at one of the TSLs, the adoption rate of the alternative nonregulatory policy cases may not be 100 percent, which would result in lower energy 

savings than a standard. The following paragraphs discuss each policy alternative. (See 

chapter 1617 of the NOPR TSD for further details.) 

No new regulatory action: The case in which no regulatory action is taken for 

commercial refrigeration equipment constitutes the base case (or no action) scenario. By 

definition, no new regulatory action yields zero energy savings and an NPV of zero 

dollars. 
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Commercial customer tax credits: ConsumerCustomer tax credits are considered a 

viable non-regulatory market transformation program. From a consumercustomer

perspective, the most important difference between rebate and tax credit programs is that 

a rebate can be obtained quickly, whereas receipt of tax credits is delayed until income 

taxes are filed or a tax refund is provided by the Internal Revenue Service (IRS). From a 

societal perspective, tax credits (like rebates) do not change the installed cost of the 

equipment, but rather transfer a portion of the cost from the consumercustomer to 

taxpayers as a whole. DOE, therefore, assumed that equipment costs in the 

consumercustomer tax credits scenario were identical to the NIA base case. The change 

in the NES and NPV is a result of the change in the efficiency distributions that results 

from lowering the prices of higher efficiency equipment.

Commercial customer rebates: ConsumerCustomer rebates cover a portion of the 

difference in incremental product price between products meeting baseline efficacy levels 

and those meeting higher efficacy levels, resulting in a higher percentage of customers

purchasing more-efficacious models and decreased aggregated energy use compared to 

the base case. Although the rebate program reduces the total installed cost to the 

customer, it is financed by tax revenues. Therefore, from a societal perspective, the 

installed cost at any efficiency level does not change with the rebate program; rather, part 

of the cost is transferred from the consumercustomer to taxpayers as a whole. 

Consequently, DOE assumed that equipment costs in the rebates scenario were identical 

to the NIA base case. The change in the NES and NPV is a result of the change in the 

efficiency distributions that results as a consequence of lowering the prices of higher 
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efficiency equipment.

Voluntary energy efficiency targets: While it is possible that voluntary programs 

for equipment would be effective, DOE lacks a quantitative basis to determine how 

effective such a program might be. As noted previously, broader economic and social 

considerations are in play than simple economic return to the equipment purchaser. DOE 

lacks the data necessary to quantitatively project the degree to which voluntary programs 

for more expensive, higher efficiency equipment would modify the market.

Bulk government purchases and early replacement incentive programs: DOE also 

considered, but did not analyze, the potential of bulk government purchases and early 

replacement incentive programs as alternatives to the proposed standards. Bulk 

government purchases would have a very limited impact on improving the overall market 

efficiency of commercial refrigeration equipment because they would be a negligible part 

of the total equipment sold in the market. In the case of replacement incentives, several 

policy options exist to promote early replacement, including a direct national program of 

customer incentives, incentives paid to utilities to promote an early replacement program, 

market promotions through equipment manufacturers, and replacement of governmentowned equipment. In considering early replacements, DOE estimates that the energy 

savings realized through a one-time early replacement of existing stock equipment does 

not result in energy savings commensurate to the cost to administer the program. 

Consequently, DOE did not analyze this option in detail.
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V. Analytical Results

A. Trial Standard Levels

1. Trial Standard Level Formulation Process and Criteria

DOE selected between five and eight efficiency levels for all but three equipment

classes for the LCC analysis and NIA; the three exceptions were the HZO.RC.M, 

HZO.RC.L, and HZO.SC.L equipment classes, which had only two efficiency levels

each, including the baseline efficiency levels.

98

 

98 As explained in section 

For all equipment classes, the first 

efficiency level is the baseline efficiency level. Based on the results of the LCC analysis

and NIA, DOE selected five TSLs above the baseline level for each equipment class for 

the NOPR stage of this rulemaking. TSL 5 was selected at the max-tech level for all 

equipment classes. TSL 4 was chosen so as to group the efficiency levels with the highest 

energy savings combined with a positive consumercustomer NPV at a 7-percent discount 

rate. Consumer“Customer NPV” is the NPV of future savings obtained from the NIA. It 

provides a measure of the benefits only to the consumerscustomers of the commercial 

refrigeration equipment, and does not account for the net benefits to the Nation. The net 

benefits to the Nation also include monetized values of emissions reductions in addition 

to the consumercustomer NPV. TSL 3 was chosen to represent the group of efficiency 

levels with the highest consumercustomer NPV at a 7-percent discount rate. While the 

selection of TSL 4 and TSL 3 were based on consumercustomer NPV, the proposed 

IV.H.1, the baseline efficiency levels for equipment classes HZO.RC.M, HZO. 

RC.L and HZO.SC.L were set by their respective standards baseline values. The latest amended standards 

for these equipment classes were specified by the January 2009 final rule. DOE could identify only one 

design option (vacuum insulated panels) that could increase the efficiency of these equipment classes above 

the standards baseline. Therefore, apart from the baseline efficiency levels (standard baseline levels), there 

was only one additional efficiency level for each of these three equipment classes.
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standard levels were selected on the basis of net social benefits. TSL 2 and TSL 1 were 

selected to provide intermediate efficiency levels that fill the gap between the baseline 

efficiency level and TSL 3. For the HZO.RC.M, HZO.RC.L, and HZO.SC.L equipment 

classes, there is only one efficiency level above baseline. While TSL 5 was associated 

with the max-tech level for these three equipment classes, TSLs 1 through 4 did not have 

corresponding efficiency levels that satisfied TSL formulation criteria. Therefore, the 

baseline efficiency level was assigned to TSL 1 through TSL 4 for each of these three 

equipment classes. Table V.1 shows the mapping between TSLs and efficiency levels.
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Table V.1 Mapping Between TSLs and Efficiency Levels

Equipment 

Class

Intermediate 

Level*

Intermediate 

Level**

Max 

NPV***

Max Eff. Lvl 

with Pos-NPV†

Maxtech

Baseline TSL 1 TSL 2 TSL 3 TSL 4 TSL 5

VOP.RC.M Level 1 Level 2 Level 23 Level 34 Level 45 Level 6

VOP.RC.L Level 1 Level 2 Level 3 Level 4 Level 4 Level 5

VOP.SC.M Level 1 Level 23 Level 34 Level 45 Level 46 Level 7

VCT.RC.M Level 1 Level 2 Level 23 Level 34 Level 56 Level 67

VCT.RC.L Level 1 Level 23 Level 34 Level 45 Level 45 Level 56

VCT.SC.M Level 1 Level 32 Level 43 Level 64 Level 7 Level 8

VCT.SC.L Level 1 Level 23 Level 34 Level 65 Level 7 Level 8

VCT.SC.I Level 1 Level 3 Level 45 Level 6 Level 6 Level 7

VCS.SC.M Level 1 Level 3 Level 5 Level 7 Level 7 Level 8

VCS.SC.L Level 1 Level 23 Level 45 Level 6 Level 7 Level 8

VCS.SC.I Level 1 Level 3 Level 45 Level 6 Level 6 Level 7

SVO.RC.M Level 1 Level 2 Level 23 Level 34 Level 45 Level 6

SVO.SC.M Level 1 Level 23 Level 34 Level 45 Level 46 Level 7

SOC.RC.M Level 1 Level 2 Level 23 Level 34 Level 46 Level 7

HZO.RC.M‡ Level 1 Level 1 Level 1 Level 1 Level 1 Level 2

HZO.RC.L‡ Level 1 Level 1 Level 1 Level 1 Level 1 Level 2

HZO.SC.M Level 1 Level 2 Level 2 Level 3 Level 4 Level 5

HZO.SC.L‡ Level 1 Level 1 Level 1 Level 1 Level 1 Level 2

HCT.SC.M Level 1 Level 3 Level 45 Level 6 Level 7 Level 8

HCT.SC.L Level 1 Level 3 Level 4 Level 5 Level 7 Level 8

HCT.SC.I Level 1 Level 2 Level 3 Level 4 Level 4 Level 5

HCS.SC.M Level 1 Level 2 Level 3 Level 4 Level 5 Level 7

HCS.SC.L Level 1 Level 4 Level 5 Level 6 Level 6 Level 7

PD.SC.M Level 1 Level 2 Level 2 Level 3 Level 7 Level 8

SOC.SC.M Level 1 Level 3 Level 4 Level 5 Level 7 Level 8

“Level” stands for “Efficiency Level.”

* TSL 1 was generally chosen as one level below TSL 2, but could bein some cases an even lower efficiency level was chosen if the 

immediate lower level is tooLevel immediately below TSL 2 had an NPV value that was close to TSL 2 when the NPV values 

are compared.. **value of TSL 2.

** TSL 2 was generally chosen as one level below TSL3TSL 3, but could be lowerin some cases an even lower efficiency level 

was chosen if the immediate lower level is tooLevel immediately below TSL 3 had an NPV value that was close to TSL 3 when 

the NPV values are compared.value of TSL 3..

*** Efficiency level that has the highest NPV at a 7-percent discount rate.

† Highest efficiency level with a positive NPV at a 7-percent discount rate.

‡ TSLs 1 through 4 for equipment classes HZO.RC.M, HZO.RC.L, and HZO.SC.L do not satisfy the criteria for the corresponding 

TSL selection. See explanation in section V.A.1. TheyTSLs 1 through 4 were assigned to the baseline efficiency level for TSLs 1 

through 4all three equipment classes.

 

2. Trial Standard Level Equations

Because of the equipment size variation within each equipment class and the use 

of daily energy consumption as the efficiency metric, DOE developed a methodology to 

express efficiency standards in terms of a normalizing metric. DOE used two normalizing 
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metrics that were used for all equipment classes: (1) volume (V) and (2) TDA. The use of 

these two normalization metrics allows for the development of the standard in the form of 

a linear equation that can be used to represent the entire range of equipment sizes within a 

given equipment class. DOE retained the respective normalization metric (TDA or 

volume) previously used in the EPACT 2005 or the January 2009 final rule standards for 

each covered equipment class. (42 U.S.C. 6313(c)(2)–(3)); 74 FR 1092,at 1093 (Jan. 9, 

2009). Additionally, in its January 2009 final rule, DOE developed offset factors as a 

method to adjust the energy efficiency requirements for smaller equipment in each 

equipment class analyzed. These offset factors, which form the y-intercept on a plot of 

each standard level equation (representing a fictitious case of zero volume or zero TDA), 

accounted for certain components of the refrigeration load (such as conduction end 

effects) that remain constant even when equipment sizes vary. These constant loads affect

smaller cases disproportionately. The offset factors were intended to approximate these 

constant loads and provide a fixed end point in an equation that describes the relationship 

between energy consumption and the corresponding normalization metric. 74 FR at 

1,118–19 (Jan. 9, 2009). The standard level equations prescribed by EPACT 2005 also 

contained similar fixed parts not multiplied by the volume metric and which correspond 

to these offset factors. (42 U.S.C. 6313(c)(2)) In this NOPR, DOE modified the January 

2009 final rule (74 FR at 1,118–19 (Jan. 9, 2009)) and EPACT 2005 offset factors at each 

TSL to reflect the proportional changes in energy consumption for each equipment class, 

as modeled in the engineering analysis. See chapter 5 of the NOPR TSD for further 

details and discussion of offset factors. 
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For the equipment classes covered under this rulemaking, the standards equation 

at each TSL is proposed in the form of MDEC (in kilowatt-hours per day), normalized by 

a volume (V) or TDA metric, with an offset factor added to that value. These equations 

take the form:

MDEC = A x TDA + B (for equipment using TDA as a normalizing metric)

or 

MDEC = A x V + B (for equipment using volume as a normalizing metric) 

For equipment classes directly analyzed in the engineering analysis, offset factor 

B was calculated for each class (see chapter 5 of the NOPR TSD for discussion of offset 

factors). The slope, A, was derived based on the offset factor, B, and the CDEC of the 

representative unit modeled in the engineering analysis for that equipment class is

presented in Table V.2. The standards equations may be used to prescribe the MDEC for 

equipment of different sizes within the same equipment class. Chapter 9 of the NOPR 

TSD explains the methodology used for selecting TSLs and developing the coefficients 

shown in Table V.3. 

Table V.2 CDEC Values by TSL for Representative Units Analyzed in the 

Engineering Analysis for Each Primary Equipment Class

Equipment 

Class

CDEC Values by TSL

kWh/day

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5

VOP.RC.M 46.84 46.8444.33 44.3335.71 44.0935.51 35.06

VOP.RC.L 106.22 105.60101.03 100.51 100.51 98.87

VOP.SC.M 30.3703 30.0329.60 29.6026.70 29.6026.62 26.46

VCT.RC.M 14.1715.56 14.178.10 6.26 5.97 5.49

VCT.RC.L 31.13 30.58 30.29 30.29 28.85

VCT.SC.M 4.187.56 4.08 3.1324 2.97 2.68

VCT.SC.L 24.9613.48 17.3213.30 12.3744 12.09 11.57

VCT.SC.I 17.45 16.5136 16.14 16.14 15.37
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VCS.SC.M 2.36 2.17 1.81 1.81 1.39

VCS.SC.L 7.6926 7.076.75 6.66 6.56 5.71

VCS.SC.I 18.24 18.1117.79 17.64 17.64 16.53

SVO.RC.M 36.11 33.8536.11 27.7133.85 33.6827.57 27.26

SVO.SC.M 26.6725.74 25.7436 25.3623.29 25.3623.24 23.12

SOC.RC.M 25.62 25.6224.97 24.9720.43 24.8520.15 19.93

HZO.RC.M 14.43 14.43 14.43 14.43 14.17

HZO.RC.L 33.10 33.10 33.10 33.10 32.22

HZO.SC.M 14.76 14.76 14.60 14.49 14.26

HZO.SC.L 30.12 30.12 30.12 30.12 29.91

HCT.SC.M 1.87 1.730.84 0.75 0.67 0.49

HCT.SC.L 4.11 3.981.77 1.7770 1.57 1.18

HCT.SC.I 3.22 3.07 2.86 2.86 2.13

HCS.SC.M 0.65 0.60 0.56 0.50 0.25

HCS.SC.L 1.61 1.46 1.27 1.27 0.74

PD.SC.M 3.90 3.90 2.23 1.64 1.42

SOC.SC.M 27.04 26.80 22.02 21.70 21.41

Table V.3 Equations Representing the Standards at Each TSL for All Primary 

Equipment Classes

Equipment 

Class

Trial Standard Levels for Primary Equipment Classes Analyzed

Baseline TSL 1 TSL 2 TSL 3 TSL 4 TSL 5

VCT.RC.L 0.56 x× TDA 

+ 2.61

0.45 x× TDA 

+ 2.08

0.44 x× TDA 

+ 2.05

0.43 x× TDA 

+ 2.03

0.43 x× TDA 

+ 2.03

0.41 x× TDA 

+ 1.93

VOP.RC.M 0.82 x× TDA 

+ 4.07

0.8 x× TDA + 

3.99

0.8 x76 ×

TDA + 

3.9978

0.76 x61 ×

TDA + 

3.7804

0.76 x61 ×

TDA + 

3.7603

0.6 x× TDA + 

2.99

SVO.RC.M 0.83 x× TDA 

+ 3.18

0.82 x× TDA 

+ 3.16

0.82 x77 ×

TDA + 

3.162.96

0.77 x63 ×

TDA + 

2.9642

0.77 x63 ×

TDA + 

2.9441

0.62 x× TDA 

+ 2.38

HZO.RC.L 0.57 x× TDA 

+ 6.88

0.57 x× TDA 

+ 6.88

0.57 x× TDA 

+ 6.88

0.57 x× TDA 

+ 6.88

0.57 x× TDA 

+ 6.88

0.55 x× TDA 

+ 6.7

HZO.RC.M 0.35 x× TDA 

+ 2.88

0.35 x× TDA 

+ 2.88

0.35 x× TDA 

+ 2.88

0.35 x× TDA 

+ 2.88

0.35 x× TDA 

+ 2.88

0.34 x× TDA 

+ 2.83

VCT.RC.M 0.22 x× TDA 

+ 1.95

0.19 x21 ×

TDA + 1.787

0.19 x11 ×

TDA + 

1.70.97

0.08 x× TDA 

+ 0.75

0.08 x× TDA 

+ 0.72

0.07 x× TDA 

+ 0.66

VOP.RC.L 2.27 x× TDA 

+ 6.85

2.23 x× TDA 

+ 6.72

2.21 x12 ×

TDA + 

6.6839

2.11 x× TDA 

+ 6.36

2.11 x× TDA 

+ 6.36

2.07 x× TDA 

+ 6.26

SOC.RC.M 0.51 x× TDA 

+ 0.11

0.5 x× TDA + 

0.11

0.5 x49 ×

TDA + 0.11

0.49 x4 ×

TDA + 

0.1109

0.49 x39 ×

TDA + 0.108

0.39 x× TDA 

+ 0.08

VOP.SC.M 1.74 x× TDA 

+ 4.71

1.72 x7 ×

TDA + 

4.6661

1.7 x68 ×

TDA + 

4.6154

1.68 x51 ×

TDA + 4.541

1.68 x51 ×

TDA + 

4.5409

1.5 x× TDA + 

4.06

SVO.SC.M 1.73 x× TDA 

+ 4.59

1.73 x67 ×

TDA + 

4.5842

1.67 x64 ×

TDA + 

4.4235

1.64 x51 ×

TDA + 4.35

1.64 x5 ×

TDA + 

4.353.99

1.5 x× TDA + 

3.97

HZO.SC.L 1.92 x× TDA 

+ 7.08

1.92 x× TDA 

+ 7.08

1.92 x× TDA 

+ 7.08

1.92 x× TDA 

+ 7.08

1.92 x× TDA 

+ 7.08

1.91 x× TDA 

+ 7.03

HZO.SC.M 0.77 x× TDA 

+ 5.55

0.77 x× TDA 

+ 5.54

0.77 x× TDA 

+ 5.54

0.76 x× TDA 

+ 5.48

0.75 x× TDA 

+ 5.44

0.74 x× TDA 

+ 5.35

HCT.SC.I 0.56 x× TDA 

+ 0.43

0.55 x× TDA 

+ 0.42

0.52 x× TDA 

+ 0.4

0.49 x× TDA 

+ 0.37

0.49 x× TDA 

+ 0.37

0.36 x× TDA 

+ 0.28

VCT.SC.I 0.67 x× TDA 

+ 3.29

0.56 x× TDA 

+ 2.77

0.53 x× TDA 

+ 2.626

0.52 x× TDA 

+ 2.56

0.52 x× TDA 

+ 2.56

0.5 x× TDA + 

2.44
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VCS.SC.I 0.38 x× V + 

0.88

0.36 x× V + 

0.84

0.36 x35 × V 

+ 0.8382

0.35 x× V + 

0.81

0.35 x× V + 

0.81

0.33 x× V + 

0.76

VCT.SC.M 0.12 x× V + 

3.34

0.05 x1 × V + 

1.512.74

0.05 x× V + 

1.48

0.04 x× V + 

1.1317

0.04 x× V + 

1.07

0.03 x× V + 

0.97

VCT.SC.L 0.53 x× V + 

2.92

0.46 x25 × V 

+ 2.511.35

0.32 x24 × V 

+ 1.7433

0.23 x× V + 

1.2425

0.22 x× V + 

1.21

0.21 x× V + 

1.16

VCS.SC.M 0.06 x× V + 

1.31

0.03 x× V + 

0.69

0.03 x× V + 

0.64

0.03 x× V + 

0.53

0.03 x× V + 

0.53

0.02 x× V + 

0.41

VCS.SC.L 0.21 x× V + 

0.72

0.15 x14 × V 

+ 0.5148

0.13 x× V + 

0.4744

0.13 x× V + 

0.44

0.13 x× V + 

0.43

0.11 x× V + 

0.38

HCT.SC.M 0.06 x× V + 

1.73

0.05 x× V + 

1.42

0.05 x02 × V 

+ 1.320.63

0.02 x× V + 

0.57

0.02 x× V + 

0.51

0.01 x× V + 

0.38

HCT.SC.L 0.36 x× V + 

1.98

0.29 x× V + 

1.57

0.28 x12 × V 

+ 1.520.68

0.12 x× V + 

0.6865

0.11 x× V + 

0.6

0.08 x× V + 

0.45

HCS.SC.M 0.03 x× V + 

0.54

0.02 x× V + 

0.49

0.02 x× V + 

0.45

0.02 x× V + 

0.41

0.02 x× V + 

0.37

0.01 x× V + 

0.18

HCS.SC.L 0.2 x× V + 

0.69

0.15 x× V + 

0.53

0.14 x× V + 

0.48

0.12 x× V + 

0.42

0.12 x× V + 

0.42

0.07 x× V + 

0.24

PD.SC.M 0.13 x× V + 

3.51

0.07 x× V + 

1.98

0.07 x× V + 

1.98

0.04 x× V + 

1.13

0.03 x× V + 

0.83

0.03 x× V + 

0.72

SOC.SC.M 0.6 × TDA + 

1.0

0.4 × TDA + 

0.67

0.4 × TDA + 

0.66

0.33 × TDA + 

0.54

0.32 × TDA + 

0.53

0.32 × TDA + 

0.53

In addition to the 24 primary equipment classes analyzed, DOE intends to 

amendevaluating existing and potentially amended standards for 23 secondary equipment 

classes of commercial refrigeration equipment covered in this rulemaking that were not 

directly analyzed in the engineering analysis. DOE’s approach to amendingevaluating

standards for these secondary equipment classes involves extension multipliers developed 

using the engineering results for the primary equipment classes analyzed and a set of 

matched-pair analyses performed during the January 2009 final rule analysis.

99. In 

addition, DOE believes that standards for certain primary equipment classes can be 

directly applied to similar secondary equipment classes. Chapter 5 of the NOPR TSD 

discusses the development of the extension multipliers. 

 

99 The matched-pair analyses compared calculated energy consumption levels for pieces of equipment with 

similar designs but one major construction or operational difference; for example, vertical open remote 

condensing cases operating at medium and low temperatures. The relationships between these sets of units 

were used to determine the effect of the design or operational difference on applicable equipment. For more 

information, please see chapter 5 of the 2009 final rule TSD, which can be found at 

http://www.regulations.gov/#!documentDetail;D=EERE-2006-STD-0126-0058. 
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Using the extension multiplier approach, DOE developed an additional set of 

TSLs and associated equations for the secondary equipment classes, as shown in Table 

V.4. The TSLs shown in Table V.4 do not necessarily satisfy the criteria spelled out in 

section V.A. DOE is presenting the standards equations developed for each TSL for all 

47 equipment classes to allow interested parties to better review the ramifications of each 

TSL across the range of equipment sizes on the market. 
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Table V.4 Equations Representing the Standards at Each TSL for All Secondary Equipment Classes

Equipment 

Class

Trial Standard Levels for Secondary Equipment Classes Analyzed

Baseline TSL 1 TSL 2 TSL 3 TSL 4 TSL 5

VOP.RC.I 2.89 x× TDA + 8.7 2.83 x× TDA + 8.54 2.81 x69 × TDA + 8.4912 2.68 x× TDA + 8.08 2.68 x× TDA + 8.08 2.63 x× TDA + 7.95

SVO.RC.L 2.27 x× TDA + 6.85 2.23 x× TDA + 6.72 2.21 x12 × TDA + 6.6839 2.11 x× TDA + 6.36 2.11 x× TDA + 6.36 2.07 x× TDA + 6.26

SVO.RC.I 2.89 x× TDA + 8.7 2.83 x× TDA + 8.54 2.81 x69 × TDA + 8.4912 2.68 x× TDA + 8.08 2.68 x× TDA + 8.08 2.63 x× TDA + 7.95

HZO.RC.I 0.72 x× TDA + 8.74 0.72 x× TDA + 8.74 0.72 x× TDA + 8.74 0.72 x× TDA + 8.74 0.72 x× TDA + 8.74 0.7 x× TDA + 8.5

VOP.SC.L 4.37 x× TDA + 11.82 4.32 x27 × TDA + 11.757

4.27 x21 × TDA + 

11.574

4.21 x3.8 × TDA + 

11.410.29

4.21 x3.79 × TDA + 

11.410.26 3.77 x× TDA + 10.2

VOP.SC.I 5.55 x× TDA + 15.02 5.49 x43 × TDA + 14.8669

5.43 x35 × TDA + 

14.6948

5.35 x4.83 × TDA + 

14.4813.06

5.35 x4.81 × TDA + 

14.4813.03 4.78 x× TDA + 12.95

SVO.SC.L 4.34 x× TDA + 11.51 4.33 x18 × TDA + 11.4909

4.18 x12 × TDA + 

11.0910.93

4.12 x3.78 × TDA + 

10.9304

4.12 x3.77 × TDA + 

10.9301 3.76 x× TDA + 9.96

SVO.SC.I 5.52 x× TDA + 14.63 5.5 x31 × TDA + 14.609

5.31 x23 × TDA + 

14.0913.88

5.23 x4.8 × TDA + 

13.8812.75

5.23 x4.79 × TDA + 

13.8812.72 4.77 x× TDA + 12.65

HZO.SC.I 2.44 x× TDA + 9.0 2.44 x× TDA + 9.0 2.44 x× TDA + 9.0 2.44 x× TDA + 9.0 2.44 x× TDA + 9.0 2.42 x× TDA + 8.93

SOC.RC.L 1.08 x× TDA + 0.22 1.05 x× TDA + 0.2223 1.05 x02 × TDA + 

0.22

1.02 x0.84 × TDA + 

0.2218

1.02 x0.83 × TDA + 

0.2218 0.82 x× TDA + 0.18

SOC.RC.I 1.26 x× TDA + 0.26 1.23 x× TDA + 0.2627 1.23 x2 × TDA + 0.26 1.2 x0.98 × TDA + 0.2621

1.19 x0.97 × TDA + 

0.2621 0.96 x× TDA + 0.21

SOC.SC.I 1.76 x× TDA + 0.36 1.72 x× TDA + 0.3637 1.72 x68 × TDA + 

0.36

1.68 x37 × TDA + 

0.363

1.67 x35 × TDA + 

0.3629 1.34 x× TDA + 0.29

VCT.RC.I 0.66 x× TDA + 3.05 0.52 x× TDA + 2.44 0.51 x× TDA + 2.39 0.51 x× TDA + 2.37 0.51 x× TDA + 2.37 0.48 x× TDA + 2.26

HCT.RC.M 0.16 x× TDA + 0.13 0.16 x× TDA + 0.12 0.15 x× TDA + 0.12 0.14 x× TDA + 0.11 0.14 x× TDA + 0.11 0.1 x× TDA + 0.08

HCT.RC.L 0.34 x× TDA + 0.26 0.33 x× TDA + 0.26 0.32 x× TDA + 0.24 0.3 x× TDA + 0.23 0.3 x× TDA + 0.23 0.22 x× TDA + 0.17

HCT.RC.I 0.4 x× TDA + 0.31 0.39 x× TDA + 0.3 0.37 x× TDA + 0.29 0.35 x× TDA + 0.27 0.35 x× TDA + 0.27 0.26 x× TDA + 0.2

VCS.RC.M 0.11 x× V + 0.26 0.11 x× V + 0.24 0.1 x× V + 0.24 0.1 x× V + 0.24 0.1 x× V + 0.24 0.1 x× V + 0.22

VCS.RC.L 0.23 x× V + 0.54 0.22 x× V + 0.51 0.22 x× V + 0.515 0.21 x× V + 0.5 0.21 x× V + 0.5 0.2 x× V + 0.46

VCS.RC.I 0.27 x× V + 0.63 0.26 x× V + 0.6 0.26 x25 × V + 0.658 0.25 x× V + 0.58 0.25 x× V + 0.58 0.23 x× V + 0.54

HCS.SC.I 0.38 x× V + 0.88 0.36 x× V + 0.84 0.36 x35 × V + 0.8382 0.35 x× V + 0.81 0.35 x× V + 0.81 0.33 x× V + 0.76

HCS.RC.M 0.11 x× V + 0.26 0.11 x× V + 0.24 0.1 x× V + 0.24 0.1 x× V + 0.24 0.1 x× V + 0.24 0.1 x× V + 0.22

HCS.RC.L 0.23 x× V + 0.54 0.22 x× V + 0.51 0.22 x× V + 0.515 0.21 x× V + 0.5 0.21 x× V + 0.5 0.2 x× V + 0.46

HCS.RC.I 0.27 x× V + 0.63 0.26 x× V + 0.6 0.26 x25 × V + 0.658 0.25 x× V + 0.58 0.25 x× V + 0.58 0.23 x× V + 0.54

SOC.SC.L* 0.75 × V + 4.10 0.84 × TDA + 1.4 0.83 × TDA + 1.39 0.68 × TDA + 1.14 0.67 × TDA + 1.12 0.66 × TDA + 1.11
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* Equipment class SOC.SC.L was inadvertently grouped under the category self-contained commercial freezers with transparent doors in the standards prescribed by EPCA, as amended by 

EPACT 2005. (42 U.S.C. 6313(c)(2)) The baseline expression is thus given by the expression 0.75 × V + 4.10, which is the current standard for SOC.SC.L equipment. A similar anomaly (of 

inadvertent classification under a different equipment category) for SOC.SC.M equipment was corrected by the standard established by AEMTCA (see section IV.C.1.d for a detailed 

discussion). (42 U.S.C. 6313(c)(4)) However, no such corrective action has been prescribed for standards for SOC.SC.L equipment. In establishing a new standard for SOC.SC.M equipment, 

AEMTCA also changed the normalization metric from volume (V) to total display area (TDA). Accordingly, DOE is proposing the amended standards for SOC.SC.M equipment with TDA as 

the normalization metric (see Table V.3), DOE derives the proposed standards for secondary equipment classes based on the proposed standard of a primary equipment that has similar 

characteristics as the secondary equipment class under consideration (see chapter 5 of the NOPR TSD for details). For the equipment class SOC.SC.L, the proposed standards were derived from 

the proposed standards for equipment class SOC.SC.M. Since the proposed standards for SOC.SC.M are in terms of TDA, the proposed standards for SOC.SC.L equipment have also been 

specified in terms of TDA. Therefore, while the baseline expression has been shown with V as the normalization metric, the expressions for TSLs 1 through 5 have been shown in terms of 

TDA. This change of normalization metric for equipment class SOC.SC.L is consistent with the legislative intent, evident in AEMTCA, for equipment class SOC.SC.M. 
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B. Economic Justification and Energy Savings

1. Economic Impacts on Commercial ConsumersCustomers

a. Life-Cycle Cost and Payback Period

ConsumersCustomers affected by new or amended standards usually incur higher 

purchase prices and lower operating costs. DOE evaluates these impacts on individual 

consumerscustomers by calculating changes inthe LCC and the PBP associated with the 

TSLs. The results of the LCC analysis for each TSL were obtained by comparing the 

installed and operating costs of the equipment in the base-case scenario (scenario with no 

amended energy conservation standards) against the standards-case scenarios at each 

TSL. The energy consumption values for both the base-case and standards-case scenarios 

were calculated based on the DOE test procedure conditions specified in the 201X2012

test procedure final rule, which adopts. 77 FR 10292, 10318-21 (Feb 21, 2012) The DOE 

test procedure adopted an industry-accepted test method and has been widely accepted as 

a reasonably accurate representativerepresentation of the conditions under actual 

equipment use for to which a vast majority of the equipment covered in this rulemaking.

is subjected during actual use. Using the approach described in section IV.H, DOE 

calculated the LCC savings and PBPs for the TSLs considered in this NOPR. The LCC 

analysis was carried out in the form of Monte Carlo simulations. Consequently, the 

results of LCC analysis are distributed over a range of values, as opposed to a single 

deterministic value. DOE presents the mean or median values, as appropriate, calculated 

from the distributions of results. 

Table V.5 through Table V.29 show the results of LCC analysis for each 
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equipment class. Each table presents the important results of the LCC analysis, including 

mean LCC, mean LCC savings, median PBP, and distribution of consumercustomer

impacts in the form of percentages of consumerscustomers who experience net cost, no 

impact, or net benefit.

Except for VCT.SC.L, All of the equipment classes have negative LCC savings 

values at TSL 5. Negative average LCC savings imply that, on average, 

consumerscustomers experience an increase in LCC of the equipment as a consequence 

of buying equipment associated with that particular TSL. TSL 5 is associated with the 

max-tech level for all the equipment classes. Vacuum insulated panel technology is the 

design option associated with the max-tech efficiency levels for all equipment classes. 

The cost increments associated with vacuum insulated panels are considerably high, and 

the increase in LCC indicates that this design option may not be economically justified. 

Even for VCT.SC.L, which has a positive value for mean LCC savings (see ), the median 

LCC savings value at TSL 5 is a negative value of $1,102.96 (not shown in any the tables 

in the NOPR). VCT.SC.L units are among the most widely used equipment in the 

commercial refrigeration equipment market, and are associated with all seven types of 

businesses considered in the LCC analysis (see section ). Therefore, the discount rates 

and electricity prices used in the Monte Carlo simulations span a wide range of values. 

The distribution of results in this case is such that while the mean LCC savings are 

slightly positive, the median LCC savings are negative, indicating most consumers are 

negatively impacted.
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The mean LCC savings associated with TSL 4 are all either positive values or 

zero (in the case of equipment classes HZO.RC.M, HZO.RC.L, and HZO.SC.L) for all 

equipment classes, and the non-zero values range from $9 to $1,969494. The mean LCC 

savings at all lower TSL levels are also positive. This implies that, on average, all the 

equipment classes show either no change in LCC or a decrease in LCC for TSL 1 through 

TSL 4. A comparison of LCC savings between TSL 4 and TSL 3, across all equipment 

classes, shows that the LCC savings associated with TSL 3 are either greater than or 

equal to the LCC savings associated with TSL 4. LCC savings are equal in cases in which

both TSLs are associated with the same efficiency level. Comparison of the mean LCC 

savings associated with TSL 3, TSL 2, and TSL 1 shows mixed results, with three 

equipment classes showing the highest mean LCC savings at TSL 2 and seven equipment 

classes showing the highest mean LCC savings at TSL 1. The remaining classes show the 

highest mean LCC savings at TSL3. 

As described in section IV.I.2, DOE used a “roll-up” scenario in this rulemaking. 

Under the roll-up scenario, DOE assumes that the market shares of the efficiency levels 

(in the base case) that do not meet the standard level under consideration would be 

“rolled up” into (meaning “added to”) the market share of the efficiency level at the 

standard level under consideration, and the market shares of efficiency levels that are 

above the standard level under consideration would remain unaffected. 

ConsumersCustomers, in the base-case scenario, who buy the equipment at or above the 

TSL under consideration would be unaffected if the amended standard were to be set at 

that TSL. ConsumersCustomers, in the base-case scenario, who buy equipment below the 
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TSL under consideration would be affected if the amended standard were to be set at that 

TSL. Among these affected consumerscustomers, some may benefit from lower LCC of 

the equipment and some may incur net cost due to higher LCC, depending on the inputs 

to LCC analysis such as electricity prices, discount rates and markups. DOE’s results 

clearly indicate that only a small percentage of consumerscustomers may benefit from an 

amended standard that is set at TSL 5, and in most cases these are the consumers that are 

already purchasing the equipment at TSL 5.. At TSL 4, the percentage of 

consumerscustomers who experience net benefits or no impacts ranges from 6059 to 100 

percent. For remote condensing equipment, the range is from 66 to 98 percent, while for 

self-contained equipment the range is from 81 to 100 percent, with the exception of the 

PD.SC.M equipment class, which shows a value of 60 percent at TSL 4. At TSL 3, a 

larger percentage of consumerscustomers experience net benefits or no impacts as 

compared to TSL 4. At TSLs 1 and 2, almost all consumerscustomers experience either 

net benefits or no impacts. 

The median PBP values for TSL 5 are long and, inFor most casesof the equipment 

classes, the median PBPs for TSL 5 are greater than the average lifetime of the 

equipment, indicating that a majority of the consumerscustomers may not be able to 

recover the higher equipment installed costs through savings in operating costs 

throughout the life of the equipment. The median PBP values for TSL 4 range from 

1.190.96 years for VCS.SC.L to 6.5940 years for VOP.RC.L.. The average lifetime of a 

majority of the commercial refrigeration equipment under consideration is 10 years. 

Therefore, PBP results for TSL 4 indicate that, in general, the majority of 
274

CRE NOPR ECS OMB Compare.docx

consumerscustomers will be able to recover the increased purchase costs associated with 

equipment that is compliant with TSL 4 through operating cost savings within the 

lifetime of the equipment.

Table V.5 Summary LCC and PBP Results for VOP.RC.M Equipment Class*

TSL

Annual 

Energy 

Consumption 

kWh/yr

Life-Cycle Cost, All 

ConsumersCustomers

20102012$

Life-Cycle Cost Savings

Median

Payback 

Period, 

years

Installed

Cost

Discounted

Operating

Cost

LCC

Affected

Consumers’

Customers’

Average

Savings

20102012$

% of ConsumersCustomers

that Experience**

Net

Cost

No 

Impact

Net

Benefit

1 17,095 9,212490

19,50920,6

18

28,72130

,108 216236 0 7576 2524 1.8373

2 17,09516,180 9,212633 19,509849

28,72129

,482 216743 0 7552 2548 1.8377

3 16,18013,033

9,35210,8

23

18,80017,3

64

28,15218

7 6771,789 0 5028 5072 1.873.77

4 16,09212,962

9,42510,8

98

18,73117,3

03

28,15620

1 4531,494 1611 2515 5974 2.413.91

5 12,798

16,50814,

006 17,751162

34,25831

,168 (5,7051,669) 10090 02 08 38.11.76

* Values in parentheses are negative values.

**Percentages may not add up to 100 percent due to rounding.

Table V.6 Summary LCC and PBP Results for VOP.RC.L Equipment Class*

TSL

Annual 

Energy 

Consumption 

kWh/yr

Life-Cycle Cost, All 

ConsumersCustomers

20102012$

Life-Cycle Cost Savings

Median 

Payback 

Period 

years Installed

Cost

Discounted

Operating

Cost

LCC

Affected

Consumers’

Customers’

Average

Savings

20102012$

% of ConsumersCustomers

that Experience**

Net

Cost

No 

Impact

Net

Benefit

1 38,770

9,815 

10,099

36,203 

39,184

46,018 

49,282 501 537 0 72 74 28 26 1.18 11

2 38,546 

36,877

9,896 

10,511

36,027 

37,520

45,923 

48,031 346 1,517 0 43 48 57 52

 1.94 

2.03

3 36,685

11,085 

10,594

34,807 

37,356

45,891 

47,950 264 1,130 34 0 16 25 50 75

 6.59 

2.22

4 36,685

11,085 

10,594

34,807 

37,356

45,891 

47,950 264 1,130 34 0 16 25 50 75

 6.59 

2.22

5 36,088

16,045 

15,667

34,339 

36,847

50,384 

52,513 (4,2673,693) 98 2 0 

 24.96 

18.30

* Values in parentheses are negative values.

**Percentages may not add up to 100 percent due to rounding.

Table V.7 Summary LCC and PBP Results for VOP.SC.M Equipment Class*

TSL

Annual 

Energy 

Consumption 

kWh/yr

Life-Cycle Cost, All 

ConsumersCustomers

20102012$

Life-Cycle Cost Savings

Median 

Payback 

Period 

Installed Discounted LCC Affected % of ConsumersCustomers years
275

CRE NOPR ECS OMB Compare.docx

Cost Operating

Cost

Consumers’

Customers’

Average

Savings

20102012$

that Experience**

Net

Cost

No 

Impact

Net

Benefit

1 11,085 

10,960 4,514 650

14,226 

15,471

18,740 

20,120 106 171 0 76 62 24 38 1.57 61

2

10,960 804 4,534 693

14,100 

15,314

18,634 

20,008 159 227 0 53 43 47 57

 1.67 

2.17

3 10,804 

9,747

4,577 

5,183

13,950 

14,180

18,527 

19,364 214 815 0 30 25 70 75

 2.23 

4.12

4 10,804 

9,718

4,577 

5,234

13,950 

14,147

18,527 

19,381 214 691 0 11 30 14 70 75

 2.23 

4.39

5

9,660

7,101 

6,293

13,333 

14,079

20,434 

373 (1,694377) 99 77 1 3 0 20

 29.48 

11.37

* Values in parentheses are negative values.

**Percentages may not add up to 100 percent due to rounding.

Table V.8 Summary LCC and PBP Results for VCT.RC.M Equipment Class*

TSL

Annual 

Energy 

Consumption 

kWh/yr

Life-Cycle Cost, All 

ConsumersCustomers

20102012$

Life-Cycle Cost Savings

Median 

Payback 

Period 

years

Installed

Cost

Discounted

Operating

Cost

LCC

Affected

Consumers’

Customers’

Average

Savings

20102012$

% of ConsumersCustomers

that Experience**

Net

Cost

No 

Impact

Net

Benefit

1

5,171 679

12,280 

070 11,081 800

23,361 

870 450 175 0 74 81 26 19

 2.63 

1.23

2 5,171 

2,955

12,280 

669

11,081 

9,411

23,361 

22,081 450 1,864 0 74 62 26 38 2.63 42

3

2,285

13,186 

12,819 8,654 809

21,840 

629 1,749 759 0 50 46 50 54

 3.49 

2.43

4 

2,177

13,293 

12,929 8,567 715

21,860 

644 1,038 108 29 26 18 16 53 57 3.73 2.70

5 

2,005

16,821 

537 8,424 560

25,245 

097 (2,513509) 95 94 2 3 4

14.29 

13.09

* Values in parentheses are negative values.

**Percentages may not add up to 100 percent due to rounding.

Table V.9 Summary LCC and PBP Results for VCT.RC.L Equipment Class*

TSL

Annual 

Energy 

Consumption 

kWh/yr

Life-Cycle Cost, All 

ConsumersCustomers

20102012$

Life-Cycle Cost Savings

Median 

Payback 

Period 

years

Installed

Cost

Discounted

Operating

Cost

LCC

Affected

Consumers’

Customers’

Average

Savings

20102012$

% of ConsumersCustomers

that Experience**

Net

Cost

No 

Impact

Net

Benefit

1

11,362

14,088 

13,756

16,639 

17,581

30,727 

31,337 1,078 357 0 69 60 31 40

 4.33 

1.30

2 

11,161

14,167 

13,836

16,474 

17,401

30,640 

31,237 711 1,005 0 46 40 54 60

 4.36 

1.51

3

11,056

14,216 

13,887

16,390 

17,311

30,606 

31,198 540 798 2 0 24 21 75 79

 4.43 

1.64

4

11,056

14,216 

13,887

16,390 

17,311

30,606 

31,198 540 798 2 0 24 21 75 79

 4.43 

1.64

5 10,531 18,850 15,958 34,808 (3,781624) 98 97 2 0 1 22.38 
276

CRE NOPR ECS OMB Compare.docx

626 16,840 35,466 15.75

* Values in parentheses are negative values.

**Percentages may not add up to 100 percent due to rounding.

Table V.10 Summary LCC and PBP Results for VCT.SC.M Equipment Class*

TSL

Annual 

Energy 

Consumption 

kWh/yr

Life-Cycle Cost, All 

ConsumersCustomers

20102012$

Life-Cycle Cost Savings

Median 

Payback 

Period 

years

Installed

Cost

Discounted

Operating

Cost

LCC

Affected

Consumers’

Customers’

Average

Savings

20102012$

% of ConsumersCustomers

that Experience**

Net

Cost

No 

Impact

Net

Benefit

1 1,526 

2,758 4,997 594 3,707 5,261

8,704 

9,855 1,425 566 0 64 83 36 17

 2.05 

0.86

2

1,488

5,012 

4,849 3,675 916

8,687 

764 1,038 364 0 49 66 51 34

 2.10 

1.73

3

1,141 182

5,183 

4,999 3,338 583

8,521 

582 830 1,122 4 0 23 51 73 49 2.60 21

4 

1,082 5,246 088 3,280 489

8,525 

578 718 641 15 27 12 13 73 60 2.83 54

5 

979 6,492 362 3,176 377

9,668 

739 (500596) 72 74 2 27 24 8.22 13

* Values in parentheses are negative values.

**Percentages may not add up to 100 percent due to rounding.

Table V.11 Summary LCC and PBP Results for VCT.SC.L Equipment Class

TSL

Annual 

Energy 

Consumption 

kWh/yr

Life-Cycle Cost, All 

ConsumersCustomers

20102012$

Life-Cycle Cost Savings

Median 

Payback 

Period 

years

Installed

Cost

Discounted

Operating

Cost

LCC

Affected

Consumers’

Customers’

Average

Savings

20102012$

% of ConsumersCustomers

that Experience**

Net

Cost

No 

Impact

Net

Benefit

1 9,112 

4,921

5,705 

6,101

11,774 

8,222

17,479 

14,323 1,434 4,186 0 85 76 15 24 0.43 58

2 6,321 

4,853

5,940 

6,120 9,026 8,150

14,966 

270 3,228 2,523 0 69 60 31 40 0.76 61

3 4,514 541 6,395 271 7,132 811

13,527 

14,082 2,281 1,984 3 0 26 44 71 56

 1.33 

0.83

4 4,411 6,471 364 7,038 692

13,509 

14,056 1,969 343 8 7 13 15 79 78

 1.44 

0.96

5 4,222 8,146 077 6,849 7,486

14,995 

15,562 252 (343) 62 74 2 37 24

 4.25 

3.65

* Values in parentheses are negative values.

**Percentages may not add up to 100 percent due to rounding.

Table V.12 Summary LCC and PBP Results for VCT.SC.I Equipment Class*

TSL

Annual Energy 

Consumption 

kWh/yr

Life-Cycle Cost, All 

ConsumersCustomers

20102012$

Life-Cycle Cost Savings

Median 

Payback 

Period 

years

Installed

Cost

Discounted

Operating

Cost

LCC

Affected

Consumers’

Customers’

Average

Savings

20102012$

% of 

ConsumersCustomers that 

Experience**

Net

Cost

No 

Impact

Net

Benefit
277

CRE NOPR ECS OMB Compare.docx

1 6,370 6,525 383

9,350 

10,160

15,875 

16,543 437 572 0 63 65 37 35

 2.32 

0.86

2 6,024 

5,972 6,672 558 8,999 9,733

15,671 

16,292 503 486 0 1 45 32 55 68

 2.87 

1.74

3 5,891 6,749 612 8,873 9,644

15,622 

16,256 371 432 2 1 15 16 82 83

 3.17 

1.97

4 5,891 6,749 612 8,873 9,644

15,622 

16,256 371 432 2 1 15 16 82 83

 3.17 

1.97

5 5,609 8,970 883 8,587 9,332

17,556 

18,215 (1,616592) 97 95 1 2 3

 15.97 

13.21

* Values in parentheses are negative values.

**Percentages may not add up to 100 percent due to rounding.

Table V.13 Summary LCC and PBP Results for VCS.SC.M Equipment Class*

TSL

Annual 

Energy 

Consumption 

kWh/yr

Life-Cycle Cost, All 

ConsumersCustomers

20102012$

Life-Cycle Cost Savings

Median 

Payback 

Period 

years

Installed

Cost

Discounted

Operating

Cost

LCC

Affected

Consumers’

Customers’

Average

Savings

20102012$

% of ConsumersCustomers

that Experience**

Net

Cost

No 

Impact

Net

Benefit

1 863 3,292 386 1,957 2,122 5,249 508 268 279 0 71 72 29 28 0.80 78

2 793 3,312 406 1,907 2,070 5,219 476 158 163 0 41 42 58

 1.01 

0.98

3 659 3,389 484 1,810 967 5,199 451 125 132 13 7 13 73 80 1.80 75

4 659 3,389 484 1,810 967 5,199 451 125 132 13 7 13 73 80 1.80 75

5 507 4,648 771 1,691 837 6,339 608 (1,031042) 99 1 0 14.57 11

* Values in parentheses are negative values.

**Percentages may not add up to 100 percent due to rounding.

Table V.14 Summary LCC and PBP Results for VCS.SC.L Equipment Class*

TSL

Annual 

Energy 

Consumption 

kWh/yr

Life-Cycle Cost, All 

ConsumersCustomers

20102012$

Life-Cycle Cost Savings

Median 

Payback 

Period 

years

Installed

Cost

Discounted

Operating

Cost

LCC

Affected

Consumers’

Customers’

Average

Savings

20102012$

% of 

ConsumersCustomers

that Experience**

Net

Cost

No 

Impact

Net

Benefit

1 2,808 649 3,563 673 3,624 829 7,186 501 864 525 0 87 73 13 27 0.51 55

2 2,582 463 3,586 735 3,452 671 7,038 405 368 329 0 57 42 43 58 0.61 91

3

2,432 3,654 751 3,339 651

6,993 

7,402 257 268 5 27 28 68 1.04 00

4 

2,394 3,678 776 3,317 630

6,995 

7,405 214 221 19 20 14 67 66 1.19 15

5 2,084 5,371 505 3,075 366 8,446 871 (1,265274) 97 0 1 3 2 10.96 54

* Values in parentheses are negative values.

**Percentages may not add up to 100 percent due to rounding.

Table V.15 Summary LCC and PBP Results for VCS.SC.I Equipment Class*

TSL

Annual 

Energy 

Consumption 

kWh/yr

Life-Cycle Cost, All 

ConsumersCustomers

20102012$

Life-Cycle Cost Savings Median 

Payback 

Period 

years

Installed

Cost

Discounted

Operating

Cost

LCC

Affected

Consumers’

Customers’

Average

% of 

ConsumersCustomers that 

Experience**

Net No Net
278

CRE NOPR ECS OMB Compare.docx

Savings

20102012$

Cost Impact Benefit

1

6,657 4,051 148 6,878 7,526

10,929 

11,674 218 237 0 66 67 34 33 0.83 80

2

6,612 492 4,066 218 6,847 7,392

10,913 

11,610 160 177 0 49 32 51 68

 1.22 

2.07

3 

6,438 4,144 243 6,719 7,357

10,863 

11,600 141 153 4 3 16 80 81 2.50 42

4

6,438 4,144 243 6,719 7,357

10,863 

11,600 141 153 4 3 16 80 81 2.50 42

5

6,034 6,388 535 6,403 7,013

12,790 

13,548 (1,809819) 99 1 0 

 28.30 

27.19

* Values in parentheses are negative values.

**Percentages may not add up to 100 percent due to rounding.

Table V.16 Summary LCC and PBP Results for SVO.RC.M Equipment Class*

TSL

Annual 

Energy 

Consumption 

kWh/yr

Life-Cycle Cost, All 

ConsumersCustomers

20102012$

Life-Cycle Cost Savings

Median 

Payback 

Period 

years

Installed

Cost

Discounted

Operating

Cost

LCC

Affected

Consumers’

Customers’

Average

Savings

20102012$

% of ConsumersCustomers

that Experience**

Net

Cost No Impact NetBenefit

1

13,179 8,072341 

15,88716,8

21 

23,95925,

161 6874 0 7475 2625 1.3831 

2 12,355 

13,179 8,072547 

15,88716,0

98 

23,95924,

645 68552 0 7451 2649 

 

1.382.64 

3

10,114 12,355 

8,2739,45

5

15,22414,3

47 23,497802 4951,217 0 4829 5271

 

2.794.34

4 12,293 

10,065 

8,3339,51

7

15,17414,3

04 23,507821 3311,008 1813 2516 5772

 

3.364.50

5

9,949 

13,26511,

511 14,483202

27,74825,

713 (3,9371,015) 9985 13 012

 

38.3011.

60

* Values in parentheses are negative values.

**Percentages may not add up to 100 percent due to rounding.

Table V.17 Summary LCC and PBP Results for SVO.SC.M Equipment Class*

TSL

Annual 

Energy 

Consumption 

kWh/yr

Life-Cycle Cost, All 

ConsumersCustomers

20102012$

Life-Cycle Cost Savings

Median 

Payback 

Period 

years

Installed

Cost

Discounted

Operating

Cost

LCC

Affected

Consumers’

Customers’

Average

Savings

20102012$

% of 

ConsumersCustomers that 

Experience**

Net

Cost

No 

Impact

Net

Benefit

9,396 

1

 9,736 

3,885 

3,67812,7

44

11,97216,6

29 15,650324 200 061 7639 241.97

 

1.259,39

6

9,255 

2 3,914 9,396 

3,74512,6

00

11,62116,5

14 15,366335 2940 043 5257 482.06

9,255 

2.01

38,501 4,314 9,255 

3,77411,8

66 

11,48516,1

80 15,258588 3080 025 3075 704.43 

 

2.088,50

1 

48,481 4,359 9,255

3,77411,8

43 

11,48516,2

02 15,258492 30812 014 3075 704.75 

 

2.088,48

1 
279

CRE NOPR ECS OMB Compare.docx

8,439 

5 5,049 8,439 

5,58111,7

96 

11,08616,8

44 

16,667 

(202) (1,133)69 984 127 110.36 

 

23.498,4

39 

* Values in parentheses are negative values.

**Percentages may not add up to 100 percent due to rounding.

Table V.18 Summary LCC and PBP Results for SOC.RC.M Equipment Class*

TSL

Annual 

Energy 

Consumption 

kWh/yr

Life-Cycle Cost, All 

ConsumersCustomers

20102012$

Life-Cycle Cost Savings

Median 

Payback 

Period 

years

Installed

Cost

Discounted

Operating

Cost

LCC

Affected

Consumers’

Customers’

Average

Savings

20102012$

% of 

ConsumersCustomers that 

Experience**

Net

Cost

No 

Impact

Net

Benefit

1 

9,353 12,455766

14,36115,1

06

26,81627,

872 113118 0 7882 2218 1.2825

2

9,353115 12,455799 14,361906

26,81627,

704 113226 0 7864 2236 1.2844

3 9,115 

7,455 

12,48713,

343 

14,17613,5

11 26,662854 209998 0 5747 4353 

 

1.503.31 

4 9,072 

7,356 

12,54113,

570 

14,14213,4

43 

26,68227,

012 120495 2129 3518 4553 

 

2.844.41 

5 

7,274 

16,25915,

050 13,397372

29,65628,

423 (2,715982) 9889 25 06

 

35.9911.

88

* Values in parentheses are negative values.

**Percentages may not add up to 100 percent due to rounding.

Table V.19 Summary LCC and PBP Results for HZO.RC.M Equipment Class*

TSL

Annual 

Energy 

Consumption 

kWh/yr

Life-Cycle Cost, All 

ConsumersCustomers

20102012$

Life-Cycle Cost Savings

Median 

Payback 

Period 

years

Installed

Cost

Discounted

Operating

Cost

LCC

Affected

Consumers’

Customers’

Average

Savings

20102012$

% of ConsumersCustomers

that Experience**

Net

Cost

No 

Impact

Net

Benefit

1 5,267 7,7888,056 8,286916 16,075972 0NA 0 NA 100 NA 0 NA NA

2 5,267 7,7888,056 8,286916 16,075972 0NA 0 NA 100 NA 0 NA NA

3 5,267 7,7888,056 8,286916 16,075972 0NA 0 NA 100 NA 0 NA NA

4 5,267 7,7888,056 8,286916 16,075972 0NA 0 NA 100 NA 0 NA NA

5 

5,173 9,109406 8,214837

17,32218,

243 (1,248271) 7978 2122 0 

 

170.6216

1.23

*“NA” stands for not applicable. TSLs 1 through 4 are at the baseline efficiency level. Therefore, the PBP is indeterminateLCC 

savings, distribution of customer impacts and has beenPBP are shown as “NA”.”

* Values in parentheses are negative values.

**Percentages may not add up to 100 percent due to rounding.

Table V.20 Summary LCC and PBP Results for HZO.RC.L Equipment Class*

TSL

Annual 

Energy 

Consumption 

kWh/yr

Life-Cycle Cost, All 

ConsumersCustomers

20102012$

Life-Cycle Cost Savings Median 

Payback 

Period 

years

Installed

Cost

Discounted

Operating

Cost

LCC

Affected

Consumers’

Customers’

Average

% of ConsumersCustomers

that Experience**

Net

Cost

No 

Impact

Net

Benefit
280

CRE NOPR ECS OMB Compare.docx

Savings

20102012$

1

12,082 8,620895 

13,87614,9

89 

22,49623,

884 0 NA 0 NA 100 NA 0 NA NA

2

12,082 8,620895 

13,87614,9

89 

22,49623,

884 0 NA 0 NA 100 NA 0 NA NA

3 

12,082 8,620895 

13,87614,9

89 

22,49623,

884 0 NA 0 NA 100 NA 0 NA NA

4

12,082 8,620895 

13,87614,9

89 

22,49623,

884 0 NA 0 NA 100 NA 0 NA NA

5

11,759 

10,97211,3

01 

13,62714,7

18 

24,59926,

019 (2,103135) 8786 1314 0 

 

88.6683.

78 

*“NA” stands for not applicable. TSLs 1 through 4 are at the baseline efficiency level. Therefore, the PBP is indeterminateLCC 

savings, distribution of customer impacts and has beenPBP are shown as “NA”.”

* Values in parentheses are negative values.

**Percentages may not add up to 100 percent due to rounding.

Table V.21 Summary LCC and PBP Results for HZO.SC.M Equipment Class*

TSL

Annual 

Energy 

Consumption 

kWh/yr

Life-Cycle Cost, All 

ConsumersCustomers

20102012$

Life-Cycle Cost Savings

Median 

Payback 

Period 

years

Installed

Cost

Discounted

Operating

Cost

LCC

Affected

Consumers’

Customers’

Average

Savings

20102012$

% of 

ConsumersCustomers that 

Experience**

Net

Cost

No 

Impact

Net

Benefit

1

5,388 2,249343 6,4277,055

8,6769,3

99 89 0 7475 2625 1.9289

2

5,388 2,249343 6,4277,055 

8,6769,3

99 89 0 7475 2625 1.9289 

3

5,330 2,261356 6,373999 

8,6359,3

54 4649 0 49 51 2.4342 

4 

5,289 2,309405 6,332954

8,6419,3

58 2429 2119 24 5557 6.5240

5 

5,206 3,224340 6,249862

9,47210,

202 (812822) 98 2 0 

 

57.3655.78

* Values in parentheses are negative values.

**Percentages may not add up to 100 percent due to rounding.

Table V.22 Summary LCC and PBP Results for HZO.SC.L Equipment Class*

TSL

Annual 

Energy 

Consumption 

kWh/yr

Life-Cycle Cost, All 

ConsumersCustomers

20102012$

Life-Cycle Cost Savings

Median 

Payback 

Period 

years

Installed

Cost

Discounted

Operating

Cost

LCC

Affected

Consumers’

Customers’

Average

Savings

20102012$

% of 

ConsumersCustomers that 

Experience**

Net

Cost

No 

Impact

Net

Benefit

1

10,994 3,584691 

12,65413,8

91 

16,23817,5

82 NA 0 NA 100 NA 0 NA NA

2 

10,994 3,584691

12,65413,8

91

16,23817,5

82 NA 0 NA 100 NA 0 NA NA

3

10,994 3,584691 

12,65413,8

91 

16,23817,5

82 NA 0 NA 100 NA 0 NA NA

4

10,994 3,584691 

12,65413,8

91 

16,23817,5

82 NA 0 NA 100 NA 0 NA NA

5 10,916 4,132251 12,57513,8 16,70718,0 (468474) 7372 2728 0 
281 

CRE NOPR ECS OMB Compare.docx

04 56 76.6073.

62 

*“NA” stands for not applicable. TSLs 1 through 4 are at the baseline efficiency level. Therefore, the PBP is indeterminateLCC 

savings, distribution of customer impacts and has beenPBP are shown as “NA”.”

* Values in parentheses are negative values.

**Percentages may not add up to 100 percent due to rounding.

Table V.23 Summary LCC and PBP Results for HCT.SC.M Equipment Class*

TSL

Annual 

Energy 

Consumption 

kWh/yr

Life-Cycle Cost, All 

ConsumersCustomers

20102012$

Life-Cycle Cost Savings

Median 

Payback 

Period 

years

Installed

Cost

Discounted

Operating

Cost

LCC

Affected

Consumers

Customers

Average

Savings

20102012$

% of ConsumersCustomers

that Experience**

Net

Cost

No 

Impact

Net

Benefit

1 

683 

1,9652,05

7 1,541685 3,506742 99107 0 6870 3230 0.7069

2 632 

305 

1,9722,16

1 1,490263 3,462423 110359 0 5238 4862

 

0.892.24

3 275 2,081175 1,124236 3,204411 286307 0 2425 7675 2.4342

4 244 2,125220 1,091200 3,215420 236254 1718 1112 7170 3.0908

5 181 2,704812 1,024127 3,727939 (301294) 89 1 10 12.3126

* Values in parentheses are negative values.

**Percentages may not add up to 100 percent due to rounding.

Table V.24 Summary LCC and PBP Results for HCT.SC.L Equipment Class*

TSL

Annual 

Energy 

Consumption 

kWh/yr

Life-Cycle Cost, All 

ConsumersCustomers

20102012$

Life-Cycle Cost Savings

Median 

Payback 

Period 

years

Installed

Cost

Discounted

Operating

Cost

LCC

Affected

Consumers’

Customers’

Average

Savings

20102012$

% of 

ConsumersCustomers

that Experience**

Net

Cost

No 

Impact

Net

Benefit

1 1,499 2,147240 2,147336 4,294576 206217 0 7275 2826 0.5553

2 1,454 

667 2,153337 1,5892,112 4,2653,926 164791 0 5861 4239

 

0.671.00

3 647 2,248344 1,440574 3,688918 698571 0 4345 5755 1.1005

4 572 2,306403 1,382513 3,688916 459369 1723 14 6963 1.5547

5 432 3,089204 1,264385 4,354590 (266355) 7376 1 2623 7.5315

* Values in parentheses are negative values.

**Percentages may not add up to 100 percent due to rounding.

Table V.25 Summary LCC and PBP Results for HCT.SC.I Equipment Class*

TSL

Annual 

Energy 

Consumption 

kWh/yr

Life-Cycle Cost, All 

ConsumersCustomers

20102012$

Life-Cycle Cost Savings

Median 

Payback 

Period 

years

Installed

Cost

Discounted

Operating

Cost

LCC

Affected

Consumers’

Customers’

Average

Savings

20102012$

% of 

ConsumersCustomers

that Experience**

Net

Cost

No 

Impact

Net

Benefit

1 1,174 2,237331 1,839991 4,076322 2022 0 74 26 0.9288

2 1,121 2,251346 1,802953 4,053299 3335 0 4849 5251 2.4339

3 1,045 2,295391 1,742889 4,037279 3842 52 23 7275 4.4228

4 1,045 2,295391 1,742889 4,037279 3842 52 23 7275 4.4228
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5

776 3,342461 1,532663 4,8745,124 (807811) 99 1 0 

 

29.2127.9

9 

* Values in parentheses are negative values.

**Percentages may not add up to 100 percent due to rounding.

Table V.26 Summary LCC and PBP Results for HCS.SC.M Equipment Class*

TSL

Annual 

Energy 

Consumption 

kWh/yr

Life-Cycle Cost, All 

ConsumersCustomers

20102012$

Life-Cycle Cost Savings

Median 

Payback 

Period 

years

Installed

Cost

Discounted

Operating

Cost

LCC

Affected

Consumers

’Customers

’

Average

Savings

20102012$

% of 

ConsumersCustomers that 

Experience**

Net

Cost

No 

Impact

Net

Benefit

1 238 1,866951 903972 2,768924 2123 0 83 17 0.5250

2 220 1,871957 890959 2,761916 1819 0 65 35 1.6964

3 203 1,878964 879948 2,757912 1617 21 48 5051 2.5854

4 183 1,892979 868937 2,760916 9 2729 31 4240 4.2628

5 90 2,393490 794857 3,187347 (418423) 98 2 0 34.9605

* Values in parentheses are negative values.

**Percentages may not add up to 100 percent due to rounding.

Table V.27 Summary LCC and PBP Results for HCS.SC.L Equipment Class*

TSL

Annual 

Energy 

Consumption 

kWh/yr

Life-Cycle Cost, All 

ConsumersCustomers

20102012$

Life-Cycle Cost Savings

Median 

Payback 

Period 

years

Installed

Cost

Discounted

Operating

Cost

LCC

Affected

Consumers’

Customers’

Average

Savings

20102012$

% of ConsumersCustomers

that Experience**

Net

Cost No Impact NetBenefit

1 588 1,902988 1,187284 3,089272 6975 0 4950 5150 0.8986

2 534 1,9162,003 1,149244 3,065246 7681 0 3233 6867 1.4136

3 464 1,9592,046 1,095184 3,053231 7381 52 1516 8082 2.6757

4 464 1,9592,046 1,095184 3,053231 7381 52 1516 8082 2.6757

5

271 2,580681 9431,020 3,523700 (407401) 9998 12 0 

 

15.6314.9

8

* Values in parentheses are negative values.

**Percentages may not add up to 100 percent due to rounding.

Table V.28 Summary LCC and PBP Results for PD.SC.M Equipment Class*

TSL

Annual 

Energy 

Consumption 

kWh/yr

Life-Cycle Cost, All 

ConsumersCustomers

20102012$

Life-Cycle Cost Savings

Median 

Payback 

Period 

years

Installed

Cost

Discounted

Operating

Cost

LCC

Affected

Consumers’

Customers’

Average

Savings

20102012$

% of ConsumersCustomers

that Experience**

Net

Cost

No 

Impact

Net

Benefit

1 1,423 3,030002 2,676926 5,706927 9351,010 0 8186 1914

 

1.460.53

2 1,423 3,030002 2,676926 5,706927 9351,010 0 8186 1914

 

1.460.53

3 815 3,147121 2,120322 5,267444 940934 0 6469 3631 1.7210
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4 597 3,369348 2,1121,924 5,293460 351310 4041 1011 5048 2.8227

5 517 4,346347 1,8502,031 6,196379 (583638) 8486 1 1513 

 

8.127.61 

* Values in parentheses are negative values.

**Percentages may not add up to 100 percent due to rounding.

Table V.29 Summary LCC and PBP Results for SOC.SC.M Equipment Class*

TSL

Annual 

Energy 

Consumption 

kWh/yr

Life-Cycle Cost, All Customers

2012$ Life-Cycle Cost Savings

Median 

Payback 

Period 

years

Installed

Cost

Discounted

Operating

Cost

LCC

Affected

Customers’

Average

Savings

2012$

% of Customers that 

Experience**

Net

Cost

No 

Impact

Net

Benefit

1 9,869 12,314 14,364 26,678 646 0 70 30 1.12 

2 9,783 12,339 14,301 26,640 466 0 55 45 1.24 

3 8,039 12,883 12,863 25,747 1,242 0 40 60 2.35 

4 7,920 13,110 12,777 25,887 740 25 16 60 2.99 

5 7,814 14,591 12,687 27,277 (735) 80 5 16 7.42 

* Values in parentheses are negative values.

**Percentages may not add up to 100 percent due to rounding.

b. Life-Cycle Cost Subgroup Analysis

As described in section IV.J, DOE estimated the impact of potential amended 

efficiency standards for commercial refrigeration equipment, at each TSL, on two 

consumercustomer subgroups, and two small business segments, one belonging to the 

foodservice sector and one to the food-retail sector. For the small business segment in the 

foodservice sector, full-service restaurants were chosen as the representative subgroup, 

and for the food-retail sector, convenience stores with gas stations were chosen as the 

representative subgroup. DOE carried out two LCC subgroup analyses, one each for fullservice restaurants and gasoline stations with convenience stores, by using the LCC 

spreadsheet described in chapter 8 of the NOPR TSD, but with certain modifications. The 

input for business type was fixed to the identified subgroup, which ensured that the 

discount rates and electricity price rates associated with only that subgroup were selected 

in the Monte Carlo simulations (see chapter 8 of the NOPR TSD). The discount rate was 

further increased by applying the small firm premium to the WACC (See Table 
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IV.9Another major change from for details). Another major modification to the LCC 

analysis was an added assumption that the subgroups do not have access to national 

accounts, which results in higher distribution channel markups for the subgroups, leading 

to higher equipment purchase prices. Apart from these changes, all other inputs for LCC 

subgroup analysis are same as those in the LCC analysis described in chapter 8 of the 

NOPR TSD.

The results for the small business subgroup in the foodservice sector (Table V.30, 

Table V.31, and Table V.32) are presented only for the self-contained equipment classes 

because full-service restaurants that are small businesses generally do not use remote 

condensing equipment. Table V.30 presents the comparison of mean LCC savings for the 

small business subgroup in foodservice sector (full-service restaurants) with the national 

average values (LCC savings results from chapter 8 of the NOPR TSD). For all TSLs in 

all equipment classes, the LCC savings for the small business subgroup are lower than 

the national average values. Table V.31 presents the percentage change in LCC savings 

compared to national average values for self-contained equipment only because fullservice restaurants that are small businesses generally do not use remote-condensing 

equipment.. For a majoritymany of the equipment classes in Table V.31, the percentage 

decrease in LCC savings is less than 15 percent. Equipment classes that show a 

substantial decrease in LCC savings, compared to national average values, are 

VCTVOP.SC.M, VCT.SC.M, VCT.SC.L, VCT.SC.I, SVO.SC.M, HZO.SC.M, HCT.SC.I 

and PD.SC.M, which belong to the classification of self-contained display type 

equipment. It is uncommon to find display type equipment in small full-service 
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restaurants. An overwhelming majority of commercial refrigeration equipment in small 

restaurants is comprisedcomposed of solid door refrigerators and freezers that are used 

for food storage in the kitchen. The solid-door equipment (VCS and HCS) exhibits a 

relatively smaller percentage decrease in LCC savings. In any case, the one case where 

the percentage decrease is high, HCS.SC.M, the actual value of change in LCC savings 

($2.23at TSL 4 is positive for all equipment classes as shown in Table V.30) is 

negligible.. Therefore, even though the LCC savings for small business subgroup in 

foodservice sector are lower than the national average values, they are still positive, 

implying that small businesses still save money over the equipment lifetime at TSL 4.

Table V.32 presents the comparison of median PBPs for the small business subgroup in 

the foodservice sector with national median values (median PBPs from chapter 8 of the 

NOPR TSD). The PBP values are higher for the small business subgroup in all cases, 

which is consistent with the decrease in LCC savings. 

Table V.33 presents the comparison of mean LCC savings for the small business 

subgroup in the food-retail sector (convenience stores with gasoline stations) with the 

national average values (LCC savings results from chapter 8 of the NOPR TSD) at each 

TSL. This comparison shows mixed results, with higher LCC savings for the subgroup in 

some instances and negativelower LCC savings in others. The higher LCC savings for the 

subgroup are exhibited in the case of large display cases such as VOP.RC.M, VOP.RC.L, 

VCT.RC.M, VCT.RC.L, SVO.RC.M, and SOC.RC.M. This equipment is predominantly 

used in large grocery stores, where the average lifetime of the equipment was assumed to 

be 10 years, while the average lifetime of this equipment in convenience stores with gas 
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stations was assumed to be 15 years (see chapter 8 of the NOPR TSD for discussion of 

equipment lifetime assumptions). In general, the longer the equipment lifetime, the lower 

the LCC values because of a longer available timeframe to offset the initial cost 

increases. Since by savings in energy costs. Because the large display type equipment is 

predominantly used in larger grocery and multi-line retail stores, the national average 

values show lower LCC savings compared to the LCC savings of the subgroup. Selfcontained equipment, on the other hand, was assumed to have a 10-year average lifetime 

in all businesses. For self-contained equipment, the subgroup LCC savings were lower 

than the national average LCC savings values are higher than the subgroup LCC 

savingswith the exception of the HCT.SC.L cases. 

Table V.34 presents the percentage change in LCC savings of the 

consumercustomer subgroup in the food-retail sector compared to national average values

at each TSL. For a majority of equipment classes that show a decrease in LCC savings 

for the subgroup, the percentage decrease in LCC savings is less than 15 percent. 

Equipment classes that show a substantial decrease in LCC savings, compared to national 

average values, are VOP.SC.M, VCT.SC.M, VCT.SC.I, SVO.SC.M, and HCT.SC.M.

SVO.SC.M, HZO.SC.M, HCT.SC.M, HCT.SC.I, and HSC.SC.M. Among these, the 

equipment classes that show decrease in LCC saving of greater than 15 percent at TSL 4 

are VOP.SC.M (27 percent), SVO.SC.M (26 percent), HZO.SC.M (38 percent), 

HCT.SC.M (21 percent), HCT.SC.I (17 percent), and HCS.SC.M (15 percent). Even 

though the percentage decrease in LCC savings for these equipment classes may appear 

to be high, the absolute value of decrease in LCC savings is small when compared to the 
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total LCC for each equipment class. Table V.35 presents the comparison of median PBPs 

for small business subgroup in the foodservice sector with national median values 

(median PBPs from chapter 8 of the NOPR TSD).) at each TSL. The PBP values are 

higher in the small business subgroup in all instances, including instances in which the 

LCC savings for the subgroup are higher than national average values. This is an 

expected outcome because the PBP values are obtained by dividing the increase in 

equipment installed cost by the first year savings in operating costs, and are not affected 

by the higher average lifetime of the equipment in the convenience stores with gas 

stations. 

Table V.30 Comparison of Mean LCC Savings for the Small Business Subgroup in 

the Foodservice Sector with the National Average Values

Equipme

nt Class* Category

Mean LCC Savings

2010$2012$**

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5

VOP.SC.

M 

Small 

Business $94.67157.27 $141.04205.50

$185.57690.2

2

$185.57576

.21

($2,010.7858

6.43)

All Business 

Types

$106.45170.7

8

$159.12227.1

7

$214.15814.9

1

$214.15691

.27

($1,693.9437

6.52)

VCT.SC.

M 

Small 

Business

$918.03421.5

9

$665.05960.3

4

$490.12752.1

5

$399.97405

.47

($940.18954.

55)

All Business 

Types

$1,424.70566

.18

$1,038.14363

.60

$830.171,122

.14

$717.99641

.05

($500.02595.

52)

VCT.SC.

L 

Small 

Business

$1,026.223,1

27.24

$2,262.441,8

79.37

$1,509.79433

.25

$1,276.629

41.77

($581.87906.

58)

All Business 

Types

$1,434.124,1

86.06

$3,227.772,5

22.67

$2,281.371,9

84.45

$1,969.243

42.84

$252.00 

($343.16)

VCT.SC.I

Small 

Business

$268.46414.0

2

$274.25310.2

6

$182.80261.2

4

$182.80261

.24

($2,085.5303

6.01)

All Business 

Types

$437.37572.0

5

$502.51486.2

8 $370431.88 $370431.88 ($1,616.18591.87)

VCS.SC.

M 

Small 

Business

$249.50272.2

6

$145.79158.6

7

$109.55125.7

2

$109.55125

.72

($1,083.0807

9.78)

All Business 

Types

$268.29278.8

4 

$158.07162.8

8 

$125.10131.8

0 

$125.10131

.80 

($1,031.0604

2.03) 

VCS.SC.

L 

Small 

Business

$806.20511.6

4 

$342.36318.9

6 

$234.31259.1

0 

$193.48213

.08 

($1,339.5832

6.22) 

All Business 

Types

$863.65524.5

2

$368.04329.3

3

$256.76267.8

1

$214.03220

.83

($1,264.8327

4.03)

VCS.SC.I

Small 

Business

$202.73231.0

8 

$147.41170.1

3 

$124.68146.5

4 

$124.68146

.54 

($1,897.5288

4.22) 

All Business $218.38236.7 $159.81176.8 $140.59152.6 $140.59152 ($1,808.9381
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Types 7 3 9 .69 8.87)

SVO.SC.

M 

Small 

Business $18.43296.25 $258.96305.21 

$270.75486.7

0 

$270.75397

.67 

($1,366.2935

6.12) 

All Business 

Types $20.50324.33 $293.95334.89 

$308.07587.9

0 

$308.07491

.99 

($1,133.5020

1.61) 

HZO.SC.

M 

Small 

Business $7.508.16 $7.508.16 $40.0544.26 $12.5818.90 

($920.98925.

33) 

All Business 

Types $8.4385 $8.4385 $45.7448.60 $24.3528.78 

($811.71821.

57) 

HZO.SC.

L**†

Small 

Business $0.00 NA $0.00 NA $0.00 NA $0.00 NA ($530.40532.72) 

All Business 

Types $0.00 NA $NA0.00 $NA0.00 $NA0.00 ($468.24473.71) 

HCT.SC.

M 

Small 

Business $89.6999.52 $98.34323.44 $243.27274.76 

$191.91219

.49 

($405.10385.

92) 

All Business 

Types $99.37106.59 $109.64359.48 

$285.69307.2

6 

$235.72253

.60 

($300.80293.

54) 

HCT.SC.

L 

Small 

Business

$198.51209.0

5 

$157.60754.2

7 

$667.27544.1

4 

$431.57344

.36 

($372.73458.

19) 

All Business 

Types

$205.71217.1

9 

$163.89790.5

3 

$697.97571.0

7 

$458.84368

.92 

($265.52354.

75) 

HCT.SC.I

Small 

Business $20.21.15 $31.6032.20 $32.4135.19 $32.4135.19 

($919.02926.

07) 

All Business 

Types $20.4621.83 $33.1934.69 $38.0242.48 $38.0242.48 

($807.17811.

31) 

HCS.SC.

M 

Small 

Business $19.8822.47 $16.3418.59 $14.0616.03 $6.887.99 ($436.2555) 

All Business 

Types $21.3423.07 $17.9419.18 $15.8616.66 $9.118.68 ($418.13422.79) 

HCS.SC.

L 

Small 

Business $64.2372.79 $69.3078.72 $63.0476.67 $63.0476.67 

($440.61422.

16) 

All Business 

Types $74.69.41 $75.7480.97 $80.72.70 $80.72.70 ($407.48400.63) 

PD.SC.M

Small 

Business

$676.69815.0

4 

$676.69815.0

4 

$669.36729.7

2 

$185.63187

.05 

($849.95861.

56) 

All Business 

Types

$934.801,009

.53 

$934.801,009

.53 

$939.55933.5

9 

$351.49310

.43 

($582.78637.

94) 

SOC.SC.

M

Small 

Business $625.01 $449.27 $1,149.04 $651.93 ($959.99)

All Business 

Types $646.15 $466.47 $1,241.60 $739.75 ($735.33)

* Only self-contained equipment have been shown for this subgroup analysis because the remote condensing equipment is not 

generally used by small full-service restaurants. **** Values in parentheses are negative values. Negative percentage values imply decrease in LCC savings and positive percentage 

values imply increase in LCC savings.

† TSLs 1 through 4 for equipment class HZO.SC.L are associated with the baseline efficiency level. Hence, the LCC savings are 

shown as zero.“NA”.

Table V.31 Percentage Change in Mean LCC Savings for the Small Business 

Subgroup in the Foodservice Sector Compared to National Average Values

Equipment Class* TSL 1** TSL 2** TSL 3** TSL 4** TSL 5**

VOP.SC.M -11%(8%) -11%(10%) -13%(15%) -13%(17%) -19%(56%)

VCT.SC.M -36%(26%) -36%(30%) -41%(33%) -44%(37%) -88%(60%)

VCT.SC.L -28%(25%) -30%(26%) -34%(28%) -35%(30%) -
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331%**(164

%)

VCT.SC.I -39%(28%) -45%(36%) -51%(40%) -51%(40%) -29%(28%)

VCS.SC.M -7%(2%) -8%(3%) -12%(5%) -12%(5%) -5%(4%)

VCS.SC.L -7%(2%) -7%(3%) -9%(3%) -10%(4%) -6%(4%)

VCS.SC.I -7%(2%) -8%(4%) -11%(4%) -11%(4%) -5%(4%)

SVO.SC.M -10%(9%) -12%(9%) -12%(17%) -12%(19%) -21%(77%)

HZO.SC.M -11%(8%) -11%(8%) -12%(9%) -48%(34%) -(13%%)

HZO.SC.L†‡ NA NA NA NA -13%(12%)

HCT.SC.M -10%(7%) -(10%%) -15%(11%) -19%(13%) -35%(31%)

HCT.SC.L -(4%%) -4%(5%) -4%(5%) -6%(7%) -40%(29%)

HCT.SC.I -1%(3%) -5%(7%) -15%(17%) -15%(17%) -(14%%)

HCS.SC.M -7%(3%) -9%(3%) -11%(4%) -24%(8%) -4%(3%)

HCS.SC.L -7%(3%) -9%(3%) -13%(5%) -13%(5%) -8%(5%)

PD.SC.M -28%(19%) -28%(19%) -29%(22%) -47%(40%) -46%(35%)

SOC.SC.M (3%) (4%) (7%) (12%) (31%)

* Negative percentage values imply decrease in LCC savings and positive percentage values imply increase in LCC savings.

*Only self-contained equipment have been shown for this subgroup analysis because the remote condensing equipment is not 

generally used by small full-service restaurants.

** Values in parentheses are negative values. Negative percentage values imply decrease in LCC savings and positive percentage 

values imply increase in LCC savings.

† This value is high because of change of sign from subgroup value to national average value.

†

‡ TSLs 1 through 4 for equipment class HZO.SC.L are associated with the baseline efficiency level. Hence, the percentage changes

in LCC savings are shown as zero.“NA”.

‘0%’ means the value is in between -0.5% and 0.5%.

Table V.32 Comparison of Median Payback Periods for the Small Business 

Subgroup in the Foodservice Sector with National Median Values

Equipment 

Class* Category

Median Payback Period

years

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5

VOP.SC.M

Small Business 1.7277 1.832.38 2.444.52 2.444.81 32.4912.46

All Business 

Types 1.5761 1.672.17 2.234.12 2.234.39 29.4811.37

VCT.SC.M

Small Business 2.140.89 2.191.77 2.7227 2.9561 8.5734

All Business 

Types 2.050.86 2.101.73 2.6021 2.8354 8.2213

VCT.SC.L

Small Business 0.4460 0.7963 1.390.85 1.500.99 4.433.76

All Business 

Types 0.4358 0.7661 1.330.83 1.440.96 4.253.65

VCT.SC.I

Small Business 2.530.93 3.131.89 3.472.14 3.472.14 17.4514.34

All Business 

Types 2.320.86 2.871.74 3.171.97 3.171.97 15.9713.21

VCS.SC.M

Small Business 0.7774 0.9894 1.7468 1.7468 14.0913.51

All Business 

Types 0.8078 1.010.98 1.8075 1.8075 14.5711

VCS.SC.L

Small Business 0.4953 0.5987 1.010.96 1.1610 10.6111

All Business 

Types 0.5155 0.6191 1.0400 1.1915 10.9654

VCS.SC.I Small Business 0.8177 1.1899 2.4232 2.4232 27.4226.08

All Business 0.8380 1.222.07 2.5042 2.5042 28.3027.19
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Types

SVO.SC.M

Small Business 1.362.15 2.2025 2.274.83 2.275.17 25.4811.30

All Business 

Types 1.2597 2.0106 2.084.43 2.084.75 23.4910.36

HZO.SC.M

Small Business 2.1107 2.1107 2.6864 7.176.98 63.0160.83

All Business 

Types 1.9289 1.9289 2.4342 6.5240 57.3655.78

HZO.SC.L**

Small Business NA NA NA NA 84.1180.27

All Business 

Types NA NA NA NA 76.6073.62

HCT.SC.M

Small Business 0.7677 0.972.49 2.6569 3.3843 13.4464

All Business 

Types 0.7069 0.892.24 2.4342 3.0908 12.3126

HCT.SC.L

Small Business 0.6058 0.741.10 1.2015 1.6961 8.227.83

All Business 

Types 0.5553 0.671.00 1.1005 1.5547 7.5315

HCT.SC.I

Small Business 1.010.96 2.6760 4.8467 4.8467 31.9730.57

All Business 

Types 0.9288 2.4339 4.4228 4.4228 29.2127.99

HCS.SC.M

Small Business 0.5048 1.6457 2.4942 4.0906 33.7732.56

All Business 

Types 0.5250 1.6964 2.5854 4.2628 34.9605

HCS.SC.L

Small Business 0.8682 1.3630 2.5847 2.5847 15.14.38

All Business 

Types 0.8986 1.4136 2.6757 2.6757 15.6314.98

PD.SC.M

Small Business 1.470.53 1.470.53 1.7311 2.8328 8.167.63

All Business 

Types 0.53 0.53 1.10 2.27 7.61

SOC.SC.M

Small Business 1.14 1.26 2.40 3.06 7.59

All Business 

Types 1.4612 1.4624 1.722.35 2.8299 8.127.42

* Only self-contained equipment have been shown for this subgroup analysis because the remote condensing equipment is not 

generally used by small full-service restaurants.

** TSLs 1 through 4 for equipment class HZO.SC.L are associated with the baseline efficiency level. Hence, the payback period 

is shown as “NA.”

Table V.33 Comparison of LCC Savings for the Small Business Subgroup in the 

Food-Retail Sector with the National Average Values

Equipmen

t Class Category

Mean LCC Savings

2010$2012$*

TSL1 TSL2 TSL3 TSL4 TSL5

VOP.RC.

M 

Small 

Business

$260.45295.

31 

$260.45927.

25 

$810.972,34

7.11 

$547.901,9

70.10 

($6,087.041,5

28.98) 

All 

Business 

Types

$216.39235.

92 

$216.39743.

00 

$677.321,78

8.85 

$453.061,4

93.72 

($5,704.771,6

68.79) 

VOP.RC.L

Small 

Business

$597.95668.

10 

$416.961,89

9.69 

$420.251,42

1.70 

$420.251,4

21.70 

($4,560.673,8

55.19) 

All 

Business 

Types

$501.33537.

27 

$345.841,51

6.59 

$264.331,12

9.51 

$264.331,1

29.51 

($4,266.533,6

92.90) 

VOP.SC.

M 

Small 

Business

$87.91145.7

2 

$130.26187.

71 

$168.95608.

29 

$168.95503

.17 

($2,089.29655

.21) 

All 

Business 

$106.45170.

78 

$159.12227.

17 

$214.15814.

91 

$214.15691

.27 

($1,693.94376

.52) 
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Types

VCT.RC.

M 

Small 

Business

$512.73205.

12 

$512.732,20

0.61 

$1,975.372,0

74.57 

$1,173.963

13.23 

($2,744.77663

.30) 

All 

Business 

Types

$450.12175.

23 

$450.121,86

4.44 

$1,749.3775

8.73 

$1,038.121

08.13 

($2,513.32508

.61) 

VCT.RC.L

Small 

Business

$1,255.3858

6.15

$825.621,17

7.93

$626.02937.

97

$626.02937

.97

($4,139.033,9

02.43)

All 

Business 

Types

$1,077.9135

7.25 

$711.311,00

4.72 

$539.92797.

91 

$539.92797

.91 

($3,781.14624

.20) 

VCT.SC.

M 

Small 

Business

$1,261.9153

5.27

$917.281,26

4.79

$712.431,02

4.79

$604.60574

.38

($737.32784.3

5)

All 

Business 

Types

$1,424.7056

6.18 

$1,038.1436

3.60 

$830.171,12

2.14 

$717.99641

.05 

($500.02595.5

2) 

VCT.SC.L

Small 

Business

$1,310.493,9

80.86

$2,930.1039

6.41

$2,033.111,8

64.97

$1,741248.

55 

($135.40602.0

9)

All 

Business 

Types

$1,434.124,1

86.06 

$3,227.772,5

22.67 

$2,281.371,9

84.45 

$1,969.243

42.84 

$252.00 

($343.16)

VCT.SC.I

Small 

Business

$367.00529.

93 

$407.67430.

30 

$290.82375.

53 

$290.82375

.53 

($1,939.10881

.48) 

All 

Business 

Types

$437.37572.

05 

$502.51486.

28 $370431.88 $370431.88 ($1,616.18591.87) 

VCS.SC.

M 

Small 

Business

$262.13271.

17 

$153.73157.

63 

$118.65124.

30 

$118.65124

.30 

($1,069.80081

.39) 

All 

Business 

Types

$268.29278.

84 

$158.07162.

88 

$125.10131.

80 

$125.10131

.80 

($1,031.06042

.03) 

VCS.SC.L

Small 

Business

$845.52510.

86 

$359.83318.

22 

$248.64258.

09 

$206.16211

.59 

($1,317.72328

.25) 

All 

Business 

Types

$863.65524.

52 

$368.04329.

33 

$256.76267.

81 

$214.03220

.83 

($1,264.83274

.03) 

VCS.SC.I

Small 

Business

$213.38230.

24

$155.54169.

16

$134.21145.

08

$134.21145

.08

($1,875.29886

.42)

All 

Business 

Types

$218.38236.

77 

$159.81176.

83 

$140.59152.

69 

$140.59152

.69 

($1,808.93818

.87) 

SVO.RC.

M 

Small 

Business $79.2489.01 $79.24674.27

$577.441,54

4.54

$389.021,2

86.98

($4,242.70949

.64)

All 

Business 

Types

$68.0573.77 $68.05551.9

8 

$495.441,21

6.77 

$331.411,0

08.46 

($3,936.631,0

15.16) 

SVO.SC.

M 

Small 

Business

$17.67285.3

7

$247.30292.

93

$257.68449.

78 $257364.68 ($1,410.15387.03)

All 

Business 

Types

$20.50324.3

3 

$293.95334.

89 

$308.07587.

90 

$308.07491

.99 

($1,133.50201

.61) 

SOC.RC.

M 

Small 

Business

$135.36147.

25

$135.36280.

43

$249.471,27

8.84

$146.81670

.29

($2,904.17960

.27)

All 

Business 

$112.80118.

36

$112.80226.

26

$209.19997.

89

$119.60494

.51

($2,715.27982

.21)
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Types

HZO.RC.

M***

Small 

Business $0.00 $0.00 $0.00 $0.00 ($1,369.23384.63) 

All 

Business 

Types

$0.00 $0.00 $0.00 $0.00 ($1,247.58271

.24) 

HZO.RC.

L***

Small 

Business $0.00 $0.00 $0.00 $0.00 ($2,296.27306.30)

All 

Business 

Types

$0.00 $0.00 $0.00 $0.00 ($2,103.12134

.96) 

HZO.SC.

M 

Small 

Business $7.328.05 $7.328.05 $39.0243.45 $11.2817.89

($923.20927.0

1)

All 

Business 

Types

$8.4385 $8.4385 $45.7448.60 $24.3528.7

8 

($811.71821.5

7) 

HZO.SC.L

***

Small 

Business $0.00 $0.00 $0.00 $0.00 ($531.55533.60)

All 

Business 

Types

$0.00 $0.00 $0.00 $0.00 ($468.24473.7

1) 

HCT.SC.

M 

Small 

Business $84.4693.73 $92.37299.6

6 

$224.15253.

49 

$173.82199

.55 

($424.55407.2

9) 

All 

Business 

Types

$99.37106.5

9 

$109.64359.

48 

$285.69307.

26 

$235.72253

.60 

($300.80293.5

4) 

HCT.SC.L

Small 

Business

$225.93249.

39 

$180.05906.

61 

$767.25655.

15 

$504.10425

.64 

($295.06366.2

3) 

All 

Business 

Types

$205.71217.

19 

$163.89790.

53 

$697.97571.

07 

$458.84368

.92 

($265.52354.7

5) 

HCT.SC.I

Small 

Business $20.21.15 $31.6032.20 $32.4135.19 $32.4135.19 

($919.02926.0

7) 

All 

Business 

Types

$20.4621.83 $33.1934.69 $38.0242.48 $38.0242.4

8 

($807.17811.3

1) 

HCS.SC.

M 

Small 

Business $20.8922.48 $17.3418.44 $15.0975 $7.9540 ($432.39437.16)

All 

Business 

Types

$21.3423.07 $17.9419.18 $15.8616.66 $9.118.68 ($418.13422.7

9) 

HCS.SC.L

Small 

Business $67.6472.46 $73.3478.02 $68.6975.98 $68.6975.98

($428.99423.2

1)

All 

Business 

Types

$74.69.41 $75.7480.97 $80.72.70 $80.72.70 ($407.48400.6

3) 

PD.SC.M

Small 

Business

$904.891,02

6.80

$904.891,02

6.80

$904.87945.

24

$315.25299

.03

($716.78744.2

7)

All 

Business 

Types

$934.801,00

9.53 

$934.801,00

9.53 

$939.55933.

59 

$351.49310

.43 

($582.78637.9

4) 

SOC.SC.

M

Small 

Business $619.20 $444.70 $1,138.70 $643.60 ($967.59)

All 

Business $646.15 $466.47 $1,241.60 $739.75 ($735.33)
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Types

* Values in parentheses are negative values.

** TSLs 1 through 4 for equipment classes HZO.RC.M, HZO.RC.L, and HZO.SC.L are associated with the baseline efficiency level. 

Hence, the LCC savings are shown as zero.“NA.”

Table V.34 Comparison of Percentage of Consumers that Experience Net Benefits 

or No ImpactsChange in Mean LCC Savings for the Small Business Subgroup in the 

Food -Retail Sector with Compared to National Average ValuesAll Business Types for 

Commercial Refrigeration Equipment

Equipment 

Class TSL 1* TSL 2* TSL 3* TSL 4* TSL 5*

VOP.RC.M 2025% 2025% 2031% 2132% -78%

VOP.RC.L 1924% 2125% 5926% 5926% -7%(4%)

VOP.SC.M -

17%(15%)

-

18%(17%)

-

21%(25%)

-

21%(27%) -23%(74%)

VCT.RC.M 1417% 1418% 1318% 1319% -9%(6%)

VCT.RC.L 1617% 1617% 1618% 1618% -9%(8%)

VCT.SC.M -11%(5%) -12%(7%) -14%(9%) -

16%(10%) -47%(32%)

VCT.SC.L -9%(5%) -9%(5%) -11%(6%) -12%(7%) -

154%**(75%)

VCT.SC.I -16%(7%) -

19%(12%)

-

22%(13%)

-

22%(13%) -20%(18%)

VCS.SC.M -2%(3%) -(3%%) -5%(6%) -5%(6%) -(4%%)

VCS.SC.L -2%(3%) -2%(3%) -3%(4%) -(4%%) -(4%%)

VCS.SC.I -2%(3%) -3%(4%) -(5%%) -(5%%) -(4%%)

SVO.RC.M 1621% 1622% 1727% 1728% -86%

SVO.SC.M -

14%(12%)

-

16%(13%)

-

16%(23%)

-

16%(26%) -24%(92%)

SOC.RC.M 2024% 2024% 1928% 2336% -72%

HZO.RC.M*† NA NA NA NA -10%(9%)

HZO.RC.L*† NA NA NA NA -9%(8%)

HZO.SC.M -13%(9%) -13%(9%) -

15%(11%)

-

54%(38%) -14%(13%)

HZO.SC.L*† NA NA NA NA -14%(13%)

HCT.SC.M -

15%(12%)

-

16%(17%)

-

22%(17%)

-

26%(21%) -41%(39%)

HCT.SC.L 10% 10% 10% 10% -11%

HCT.SC.IL -115% -515% -15% -15% -14%(3%)

HCT.SC.I (3%) (7%) (17%) (17%) (14%)

HCS.SC.M -2%(3%) -3%(4%) -(5%%) -

13%(15%) -(3%%)

HCS.SC.L -(3%%) -3%(4%) -(6%%) -(6%%) -5%(6%)

PD.SC.M -32% -32% -41% -10%(4%) -23%(17%)

SOC.SC.M (4%) (5%) (8%) (13%) (32%)

* Values in parentheses are negative values. Negative percentage values imply decrease in LCC savings and 

positive percentage values imply increase in LCC savings.

*† TSLs 1 through 4 for equipment classes HZO.RC.M, HZO.RC.L, and HZO.SC.L are associated with the 

baseline efficiency level. Hence, the LCC savings are zero and the decrease in LCC savings are shown as 

“NA.” 

**This value is high because of change of sign from subgroup value to national average 

value.‘0%’ implies the value is in between -0.5% and 0.5%
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Table V.35 Comparison of Median Payback Periods for the Small Business 

Subgroup in the Food-Retail Sector with the National Median Values

Equipment 

Class Category

Median Payback Period

years

TSL1TSL

1

TSL2TSL

2

TSL3TSL

3

TSL4TSL

4

TSL5TSL 5

VOP.RC.M

Small Business 1.8778 1.8783 1.923.88 2.484.02 36.8012.09

All Business 

Types 1.8373 1.8377 1.873.77 2.413.91 38.11.76

VOP.RC.L

Small Business 1.2115 1.992.10 6.712.30 6.712.30 25.4518.90

All Business 

Types 1.1811 1.942.03 6.592.22 6.592.22 24.9618.30

VOP.SC.M

Small Business 1.9095 2.0365 2.725.02 2.725.34 38.3613.84

All Business 

Types 1.5761 1.672.17 2.234.12 2.234.39 29.4811.37

VCT.RC.M

Small Business 2.721.28 2.7251 3.612.53 3.862.80 14.7913.61

All Business 

Types 2.631.23 2.6342 3.492.43 3.732.70 14.2913.09

VCT.RC.L

Small Business 4.381.35 4.421.57 4.491.71 4.491.71 22.7816.40

All Business 

Types 4.331.30 4.361.51 4.431.64 4.431.64 22.3815.75

VCT.SC.M

Small Business 2.330.98 2.391.95 2.9749 3.222.87 9.3717

All Business 

Types 2.050.86 2.101.73 2.6021 2.8354 8.2213

VCT.SC.L

Small Business 0.4965 0.8668 1.520.93 1.6509 4.8512

All Business 

Types 0.4358 0.7661 1.330.83 1.440.96 4.253.65

VCT.SC.I

Small Business 2.831.02 3.492.08 3.862.35 3.862.35 19.3615.75

All Business 

Types 2.320.86 2.871.74 3.171.97 3.171.97 15.9713.21

VCS.SC.M

Small Business 0.8279 1.0401 1.8579 1.8579 14.9245

All Business 

Types 0.8078 1.010.98 1.8075 1.8075 14.5711

VCS.SC.L

Small Business 0.5256 0.6393 1.0703 1.2218 11.2310.80

All Business 

Types 0.5155 0.6191 1.0400 1.1915 10.9654

VCS.SC.I

Small Business 0.8582 1.252.12 2.5648 2.5648 29.0127.85

All Business 

Types 0.8380 1.222.07 2.5042 2.5042 28.3027.19

SVO.RC.M

Small Business 1.4236 1.422.74 2.884.49 3.464.66 37.0612.01

All Business 

Types 1.3831 1.382.64 2.794.34 3.364.50 38.3011.60

SVO.SC.M

Small Business 1.492.29 2.4140 2.505.18 2.505.55 29.6012.12

All Business 

Types 1.2597 2.0106 2.084.43 2.084.75 23.4910.36

SOC.RC.M

Small Business 1.3128 1.3148 1.533.41 2.904.54 35.3612.24

All Business 

Types 1.2825 1.2844 1.503.31 2.844.41 35.9911.88

HZO.RC.M*

Small Business 0.00NA 0.00NA 0.00NA NA0.00 175.10166.41

All Business 

Types NA0.00 NA0.00 NA0.00 NA0.00 170.62161.23

HZO.RC.L*

Small Business NA0.00 NA0.00 NA0.00 NA0.00 90.9986.47

All Business 

Types NA0.00 NA0.00 NA0.00 NA0.00 88.6683.78
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HZO.SC.M

Small Business 2.1914 2.1914 2.7974 7.4623 65.5362.97

All Business 

Types 1.9289 1.9289 2.4342 6.5240 57.3655.78

HZO.SC.L*

Small Business NA0.00 NA0.00 NA0.00 NA0.00 87.3683.02

All Business 

Types NA0.00 NA0.00 NA0.00 NA0.00 76.6073.62

HCT.SC.M

Small Business 0.8380 1.062.60 2.9281 3.7258 14.8023

All Business 

Types 0.7069 0.892.24 2.4342 3.0908 12.3126

HCT.SC.L

Small Business 0.6159 0.751.12 1.2317 1.7265 8.3801

All Business 

Types 0.5553 0.671.00 1.1005 1.5547 7.5315

HCT.SC.I

Small Business 1.010.96 2.6760 4.8467 4.8467 31.9730.57

All Business 

Types 0.9288 2.4339 4.4228 4.4228 29.2127.99

HCS.SC.M

Small Business 0.5351 1.7368 2.6460 4.3639 35.8034.88

All Business 

Types 0.5250 1.6964 2.5854 4.2628 34.9605

HCS.SC.L

Small Business 0.9188 1.4440 2.7363 2.7363 16.0215.35

All Business 

Types 0.8986 1.4136 2.6757 2.6757 15.6314.98

PD.SC.M

Small Business 1.610.58 1.610.58 1.8922 3.102.50 8.9340

All Business 

Types 0.53 0.53 1.10 2.27 7.61

SOC.SC.M

Small Business 1.23 1.36 2.58 3.28 8.13

All Business 

Types 1.4612 1.4624 1.722.35 2.8299 8.127.42

* TSLs 1 through 4 for equipment classes HZO.RC.M, HZO.RC.L, and HZO.SC.L are associated with the baseline efficiency 

level. Hence, the payback period is shown as “NA.”

2. Economic Impacts on Manufacturers

DOE performed an MIA to estimate the impact of amended energy conservation 

standards on manufacturers of commercial refrigeration equipment. The following 

section describes the expected impacts on manufacturers at each TSL. Chapter 12 of the 

NOPR TSD explains the analysis in further detail.

a. Industry Cash-Flow Analysis Results

The following tables depict the financial impacts (represented by changes in 

INPV) of amended energy standards on manufacturers as well as the conversion costs 

that DOE estimates manufacturers would incur for all equipment classes at each TSL. To 
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evaluate the range of cash flow impacts on the commercial refrigeration industry, DOE 

modeled two different scenarios using different assumptions for markups that correspond 

to the range of anticipated market responses to new and amended standards. 

To assess the lower (less severe) end of the range of potential impacts, DOE 

modeled a preservation of gross margin percentage markup scenario, in which a uniform 

“gross margin percentage” markup was applied across all potential efficiency levels. In 

this scenario, DOE assumed that a manufacturer’s absolute dollar markup would increase 

as production costs increase in the amended standards case. Manufacturers have indicated 

that it is optimistic to assume that they would be able to maintain the same gross margin 

percentage markup as their production costs increase in response to an amended 

efficiency standard, particularly at higher TSLs. To assess the higher (more severe) end 

of the range of potential impacts, DOE modeled the preservation of operating profit 

markup scenario, which assumes that manufacturers would be able to earn the same 

operating margin in absolute dollars in the amended standards case as in the base case. 

Table V.36 and Table V.37 show the potential INPV impacts for commercial 

refrigeration equipment manufacturers: the first table at each TSL: Table V.36 reflects 

the lower bound of impacts and Table V.37the second represents the upper bound. 

Each of the modeled scenarios results in a unique set of cash flows and 

corresponding industry values at each TSL. In the following discussion, the INPV results 

refer to the difference in industry value between the base case and each potential 

amended standards case that results from the sum of discounted cash flows from the base 
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year 20092013 through 20452046, the end of the analysis period. To provide perspective 

on the short-run cash flow impact, DOE includes in the discussion of the results below a 

comparison of free cash flow between the base case and the standards case at each TSL in 

the year before amended standards take effect.

Table . Manufacturer Impact Analysis for Commercial Refrigeration Equipment -

Preservation of Gross Margin Percentage Markup Scenario

Units Base 

Case

Trial Standard Level

1 2 3 4 5

INPV 2010$ 

Millions 869.3 869.0 863.8 836.2 824.4 860.4 

Change in INPV

2010$ 

Millions - (0.2) (5.4) (33.1) (44.8) (8.9)

(%) - (0.03) (0.63) (3.80) (5.16) (1.02)

Product 

Conversion Costs

2010$ 

Millions - 5.6 6.8 7.6 7.9 51.7

Capital 

Conversion Costs

2010$ 

Millions - 0.0 8.1 56.5 79.8 222.0

Total Conversion 

Costs

2010$ 

Millions - 5.6 14.9 64.2 87.6 273.7

Table V.36 Manufacturer Impact Analysis for Commercial Refrigeration 

Equipment -– Preservation of Operating ProfitGross Margin Percentage Markup 

Scenario*

Units Base 

Case

Trial Standard Level

1 2 3 4 5

INPV 2012$ 

Millions 1,162.0 1,158.4 1,146.9 1,135.7 1,116.1 1,136.5 

Change in INPV

2012$ 

Millions

 - (3.6) (15.2) (26.3) (45.9) (25.5)

(%) - (0.31) (1.30) (2.26) (3.95) (2.20)

Product Conversion 

Costs

2012$ 

Millions - 8.0 9.9 10.5 11.2 68.0 

Capital Conversion 

Costs

2012$ 

Millions - - 18.4 42.9 76.3 252.4 

Total Conversion 

Costs

2012$ 

Millions - 8.0 28.3 53.4 87.5 320.4 

* Values in parentheses are negative values.

Table V.37 Manufacturer Impact Analysis for Commercial Refrigeration 

Equipment – Preservation of Operating Profit Markup Scenario*

Units Base 

Case

Trial Standard Level

1 2 3 4 5

INPV 20102012

$ Millions

869.31,

162.0 

859.01,

155.2 

851.1,1

35.6 

805.61,

102.8 

779.91,06

9.4 183.2646.0 

Change in INPV 20102012 - (10.26.8 (18.226. (63.759. (89.392.6) (686.1516.
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$ Millions ) 4) 2) 0)

(%) - (1.180.5

8) (2.0927) (7.325.09) 

(10.287.9

7) 

(78.9344.4

1) 

Product Conversion 

Costs

20102012

$ Millions - 5.68.0 6.89.9 7.610.5 7.911.2 51.768.0 

Capital Conversion 

Costs

20102012

$ Millions - 0.0- 8.118.4 56.542.9 79.876.3 222.0252.4 

Total Conversion 

Costs

20102012

$ Millions - 5.68.0 14.928.3 

64.253.

4 87.65 273.7320.4 

* Values in parentheses are negative values.

At TSL 1, DOE estimates impacts on INPV for commercial refrigeration 

equipment manufacturers to range from -$10.26.8 million to -$0.23.6 million, or a change 

in INPV of -1.180.58 percent to -0.0331 percent. At this potential standard level, industry 

free cash flow is estimated to decrease by approximately 2.285 percent to $81.589.6

million, compared to the base-case value of $83.492.2 million in the year before the 

compliance date (20152016).

DOE anticipates no capital conversion costs at TSL 1 because manufacturers 

would be able to make simple component swaps to meet the efficiency levels for each 

equipment class at this TSL. However, small product conversion costs may be incurred in 

order to incorporate the new components in existing designs. 

At TSL 2, DOE estimates impacts on INPV for commercial refrigeration 

equipment manufacturers to range from -$1826.4 million to -$15.2 million to -$5.4

million, or a change in INPV of -2.0927 percent to -0.631.30 percent. At this potential 

standard level, industry free cash flow is estimated to decrease by approximately 

7.0412.48 percent to $77.580.7 million, compared to the base-case value of $83.492.2

million in the year before the compliance date (20152016).
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At TSL 2, DOE expects mild impacts on the industry. While capital conversion 

costs ramp up to $818.4 million for the industry, these costs are entirely accounted for by 

the VOP.RC.L and VCT.RC.L equipment classes. This is due to the potential need for 

foam insulation that is a half-inch thicker to meet thea standard. set at this level. Product 

conversion costs will also slightly increase as design options that require new UL or NSF 

certification are incorporated. Detailed discussion can be found in chapter 12 of NOPR 

TSD. 

At TSL 3, DOE estimates impacts on INPV for commercial refrigeration 

equipment manufacturers to range from -$63.759.2 million to -$33.126.3 million, or a 

change in INPV of -7.325.09 percent to -3.82.26 percent. At this potential standard level, 

industry free cash flow is estimated to decrease by approximately 33.5224.65 percent to 

$55.469.5 million, compared to the base-case value of $83.492.2 million in the year 

before the compliance date (20152016).

DOE expects mild, though slightly higher, conversion costs at TSL 3. The 

majority of the capital conversion costs are associated with the potential need for 

additional foam insulation for high-volume products, such as VCS.SC.M, which accounts 

for approximately 27.4 percent of total shipments, and for VCS.SC.L, which accounts for 

15.5approximately16 percent. In total, DOE expects 8 of the 24 equipment classes to 

require new production equipment due to higher standards at this level. 
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At TSL 4, DOE estimates impacts on INPV for commercial refrigeration 

equipment manufacturers to range from -$89.392.6 million to -$44.845.9 million, or a 

change in INPV of -10.287.97 percent to -5.163.95 percent. At this potentialproposed

standard level, industry free cash flow is estimated to decrease by approximately 

46.1341.19 percent to $44.954.2 million, compared to the base-case value of $83.492.2

million in the year before the compliance date (20152016).

At TSL 4, the drop in INPV is largely driven by continued increases in conversion 

costs. The increase in conversion costs is caused by the need for new tooling to 

accommodate additional foam insulation. At TSL 4, DOE expects 2118 of the 24 

equipment classes to require new production equipment due to higher standards.

At TSL 5, DOE estimates impacts on INPV for commercial refrigeration 

equipment manufacturers to range from -$686.1516.0 million to -$8.925.5 million, or a 

change in INPV of -78.9344.41 percent to -1.022.20 percent. At this potential standard 

level, industry free cash flow is estimated to decrease by approximately 140.16147.31

percent to -$ 33.543.6 million, compared to the base-case value of $83.492.2 million in 

the year before the compliance date (20152016).

A substantial increase in conversion costs are expected at TSL 5 due to the 

possible need for vacuum insulated panel technology required to meet a standard at TSL 

5. Vacuum insulated panels are not currently used by any commercial refrigeration 

equipment manufacturers, and the production of vacuum insulated panels would require 
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processes different from those used to produce standard foam panels. Therefore, high 

R&D investments may be necessary to redesign commercial refrigeration equipment 

cases. It is possible that substantial new equipment would be necessary to produce 

vacuum insulated panels for commercial refrigeration equipment applications. Current 

panel production equipment that cannot be used to produce vacuum insulated panels 

would be retired before it reaches the end of its useful life and would become a stranded 

asset. 

b. Impacts on Direct Employment

To quantitatively assess the impacts of amended energy conservation standards on 

employment, DOE consideredused the GRIM to estimate the domestic labor expenditures 

and number of employees in the base case and at each TSL from 2013 through 2046. 

DOE used statistical data from the U.S. Census Bureau’s 2011 Annual Survey of 

Manufacturers (ASM), the results of the engineering analysis and responses from , the 

commercial refrigeration equipment shipments forecast, and interviews with 

manufacturers. to determine the inputs necessary to calculate industry-wide labor 

expenditures and domestic employment levels. Labor expenditures related to 

manufacturing of the equipmentproduct are a function of the labor intensity of the 

equipmentproduct, the sales volume, and an assumption that wages remain fixed in real 

terms over time. The total labor expenditures in each year are calculated by multiplying 

the MPCs by the labor percentage of MPCs. 

DOE typically presents modeled quantitative estimates of the potential changes 
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inThe total labor expenditures in the GRIM were then converted to domestic production 

employment that could result following amended energy conservation standards. 

However, for this rulemaking, DOE determined that labor costs do not change across 

efficiency levels for any of the equipment classes analyzed, as explained below. Since 

labor inputs remain mostly constant regardless of the TSL selected, DOE does not expect 

employment levels to change based on the proposed standard. 

by dividing production labor expenditures by the annual payment per production 

worker (production worker hours times the labor rate found in the U.S. Census Bureau’s 

2011 ASM). The estimates of production workers in this section only account forcover

workers up to the, including line-supervisor level that supervisors who are directly 

involved in fabricating and assembling a piece of equipmentproduct within the 

manufacturer’sOEM facility. Workers that performperforming services that are closely 

associated with production operations, such as material handing with a forkliftmaterials 

handling tasks using forklifts, are also included as production labor. DOE’s estimates 

only account for production workers who specifically manufacture the equipmentspecific 

products covered by this rulemaking.
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Table V.38 Potential Changes in the Number of Commercial Refrigeration 

Equipment Production Workers in 2017

Trial Standard Level*

Base Case 1 2 3 4 5

Total Number of Domestic 

Production Workers in 2017 

(assuming no changes in 

production locations)

3,672 3,672 3,672 3,672 3,672 3,925 

Range of Potential Changes 

in Domestic Production 

Workers in 2017**

- -3,672 to 

0

-3,672 to 

0

-3,672 to 

0

-3,672 to 

0

-3,672 to 

253

*Numbers in parentheses are negative numbers.

**DOE presents a range of potential employment impacts, where the lower range represents the scenario in 

which all domestic manufacturers move production to other countries.

The employment impacts shown in Table V.38 represent the potential production 

employment changes that could result following the compliance date of an amended

energy conservation standard. The upper end of the results in the table estimates the 

maximum increase in the number of production workers after the implementation of new 

energy conservation standards and it assumes that manufacturers would continue to 

produce the same scope of covered products within the United States. The lower end of 

the range indicates the total number of U.S. production workers in the industry who could 

lose their jobs if all existing production were moved outside of the United States. Though 

manufacturers stated in interviews that shifts in production to foreign countries is 

unlikely, the industry did not provide enough information for DOE fully quantify what 

percentage of the industry would move production at each evaluated standard level. 

The majority of design options analyzed in the engineering analysis require 

manufacturers to purchase more-efficient components from suppliers. However, most of 

the more-efficientThese components do not require significant additional labor to 

assemble. Thus, labor costs are not expected to increase along with higher efficiency 
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components. The mainA key component of a commercial refrigeration equipment unit 

that requires fabrication labor by the commercial refrigeration equipment manufacturer is 

the shell of the unit, which needs to be formed and foamed in. Although this activity may 

require new production equipment if thicker insulation is needed to meet higher 

efficiency levels, the process of building the panels would essentially remain the same, 

and therefore require no additional labor costs. Costs for supervisors and indirect labor 

employees (forklift drivers, quality control management, etc.) are also expected to remain 

constant as the overall process for manufacturing a unit would require them to hold the 

same responsibilities regardless of the unit’s level of efficiencyAs a result, labor needs 

are not expected to increase as the amended energy conservation standard increases from 

baseline to TSL 4. 

During interviews, manufacturers confirmed that higher efficiency standards 

would not have a major impact on employment. The only exception would be if an 

amended standard were set so high that the necessary price increases were found to be 

unacceptable by their customers. If industry-wide shipments decreased from current 

levels, manufacturers may be forced to reduce their workforce. 

At TSL 5, the introduction of hybrid vacuum insulation panels may lead to greater 

labor requirements. In general, the production and handling of hybrid VIPs will require 

more labor than the production of standard panels. This is due to the delicate nature of 

VIPs and the additional labor necessary to embed them into a hybrid panel. The 

additional labor and handling associated with hybrid panels account for the increase in 
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labor at the max-tech trial standard level. 

DOE notes that the employment impacts discussed here are independent of the 

employment impacts to the broader U.S. economy, which are documented in the 

Employment Impact Analysis, chapter 1516 of the NOPR TSD.

c. Impacts on Manufacturing Capacity 

According to the majority of commercial refrigeration equipment manufacturers 

interviewed, amended energy conservation standards will not significantly affect 

manufacturers’ production capacities. Any necessary redesign of commercial 

refrigeration equipment would not change the fundamental assembly of the equipment, 

but manufacturers do anticipate some potential for minor changes to tooling. The most 

significant of these would come as a result of any redesigns performed to accommodate 

additional foam insulation thickness. Additionally, most of the design options being 

evaluated are already available on the market as product options. Thus, DOE believes 

manufacturers would be able to maintain manufacturing capacity levels and continue to 

meet market demand under amended energy conservation standards.

d. Impacts on Subgroups of Manufacturers

Small manufacturers, niche equipment manufacturers, and manufacturers 

exhibiting a cost structure substantially different from the industry average could be 

affected disproportionately. As discussed in section IV.K, using average cost assumptions 

to develop an industry cash-flow estimate is inadequate to assess differential impacts 
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among manufacturer subgroups. 

For commercial refrigeration equipment, DOE identified and evaluated the impact 

of amended energy conservation standards on one subgroup: small manufacturers. The 

SBA defines a “small business” as having 750 employees or less for NAICS 333415, 

“Air-Conditioning and Warm Air Heating Equipment and Commercial and Industrial 

Refrigeration Equipment Manufacturing.” Based on this definition, DOE identified 3132

manufacturers in the commercial refrigeration equipment industry that are small 

businesses.

For a discussion of the impacts on the small manufacturer subgroup, see the 

regulatory flexibility analysis in section VI.B of this notice and chapter 12 of the NOPR 

TSD. 

e. Cumulative Regulatory Burden

While any one regulation may not impose a significant burden on manufacturers, 

the combined effects of recent or impending regulations may have serious consequences 

for some manufacturers, groups of manufacturers, or an entire industry. Assessing the 

impact of a single regulation may overlook this cumulative regulatory burden. In addition 

to energy conservation standards, other regulations can significantly affect 

manufacturers’ financial operations. Multiple regulations affecting the same 

manufacturer can strain profits and lead companies to abandon product lines or markets 

with lower expected future returns than competing products. For these reasons, DOE 
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conducts an analysis of cumulative regulatory burden as part of its rulemakings 

pertaining to appliance efficiency. 

 

During previous stages of this rulemaking, DOE identified a number of 

requirements in addition to amended energy conservation standards for commercial 

refrigeration equipment. The following section briefly addresses comments DOE 

received with respect to cumulative regulatory burden and summarizes other key related 

concerns that manufacturers raised during interviews. 

Certification, Compliance, and Enforcement Rule

Multiple manufacturers have expressed concerns about the CC&E burdens for 

commercial refrigeration equipment. Traulsen stated that CC&E is the most significant 

cost item in terms of internal resources in the form of time and direct expenses. 

(Traulsen, No. 45 at pp. 4–5) NEEA expressed the opinion that the most significant issue 

associated with manufacturer impacts is testing and compliance for a wide array of 

equipment offerings, especially considering the large number of variations on single 

models. NEEA also agreed with manufacturers that testing each variation would create a 

significant potential burden, especially on small manufacturers. (NEEA, No. 36 at p. 7) 

AHRI stated that the CC&E requirements put in place by DOE have the potential to 

bankrupt the industry due to the excessive number of tests required. (AHRI, No. 43 at p. 

3) In addition, Southern Store Fixtures stated that it would be difficult to produce 

information to estimate the compliance testing burden on manufacturers, as the 

certification and compliance requirements had not yet been finalized. (Southern Store 
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Fixtures, Public Meeting Transcript, No. 31 at pp. 149–50) Southern Store Fixtures added 

that it is impossible to determine potential impacts of testing and certification on 

manufacturers until the issue of basic model is clarified. (Southern Store Fixtures, No. 38 

at p. 1) 

DOE understands that testing and certification requirements may have a 

significant impact on manufacturers, and the CC&E burden is identified as a key issue in 

the MIA. DOE also understands that CC&E requirements can be particularly onerous for 

manufacturers producing low volume or highly customized commercial refrigeration 

equipment. As a result, DOE is considering approvalconducting a rulemaking to expand 

AEDM coverage and has issued a proposed rule to permit the application of AEDMs to 

establish CRE efficiency ratings in lieu of testing.for commercial refrigeration 

equipment. 77 FR at 32038 (May 31, 2012). More information about the AEDM 

rulemaking can be found at: 

www1.eere.energy.gov/buildings/appliance_standards/certification_enforcement.html. 

In addition, the Department continues to review and develop more precise, 

product-specific definitions for basic models and will take into account comments 

received when addressing this issue in the next phase of the certification, compliance, and 

enforcement rulemaking.

EPA and ENERGY STAR

Some stakeholders also expressed concern regarding potential conflicts with other 
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certification programs. Traulsen stated that redundancy of testing given other Federal 

programs (such as EPA ENERGY STAR), where there may be conflicting criteria, 

increases cost, and that cross-references to other databases with inconsistent tests, classes, 

and enforcement adds further complications. Traulsen estimated that the financial impact 

of meeting DOE and EPA ENERGY STAR requirements has been greater than 0.5 

percent of revenue, and stated that it would be beneficial to reconcile the differences 

between DOE and EPA standards. (Traulsen, No. 45 at pp. 5–6) NEEA stated that the 

burden of certifications and associated testing is inherent in the manufacturing industry, 

and that this burden should have little to do with the standards rulemaking. However, 

NEEA added, any steps that can be taken to harmonize test methods and procedures 

between certifications should be taken. (NEEA, No. 36 at p. 7) 

DOE realizes that the cumulative effect of several regulations on an industry may 

significantly increase the burden faced by manufacturers that need to comply with 

multiple regulations and certification programs from different organizations and levels of 

government. However, DOE notes that certain standards, such as ENERGY STAR, are 

optional for manufacturers. Harmonizing of test methods and procedures is not part of the 

energy conservation standards rulemaking. In its test procedure rulemaking, which 

culminated in the publication of the February 2012 test procedure final rule (77 FR 10292

(Feb. 21, 2012)), DOE attempted to set the test procedure in such a way so as to 

maximize the similarities between the DOE test procedure and the test procedure required 

for ENERGY STAR certification.
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Other Federal Regulations

AHRI stated that there are several legislative and regulatory activities that could 

significantly burden manufacturers of commercial refrigeration equipment, including the 

upcoming amended energy conservation standards for walk-in coolers and freezers. 

AHRI also added that climate change bills that could be presented before Congress could 

have significant negative impact on the availability and price of HFC refrigerants. 

(AHRI, No. 43 at p. 4) 

DOE recognizes the additional burden faced by manufacturers that produce both 

commercial refrigeration equipment and walk-in coolers and freezers. Companies that 

produce a wide range of regulated equipment may be faced with more capital and 

equipment design development expenditures than competitors with a narrower scope of 

production. However, DOE cannot consider the quantitative impacts of amended 

standards that have not yet been finalized, such as those for walk-ins. Likewise, DOE 

cannot consider the impacts of potential climate change bills because any potential 

impacts would be speculative in the absence of finalized legislation. 

State Regulations

AHRI stated that California is currently working on new regulations as part of 

Title 24 that will likely establish new prescriptive requirements on commercial 

refrigeration equipment beginning in 2013. Additionally, AHRI added, other States on 

the West Coast are following California’s lead and are likely to implement similar 

regulations in the near future. Finally, AHRI commented that several States have enacted 
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their own climate change legislation, including regulations established by CARB to limit 

GHGs and reduce the usage of high-GWP refrigerants such as HFCs. AHRI stated that 

CARB will implement these regulations in 2011. (AHRI, No. 43 at p. 4)

According to the latest California Code of Regulations, title 24, part 6, any 

appliance for which there is a California energy conservation standard established in the 

California Appliance Efficiency Regulations may be installed only if the manufacturer 

has certified to the CEC, as specified in those regulations, that the appliance complies 

with the applicable standard for that appliance. The Commission’s appliance efficiency 

regulations require that the MDEC (in kilowatt-hours) for commercial refrigerators 

manufactured on or after January 1, 2010 does not exceed the following:

• refrigerators with solid doors: 0.10V + 2.04 

• refrigerators with transparent doors: 0.12V + 3.34

• freezers with solid doors: 0.40V + 1.38 

• freezers with transparent doors: 0.75V + 4.10

• refrigerator/freezers with solid doors: the greater of 0.27AV–0.71 or 0.70

• refrigerators with self-condensing unit designed for pull-down temperature 

applications: 0.126V + 3.51

Since these standards are identical to the ones prescribed in EPACT 2005, and the 

efficiency levels set by the current rulemaking will either exceed or be equivalent to the 

EPACT 2005 levels, DOE does not expect the Title 24 regulations to create a cumulative 

regulatory burden on manufacturers. California has started a rulemaking proceeding to 
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adopt changes to the building energy efficiency standards contained in the California 

Code of Regulations, title 24, part 6, but the CEC is currently in the pre-rulemaking stage 

and amended standards will not be published until 2013. 

Further, CARB is currently limiting the in-State use of high-GWP refrigerants in 

non-residential refrigeration systems through its Refrigerant Management Program, 

effective January 1, 2011.100 According to this new regulation, facilities with 

refrigeration systems that have a refrigerant capacity exceeding 50 pounds must repair 

leaks within 14 days of detection, maintain on-site records of all leak repairs, and keep 

receipts of all refrigerant purchases. The regulation applies to any person or company that 

installs, services, or disposes of appliances with high-GWP refrigerants. Refrigeration 

systems with a refrigerant capacity exceeding 50 pounds typically belong to food retail 

operations with remote condensing racks that store refrigerant serving multiple 

commercial refrigeration equipment units within a business. However, commercial 

refrigeration equipment units in food retail are usually installed and serviced by 

refrigeration contractors, not manufacturers. As a result, although these CARB 

regulations do apply to refrigeration technicians and owners of facilities with 

refrigeration systems, they are unlikely to represent a regulatory burden for commercial 

refrigeration manufacturers.

DOE discusses these and other requirements, and includes the full details of the 

cumulative regulatory burden analysis, in chapter 12 of the NOPR TSD.

 

100 California Air Resources Board. Refrigerant Management Program Final Regulation. 2011. Cal. Code 

Regs. tit. 17, § 95386. (Last accessed March 16, 2012.) www.arb.ca.gov/cc/reftrack/reftrackrule.html
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3. National Impact Analysis

a. Amount and Significance of Energy Savings

DOE estimated the NES by calculating the difference in annual energy 

consumption for the base-case scenario and standards-case scenario at each TSL for each 

equipment class and summing up the annual energy savings over the 30-year analysis 

period from 2016 to 2045.for all equipment purchased in 2017-2046. The energy 

consumption calculated in the NIA is source energy, taking into account losses in the 

generation and transmission of electricity as discussed in section IV.I. 

Table V.39 presents the undiscounted NES for all equipment classes at each TSL 

and the sum total of NES for each TSL. and Table V.40 present the NES results 

discounted at 7-percent and 3-percent discount rates, respectively. presents estimated 

FFC energy savings for each considered TSL. The undiscounted total NES progressively 

increases from 0.274236 quads at TSL 1 to 1.302278 quads at TSL 5. Table V.41

presents the energy savings at each TSL for each equipment class in the form of 

percentage of the cumulative energy use of the equipment stock in the base case scenario. 

Table V.39 Undiscounted Cumulative National Primary Energy Savings (2016–

2045)for Equipment Purchased in 2017–2046

Equipment Class quads*

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5

VOP.RC.M 0.007 0.007045 0.042238 0.047244 0.294257

VOP.RC.L 0.001 0.001005 0.008006 0.008006 0.010009

VOP.SC.M 0.000001 0.001003 0.003017 0.003018 0.021019

VCT.RC.M 0.001000 0.001007 0.009 0.009 0.010

VCT.RC.L 0.068061 0.076071 0.082078 0.082078 0.121

VCT.SC.M 0.058011 0.060057 0.082074 0.087081 0.097092

VCT.SC.L 0.001005 0.005 0.010006 0.010007 0.011008

VCT.SC.I 0.001 0.002003 0.003 0.003 0.005

VCS.SC.M 0.044047 0.059064 0.101111 0.101111 0.159176
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VCS.SC.L 0.031042 0.045064 0.064068 0.070076 0.131144

VCS.SC.I 0.000 0.000 0.000 0.000 0.001

SVO.RC.M 0.002 0.002029 0.028139 0.031142 0.170150

SVO.SC.M 0.000004 0.004006 0.006021 0.006022 0.025023

SOC.RC.M 0.001 0.001002 0.002017 0.003019 0.027020

HZO.RC.M - - - - 0.001

HZO.RC.L - - - - 0.008009

HZO.SC.M 0.000 0.000 0.000 0.000 0.000

HZO.SC.L - - - - 0.000

HCT.SC.M 0.000 0.000 0.000 0.000 0.001

HCT.SC.L 0.001 0.001004 0.005004 0.005 0.007006

HCT.SC.I 0.000 0.000 0.001 0.001 0.004005

HCS.SC.M 0.001 0.001 0.002 0.003004 0.012013

HCS.SC.L 0.001 0.001 0.002 0.002 0.004005

PD.SC.M 0.057047 0.057047 0.117105 0.164157 0.186181

SOC.SC.M 0.000 0.000 0.002 0.002 0.002

Net NES 0.274233 0.325416 0.566905 0.636985 1.302257

‘-’ represents zero energy savings, since TSLs 1 through 4 for the equipment classes HZO.RC.M, HZO.RC.L, and HZO.SC.L are 

associated with the baseline efficiency level.

* A valuesvalue of 0.000 means NES values are less than 0.0005 quads.

Table V.40 Cumulative National Full-Fuel-Cycle Energy Savings at a 7-percent 

discount rate (2016-2045)for Equipment Purchased in 2017–2046

Equipment Class quads*

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5

VOP.RC.M 0.002007 0.002046 0.010242 0.011248 0.067262

VOP.RC.L 0.000001 0.000005 0.002006 0.002006 0.002009

VOP.SC.M 0.000001 0.000003 0.001018 0.001018 0.005019

VCT.RC.M 0.000 0.000007 0.002009 0.002009 0.002010

VCT.RC.L 0.015062 0.017072 0.019079 0.019079 0.027123

VCT.SC.M 0.013011 0.014058 0.019075 0.020083 0.022094

VCT.SC.L 0.005 0.006 0.006 0.007 0.008

VCT.SC.LI 0.000001 0.001003 0.002003 0.002003 0.003005

VCS.SC.M 0.048 0.065 0.112 0.112 0.179

VCS.SC.L 0.043 0.065 0.070 0.077 0.146

VCTVCS.SC.I 0.000 0.001000 0.001000 0.001000 0.001

SVO.RC.M 0.002 0.030 0.141 0.144 0.152

VCSSVO.SC.M 0.010004 0.013006 0.023022 0.023022 0.036023

SOC.RC.M 0.001 0.002 0.018 0.019 0.020

HZO.RC.M - - - - 0.001

VCS.SCHZO.RC.

L 

0.007- 0.010- 0.014- 0.016- 0.030009

VCSHZO.SC.IM 0.000 0.000 0.000 0.000 0.000

HZO.SC.L - - - - 0.000

SVO.RCHCT.SC.

M

0.000 0.000 0.006000 0.007000 0.039001

SVOHCT.SC.ML 0.000001 0.001004 0.002004 0.002005 0.006

SOC.RC.MHCT.S

C.I

0.000 0.000 0.001 0.001 0.006005

HZO.RC.M - - - - 0.000

HZO.RC.L - - - - 0.002

HZO.SC.M 0.000 0.000 0.000 0.000 0.000

HZO.SC.L - - - - 0.000

HCT.SC.M 0.000 0.000 0.000 0.000 0.000
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HCTHCS.SC.LM 0.000001 0.000001 0.001002 0.001004 0.002013

HCT.SC.I 0.000 0.000 0.000 0.000 0.001

HCS.SC.ML 0.000001 0.000001 0.000002 0.001002 0.003005

HCSPD.SC.LM 0.000048 0.000048 0.000106 0.000159 0.001184

PDSOC.SC.M 0.013000 0.013000 0.027002 0.037002 0.042002

Net NES 0.062236 0.074422 0.129920 1.0010.144 0.2961.278

‘-’ represents zero energy savings, since TSLs 1 through 4 for the equipment classes HZO.RC.M, HZO.RC.L, and HZO.SC.L are 

associated with the baseline efficiency level.

* A value of 0.000 means NES values are less than 0.0005 quads.

Table V.41 Cumulative National Energy Savings at a 3-percent discount rate

Equipment Class quads*

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5

VOP.RC.M 0.003 0.003 0.021 0.024 0.149

VOP.RC.L 0.000 0.001 0.004 0.004 0.005

VOP.SC.M 0.000 0.001 0.002 0.002 0.010

VCT.RC.M 0.001 0.001 0.005 0.005 0.005

VCT.RC.L 0.035 0.039 0.042 0.042 0.061

VCT.SC.M 0.029 0.030 0.042 0.044 0.049

VCT.SC.L 0.001 0.003 0.005 0.005 0.006

VCT.SC.I 0.001 0.001 0.002 0.002 0.002

VCS.SC.M 0.022 0.030 0.051 0.051 0.081

VCS.SC.L 0.016 0.023 0.032 0.036 0.067

VCS.SC.I 0.000 0.000 0.000 0.000 0.000

SVO.RC.M 0.001 0.001 0.014 0.016 0.086

SVO.SC.M 0.000 0.002 0.003 0.003 0.013

SOC.RC.M 0.000 0.000 0.001 0.001 0.014

HZO.RC.M - - - - 0.000

HZO.RC.L - - - - 0.004

HZO.SC.M 0.000 0.000 0.000 0.000 0.000

HZO.SC.L - - - - 0.000

HCT.SC.M 0.000 0.000 0.000 0.000 0.000

HCT.SC.L 0.000 0.000 0.002 0.003 0.003

HCT.SC.I 0.000 0.000 0.001 0.001 0.002

HCS.SC.M 0.000 0.001 0.001 0.002 0.006

HCS.SC.L 0.000 0.001 0.001 0.001 0.002

PD.SC.M 0.029 0.029 0.059 0.083 0.094

Net NES 0.139 0.165 0.287 0.323 0.661

‘-’ represents zero energy savings, since TSLs 1 through 4 for the equipment classes HZO.RC.M, HZO.RC.L and 

HZO.SC.L are associated with the baseline efficiency level.

*A values of 0.000 means NES values are less than 0.0005 quads.

Table . Cumulative Energy Savings by TSL for Each Equipment Class Expressed as 

a Percentage of Cumulative Base-Case Energy Usage of the New Commercial 

Refrigeration Equipment Stock (2016-2045)Purchased in 2017-2046

Equipment 

Class

Total Usage 

2016-2045BaseCase Energy Use

quads*

TSL Savings as Percent of Total 2016-2045 UsageBase-Case 

Energy Use

TSL1TSL

1

TSL2TSL

2

TSL3TSL

3

TSL4TSL

4

TSL5TSL

5

VOP.RC.M 1.456606 0% 03% 315% 315% 2016%

VOP.RC.L 0.178203 0% 13% 43% 43% 64%
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VOP.SC.M 0.203231 01% 1% 28% 28% 108%

VCT.RC.M 0.024027 51% 525% 3733% 3835% 4239%

VCT.RC.L 1.046198 75% 76% 87% 87% 1210%

VCT.SC.M 0.218235 275% 2725% 3832% 4035% 4440%

VCT.SC.L 0.036 315% 15% 2718% 2819% 3022%

VCT.SC.I 0.040047 3% 6% 7% 7% 1110%

VCS.SC.M 0.408472 1110% 14% 2524% 2524% 3938%

VCS.SC.L 0.623720 56% 79% 10% 11% 2120%

VCS.SC.I 0.010012 1% 23% 3% 3% 98%

SVO.RC.M 0.894990 0% 03% 314% 315% 1915%

SVO.SC.M 0.263300 01% 2% 27% 27% 98%

SOC.RC.M 0.160173 0% 01% 110% 211% 1712%

HZO.RC.M 0.057066 0% 0% 0% 0% 1%

HZO.RC.L 0.409475 0% 0% 0% 0% 2%

HZO.SC.M 0.013015 0% 0% 1% 1% 2%

HZO.SC.L 0.054063 0% 0% 0% 0% 0%

HCT.SC.M 0.001 5% 940% 4543% 4948% 5957%

HCT.SC.L 0.012 56% 733% 4133% 4538% 5550%

HCT.SC.I 0.015017 1% 3% 7% 7% 2827%

HCS.SC.M 0.023026 2% 5% 8% 14% 5049%

HCS.SC.L 0.009010 8% 13% 21% 21% 4948%

PD.SC.M 0.373401 1512% 1512% 3127% 4440% 5046%

SOC.SC.M 0.014 3% 3% 13% 13% 14%

Totals 6.52367.349 43% 56% 913% 1014% 2017%

* Stock energy usage in the base-case scenario.* Energy use of the entire commercial refrigeration equipment stock in 

the base-case scenario in 2017–2046 plus the energy use of the surviving stock of equipment in 2047–2060 for equipment purchased 

in 2017–2046.

‘-’ represents zero energy savings, since TSLs 1 through 4 for equipment classes HZO.RC.M, HZO.RC.L, and HZO.SC.L are 

associated with the baseline efficiency level.

Circular A-4 requires agencies to present analytical results, including separate 

schedules of the monetized benefits and costs that show the type and timing of benefits 

and costs. Circular A-4 also directs agencies to consider the variability of key elements 

underlying the estimates of benefits and costs. For this rulemaking, DOE undertook a 

sensitivity analysis using nine rather than 30 years of product shipments. The choice of a 

9-year period is a proxy for the timeline in EPCA for the review of certain energy 

conservation standards and potential revision of and compliance with such revised 

standards.101

 

101 EPCA requires DOE to review its standards at least once every 6 years (42 U.S.C. 6295(m)(1), 6316(e)), 

and requires, for certain products, a 3-year period after any new standard is promulgated before compliance 

is required, except that in no case may any new standards be required within 6 years of the compliance date 

of the previous standards. (42 U.S.C. 6295(m)(4), 6316(e)).While adding a 6-year review to the 3-year 

We would note that the review timeframe established in EPCA generally 

Comment [A43]: Revision required by OIRA.
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does not overlap with the product lifetime, product manufacturing cycles or other factors 

specific to commercial refrigeration equipment. Thus, this information is presented for 

informational purposes only and is not indicative of any change in DOE’s analytical 

methodology. The primary and full-fuel cycle NES results based on a 9-year analysis 

period are presented in Table V.42 and Table V.43, respectively. The impacts are counted 

over the lifetime of products purchased in 2017–2025.

Table V.42 Cumulative National Primary Energy Savings for 9-year Analysis 

Period (Equipment Purchased in 2017–2025)

Equipment Class quads*

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5

VOP.RC.M 0.001 0.009 0.049 0.050 0.053

VOP.RC.L 0.000 0.001 0.001 0.001 0.002

VOP.SC.M 0.000 0.001 0.004 0.004 0.004

VCT.RC.M 0.000 0.001 0.002 0.002 0.002

VCT.RC.L 0.012 0.015 0.016 0.016 0.025

VCT.SC.M 0.002 0.012 0.015 0.017 0.019

VCT.SC.L 0.001 0.001 0.001 0.001 0.002

VCT.SC.I 0.000 0.001 0.001 0.001 0.001

VCS.SC.M 0.010 0.013 0.023 0.023 0.036

VCS.SC.L 0.009 0.013 0.014 0.016 0.030

VCS.SC.I 0.000 0.000 0.000 0.000 0.000

SVO.RC.M 0.000 0.006 0.029 0.029 0.031

SVO.SC.M 0.001 0.001 0.004 0.004 0.005

SOC.RC.M 0.000 0.000 0.004 0.004 0.004

HZO.RC.M - - - - 0.000

HZO.RC.L - - - - 0.002

HZO.SC.M 0.000 0.000 0.000 0.000 0.000

HZO.SC.L - - - - 0.000

HCT.SC.M 0.000 0.000 0.000 0.000 0.000

HCT.SC.L 0.000 0.001 0.001 0.001 0.001

HCT.SC.I 0.000 0.000 0.000 0.000 0.001

HCS.SC.M 0.000 0.000 0.000 0.001 0.003

HCS.SC.L 0.000 0.000 0.000 0.000 0.001

PD.SC.M 0.010 0.010 0.021 0.032 0.037

SOC.SC.M 0.000 0.000 0.000 0.000 0.000

Net NES 0.048 0.085 0.185 0.202 0.258

‘-’ represents zero energy savings, since TSLs 1 through 4 for the equipment classes HZO.RC.M, HZO.RC.L, and HZO.SC.L are 

associated with the baseline efficiency level.

 

compliance period sums to 9 years, DOE notes that it may undertake reviews at any time within the 6-year 

period, and that the 3 year compliance date may be extended to 5 years. A 9-year analysis period may not 

be appropriate given the variability that occurs in the timing of standards reviews and the fact that, for some 

consumer products, the period following establishment of a new or amended standard before which 

compliance is required is 5 years rather than 3 years.

Comment [A44]: Revision requested by OIRA.

Comment [A45]: Revision requested by OIRA.
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* A value of 0.000 means NES values are less than 0.0005 quads.

‘-’ represents zero energy savings, since TSLs 1 through 4 for equipment classes HZO.RC.M, HZO.RC.L, and HZO.SC.L are 

associated with the baseline efficiency level.

Table V.43 Cumulative Full Fuel Cycle National Energy Savings for 9-year Analysis 

Period (Equipment Purchased in 2017–2025)

Equipment Class quads*

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5

VOP.RC.M 0.001 0.009 0.050 0.051 0.054

VOP.RC.L 0.000 0.001 0.001 0.001 0.002

VOP.SC.M 0.000 0.001 0.004 0.004 0.004

VCT.RC.M 0.000 0.001 0.002 0.002 0.002

VCT.RC.L 0.013 0.015 0.016 0.016 0.025

VCT.SC.M 0.002 0.012 0.015 0.017 0.019

VCT.SC.L 0.001 0.001 0.001 0.001 0.002

VCT.SC.I 0.000 0.001 0.001 0.001 0.001

VCS.SC.M 0.010 0.013 0.023 0.023 0.037

VCS.SC.L 0.009 0.013 0.014 0.016 0.030

VCS.SC.I 0.000 0.000 0.000 0.000 0.000

SVO.RC.M 0.000 0.006 0.029 0.030 0.031

SVO.SC.M 0.001 0.001 0.004 0.005 0.005

SOC.RC.M 0.000 0.000 0.004 0.004 0.004

HZO.RC.M - - - - 0.000

HZO.RC.L - - - - 0.002

HZO.SC.M 0.000 0.000 0.000 0.000 0.000

HZO.SC.L - - - - 0.000

HCT.SC.M 0.000 0.000 0.000 0.000 0.000

HCT.SC.L 0.000 0.001 0.001 0.001 0.001

HCT.SC.I 0.000 0.000 0.000 0.000 0.001

HCS.SC.M 0.000 0.000 0.000 0.001 0.003

HCS.SC.L 0.000 0.000 0.000 0.000 0.001

PD.SC.M 0.010 0.010 0.022 0.033 0.038

SOC.SC.M 0.000 0.000 0.000 0.000 0.000

Net NES 0.048 0.087 0.189 0.205 0.262

‘-’ represents zero energy savings, since TSLs 1 through 4 for the equipment classes HZO.RC.M, HZO.RC.L, and HZO.SC.L are 

associated with the baseline efficiency level.

* A value of 0.000 means NES values are less than 0.0005 quads.

‘-’ represents zero energy savings, since TSLs 1 through 4 for equipment classes HZO.RC.M, HZO.RC.L, and HZO.SC.L are 

associated with the baseline efficiency level.

b. Net Present Value of ConsumerCustomer Costs and Benefits

DOE estimated the cumulative NPV to the Nation of the total savings for the 

customers that would result from potential standards at each TSL. In accordance with 

OMB guidelines on regulatory analysis (OMB Circular A-4, section E, September 17, 

2003), DOE calculated NPV using both a 7-percent and a 3-percent real discount rate. 
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The 7-percent rate is an estimate of the average before-tax rate of return on private capital 

in the U.S. economy, and reflects the returns on real estate and small business capital, 

including corporate capital. DOE used this discount rate to approximate the opportunity 

cost of capital in the private sector because recent OMB analysis has found the average 

rate of return on capital to be near this rate. In addition, DOE used the 3-percent rate to 

capture the potential effects of amended standards on private consumption. This rate 

represents the rate at which society discounts future consumption flows to their present 

value. It can be approximated by the real rate of return on long-term government debt 

(i.e., yield on Treasury notes minus annual rate of change in the Consumer Price Index), 

which has averaged about 3 percent on a pre-tax basis for the last 30 years.

Table V.44 and Table V.45 show the customer NPV results for each of the TSLs 

DOE considered for commercial refrigeration equipment at both 7-percent and 3-percent 

discount rates. In each case, the impacts cover the expected lifetime of equipment

purchased from 2016–2045in 2017–2046. Detailed NPV results are presented in chapter 

10 of the NOPR TSD.

The NPV results at a 7-percent discount rate were negative for all equipment 

classes at TSL 5. This is consistent with the results of LCC analysis results for TSL 5, 

which showed significant increase in LCC and significantly high PBPs that were greater 

than the average equipment lifetimes. Efficiency levels for TSL 4 were chosen to 

correspond to the highest efficiency level with a positive NPV at a 7-percent discount rate 

for each equipment class. Similarly, the criteria for choice of efficiency levels for TSL 3, 
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TSL 2, and TSL 1 were such that the NPV values for all the equipment classes show 

positive values. The criterion for TSL 3 was to select efficiency levels with the highest 

NPV at a 7-percent discount rate. Consequently, the total NPV for commercial 

refrigeration equipment is highest for TSL 3, with a value of $1.093705 billion

(20102012$) at a 7-percent discount rate. TSL 4 shows the second highest total NPV, 

with a value of $1.023606 billion (20102012$) at a 7-percent discount rate. TSL 2 and 

TSL 1 have a total NPV lower than TSL 4, while TSL 5 has a negative total NPV of 

$8.3546.735 billion (20102012$). 

Table V.44 Net Present Value at a 7-percent Discount Rate

Equipment Class billion 20102012$ *,

**

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5

VOP.RC.M 0.016 0.016099 0.099466 0.098461 (1.7200.466)

VOP.RC.L 0.002 0.003013 0.003014 0.003014 (0.068062)

VOP.SC.M 0.001003 0.003005 0.006027 0.006025 (0.125041)

VCT.RC.M 0.002001 0.002013 0.016017 0.016017 (0.056060)

VCT.RC.L 0.088141 0.100155 0.106161 0.106161 (1.134170)

VCT.SC.M 0.139026 0.141120 0.162136 0.155129 (0.283340)

VCT.SC.L 0.003014 0.014 0.023015 0.023015 (0.006016)

VCT.SC.I 0.002003 0.004 0.004005 0.004005 (0.039042)

VCS.SC.M 0.114113 0.137135 0.157153 0.157153 (1.596720)

VCS.SC.L 0.084105 0.121138 0.140139 0.138135 (1.001084)

VCS.SC.I 0.000 0.000001 0.001 0.001 (0.010011)

SVO.RC.M 0.004 0.004057 0.057245 0.055240 (0.961231)

SVO.SC.M 0.000 0.009 0.014 0.014 (0.127)

SOC.RC.M 0.002 0.002 0.005 0.005 (0.163)

HZO.RC.M - - - - (0.037)

HZO.RC.L - - - - (0.216)

HZO.SC.M 0.000 0.000 0.000 0.000 (0.007)

HZO.SC.L - - - - (0.006)

HCT.SC.M 0.000 0.000 0.001 0.001 (0.002)

HCTSVO.SC.LM 0.002008 0.002012 0.013029 0.012027 (0.012037)

HCT.SC.ISOC.RC.M 0.000001 0.001004 0.001039 0.001031 (0.036056)

HCS.SCHZO.RC.M 0.001- 0.002- 0.003- 0.002- (0.155039)

HCS.SC.L 0.002 0.002 0.003 0.003 (0.020)

PD.SC.M 0.150 0.150 0.280 0.225 (0.755)

Sum Total 0.613 0.712 1.093 1.023 (8.534)

‘-’ represents zero 

energy savings, since 

TSLs 1 to 4 for the

equipment classes

HZO.RC.M, 

HZO.RC.L and 

- - - -

(0.229)

Inserted Cells

Inserted Cells

Inserted Cells

Inserted Cells

Inserted Cells
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HZO.SC.L are 

associated with the 

baseline efficiency 

level.

*A values of $0.000 

means NES values are 

less than 0.001 billion 

2010$.

**Values in 

parentheses are 

negative 

values.HZO.RC.L

Table . Net Present Value at a 3-percent Discount Rate

Equipment 

Class

billion 2010$ *,**

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5

VOP.RC.M 0.036 0.036 0.220 0.223 (2.837)

VOP.RC.L 0.016 0.023 0.043 0.043 (0.364)

VOP.SC.M 0.003 0.008 0.015 0.015 (0.229)

VCT.RC.M 0.006 0.006 0.043 0.043 (0.096)

VCT.RC.L 0.239 0.272 0.292 0.292 (2.079)

VCT.SC.M 0.349 0.354 0.422 0.416 (0.428)

VCT.SC.L 0.020 0.092 0.156 0.157 0.007 

VCT.SC.I 0.006 0.010 0.011 0.011 (0.071)

VCS.SC.M 0.264 0.322 0.409 0.409 (2.802)

VCS.SC.L 0.189 0.272 0.328 0.330 (1.675)

VCS.SC.I 0.001 0.001 0.002 0.002 (0.018)

SVO.RC.M 0.010 0.010 0.146 0.145 (1.768)

SVO.SC.M 0.001 0.023 0.035 0.035 (0.229)

SOC.RC.M 0.004 0.004 0.013 0.012 (0.298)

HZO.RC.M - - - - (0.037)

HZO.RC.L - - - - (0.216)

HZO.SC.M 0.000 0.000 0.000 0.000 (0.007)

HZO.SC.L - - - - (0.006)

HCT.SC.M 0.000 0.000001 0.001 0.001 (0.002003)

HCT.SC.L 0.002 0.002009 0.013010 0.012009 (0.012016)

HCT.SC.I 0.000 0.001 0.001 0.001 (0.036039)

HCS.SC.M 0.001 0.002 0.003 0.002001 (0.155166)

HCS.SC.L 0.002 0.002 0.003 0.003 (0.020021)

PD.SC.M 0.150119 0.150119 0.280237 0.225176 (0.755872)

SOC.SC.M 0.001 0.001 0.004 0.003 (0.003)

Sum Total 1.2960.561 1.5890.905 2.4351.705 2.3751.606 (14.1336.735)

 ‘-’ represents zero energy savings, since TSLs 1 to 4 for equipment classes HZO.RC.M, HZO.RC.L, and HZO.SC.L

are associated with the baseline efficiency level.

* A value of $0.000 means NES values are less than 0.001 billion 20102012$. 

** Values in parentheses are negative values.

Table V.45 Net Present Value at a 3-percent Discount Rate

Equipment Class billion 2012$ *,

**

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5

VOP.RC.M 0.037 0.233 1.144 1.140 (0.549)

VOP.RC.L 0.005 0.030 0.032 0.032 (0.104)

VOP.SC.M 0.006 0.012 0.070 0.068 (0.053)

VCT.RC.M 0.001 0.031 0.041 0.041 (0.100)

VCT.RC.L 0.327 0.363 0.383 0.383 (2.017)
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VCT.SC.M 0.059 0.283 0.331 0.326 (0.524)

VCT.SC.L 0.031 0.032 0.035 0.035 (0.020)

VCT.SC.I 0.007 0.011 0.012 0.012 (0.071)

VCS.SC.M 0.259 0.316 0.398 0.398 (2.976)

VCS.SC.L 0.239 0.323 0.329 0.327 (1.837)

VCS.SC.I 0.001 0.001 0.002 0.002 (0.018)

SVO.RC.M 0.008 0.137 0.615 0.608 (0.249)

SVO.SC.M 0.018 0.028 0.078 0.074 (0.043)

SOC.RC.M 0.003 0.010 0.093 0.079 (0.078)

HZO.RC.M - - - - (0.071)

HZO.RC.L - - - - (0.411)

HZO.SC.M 0.000 0.000 0.000 0.000 (0.013)

HZO.SC.L - - - - (0.012)

HCT.SC.M 0.000 0.002 0.002 0.002 (0.004)

HCT.SC.L 0.004 0.022 0.022 0.022 (0.023)

HCT.SC.I 0.001 0.002 0.003 0.003 (0.066)

HCS.SC.M 0.003 0.005 0.007 0.006 (0.292)

HCS.SC.L 0.004 0.006 0.007 0.007 (0.034)

PD.SC.M 0.270 0.270 0.551 0.494 (1.406)

SOC.SC.M 0.002 0.002 0.009 0.008 (0.003)

Sum Total 1.285 2.118 4.165 4.067 (10.972)

‘-’ represents zero energy savings, since TSLs 1 to 4 for equipment classes HZO.RC.M, HZO.RC.L, and HZO.SC.L are 

associated with the baseline efficiency level.

* A value of $0.000 means NES values are less than 0.001 billion 2012$.

** Values in parentheses are negative values.

The NPV results based on the aforementioned 9-year analysis period are 

presented in Table V.46 and Table V.47. The impacts are counted over the lifetime of 

products purchased in 2017–2025. As mentioned previously, this information is presented 

for informational purposes only and is not indicative of any change in DOE’s analytical 

methodology or decision criteria.

Table V.46 Net Present Value at a 7-percent Discount Rate for 9-year Analysis 

Period (Equipment Purchased in 2017–2025) 

Equipment Class billion 2012$ *,

**,†

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5

VOP.RC.M 0.008 0.039 0.154 0.150 (0.294)

VOP.RC.L 0.001 0.005 0.005 0.005 (0.032)

VOP.SC.M 0.001 0.002 0.008 0.007 (0.025)

VCT.RC.M 0.000 0.005 0.006 0.006 (0.031)

VCT.RC.L 0.054 0.059 0.060 0.060 (0.583)

VCT.SC.M 0.011 0.045 0.049 0.044 (0.182)

VCT.SC.L 0.005 0.005 0.006 0.006 (0.009)

VCT.SC.I 0.001 0.002 0.002 0.002 (0.021)

VCS.SC.M 0.043 0.051 0.049 0.049 (0.858)

VCS.SC.L 0.041 0.051 0.051 0.047 (0.548)

VCS.SC.I 0.000 0.000 0.000 0.000 (0.005)
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SVO.RC.M 0.003 0.021 0.078 0.075 (0.151)

SVO.SC.M 0.003 0.004 0.008 0.007 (0.024)

SOC.RC.M 0.001 0.002 0.014 0.009 (0.032)

HZO.RC.M - - - - (0.019)

HZO.RC.L - - - - (0.111)

HZO.SC.M 0.000 0.000 0.000 (0.000) (0.004)

HZO.SC.L - - - - (0.003)

HCT.SC.M 0.000 0.000 0.000 0.000 (0.001)

HCT.SC.L 0.001 0.004 0.004 0.003 (0.009)

HCT.SC.I 0.000 0.000 0.000 0.000 (0.019)

HCS.SC.M 0.001 0.001 0.001 0.000 (0.082)

HCS.SC.L 0.001 0.001 0.001 0.001 (0.011)

PD.SC.M 0.047 0.047 0.090 0.049 (0.455)

SOC.SC.M 0.000 0.000 0.001 0.001 (0.002)

Sum Total 0.221 0.343 0.586 0.521 (3.509)

‘-’ represents zero energy savings, since TSLs 1 to 4 for equipment classes HZO.RC.M, HZO.RC.L, and HZO.SC.L

are associated with the baseline efficiency level.

*A value of $0.000 means NES values are less than 0.001 billion 2012$.

**Values in parentheses are negative values.

†The impacts were calculated over the lifetime of the equipment purchased in 2017–2025

Table V.47 Net Present Value at a 3-percent Discount Rate for 9-year Analysis 

period (Equipment Purchased in 2017–2025)

Equipment Class billion 2012$ *,

**,†

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5

VOP.RC.M 0.013 0.063 0.267 0.263 (0.330)

VOP.RC.L 0.001 0.008 0.008 0.008 (0.040)

VOP.SC.M 0.002 0.003 0.015 0.014 (0.028)

VCT.RC.M 0.001 0.008 0.010 0.010 (0.039)

VCT.RC.L 0.088 0.096 0.099 0.099 (0.753)

VCT.SC.M 0.017 0.073 0.083 0.077 (0.222)

VCT.SC.L 0.008 0.009 0.009 0.009 (0.011)

VCT.SC.I 0.002 0.003 0.003 0.003 (0.027)

VCS.SC.M 0.069 0.082 0.090 0.090 (1.111)

VCS.SC.L 0.064 0.083 0.084 0.080 (0.702)

VCS.SC.I 0.000 0.000 0.000 0.000 (0.007)

SVO.RC.M 0.004 0.036 0.138 0.135 (0.166)

SVO.SC.M 0.005 0.007 0.016 0.014 (0.027)

SOC.RC.M 0.001 0.003 0.023 0.017 (0.038)

HZO.RC.M - - - - (0.025)

HZO.RC.L - - - - (0.147)

HZO.SC.M 0.000 0.000 0.000 (0.000) (0.005)

HZO.SC.L - - - - (0.004)

HCT.SC.M 0.000 0.000 0.000 0.000 (0.002)

HCT.SC.L 0.001 0.006 0.006 0.006 (0.011)

HCT.SC.I 0.000 0.000 0.001 0.001 (0.025)

HCS.SC.M 0.001 0.001 0.002 0.001 (0.107)

HCS.SC.L 0.001 0.001 0.002 0.002 (0.014)

PD.SC.M 0.074 0.074 0.145 0.102 (0.568)

SOC.SC.M 0.001 0.001 0.002 0.002 (0.002)

Sum Total 0.352 0.558 1.003 0.934 (4.410)

 ‘-’ represents zero energy savings, since TSLs 1 to 4 for equipment classes HZO.RC.M, HZO.RC.L, and HZO.SC.L

are associated with the baseline efficiency level.

* A value of $0.000 means NES values are less than 0.001 billion 2012$.
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** Values in parentheses are negative values.

† The impacts were calculated over the lifetime of the equipment purchased in 2017–2025

c. Employment Impacts

In addition to the direct impacts on manufacturing employment discussed in 

section V.B.2, DOE develops general estimates of the indirect employment impacts of 

proposed standards on the economy. As discussed above, DOE expects energy amended 

conservation standards for commercial refrigeration equipment to reduce energy bills for 

commercial customers, and the resulting net savings to be redirected to other forms of 

economic activity. DOE also realizes that these shifts in spending and economic activity 

by commercial refrigeration equipment owners could affect the demand for labor. Thus, 

indirect employment impacts may result from expenditures shifting between goods (the 

substitution effect) and changes in income and overall expenditure levels (the income 

effect) that occur due to the imposition of amended standards. These impacts may affect a 

variety of businesses not directly involved in the decision to make, operate, or pay the 

utility bills for commercial refrigeration equipment. To estimate these indirect economic 

effects, DOE used an input/output model of the U.S. economy using U.S. Department of 

Commerce, Bureau of Economic Analysis (BEA) and BLS data (as described in section 

IV.L of this notice; see chapter 1416 of the NOPR TSD for more details).

In thisCustomers who purchase more-efficient equipment pay lower amounts 

towards utility bills, which results in job losses in the electric utilities sector. However, in 

the input/output model, the dollars saved on utility bills from more-efficient commercial 

refrigeration equipment are concentratedare re-invested in economic sectors that create 

more jobs than are lost in the electric utilities sector when spending is shifted from 
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electricity to other products and services. Thus, the proposed amended energy 

conservation standards for commercial refrigeration equipment are likely to slightly 

increase the net demand for labor in the economy. However, the net increase in jobs 

might be offset by other, unanticipated effects on employment. Neither the BLS data nor 

the input/output model used by DOE includes the quality of jobs. As shown in Table 

V.4348, DOE estimates that net indirect employment impacts from a proposed 

commercial refrigeration equipment amended standard are small relative to the national 

economy. 

Table V.48 Net Short-Term Change in Employment*

Trial Standard Level 2016*2017 2020*2021

1 435 to 1538 64198 to 76 201

2 453 to 1761 74345 to 89354

3 (4)74 to 27108 118719 to 153749

4 (24)60 to 28105 113760 to 171801

5 (752728) to (61363) (588)130 to 181504

* Values in parentheses are negative values.

4. Impact on Utility or Performance of Equipment

In performing the engineering analysis, DOE considers design options that would 

not lessen the utility or performance of the individual classes of equipment. (42 U.S.C. 

6295(o)(2)(B)(i)(IV) and 6316(e)(1)) As presented in the screening analysis (chapter 4 of 

the NOPR TSD), DOE eliminates from consideration any design options that reduce the 

utility of the equipment. For this notice, DOE tentatively concluded that none of the 

efficiency levels proposed for commercial refrigeration equipment reduce the utility or 

performance of the equipment. 

5. Impact of Any Lessening of Competition

EPCA directs DOE to consider any lessening of competition likely to result from 

Field Code Changed
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amended standards. It directs the Attorney General to determine in writing the impact, if 

any, of any lessening of competition likely to result from a proposed standard. (42 U.S.C. 

6295(o)(2)(B)(i)(V) and 6316(e)(1)) To assist the Attorney General in making such a 

determination, DOE provided the Department of Justice (DOJ) with copies of this notice 

and the TSD for review. During MIA interviews, domestic manufacturers indicated that 

foreign manufacturers have begun to enter the commercial refrigeration equipment 

industry, but not in significant numbers. Manufacturers also stated that consolidation has 

occurred among commercial refrigeration equipment manufacturers in recent years. 

Interviewed manufacturers believe that these trends may continue in this market even in 

the absence of amended standards.

DOE does not believe that amended standards would result in domestic firms 

moving their production facilities outside the United States. The majority of commercial 

refrigeration equipment is manufactured in the United States and, during interviews, 

manufacturers in general indicated they would modify their existing facilities to comply 

with amended energy conservation standards.

6. Need of the Nation to Conserve Energy

An improvement in the energy efficiency of the equipment subject to today’s 

NOPR is likely to improve the security of the Nation’s energy system by reducing overall 

demand for energy. Reduced electricity demand may also improve the reliability of the 

electricity system. As a measure of this reduced demand, presents the estimated 

reductionReductions in national electric generating capacity in 2045estimated for the 
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TSLs that DOEeach considered in this rulemaking.TSL are reported in chapter 14 of the 

NOPR TSD. 

Table . Reduction in Electric Generating Capacity in 2045

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5

Capacity Reduction

GW 0.09 0.11 0.19 0.22 0.45

Energy savings from amended standards for commercial refrigeration equipment 

could also produce environmental benefits in the form of reduced emissions of air 

pollutants and GHGs associated with electricity production. Table V.49 provides DOE’s 

estimate of cumulative CO2, NOx, and Hg emissions reductions projected to result from 

the TSLs considered in this rule. The table includes both power sector emissions and 

upstream emissions. The upstream emissions were calculated using the multipliers 

discussed in section IV.N. DOE reports annual CO2, NOx, SO2, NO2, CH4 and Hg 

emissions reductions for each TSL in the environmental assessment in chapter 1615 of 

the NOPR TSD.

Table . Summary of Emissions Reduction Estimated for Commercial Refrigeration 

Equipment TSLs (cumulative for 2016 through 2045)

Trial Standard 

Level

Cumulative Reduction in Emissions 

(2016 through 2045)

CO2

MMt

NOx

kt

Hg

t

1 21.93 5.6 (0.111)

2 25.99 6.63 (0.132)

3 44.59 11.38 (0.226)

4 51.08 13.03 (0.259)

5 104.21 26.59 (0.528)

As discussed in Section IV.N, DOE did not report SO2 emission reductions from 

power plants due to amended standards because there is uncertainty about the effect of 

energy conservation standards on the overall level of SO2 emissions in the United States 
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due to SO2 emission caps. DOE also did not include NOx emission reduction from power 

plants in States subject to CAIR because an amended energy conservation standard would 

not affect the overall level of NOx emissions in those States due to the emission caps 

mandated by CAIR. 70 FR 25162 (May 12, 2005).

Table V.49 Cumulative Emissions Reduction Estimated for Commercial 

Refrigeration Equipment TSLs for Equipment Purchased in 2017–2046 

TSL

1 2 3 4 5

Primary Emissions

 CO2 (million metric tons) 12.22 21.83 47.55 51.77 66.05

 NOX (thousand tons) 9.05 16.18 35.23 38.36 48.93

 Hg (tons) 0.03 0.05 0.10 0.11 0.14

 N2O (thousand tons) 0.26 0.47 1.02 1.11 1.42

 CH4 (thousand tons) 1.53 2.73 5.95 6.48 8.27

 SO2 (thousand tons) 16.39 29.28 63.78 69.43 88.58

Upstream Emissions

 CO2 (million metric tons) 0.73 1.31 2.85 3.10 3.96

 NOX (thousand tons) 10.08 18.01 39.23 42.71 54.49

 Hg (tons) 0.000 0.001 0.002 0.002 0.002

 N2O (thousand tons) 0.01 0.01 0.03 0.03 0.04

 CH4 (thousand tons) 61.23 109.39 238.27 259.41 330.92

 SO2 (thousand tons) 0.16 0.28 0.61 0.67 0.85

Total Emissions

 CO2 (million metric tons) 12.95 23.14 50.41 54.88 70.01

 NOX (thousand tons) 19.14 34.19 74.46 81.07 103.42

 Hg (tons) 0.03 0.05 0.10 0.11 0.14

 N2O (thousand tons) 0.27 0.48 1.05 1.15 1.46

 CH4 (thousand tons) 62.76 112.13 244.22 265.89 339.19

 SO2 (thousand tons) 16.55 29.56 64.39 70.10 89.43

As part of the analysis for this NOPR, DOE estimated monetary benefits likely to 

result from the reduced emissions of CO2 and NOx that DOE estimated for each of the 

TSLs considered. As discussed in section IV.O, for CO2, DOE used values for the SCC 

developed by an interagency process. TheThe interagency group selected four sets of 

SCC values for CO2 emission reductions resulting from that process (expressed in 2010$) 

are $4.9/ton (the average value from a distribution that uses a 5-percent discount rate), 

$22.3/ton (the average value from a distribution that usesuse in regulatory analyses. 

Comment [A46]: Revision requested by OIRA.
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Three sets are based on the average SCC from three integrated assessment models, at 

discount rates of 2.5 percent, 3 percent, and 5 percent. The fourth set, which represents 

the 95th-percentile SCC estimate across all three models at a 3-percent discount rate), 

$36.5/ton (the average value from a distribution that uses a 2.5-percent discount rate), and 

$67.6/ton (the 95th-percentile value from a distribution that uses a 3-percent discount 

rate). These values correspond, is included to the value of emission reductions in 2010; 

the values for represent higher-than-expected impacts from temperature change further 

out in the tails of the SCC distribution. The four SCC values for CO2 emissions 

reductions in 2015, expressed in 2012$, are $12.9/ton, $40.8/ton, $62.2/ton, and 

$117.0/ton. These values for later years are higher due to increasing damagesemissionsrelated costs as the magnitude of projected climate change is expected to increase.

 

Table V.50 For each TSL, DOE calculated presents the global present values of 

CO2 emission reductions, using the same discount rate as was used in the studies upon 

which the dollar-per-ton values are based.value of CO2 emissions reductions at each TSL.

DOE calculated domestic values as a range from 7 percent to 23 percent of the global 

values, and these results are presented in chapter 14 of the NOPR TSD. 

Table V.50 Global Present Value of CO2 Emissions Reduction for Potential 

Standards for Commercial Refrigeration Equipment 

TSL

SCC Scenario*

5% discount 

rate, 

average

3% discount 

rate, 

average

2.5% 

discount 

rate, 

average

3% discount rate, 

95th percentile

million 2012$

Primary Emissions

1 68.6 335.1 546.1 1,013.7

2 122.6 598.7 975.6 1,811.1

3 266.9 1,304.1 2,124.9 3,944.8
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4 290.6 1,419.8 2,313.4 4,294.8

5 370.7 1,811.2 2,951.2 5,478.8

Upstream Emissions

1 4.0 20.0 32.6 60.6

2 7.2 35.7 58.3 108.3

3 15.8 77.8 126.9 236.0

4 17.1 84.7 138.1 256.9

5 21.9 108.1 176.2 327.7

Total Emissions

1 72.6 355.1 578.7 1,074.4

2 129.8 634.4 1,033.8 1,919.5

3 282.7 1,381.9 2,251.8 4,180.7

4 307.8 1,504.5 2,451.6 4,551.7

5 392.6 1,919.2 3,127.4 5,806.5

* For each of the four cases, the corresponding SCC value for emissions in 2015 is $12.9, 

$40.8, $62.2 and $117.0 per metric ton (2012$).

DOE is well aware that scientific and economic knowledge about the contribution 

of CO2 and other GHG emissions to changes in the future global climate and the potential 

resulting damages to the world economy continues to evolve rapidly. Thus, any value 

placed in this NOPR on reducing CO2 emissions is subject to change. DOE, together with 

other Federal agencies, will continue to review various methodologies for estimating the 

monetary value of reductions in CO2 and other GHG emissions. This ongoing review will 

consider the comments on this subject that are part of the public record for this NOPR 

and other rulemakings, as well as other methodological assumptions and issues. 

However, consistent with DOE’s legal obligations, and taking into account the 

uncertainty involved with this particular issue, DOE has included in this NOPR the most 

recent values and analyses resulting from the ongoing interagency review process.

DOE also estimated a range for the cumulative monetary value of the economic 

benefits associated with NOx emission reductions anticipated to result from amended 

commercial refrigeration equipment standards. Estimated monetary benefits for CO2 and

NOx emission reductions are detailed in chapter 14 of the NOPR TSD. Table V.5117 of 
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the NOPR TSD presents the present value of cumulative NOx emissions reductions for 

each TSL calculated using the average dollar-per-ton values and 7-percent and 3-percent 

discount rates. 

Table V.51 Present Value of NOx Emissions Reduction for Potential Standards for 

Commercial Refrigeration Equipment

TSL 3% Discount Rate 7% Discount Rate

million 2012$

Primary Emissions

1 12.0 5.6

2 21.4 10.0

3 46.6 21.7

4 50.7 23.6

5 64.7 30.1

Upstream Emissions

1 13.4 6.2

2 24.0 11.0

3 52.3 24.0

4 56.9 26.1

5 72.6 33.3

Total Emissions

1 25.4 11.7

2 45.4 21.0

3 98.9 45.7

4 107.6 49.8

5 137.3 63.5

The NPV of the monetized benefits associated with emission reductions can be 

viewed as a complement to the NPV of the customer savings calculated for each TSL 

considered in this NOPR. Table V.52 presents the NPV values that result from adding the 

estimates of the potential economic benefits resulting from reduced CO2 and NOX

emissions in each of four valuation scenarios to the NPV of consumer savings calculated 

for each TSL considered in this NOPR. shows, as an example, results of the calculation 

of the combined NPV including benefits from emission reductions for TSL 4rulemaking, 

at both a 7-percent and a 3-percent discount rate. The CO2 values used in the table 

correspond to the four scenarios for the valuation of CO2 emission reductions discussed 

above. 
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Table V.52 Adding Commercial Refrigeration Equipment TSLs: Net Present Value 

of Consumer Savings toCombined with Net Present Value of Monetized Benefits 

from CO2 and NOX EmissionEmissions Reductions at TSL 4 for Commercial 

Refrigeration Equipment

CategoryTS

L Consumer NPV at 3% Discount Rate added with:

Prese

nt 

Value

millio

n 

2010$

Benefits

Operating Cost Savings 7% 1,838

3% 4,280

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CO2 Reduction 

MonetizedSCC

Value (at $4of 

$12.9/metric 

ton)** CO2

* and 

Low Value for 

NOX

**

5%SCC Value of 

$40.8/metric ton 

CO2

* and 

Medium Value 

for NOX

**

185SCC Value 

of $62.2/metric 

ton CO2

* and 

Medium Value 

for NOX

**

SCC Value of 

$117.0/metric ton CO2

*

and High Value for NOX

**

CO2 

Reduction 

Monetized 

Value (at 

$22.3/Metric 

Ton)**

3%billion 2012$

939

CO2 

Reduction 

Monetized 

Value (at 

$36.5/Metric 

Ton)**1

2.50%1.362 1,588.665 1.889 2.406

2 2.256 2.798 3.197 4.120

3 4.466 5.646 6.516 8.5

4

26

4.394 5.679 6.626 8.815

5 (10.555) (8.916) (7.708) (4.916)

TSL

Consumer NPV at 7% Discount Rate added with:

CO2 Reduction 

Monetized Value 

(at $67.6/Metric 

Ton)**SCC 

Value of 

$12.9/metric ton 

CO2

* and Low 

Value for NOX

**

3%SCC Value of 

$40.8/metric ton 

CO2

* and 

Medium Value 

for NOX

**

2,865SCC Value 

of $62.2/metric 

ton CO2

* and 

Medium Value 

for NOX

**

SCC Value of 

$117.0/metric ton CO2

*

and High Value for NOX

**

NOx

Reduction 

Monetized 

Value (at 

$2,543/Ton)

**

7%billion 2012$

10.4

1 0.6363% 19.20.928 1.151 1.657

Total 

Benefits 

(Operating 

Cost 

Savings, 

CO2

Reduction 

and NOx

Reduction)†

2

7%1.038 1.560 1.959 2,787.862

3 1.996 3%.133 4.002 5,238.969

Costs

Total Incremental Installed 

Costs 7% 815

4 1.922 3%.160 1,5624.107 6.248

Net Benefits/Costs

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Total Benefits Less 

Incremental Costs 7% 1,972

5 3%(6.331) (4.752) (3,676.544) (0.813)

Note: Parentheses indicate negative values.

* These label values represent the global values (SCC in 2010$) of the social cost of CO2 emissions2015, in 2010 

under several scenarios.2012$. The present values of $4.9, $22.3, and $36.5 per ton are the averages of SCC 

distributionshave been calculated using 5 percent, 3 percent, and 2.5 percentwith scenario-consistent discount 

rates, respectively. The value of $67.6. ** Low Value corresponds to $468 per ton of NOX emissions. Medium Value corresponds to $2,639 per ton represents 

the 95th percentile of the SCC distribution calculated using a 3-percent discount rate. See section for 

details. For NOx, an average value ($2,543) of the low ($451) and high ($4,635) values was used.

** Total monetary benefits for both the 3 percent and 7 percent cases utilize the central estimate of social 

cost of NOx and CO2 emissions calculated at a 3-percent discount rate (averaged across three IAMs), which 

is equal to $22.3/ton in 2010 (in 2010$).of NOX emissions. High Value corresponds to $4,809 per ton of NOX

emissions.

Although adding the value of consumercustomer savings to the values of emission 

reductions provides a valuable perspective, two issues should be considered. First, the 

national consumeroperating cost savings are domestic U.S. consumercustomer monetary 

savings found in that occur as a result of market transactions, while the value of 

emissionCO2 reductions are based on estimates of marginal social costs, which, in the 

case of CO2, are is based on a global value. Second, the assessments of 

consumeroperating cost savings and emission-related benefitsthe SCC are performed 

with different computer models, leading tomethods that use quite different time frames 

for analysis. For commercial refrigeration equipment, the present value of The national 

consumeroperating cost savings is measured for the period in which unitslifetime of 

products shipped (2016–2045) continue to operate. However, the time frames of the 

benefits associated with the emission reductions differ. For example, the value of CO2 

emission reductions in a given year reflects the present value of all in 2017–2046. The 

SCC values, on the other hand, reflect the present value of future climate-related impacts 

due to emitting aresulting from the emission of one metric ton of CO2 in that year, out to 

the yeareach year. These impacts continue well beyond 2100. 

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Chapter 17 of the NOPR TSD presents calculations of the combined NPV 

including benefits from emission reductions for each TSL. 

7. Other Factors

EPCA allows the Secretary, in determining whether a proposed standard is 

economically justified, to consider any other factors that the Secretary deems to be 

relevant. (42 U.S.C. 6295(o)(2)(B)(i)(VII) and 6316(e)(1)) DOE considered LCC impacts 

on identifiable groups of customers, such as customers of different business types, who 

may be disproportionately affected by any amended national energy conservation 

standard level. DOE also considered the reduction in generation capacity that could result 

from the imposition of any amended national energy conservation standard level. 

DOE carried out a RIA, as described in section IV.P, to study the impact of

certain non-regulatory alternatives that may encourage customers to purchase higher 

efficiency equipment and, thus, achieve NES. The two major alternatives identified by 

DOE are customer rebates and customer tax credits. DOE surveyed the various rebate 

programs available in the United States. Typically, rebates are offered for grocery stores 

that retrofit their display cases with energy efficiency components such as LED lamps, 

electronically commutated motor (ECM) fan motors, night curtains, and higher efficiency 

doors. Based on comparison with the incremental MSP values obtained from the 

engineering analysis, DOE chose to model a scenario in which consumerscustomers are 

offered, as rebates, 60 percent of the incremental equipment installed cost. The value of 
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60 percent is very high compared to most rebate programs and was chosen to represent 

the maximum possible rebate scenario. 

For the tax credits scenario, DOE did not find a suitable program by which to 

model the scenario. Therefore, DOE used a 5-percent/10-percent tax credit scenario. 

DOE first calculated the MSP increments over baseline for each TSL for each equipment 

class. For TSLs that had an increase in MSP between 10 and 15 percent over the baseline 

MSP, DOE applied a 5-percent tax credit, where the amount of tax credit was equal to 5

percent of the MSP of the higher efficiency equipment. For TSLs that had increase of 15

percent or more in MSP values over the baseline MSP, DOE applied a 10-percent tax 

credit. This type of tax credit scenario is an attempt to approximate a model in which the 

tax credits are proportional to the magnitude of efficiency improvement with the implicit 

assumption that the magnitude of the increase in MSP is proportional to the magnitude of 

increase in energy efficiency.

Table V.53 and Table V.54 show the NES and NPV, respectively, for the nonregulatory alternatives analyzed. For comparison, the table includes the results of the 

NES and NPV for TSL 4, the proposed energy conservation standard. Energy savings are 

expressed in quads in terms of primary or source energy, which includes generation and 

transmission losses from electricity utility sector. 

Table V.53 Cumulative NESPrimary Energy Savings of Non-Regulatory 

Alternatives Compared to the Proposed Standards for Commercial Refrigeration 

Equipment*

Policy Alternatives Cumulative NES

Quads

No new regulatory action 0
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ConsumerCustomer tax credits 0.12151

Customer rebates 0.119198

Voluntary energy efficiency targets** 0NA

Early replacement** 0NA

Proposed standards (TSL 4) 0.636985

*Chapter 17 of the TSD describes the inputs and their respective sources for the RIA.

**Analysis of two non-regulatory alternatives: voluntary energy efficiency targets and early replacement were not performed as DOE 

expected minimal potential benefits as discussed in Chapter 17 of the TSD.

Table V.54 Cumulative NPV of Non-Regulatory Alternatives Compared to the 

Proposed Standards for Commercial Refrigeration Equipment

Policy Alternatives

Cumulative Net Present Value

billion 20102012$

7% Discount 3% Discount

No new regulatory action 0 0

ConsumerCustomer tax credits 0.172257 0.334489

Customer rebates 0.101055 0.197122

Voluntary energy efficiency targets* 0NA 0NA

Early replacement* 0NA 0NA

Proposed standards (TSL 4) 1.023606 2.7184.067

* Analysis of two non-regulatory alternatives: voluntary energy efficiency targets and early replacement, were not performed as DOE 

expected minimal potential benefits as discussed in Chapter 17 of the TSD.

As shown above, none of the policy alternatives DOE examined would achieve 

close to the amount of energy or monetary savings that could be realized under the 

proposed amended standard. Also, implementing either tax credits or customer rebates 

would incur initial and/or administrative costs that were not considered in this analysis.

C. Proposed Standard

DOE recognizes that when it considers proposed standards, it is subject to the 

EPCA requirement that any new or amended energy conservation standard for any type 

(or class) of covered product be designed to achieve the maximum improvement in 

energy efficiency that the Secretary determines is technologically feasible and 

economically justified. (42 U.S.C. 6295(o)(2)(A) and 6316(e)(1)) In determining whether 

a proposed standard is economically justified, the Secretary must determine whether the 

benefits of the standard exceed its burdens to the greatest extent practicable, in light of 

Comment [A47]: Revision requested by OIRA.

Comment [A48]: Revision requested by OIRA.

Comment [A49]: Revision requested by OIRA. 

Comment [A50]: Revision requested by OIRA.

Comment [A51]: Revision requested by OIRA. 

Comment [A52]: Revision requested by OIRA.

Comment [A53]: Revision requested by OIRA.

Comment [A54]: Revision requested by OIRA. 
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the seven statutory factors discussed previously. (42 U.S.C. 6295(o)(2)(B)(i) and 

6316(e)(1)) The new or amended standard must also result in a significant conservation 

of energy. (42 U.S.C. 6295(o)(3)(B) and 6316(e)(1)) 

DOE considered the impacts of potential standards at each TSL, beginning with 

the maximum technologically feasible level, to determine whether that level met the 

evaluation criteria. If the max-tech level was not justified, DOE then considered the next 

most efficient level and undertook the same evaluation until it reached the highest 

efficiency level that is both technologically feasible and economically justified and saves 

a significant amount of energy.

DOE discusses the benefits and/or burdens of each TSL in the following sections. 

DOE bases its discussion on quantitative analytical results for each TSL, including NES, 

NPV (discounted at 7 and 3 percent), emission reductions, INPV, LCC, and 

consumers’customers’ installed price increases. Beyond the quantitative results, DOE 

also considers other burdens and benefits that affect economic justification, including 

how technological feasibility, manufacturer costs, and impacts on competition may affect 

the economic results presented.

Table V.55, Table V.56, Table V.57 and Table V.58 present a summary of the 

results of DOE’s quantitative analysis for each TSL. In addition to the quantitative results 

presented in the tables, DOE also considers other burdens and benefits that affect 

economic justification of certain consumercustomer subgroups that are disproportionately 
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affected by the proposed standards. Section V.B.7 presents the estimated impacts of each 

TSL for these subgroups. 

Table V.55 Summary of Results for Commercial Refrigeration Equipment TSLs: 

National Impacts†

*

Category TSL 1 TSL 2 TSL 3 TSL 4 TSL5

Cumulative National Energy Savings 20162017 through 20452060

quads

Undiscoun

ted values 0.274236 0.325422 0.566920 0.6361.001 1.302278

Cumulative NPV of ConsumerCustomer Benefits 20162017 through 20452060

20102012$ billion

3% 

discount 

rate $1.500285 1.750$2.118 2.771$4.165 2.718$4.067 

(15.096($10.972

)

7% 

discount 

rate $0.613561 $0.712905 $1.093705 $1.023606 (8.534($6.735) 

Industry Impacts

Change in 

Industry 

NPV 

(20102012

$ million)

(10.23.6) to 

(0.26.8) 

(1815.2) to 

(526.4)

(63.726.3) to 

(33.159.2) 

(89.345.9) to 

(44.892.6) 

(686.125.5) to 

(8.9516.0) 

Change in 

Industry 

NPV (%)

(1.180.58) to 

(0.03)31)

(2.0927) to 

(0.63)1.30)

(7.325.09) to 

(3.8)2.26)

(10.287.97) to 

(5.16)3.95)

(78.9344.41) to 

(1.02)2.20)

Cumulative Emissions Reductions 20162017 through 20452060

CO2

(MMt)*)** 21.9312.95 26.0223.14 45.3350.41 50.9154.88 104.2170.01

NOx

(kt)*)** 5.619.14 6.6434.19 11.5774.46 12.9981.07 26.59103.42

Hg (t)*)** (0.111)03 (0.132)05 (0.23)10 (0.258)11 (0.528)14

N2O (kt)** 0.27 0.48 1.05 1.15 1.46

N2O (kt

CO2eq)** 80.56 143.92 313.48 341.29 435.39

CH4 (kt)** 62.76 112.13 244.22 265.89 339.19

CH4 (kt 

CO2eq)** 1,568.96 2,803.13 6,105.43 6,647.15 8,479.71

SO2 (kt)** 16.55 29.56 64.39 70.10 89.43

Monetary Value of Cumulative Emissions Reductions 20162017 through 2045**2060†

CO2

(2010$ 

billion2012

$ million)

0.0873 to 

1.23,074

0.09130 to 

1.46,919

0.16283 to 

2.554,181

0.18308 to 

2.864,552

0.38393 to 

5.86,807

NOX – 3% 

discount 

rate 

(20102012

$ million)

14.5 to 

15.146.3

8.1.7 to 

17.982.7

3.0 to3117.5 to 

180.2

3.419.1 to 

35.1196.2

7.024.4 to 

71.4250.2

NOx – 7% 0.82.1 to 0.93.7 to 8.1.6 to 16.983.3 1.98.8 to 1990.7 11.3.8 to 

Comment [A55]: Revision requested by OIRA.

Comment [A56]: Revision requested by OIRA.
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discount 

rate 

(20102012

$ million)

8.221.4 9.738.2 38.8115.7

Impact on Utilities

Generatio

n Capacity 

Reduction 

in 2045 

(GW)

0.09 0.11 0.19 0.22 0.45

Employment Impacts

Net 

Change in 

Indirect 

Domestic 

Jobs by 

20202021

64198 to 

76201 74345 to 89354 118719 to 153749

113760 to 

171801

(588)130 to 

181504

** Values in parentheses are negative values.

** “MMt” stands for million metric tons; “kt” stands for kilotons; “t” stands for tons. CO2eq is the quantity of CO2 that would have 

the same global warming potential (GWP)

**† Range of the economic value of CO2 reductions is based on estimates of the global benefit of reduced CO2 emissions † Values in parentheses are negative values.

Table V.56 Summary of Results for Commercial Refrigeration Equipment TSLs: 

Mean LCC Savings

Mean LCC Savings*

20102012$

Equipment 

Class TSL 1 TSL 2 TSL 3 TSL 4 TSL5

VOP.RC.M 216.39$235.9

2 

216.39$743.0

0 

677.32$1,788.

85 

453.06$1,493.

72 

(5704.77($1,668

.79) 

VOP.RC.L 501.33$537.2

7 

345.84$1,516.

59 

264.33$1,129.

51 

264.33$1,129.

51 

(4266.53($3,692

.90) 

VOP.SC.M 106.45$170.7

8 

159.12$227.1

7 

214.15$814.9

1 

214.15$691.2

7 

(1693.94($376.5

2) 

VCT.RC.M 450.12$175.2

3 

450.12$1,864.

44 

1749.37$1,75

8.73 

1038.12$1,10

8.13 

(2513.32($2,508

.61) 

VCT.RC.L 1077.91$1,35

7.25 

711.31$1,004.

72 

539.92$797.9

1 

539.92$797.9

1 

(3781.14($3,624

.20) 

VCT.SC.M 1424.70$566.

18 

1038.14$1,36

3.60 

830.17$1,122.

14 

717.99$641.0

5 

(500.02($595.52

) 

VCT.SC.L 1434.12$4,18

6.06 

3227.77$2,52

2.67 

2281.37$1,98

4.45 

1969.24$1,34

2.84 

252.00 

($343.16)

VCT.SC.I 437.37$572.0

5 

502.51$486.2

8 370$431.88 370$431.88 (1616.18($1,591.87) 

VCS.SC.M 268.29$278.8

4 

158.07$162.8

8 

125.10$131.8

0 

125.10$131.8

0 

(1031.06($1,042

.03) 

VCS.SC.L 863.65$524.5

2 

368.04$329.3

3 

256.76$267.8

1 

214.03$220.8

3 

(1264.83($1,274

.03) 

VCS.SC.I 218.38$236.7

7

159.81$176.8

3

140.59$152.6

9

140.59$152.6

9

(1808.93($1,818

.87)

SVO.RC.M 68.05$73.77 68.05$551.98 495.44$1,216.

77

331.41$1,008.

46

(3936.63($1,015

.16)

SVO.SC.M 20.50$324.33 293.95$334.8

9 

308.07$587.9

0 

308.07$491.9

9 

(1133.50($201.6

1) 

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SOC.RC.M 112.80$118.3

6

112.80$226.2

6

209.19$997.8

9

119.60$494.5

1

(2715.27($982.2

1)

HZO.RC.M*** $0.00 $0.00 $0.00 $0.00 (1247.58($1,271

.24)

HZO.RC.L*** $0.00 $0.00 $0.00 $0.00 (2103.12($2,134

.96) 

HZO.SC.M $8.4385 $8.4385 45.74$48.60 24.35$28.78 (811.71($821.57

)

HZO.SC.L*** $0.00 $0.00 $0.00 $0.00 (468.24($473.71

)

HCT.SC.M 99.37$106.59 109.64$359.4

8

285.69$307.2

6

235.72$253.6

0

(300.80($293.54

)

HCT.SC.L 205.71$217.1

9

163.89$790.5

3

697.97$571.0

7

458.84$368.9

2

(265.52($354.75

)

HCT.SC.I 20.46$21.83 33.19$34.69 38.02$42.48 38.02$42.48 (807.17($811.31

)

HCS.SC.M 21.34$23.07 17.94$19.18 15.86$16.66 9.11$8.68 (418.13($422.79

)

HCS.SC.L $74.69.41 75.74$80.97 $80.72.70 $80.72.70 (407.48($400.63

)

PD.SC.M 934.80$1,009.

53

934.80$1,009.

53

939.55$933.5

9

351.49$310.4

3

(582.78($637.94

)

SOC.SC.M $646.15 $466.47 $1,241.60 $739.75 ($735.33)

* LCC savings* Values in parentheses are negative values.

** “NA” means “not applicable,” because for equipment classes HZO.RC.M, HZO.RC.L, and HZO.SC.L are shown as zero 

because , TSLs 1 through 4 for these equipment classes are associated with the baseline efficiency level.
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Table V.57 Summary of Results for Commercial Refrigeration Equipment TSLs: 

Median Payback Period

Median Payback Period 

years

Equipment Class TSL 1 TSL 2 TSL 3 TSL 4 TSL5

VOP.RC.M 1.8373 1.8377 1.873.77 2.413.91 38.11.76

VOP.RC.L 1.1811 1.942.03 6.592.22 6.592.22 24.9618.30

VOP.SC.M 1.5761 1.672.17 2.234.12 2.234.39 29.4811.37

VCT.RC.M 2.631.23 2.6342 3.492.43 3.732.70 14.2913.09

VCT.RC.L 4.331.30 4.361.51 4.431.64 4.431.64 22.3815.75

VCT.SC.M 2.050.86 2.101.73 2.6021 2.8354 8.2213

VCT.SC.L 0.4358 0.7661 1.330.83 1.440.96 4.253.65

VCT.SC.I 2.320.86 2.871.74 3.171.97 3.171.97 15.9713.21

VCS.SC.M 0.8078 1.010.98 1.8075 1.8075 14.5711

VCS.SC.L 0.5155 0.6191 1.0400 1.1915 10.9654

VCS.SC.I 0.8380 1.222.07 2.5042 2.5042 28.3027.19

SVO.RC.M 1.3831 1.382.64 2.794.34 3.364.50 38.3011.60

SVO.SC.M 1.2597 2.0106 2.084.43 2.084.75 23.4910.36

SOC.RC.M 1.2825 1.2844 1.503.31 2.844.41 35.9911.88

HZO.RC.M* NA0.00 NA0.00 NA0.00 NA0.00 170.62161.23

HZO.RC.L* NA0.00 NA0.00 NA0.00 NA0.00 88.6683.78

HZO.SC.M 1.9289 1.9289 2.4342 6.5240 57.3655.78

HZO.SC.L* NA0.00 NA0.00 NA0.00 NA0.00 76.6073.62

HCT.SC.M 0.7069 0.892.24 2.4342 3.0908 12.3126

HCT.SC.L 0.5553 0.671.00 1.1005 1.5547 7.5315

HCT.SC.I 0.9288 2.4339 4.4228 4.4228 29.2127.99

HCS.SC.M 0.5250 1.6964 2.5854 4.2628 34.9605

HCS.SC.L 0.8986 1.4136 2.6757 2.6757 15.6314.98

PD.SC.M 0.53 0.53 1.10 2.27 7.61

PDSOC.SC.M 1.4612 1.4624 1.722.35 2.8299 8.127.42

* “NA” means “not applicable,” because for equipment classes HZO.RC.M, HZO.RC.L, and HZO.SC.L, TSLs 1 through 4 are 

associated with the baseline efficiency level.

Table V.58 Summary of Results for Commercial Refrigeration Equipment TSLs: 

Distribution of ConsumerCustomer LCC Impacts

Category TSL 1* TSL 2* TSL 3* TSL 4* TSL 5*

VOP.RC.M

Net Cost (%) 0 0 0 1611 10090

No Impact (%) 7576 7552 5028 2515 02

Net Benefit (%) 2524 2548 5072 5974 08

VOP.RC.L

Net Cost (%) 0 0 340 340 98

No Impact (%) 7274 4348 1625 1625 2

Net Benefit (%) 2826 5752 5075 5075 0

VOP.SC.M

Net Cost (%) 0 0 0 011 9977

No Impact (%) 7662 5343 3025 3014 13

Net Benefit (%) 2438 4757 7075 7075 020

VCT.RC.M

Net Cost (%) 0 0 0 2926 9594

No Impact (%) 7481 7462 5046 1816 2

Net Benefit (%) 2619 2638 5054 5357 34

VCT.RC.L

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Net Cost (%)002020 9897

No Impact (%) 6960 4640 2421 24212

Net Benefit (%) 3140 5460 7579 757901

VCT.SC.M

Net Cost (%)0040 1527 7274

No Impact (%) 6483 4966 2351 12132

Net Benefit (%) 3617 5134 7349 7360 2724

VCT.SC.L

Net Cost (%)003087 6274

No Impact (%) 8576 6960 2644 13152

Net Benefit (%) 1524 3140 7156 7978 3724

VCT.SC.I

Net Cost (%)0012121 9795

No Impact (%) 6365 4532 1516 15161

Net Benefit (%) 3735 5568 8283 828323

VCS.SC.M

Net Cost (%)00 137 137 99

No Impact (%) 7172 4142 13 131

Net Benefit (%) 2928 58 7380 73800

VCS.SC.L

Net Cost (%)005 1920 97

No Impact (%) 8773 5742 2728 1401

Net Benefit (%) 1327 4358 68 676632

VCS.SC.I

Net Cost (%)004343 99

No Impact (%) 6667 4932 16 161

Net Benefit (%) 3433 5168 8081 80810

SVO.RC.M

Net Cost (%)000 1813 9985

No Impact (%) 7475 7451 4829 251613

Net Benefit (%) 2625 2649 5271 5772012

SVO.SC.M

Net Cost (%)000012 9869

No Impact (%) 7661 5243 3025 301414

Net Benefit (%) 2439 4857 7075 7075127

SOC.RC.M

Net Cost (%)000 2129 9889

No Impact (%) 7882 7864 5747 351825

Net Benefit (%) 2218 2236 4353 455306

HZO.RC.M**

Net Cost (%)0NA0NA0NA0NA 7978

No Impact (%) 100NA 100NA 100NA 100NA 2122

Net Benefit (%)0NA0NA0NA0NA0

HZO.RC.L**

Net Cost (%)0NA0NA0NA0NA 8786

No Impact (%) 100NA 100NA 100NA 100NA 1314

Net Benefit (%)0NA0NA0NA0NA0

HZO.SC.M

Net Cost (%)000 2119 98

No Impact (%) 7475 7475 49 242

Net Benefit (%) 2625 2625 51 55570

HZO.SC.L**

Net Cost (%)0NA0NA0NA0NA 7372

No Impact (%) 100NA 100NA 100NA 100NA 2728

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Net Benefit (%) 0NA 0NA 0NA 0NA 0

HCT.SC.M

Net Cost (%) 0 0 0 1718 89

No Impact (%) 6870 5238 2425 1112 1

Net Benefit (%) 3230 4862 7675 7170 10

HCT.SC.L

Net Cost (%) 0 0 0 1723 7376

No Impact (%) 7275 5861 4345 14 1

Net Benefit (%) 2826 4239 5755 6963 2623

HCT.SC.I

Net Cost (%) 0 0 52 52 99

No Impact (%) 74 4849 23 23 1

Net Benefit (%) 26 5251 7275 7275 0

HCS.SC.M

Net Cost (%) 0 0 21 2729 98

No Impact (%) 83 65 48 31 2

Net Benefit (%) 17 35 5051 4240 0

HCS.SC.L

Net Cost (%) 0 0 52 52 9998

No Impact (%) 4950 3233 1516 1516 12

Net Benefit (%) 5150 6867 8082 8082 0

PD.SC.M

Net Cost (%) 0 0 0 4041 8486

No Impact (%) 8186 8186 6469 1011 1

Net Benefit (%) 1914 1914 3631 5048 1513

SOC.SC.M

Net Cost (%) 0 0 0 25 80

No Impact (%) 70 55 40 16 5

Net Benefit (%) 30 45 60 60 16

*Values have been rounded to the nearest integer. Therefore, some of the percentages may not add up to 100

due to rounding.

** “NA” means “not applicable”; because for equipment classes HZO.RC.M, HZO.RC.L and HZO.SC.L, 

TSLs 1 through 4 are associated with the baseline efficiency level.

DOE also notes that the economics literature provides a wide-ranging discussion 

of how consumers trade off upfront costs and energy savings in the absence of 

government intervention. Much of this literature attempts to explain why consumers 

appear to undervalue energy efficiency improvements. This undervaluation suggests that 

regulation that promotes energy efficiency can produce significant net private gains (as 

well as producing social gains by, for example, reducing pollution). There is evidence 

that consumers undervalue future energy savings as a result of (1) a lack of information;

(2) a lack of sufficient salience of the long-term or aggregate benefits; (3) a lack of 

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sufficient savings to warrant delaying or altering purchases (e.g., an inefficient ventilation 

fan in a new building or the delayed replacement of a water pump); (4) excessive focus 

on the short term, in the form of inconsistent weighting of future energy cost savings 

relative to available returns on other investments; (5) computational or other difficulties 

associated with the evaluation of relevant tradeoffs; and (6) a divergence in incentives 

(e.g., renter versus building owner, builder versus home buyer). Other literature indicates 

that with less than perfect foresight and a high degree of uncertainty about the future, 

consumers may trade off these types of investments at a higher than expected rate 

between current consumption and uncertain future energy cost savings. 

While DOE is not prepared at present to provide a fuller quantifiable framework 

for estimating the benefits and costs of changes in consumer purchase decisions due to an 

amended energy conservation standard, DOE has posted a paper that discusses the issue 

of consumer welfare impacts of appliance energy efficiency standards, and potential 

enhancements to the methodology by which these impacts are defined and estimated in 

the regulatory process.102 DOE is committed to developing a framework that can support 

empirical quantitative tools for improved assessment of the consumer welfare impacts of 

appliance standards. DOE welcomes comments on information and methods to better 

assess the potential impact of energy conservation standards on consumer choice and 

methods to quantify this impact in its regulatory analysis in future rulemakings.

 

102 Sanstad, A. Notes on the Economics of Household Energy Consumption and Technology Choice. 2010. 

Lawrence Berkeley National Laboratory, Berkeley, CA. 

www1.eere.energy.gov/buildings/appliance_standards/pdfs/consumer_ee_theory.pdf. 
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TSL 5 corresponds to the max-tech level for all the equipment classes and offers 

the potential for the highest cumulative energy savings through the analysis period from 

2016 to 2045.. The estimated energy savings from TSL 5 is 1.3022784 quads of primary 

energy. DOE projects a net negative NPV for consumerscustomers with estimated 

increased costs valued at $8.56.735 billion at a 7-percent discount rate. Estimated 

emissions reductions are 104.2170.0 MMt of CO2, and up to 26.59103.4 kt of NOx., and 

89.4 kt of SO2. DOE also projects an increasea decrease in Hg emissions of up to 0.5314

tons. The CO2 emissions have a value of up to $5.868 billion and the NOx emissions have 

a value of $38.8115.7 million at a 7-percent discount rate. DOE estimates that, compared 

to base case, the total required electric generating capacity in 2045 would decrease by 

0.45 GW at TSL 5.

For TSL 5, with the exception of equipment class VCT.SC.L, the mean LCC 

savings for all equipment classes are negative, implying an increase in LCC, with the 

increase ranging from $266 for the HCT.SC.L equipment class to $5,705 for the 

VOP.RC.M equipment class. Although the mean LCC decrease for VCT.SC.L shows a 

value of $252, the median LCC savings is a negative value of $1,103 (not shown in any 

of the tables in today’s NOPR), implying an increase in LCC for the majority of the 

consumers.202 for the SVO.SC.M equipment class to $3,693 for the VOP.RC.L

equipment class. 

At TSL 5, manufacturers may expect diminished profitability due to large 

increases in product costs, capital investments in equipment and tooling, and 
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expenditures related to engineering and testing. The projected change in INPV ranges 

from a decrease of $686.1516.0 million to a decrease of $8.925.5 million based on DOE’s 

manufacturer markup scenarios. The upper bound of -$8.925.5 million is considered an 

optimistic scenario for manufacturers because it assumes manufacturers can fully pass on 

substantial increases in equipment costs. DOE recognizes the risk of large negative 

impacts on industry if manufacturers’ expectations concerning reduced profit margins are 

realized. TSL 5 could reduce commercial refrigeration equipment INPV by up to 

78.9344.41 percent if impacts reach the lower bound of the range.

After carefully considering the analyses results and weighing the benefits and 

burdens of TSL 5, DOE finds that the benefits to the Nation from TSL 5, in the form of 

energy savings and emissions reductions, including environmental and monetary benefits, 

are small compared to the burdens, in the form of a decrease of $8.56.735 billion in 

consumercustomer NPV and a decrease of up to 78.9344.41 percent in INPV. DOE 

concludes that the burdens of TSL 5 outweigh the benefits and, therefore, does not find 

TSL 5 to be economically justifiable. DOE is not proposing to adopt TSL 5 in this notice. 

TSL 4 corresponds to the highest efficiency level, in each equipment class, with a 

positive NPV at a 7-percent discount rate. The estimated energy savings from 2016 to 

2045for equipment purchased in 2017–2046 is 0.6361.001 quads of primary energy, an 

amount DOE deems significant. At TSL 4, DOE projects an increase in 

consumercustomer NPV of $1.023606 billion at a 7-percent discount rate; estimated 

emissions reductions of 50.9154.88 MMt of CO2; up to 12.9981.1 kt of NOx. Analysis 
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results show an increase, 0.11 in Hg emissionsand 70.1 kt of up to 0.26 tons.SO2. The 

monetary value of these emissions was estimated to be up to $2.864.55 billion for CO2

and up to $1990.7 million for NOx at a 7-percent discount rate. Total required electric 

generating capacity in 2045 is projected to decrease by 0.22 GW compared to the base 

case. 

At TSL 4, the mean LCC savings vary from $9.118.68 for HCS.SC.M to 

$1,969.24493.72 for VCT.SC.LVOP.RC.M, which implies that on an average 

consumerscustomers will experience a decrease in LCC. For equipment classes 

HZO.RC.M, HZO.RC.L, and HZO.SC.L, TSL 4 is associated with the baseline level 

because these equipment classes have only one efficiency level above baseline and each 

of those higher efficiency levels yields a negative NPV. Therefore, there are no efficiency 

levels that satisfy the criteria used for selection of TSLs 1 through 4. DOE is not 

proposing to amend standard levelsthe standards for these three equipment classes at TSL 

4 (and below).. 

At TSL 4, the projected change in INPV ranges from a decrease of $89.392.6

million to a decrease of $44.845.9 million. At TSL 4, DOE recognizes the risk of 

negative impacts if manufacturers’ expectations concerning reduced profit margins are 

realized. If the lower bound of the range of impacts is reached, as DOE expects, TSL 4 

could result in a net loss of 10.287.97 percent in INPV for commercial refrigeration 

equipment manufacturers. 
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DOE contrasted the benefits and burdens of TSL 4 with those of TSL 3 because 

even though TSL 4 has the benefits of higher energy savings than TSL 3, the 

consumercustomer NPV values at TSL 3 are higher than at TSL 4. The estimated energy 

savings at TSL 3 from 2016 to 2045 is 0.566920 quads of primary energy;, whereas at 

TSL 4 the energy savings are higher by about 129 percent at 0.6361.001 quads. At TSL 3, 

DOE projects an increase in consumercustomer NPV of $1.093705 billion at a 7-percent 

discount rate, whereas at TSL 4 the consumercustomer NPV is lower by about 6.5

percent at $1.023606 billion, with the actual difference amounting to about $70 

approximately $99 million. Estimated emissions reductions at TSL 3 are 45.3350.41

MMt of CO2 as opposed to 50.9154.88 MMt at TSL 4, and up to 74.46 kt of NOx at TSL 

3 as compared to 12.9981.07 kt at TSL 4. The monetary value of the CO2 emissions 

reductions was estimated to be up to $24.18 billion at TSL 3 compared to $4.55 billion at 

TSL3 compared to $2.86 billion at TSL4TSL 4, and NOx emission reductions at a 7-

percent discount rate were valued at up to up to $16.9$83.3 million at TSL3TSL 3

compared to $1990.7 million at TSL 4.

To facilitate a direct comparison between the benefits of TSL 3 versus those of 

TSL4, DOE evaluated the net social benefits of TSL 3 and TSL 4 by combining the 

consumercustomer NPV values with monetized emissions reductions. While Table V.55

provides a range of monetized values for CO2 and NOx emissions reductions, DOE 

calculated certain intermediate values here for the purpose of net benefits calculation. 

The monetized CO2 emissions reduction values were calculated at $22.340.8 per ton in 

20102012$ and the monetized NOx emissions reductions were calculated at an 
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intermediate value of $2,537639 per ton in 20102012$. These monetized emissions 

reduction values were added to the consumercustomer NPV at 3-percent anda 7-percent 

discount ratesrate to obtain valuesa value of $3.624133 billion and 1.939 billion, 

respectively, at TSL 3. At TSL 4, the net benefit valuesvalue of $3.676160 billion and 

$1.973 billion, respectively, areis higher than thosethat at TSL 3.

After careful consideration of the analyses results, weighing the benefits and 

burdens of TSL 4, and comparing them to those of TSL 3, DOE believes that setting the 

standards for commercial refrigeration equipment at TSL 4 represents the maximum 

improvement in energy efficiency that is technologically feasible and economically 

justified. TSL 4 is technologically feasible because the technologies required to achieve 

these levels already exist in the current market. TSL 4 is economically justified because 

the benefits to the Nation in the form of energy savings, consumercustomer NPV at 3 

percent and at 7 percent, and emissions reductions outweigh the costs associated with 

reduced INPV.

Therefore, DOE has decided to propose the adoption of amended energy 

conservation standards for commercial refrigeration equipment at TSL 4. DOE 

specifically seeks comment on the magnitude of the estimated decline in INPV at TSL 4 

compared to the baseline, and whether this impact could risk industry consolidation. DOE 

also specifically requests comment on whether DOE should adopt TSL 5, and, in 

particular, whether, compared to TSL 4, TSL 5’s higher energy savings outweigh its 

lower NPV benefits and higher manufacturer impacts. DOE may reexamine this level 
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depending on the nature of the information it receives during the comment period and 

adjust its final levels in response to that information. 

VI. 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 today’s standards address are as follows: 

1. There is a lack of consumer information and/or information processing 

capability about energy efficiency opportunities in the commercial 

refrigeration equipment market.

2. There is asymmetric information (one party to a transaction has more and 

better information than the other) and/or high transactions costs (costs of 

gathering information and effecting exchanges of goods and services). 

3. There are external benefits resulting from improved energy efficiency of 

commercial refrigeration equipment that are not captured by the users of such 

equipment. These benefits include externalities related to environmental 

protection and energy security that are not reflected in energy prices, such as 

reduced emissions of GHGs. 

 
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In addition, DOE has determined that today’s regulatory action is an 

“economically significant regulatory action” under section 3(f)(1) of Executive Order 

12866. Accordingly, section 6(a)(3) of the Executive Order requires that DOE prepare an 

RIA on today’s rule and that OIRA in OMB review this rule. DOE presented to OIRA for 

review the draft rule and other documents prepared for this rulemaking, including the 

RIA, and has included these documents in the rulemaking record. The assessments 

prepared pursuant to Executive Order 12866 can be found in the TSD for this 

rulemaking. 

DOE has also reviewed this regulation pursuant to Executive Order 13563, issued 

on January 18, 2011. 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 
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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, ORIA 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 today’s 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 a 

final regulatory flexibility analysis (FRFA) 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 (Aug. 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 at 7990. DOE has made its procedures 

and policies available on the Office of the General Counsel’s website 
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(http://energy.gov/gc/office-general-counsel). 

1. Description and Estimated Number of Small Entities Regulated 

For the manufacturers of commercial refrigeration equipment, the 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 CFR part 121. The size standards are listed by NAICS code and industry description 

and are available at: 

www.sba.gov/idc/groups/public/documents/sba_homepage/serv_sstd_tablepdf.pdf. 

Commercial refrigeration equipment manufacturing is classified under NAICS 333415, 

“Air-Conditioning and Warm Air Heating Equipment and Commercial and Industrial 

Refrigeration Equipment Manufacturing.” The SBA sets a threshold of 750 employees or 

less for an entity to be considered as a small business for this category.

 

During its market survey, DOE used available public information to identify 

potential small manufacturers. DOE’s research involved industry trade association 

membership directories (including AHRI), public databases (e.g., AHRI Directory,103 the 

SBA Database104), individual company websites, and market research tools (e.g., Dunn 

and Bradstreet reports105 and Hoovers reports106

 

103 See 

) to create a list of companies that 

www.ahridirectory.org/ahriDirectory/pages/home.aspx. 104 See http://dsbs.sba.gov/dsbs/search/dsp_dsbs.cfm. 105 See www.dnb.com/. 
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manufacture or sell products covered by this rulemaking. DOE also asked stakeholders 

and industry representatives if they were aware of any other small manufacturers during 

manufacturer interviews and at DOE public meetings. DOE reviewed publicly available 

data and contacted select companies on its list, as necessary, to determine whether they 

met the SBA’s definition of a small business manufacturer of covered commercial 

refrigeration equipment. DOE screened out companies that do not offer products covered 

by this rulemaking, do not meet the definition of a “small business,” or are foreign 

owned. 

DOE identified 5354 companies selling commercial refrigeration equipment 

products in the United States. Nine of the companies are foreign-owned firms. Of the 

remaining 4445 companies, about 70 percent (3132 companies) are small domestic 

manufacturers. DOE interviewed two of the small contacted eight domestic commercial 

refrigeration equipment manufacturers during MIAfor interviews and all eight companies 

accepted. Of these eight companies, four were small businesses. 

2. Description and Estimate of Compliance Requirements 

The 3132 identified domestic manufacturers of commercial refrigeration 

equipment that qualify as small businesses under the SBA size standard account for 

approximately 26 percent of commercial refrigeration equipment shipments.107

107

While 

some small businesses have significant market share (e.g., Continental has a 4-percent 

market share for foodservice commercial refrigeration ), the majority of small 

 

106 See www.hoovers.com/. 10732nd Annual Portrait of the U.S. Appliance Industry. Appliance Magazine. September 2009. 66(7).
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businesses have less than a 1-percent market share. These smaller firms often specialize 

in designing custom products and servicing niche markets. 

At the proposed level, the average small manufacturer is expected to face capital 

conversion costs that are more than triple the average annual capital expenditures, and 

product conversion costs that are nearly double the 80% of annual R&D spending of an 

average commercial refrigeration equipment manufacturer, as shown in Table VI.1. At 

the proposed level, the conversion costs are driven by the incorporation of thicker 

insulation into case designs. The thicker cases design may necessitate the purchase of 

new jigs for production. Manufacturer estimates of the cost of a new jig ranged from 

$50,000 to $300,000 in 2011, depending on the jig design. In addition to the cost of jigs, 

changes in case thickness may require product redesign due to changes in the interior 

volume of the equipment and may require new industry certifications. 

The proposed standard could cause small manufacturers to be at a disadvantage 

relative to large manufacturers. The capital conversion costs represent a smaller 

percentage of annual capital expenditures for large manufacturers than for small 

manufacturers. The capital conversion costs are 48%60 percent of annual capital 

expenditures for an average large manufacturer, while capital conversion costs are 

378%423 percent of annual capital expenditures for an average small manufacturer. 

Small manufacturermanufacturers may have greater difficulty obtaining credit, or may 

obtain less favorable terms than larger competitors when financing the equipment 

necessary to meet thean amended standard.

 
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Additionally, small manufacturers may be disproportionately affected by 

productequipment conversion costs. Product redesign and industry certification costs tend 

to be fixed and do not scale with sales volume. For each productequipment platform, 

small businesses must make productequipment redesign investments that are similar to 

their large competitors. However, small manufacturer costs are spread over a much lower 

volume of units, making cost recovery more difficult. 

Manufacturers indicated that many design options evaluated in the engineering 

analysis (e.g., higher efficiency lighting, motors, and compressors) would force them to 

purchase more expensive components. Due to smaller purchasing volumes, small 

manufacturers typically pay higher prices for components, while their large competitors 

receive volume discounts. At the proposed standard, small businesses will likely have 

greater increases in component costs than large businesses and will thus be at a pricing 

disadvantage.

Small firms would likely be at a disadvantage relative to larger firms in meeting 

an amended energy conservation standard for commercial refrigeration equipment. The 

small businesses face disadvantages in terms of access to capital, the cost of product 

redesigns, and pricing for key components. As a result, DOE could not certify that the 

proposed standards would not have a significant impact on a significant number of small 

businesses.

To estimate how small manufacturers would be potentially impacted, DOE used 
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the market share of small manufacturers to estimate the annual revenue, earnings before 

interest and tax (EBIT), R&D expense, and capital expenditures for a typical small 

manufacturer. DOE then compared these costs to the required capital and product 

conversion costs at each TSL for both an average small manufacturer (Table VI.1) and an 

average large manufacturer (Table VI.2). In the following tables, TSL 4 represents the 

proposed standard.

Table VI.1 Comparison of an Average Small Commercial Refrigeration Equipment 

Manufacturer’s Conversion Costs to Annual Expenses, Revenue, and Profit

TSL

Capital Conversion 

Cost as a Percentage 

of Annual Capital 

Expenditures

Product 

Conversion Cost as 

a Percentage of 

Annual R&D 

Expense

Total Conversion 

Cost as a 

Percentage of 

Annual Revenue

Total Conversion 

Cost as a Percentage 

of Annual EBIT

TSL 1 0% 0% 0% 0%

TSL 2 38102% 15771% 35% 9363%

TSL 3 268238% 17676% 810% 238119%

TSL 4 378423% 18180% 1117% 305196%

TSL 5 10531400% 1190489% 4162% 1159717%

Table VI.2 Comparison of an Average Large Commercial Refrigeration Equipment 

Manufacturer’s Conversion Costs to Annual Expenses, Revenue, and Profit

TSL

Capital Conversion 

Cost as a Percentage 

of Annual Capital 

Expenditures

Product 

Conversion Cost as 

a Percentage of

Annual R&D 

Expense

Total Conversion 

Cost as a 

Percentage of 

Annual Revenue

Total Conversion 

Cost as a Percentage 

of Annual EBIT

TSL 1 0% 0% 0% 0%

TSL 2 515% 910% 01% 79%

TSL 3 34% 1011% 1% 2517%

TSL 4 4860% 11% 12% 3328%

TSL 5 134200% 70% 49% 111102%

3. Duplication, Overlap, and Conflict with Other Rules and Regulations 

DOE is not aware of any rules or regulations that duplicate, overlap, or conflict 

with the rule being promulgatedproposed today. 
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4. Significant Alternatives to the Rule 

The primary alternatives to the proposed rule are the TSLs other than the one 

being consideredproposed today, TSL 4. DOE explicitly considered the role of 

manufacturers, including small manufacturers, in its selection of TSL 4 rather than TSL 

5. Though TSL 5 results in greater energy savings for the country, the standard would 

place excessive burdens on manufacturers. Chapter 12 of the NOPR TSD contains 

additional information about the impact of this rulemaking on manufacturers.

In addition to the other TSLs being considered, the NOPR TSD includes an RIA. 

For commercial refrigeration equipment, the RIA discusses the following policy 

alternatives: (1) no change in standard; (2) consumercustomer rebates; (3) 

consumercustomer tax credits; (4) manufacturer tax credits; and (5) early replacement. 

While these alternatives may mitigate to some varying extent the economic impacts on 

small entities compared to the amended standards, DOE determined that the energy 

savings of these regulatory alternatives would be at least five times smaller than those 

that would be expected to result from adoption of the proposed amended standard levels. 

Thus, DOE rejected these alternatives and is proposing to adopt the amended standards 

set forth in this rulemaking. (See chapter 1617 of the NOPR TSD for further detail on the 

policy alternatives DOE considered.)

However, DOE seeks comment and, in particular, data on the impacts of this 

rulemaking on small businesses. (See Issue 10 under “Issues on Which DOE Seeks 

Comment” in section VII.E of this NOPR.)
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C. Review Under the Paperwork Reduction Act

Manufacturers of commercial refrigeration equipment 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 commercial refrigeration equipment, 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

commercial refrigeration equipment. 76 FR 12422 (March 7, 2011). The collection-ofinformation 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 20 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.

D. Review Under the National Environmental Policy Act of 1969 

Pursuant to the National Environmental Policy Act (NEPA) of 1969, (42 U.S.C. 
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4321 et seq.) 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, appendix 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 establishes energy conservation standards for 

consumer products or industrial equipment, 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 at 

13735. EPCA governs and prescribes Federal preemption of State regulations as to 
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energy conservation for the products that are the subject of today’s 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 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 
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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. Pub. L. 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 at 12820. DOE’s policy statement is

also available at http://energy.gov/gc/office-general-counsel. 

Although today’s proposed rule does not contain a Federal intergovernmental 

mandate, it may require expenditures of $100 million or more on the private sector. 

Specifically, the proposed rule will likely result in a final rule that could require 
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expenditures of $100 million or more. Such expenditures may include: (1) investment in 

research and development and in capital expenditures by commercial refrigeration 

equipment manufacturers in the years between the final rule and the compliance date for 

the new standards; and (2) incremental additional expenditures by consumerscustomers to 

purchase higher efficiency commercial refrigeration equipment, starting at the 

compliance date for the applicable standard. 

Section 202 of UMRA authorizes a Federal agency to respond to the content 

requirements of UMRA in any other statement or analysis that accompanies the proposed 

rule. (2 U.S.C. 1532(c)) The content requirements of section 202(b) of UMRA relevant to 

a private sector mandate substantially overlap the economic analysis requirements that 

apply under section 325(o) of EPCA and Executive Order 12866. The 

SUPPLEMENTARY INFORMATION section of this NOPR and the “Regulatory 

Impact Analysis” section of the NOPR TSD for this proposed rule respond to those 

requirements. 

Under section 205 of UMRA, DOE is obligated to identify and consider a 

reasonable number of regulatory alternatives before promulgating a rule for which a 

written statement under section 202 is required. (2 U.S.C. 1535(a)) DOE is required to 

select from those alternatives the most cost-effective and least burdensome alternative 

that achieves the objectives of the proposed rule unless DOE publishes an explanation for 

doing otherwise, or the selection of such an alternative is inconsistent with law. As 

required by 42 U.S.C. 6295(d), (f), and (o), 6313(e), and 6316(a), today’s proposed rule 
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would establish energy conservation standards for commercial refrigeration equipment

that are designed to achieve the maximum improvement in energy efficiency that DOE 

has determined to be both technologically feasible and economically justified. A full 

discussion of the alternatives considered by DOE is presented in the “Regulatory Impact 

Analysis” section of the TSD for today’s proposed rule.

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 126

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.

30

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 
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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 today’s 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 today’s regulatory action, which sets forth 

proposed energy conservation standards for commercial refrigeration equipment, is not a 

significant energy action because the proposed standards are not likely to have a 

significant adverse effect on the supply, distribution, or use of energy, nor has it been 
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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 at 2667 (Jan. 14, 2005). 

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 
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“Energy Conservation Standards Rulemaking Peer Review Report,” dated February 

2007, has been disseminated and is available at the following website: 

www1.eere.energy.gov/buildings/appliance_standards/peer_review.html. 

VII. Public Participation

A. Attendance at the Public Meeting

The time, date, and location of the public meeting are listed in the DATES and 

ADDRESSES sections at the beginning of this notice. If you plan to attend the public 

meeting, please notify Ms. Brenda Edwards at (202) 586-2945 or 

Brenda.Edwards@ee.doe.gov. Please note that foreign nationals visiting DOE 

Headquarters are subject to advance security screening procedures. Any foreign national 

wishing to participate in the meeting should advise DOE as soon as possible by 

contacting Ms. Edwards to initiate the necessary procedures. Please also note that those 

wishing to bring laptops into the Forrestal Building will be required to obtain a property 

pass. Visitors should avoid bringing laptops, or allow an extra 45 minutes. 

In addition, you can attend the public meeting via webinar. Webinar registration 

information, participant instructions, and information about the capabilities available to 

webinar participants will be published on DOE’s website at: 

www1.eere.energy.gov/buildings/appliance_standards/product.aspx/productid/52. 

Participants are responsible for ensuring their systems are compatible with the webinar 

software.
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B. Procedure for Submitting Prepared General Statements for Distribution

Any person who has plans to present a prepared general statement may request 

that copies of his or her statement be made available at the public meeting. Such persons 

may submit requests, along with an advance electronic copy of their statement in PDF 

(preferred), Microsoft Word or Excel, WordPerfect, or text (ASCII) file format, to the 

appropriate address shown in the ADDRESSES section at the beginning of this notice. 

The request and advance copy of statements must be received at least one week before 

the public meeting and may be emailed, hand-delivered, or sent by mail. DOE prefers to 

receive requests and advance copies via email. Please include a telephone number to 

enable DOE staff to make follow-up contact, if needed.

C. Conduct of the Public Meeting

DOE will designate a DOE official to preside at the public meeting and may also 

use a professional facilitator to aid discussion. The meeting will not be a judicial or 

evidentiary-type public hearing, but DOE will conduct it in accordance with section 336 

of EPCA (42 U.S.C. 6306). A court reporter will be present to record the proceedings and 

prepare a transcript. DOE reserves the right to schedule the order of presentations and to 

establish the procedures governing the conduct of the public meeting. After the public 

meeting, interested parties may submit further comments on the proceedings as well as on 

any aspect of the rulemaking until the end of the comment period.

The public meeting will be conducted in an informal, conference style. DOE will 
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present summaries of comments received before the public meeting, allow time for 

prepared general statements by participants, and encourage all interested parties to share 

their views on issues affecting this rulemaking. Each participant will be allowed to make 

a general statement (within time limits determined by DOE), before the discussion of 

specific topics. DOE will allow, as time permits, other participants to comment briefly on 

any general statements. 

At the end of all prepared statements on a topic, DOE will permit participants to 

clarify their statements briefly and comment on statements made by others. Participants 

should be prepared to answer questions by DOE and by other participants concerning 

these issues. DOE representatives may also ask questions of participants concerning other 

matters relevant to this rulemaking. The official conducting the public meeting will 

accept additional comments or questions from those attending, as time permits. The 

presiding official will announce any further procedural rules or modification of the above 

procedures that may be needed for the proper conduct of the public meeting.

A transcript of the public meeting will be included in the docket, which can be 

viewed as described in the Docket section at the beginning of this notice. In addition, any 

person may buy a copy of the transcript from the transcribing reporter. 

D. Submission of Comments

DOE will accept comments, data, and information regarding this proposed rule 

before or after the public meeting, but no later than the date provided in the DATES 
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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 webpage 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 
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regulations.gov cannot be claimed as CBI. Comments received through the website 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.

 
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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 wellmarked copies: one copy of the document marked confidential including all the 

information believed to be confidential, and one copy of the document marked nonconfidential 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 
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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 may 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). 

E. 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. Primary and Secondary Equipment Classes

In the January 2009 final rule analysis, DOE selected 15 “primary” classes to 

analyze directly in its engineering analyses, and designated the remaining 23 classes as 

“secondary” classes, for which standards were developed based on the primary class 

results. These designations were based on shipment-volume data coupled with input from 

stakeholders during that rulemaking process. As this rulemaking seeks to review and 
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potentially amend standards for the 38 total equipment classes examined in the January 

2009 final rule, DOE retained those primary and secondary class designations in its 

analyses. Additionally, equipment for which EPACT 2005 directly set standards was 

incorporated into the scope of this rulemaking. DOE treated all of these equipment 

classes previously covered by EPACT 2005 standards as primary classes. DOE seeks 

comment regarding its designation of primary and secondary equipment classes. 

2. Design Option and Core Case Costs

During the NOPR analyses, DOE performed physical teardowns on a selection of 

units currently on the market. From the bills of materials and cost model developed using 

this teardown data, DOE calculated an estimate of the manufacturer production cost of 

the core case assembly for each of the primary equipment classes in the engineering 

analysis. DOE also developed estimates of the costs for components that affect energy 

consumption, namely those it considered as design options. These estimates were 

obtained from a combination of sources, including publicly available prices from vendors 

and confidential estimates provided by manufacturers. This price data was aggregated for 

use in the engineering analysis. DOE seeks comment and data regarding the manufacturer 

production costs for commercial refrigeration equipment cases and components and the 

technological feasibility of applying technologies identified in the engineering analysis to 

meeting the proposed standards. Comment [A58]: Revision requested by OIRA.
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3. Offset Factors

In its January 2009 final rule, DOE developed offset factors as a way to adjust the 

energy -efficiency requirements for smaller equipment in each equipment class analyzed. 

These offset factors accounted for certain components of the refrigeration load (such as 

conduction end effects) that remain constant when equipment size varies and thus affect 

smaller cases disproportionately. The offset factors were intended to approximate these 

constant loads and provide a fixed end point, corresponding to a zero-volume or zeroTDA case, in an equation that describes the relationship between energy consumption 

and the corresponding TDA or volume metric. Similarly, the EPACT 2005 standards also 

contained values that did not vary with unit volume and which served a similar purpose. 

In developing standard level equations for the proposed amended standards, DOE scaled 

the existing offset factors by the ratio of the amount of energy consumption allowed by 

the existing standards for a given representative unit and the energy use calculated in the 

engineering analysis at each TSL. This adjustment of the offset factors ensures that 

neither larger nor smaller units are disadvantaged by these proposed standards. DOE 

seeks comment on its methodology for developing offset factors for the standard level 

equations presented in this NOPR. 

4. Extension of Standards

In its January 2009 final rule, DOE developed an extension approach toa 

quantitative method for applying the standards developed for its primary equipment 

classes to the remaining, secondary classes. This approach involved extension multipliers 

developedcreated using results from the analysis of the primary equipment classes and a 
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set of focused matched-pair analyses. Additionally, DOE applied standards developed for 

certain primary equipment classes directly to other similar secondary classes. In this 

rulemaking, DOE retained the extension multipliers from the January 2009 final rule and 

reapplied them to the equipment classes from that rulemaking for which DOE is 

proposing amended standards. DOE believes that the relationship between the 

performances of various types of equipment is still adequately modeled by the use of 

those multipliers. DOE’s approach in developing extension multipliers in the 2009 

rulemaking and its rationale for retaining them in this rulemaking are discussed in detail 

in section 5.9 of the NOPR TSD. DOE seeks comment on its approach to extending the 

results of the engineering analysis to secondary equipment classes. Specifically, DOE 

requests comment on whether the assumptions underlying its development and 

application of extension multipliers are appropriate, or whether there are additional 

differences between related equipment classes that DOE should take into account.

5. Types of Refrigerant Analyzed

DOE based its analysis on refrigeration equipment using R404A and R134a, HFC 

refrigerants widely used in the commercial refrigeration industry. DOE received 

comments regarding the consideration of refrigerants with lower GWP due to possible 

shifts in the marketplace toward these refrigerants and notes that a number of lower-GWP 

alternatives are available for use within certain portions of the commercial refrigeration 

sector.

108

 

108 For an overview of lower-GWP alternatives available to certain sections of the commercial refrigeration 

equipment sector, please see 

 The use of alternative refrigerants could be impacting to Climate Change and 

the environment. DOE requests comment on the extent of the current use or likely future 

http://www.epa.gov/ozone/downloads/EPA_HFC_ComRef.pdf 

Comment [A59]: Revision requested by OIRA.

Comment [A60]: Revision requested by OIRA.

Comment [A61]: Revision requested by OIRA.
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use of lower-GWP refrigerants, and asks manufacturers to submit data related to the 

ability of equipment (either existing or redesigned) using these refrigerants to meet the 

proposed standard. DOE seeks input as to the impacts of alternative refrigerants to the 

refrigeration system in this rulemaking.

6. Distribution Channel Market Shares and Markups

DOE has revised the distribution channel market shares for some of the 

equipment classes based on comments received during April 2011 preliminary analysis 

public meeting. The markup values associated with each distribution channel have been 

updated based on currently available industry profit data. DOE welcomes comment on 

the assumptions and values used for the markups analysis.

7. Market Shares of Efficiency Levels

DOE seeks comments on the market shares of efficiency levels used for this 

NOPR analysis. DOE is currently using a model to predict the market share of efficiency 

levels. According to commenters, the calculated market shares are biased toward the 

higher efficiency levels. However, DOE has cited lack of data as the primary reason for 

its lack of more accurate numbers. DOE welcomes information from stakeholders that 

would aid DOE in improving upon the numbers for market shares of efficiency levels.

8. Maintenance and Repair Costs at Higher Efficiency Levels. 

Currently, DOE assumes no increase in regular maintenance costs at higher 

efficiency levels contemplated in the proposed rule. Lighting maintenance and repair 

Comment [A62]: Revision requested by OIRA.

Comment [A63]: Revision requested by OIRA.

Comment [A64]: Revision requested by OIRA.

Comment [A65]: Revision requested by OIRA.
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costs are estimated based on OEM costs; they vary with higher efficiency levels. DOE 

welcomes stakeholder input and additional information to improve upon these estimates

with respect to maintenance and repair costs. Data pertaining to cost increases 

specifically associated with the design options considered in this rulemaking would be 

greatly appreciated.

9. Impact of Amended Standards on Future Shipments

Currently, DOE assumes that future shipments of commercial refrigeration 

equipment will not be affected by amended standards. While DOE has cited strong 

reasons to believe that this assumption is true for display cases, the assumption may not 

be entirely true in the case of equipment used in the foodservice industry. While there 

may be a small effect in the initial years of amended standards, DOE does not have data 

for the commercial refrigeration industry to obtain a reasonably accurate estimate of this 

effect. DOE welcomes stakeholder input and estimates on the effect of amended 

standards on future commercial refrigeration equipment shipments. DOE also welcomes 

input and data on the demand elasticity estimates used in the analysis. 

10. Learning Impacts on Price Forecast for Future Shipments

Currently, DOE projects future prices by subtracting the cost reductions 

associated with learning effects from the cost associated with the amended standards. 

DOE analyzes learning effects using PPI, a quantity adjusted index of wholesale prices, 

as a proxy for price of commercial refrigerators. DOE is seeking input, and price data 

that could be used in place of PPI. Also DOE is seeking input on the magnitude of the 
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price data and the cause of those price changes. 

11. Product Attributes

DOE requests comment on whether there are features or attributes of the more 

energy-efficient commercial refrigerators that manufacturers would produce to meet the 

standards in this proposed rule that might affect how they would be used by different 

customer categories (e.g., refrigeration in grocery stores or restaurants). One example of 

such an effect might be that grocers or restaurant operators would change where, how,

and how long food items would be stored or displayed. DOE requests comment 

specifically on how any such effects should be weighed in the choice of standards for 

these refrigerators for the final rule.

12. Analytical Timeline

For this rulemaking, DOE analyzed the effects of this proposal assuming that the 

commercial refrigerators would be available to purchase for 30 years and undertook a 

sensitivity analysis using 9 years rather than 30 years of product shipments. The choice of 

a 30-year period of shipments is consistent with the DOE analysis for other products and 

commercial equipment. The choice of a 9-year period is a proxy for the timeline in 

EPCA for the review of certain energy conservation standards and potential revision of 

and compliance with such revised standards. We are seeking input, information and data 

on whether there are ways to refine the analytic timeline further.
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13. Equipment Lifetime

DOE defines lifetime as the age at which a commercial refrigeration equipment 

unit is retired from service. DOE based expected equipment lifetime on discussions with 

industry experts and concluded that a typical lifetime of 10 years is appropriate for most 

commercial refrigeration equipment in large grocery/multi-line stores and restaurants. 

Operators of small food retail stores, on the other hand, tend to use display cases longer. 

DOE used 15 years as the average equipment lifetime for display cases used in such retail 

stores. DOE welcomes further input on the average equipment lifetimes for the LCC 

analysis and NIA.

13.14. Small Businesses

During the Framework and preliminary analysis public meetings, DOE received 

many comments regarding the potential impacts of amended energy conservation 

standards on small business manufacturers of commercial refrigeration equipment. In its 

market and technology assessment and manufacturer impact analysis research, DOE 

developed a list of companies falling under its classification of small businesses, and 

sought specific feedback regarding potentially disproportionate impacts of amended 

standards on these businesses. DOE incorporated this feedback into its analyses for the 

NOPR and has presented its results in this notice and the technical support document. 

However, DOE seeks comment and, in particular, data, in its efforts to quantify the 

impacts of this rulemaking upon small businesses.on small business manufacturers. In 

addition, DOE seeks comment on any disproportionate impacts of amended standards on 

any particular customer groups, such as small businesses that are small grocery, 

Comment [A66]: Revision requested by OIRA.
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convenience stores, and restaurants. 

15. Update to Social Cost of Carbon Values

DOE solicits comment on the application of the new SCC values used to 

determine the social benefits of CO2 emissions reductions over the rulemaking analysis 

period. The rulemaking analysis period covers from 2017 to 2046 plus an additional 15 

years to account for the lifetime of the equipment purchased between 2017 and 2046. In 

particular, the agency solicits comment on the agency’s derivation of SCC values after 

2050 where the agency applied the average annual growth rate of the SCC estimates in 

2040−2050 associated with each of the four sets of values.

16. Cumulative Regulatory Burdens

 The agency seeks input on the cumulative regulatory burden that may be 

imposed on industry either from recently implemented rulemakings for this product class 

or other rulemakings that affect the same industry. 

17. Compliance Date

Pursuant to EPCA, any amended standards established in this rulemaking must

apply to equipment that is manufactured on or after 3 years after the final rule is 

published in the Federal Register unless DOE determines, by rule, that a 3-year period is 

inadequate, in which case DOE may extend the compliance date for that standard by an 

additional 2 years. DOE proposes to provide 3 years for compliance with this standard, 
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but seeks comment on whether it should consider a longer compliance date as authorized, 

and, if so, by how much.

 

Comment [A67]: Revision requested by OIRA.
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VIII. Approval of the Office of the Secretary

The Secretary of Energy has approved publication of today’s proposed rule.

List of Subjects in 10 CFR Part 431

Administrative practice and procedure, Confidential business information, Energy 

conservation, Commercial equipment, Imports, Intergovernmental relations,and

Reporting and recordkeeping requirements, and Small businesses. 

 

Issued in Washington, DC, on 

________________________________ 

Henry Kelly

Acting David T. Danielson

Assistant Secretary

Energy Efficiency and Renewable Energy
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For the reasons set forth in the preamble, DOE proposes to amend part 431 of chapter II 

of title 10, of the Code of Federal Regulations, as set forth below: 

PART 431 – ENERGY EFFICIENCY PROGRAM FOR CERTAIN 

COMMERCIAL AND INDUSTRIAL EQUIPMENT

1. The authority citation for part 431 continues to read as follows:

Authority: 42 U.S.C. 6291–6317. 

2. Section 431.62 is amended by adding in alphabetical order a new definition for 

“service over counter,” to read as follows:

§ 431.62 Definitions concerning commercial refrigerators, freezers and 

refrigerator-freezers.

* * * * * 

Service over counter means equipment with sliding or hinged doors in the back 

intended for use by sales personnel for loading and retrieving items for sale and fixed, 

sliding or hinged transparent panels in the front for displaying merchandise. The 

equipment has a height no greater than 66 inches and is intended to serve as a counter for 

transactions between sales personnel and customers.

* * * * * 

3. Section 431.66 is amended by:

a. Revising paragraph (a)(3);
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b. Revising paragraph (b) introductory paragraph, (c), and (d) introductory paragraphtext;

c. Adding newRevising paragraph (c);

d. Revising paragraph (d) introductory text; and

c. Adding paragraph (e). 

The revisions and addition read as follows:

§ 431.66 Energy conservation standards and their effective dates.

(a) * * *

(3) For the purpose of paragraph (d) of this section, the term “TDA” means the 

total display area (ft2

) of the case, as defined in ARI Standard 1200-2006, appendix D 

(incorporated by reference, see §431.63). For the purpose of paragraph (e) of this section, 

the term “TDA” means the total display area (ft2

) of the case, as defined in AHRI 

Standard 1200 (I-P)-2010, appendix D (incorporated by reference, see §431.63). 

(b) Each commercial refrigerator, freezer, and refrigerator-freezer with a selfcontained condensing unit designed for holding temperature applications manufactured 

on or after January 1, 2010 and before January 1, 2016 [date 3 years after date of 

publication of the final rule in the Federal Register]shall have a daily energy 

consumption (in kilowatt-hours per day) that does not exceed the following: 

* * * * * 

(c) Each commercial refrigerator with a self-contained condensing unit designed 

for pull-down temperature applications and transparent doors manufactured on or after 

January 1, 2010 and before January 1, 2016[date 3 years after date of publication of the 

final rule in the Federal Register] shall have a daily energy consumption (in kilowatt-
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hours per day) of not more than 0.126V + 3.51.

(d) Each commercial refrigerator, freezer, and refrigerator-freezer with a selfcontained condensing unit and without doors; commercial refrigerator, freezer, and 

refrigerator-freezer with a remote condensing unit; and commercial ice-cream freezer 

manufactured on or after January 1, 2012 and before January 1, 2016[date 3 years after 

date of publication of the final rule in the Federal Register] shall have a daily energy 

consumption (in kilowatt-hours per day) that does not exceed the levels specified: 

* * * * * 

(e) Each commercial refrigerator, freezer, and refrigerator-freezer with a selfcontained condensing unit designed for holding temperature applications and with solid 

or transparent doors; commercial refrigerator with a self-contained condensing unit 

designed for pull-down temperature applications and with transparent doors; commercial 

refrigerator, freezer, and refrigerator-freezer with a self-contained condensing unit and 

without doors; commercial refrigerator, freezer, and refrigerator-freezer with a remote 

condensing unit; and commercial ice-cream freezer manufactured on or after January 1, 

2016,[date 3 years after date of publication of the final rule in the Federal Register],

shall have a daily energy consumption (in kilowatt-hours per day) that does not exceed 

the levels specified:

(1) For equipment other than hybrid equipment, refrigerator/freezers, or wedge 

cases:

Equipment 

Category

Condensing 

Unit 

Configuration

Equipment 

Family

Rating 

Temp.

°F

Operating 

Temp.

°F

Equipment 

Class 

Designation*

Maximum 

Daily Energy 

Consumption

kWh/day

Remote 

Condensing 

Commercial 

Remote (RC) Vertical 

Open (VOP) 38 (M) ≥32 VOP.RC.M

0.76 x61 ×

TDA + 3.76

03
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Refrigerators and 

Commercial 

Freezers

0 (L) <32 VOP.RC.L

.....

2.11 x× TDA 

+ 6.36

Semivertical 

Open (SVO)

38 (M) ≥32 SVO.RC.M

0.77 x63 ×

TDA + 2.94

41

0 (L) <32 SVO.RC.L

.....

2.11 × TDA + 

6.36

Horizontal 

Open (HZO)

38 (M) ≥32 HZO.RC.M 0.35 × TDA + 

2.88

0 (L) <32 HZO.RC.L 0.57 × TDA + 

6.88

Vertical 

Closed 

Transparent 

(VCT)

38 (M) ≥32 VCT.RC.M 0.08 × TDA + 

0.72

0 (L) <32 VCT.RC.L 0.43 × TDA + 

2.03

Horizontal 

Closed 

Transparent 

(HCT)

38 (M) ≥32 HCT.RC.M 0.14 × TDA + 

0.11

0 (L) <32 HCT.RC.L 0.3 × TDA + 

0.23

Vertical 

Closed Solid 

(VCS)

38 (M) ≥32 VCS.RC.M 0.1 × V + 

0.24

0 (L) <32 VCS.RC.L 0.21 × V + 

0.5

Horizontal 

Closed Solid 

(HCS)

38 (M) ≥32 HCS.RC.M 0.1 × V + 

0.24

0 (L) <32 HCS.RC.L 0.21 × V + 

0.5

Service 

Over 

Counter 

(SOC)

38 (M) ≥32 SOC.RC.M

0.49 x39 ×

TDA + 0.1

08

0 (L) <32 SOC.RC.L

1.02 x0.83 ×

TDA + 0.22

18

Self-Contained 

Commercial 

Refrigerators and 

Commercial 

Freezers Without 

Doors

Self-Contained 

(SC).

Vertical 

Open (VOP)

38 (M) ≥32 VOP.SC.M

1.68 x51 ×

TDA + 4.54

09

0 (L) <32 VOP.SC.L

4.21 x3.79 ×

TDA + 11.4

10.26

Semivertical 

Open (SVO)

38 (M) ≥32 SVO.SC.M

1.64 x5 ×

TDA + 4.35

3.99

0 (L) <32 SVO.SC.L

4.12 x3.77 ×

TDA + 10.93

01

Horizontal 

Open (HZO)

38 (M) ≥32 HZO.SC.M 0.75 × TDA + 

5.44

0 (L) <32 HZO.SC.L 1.92 × TDA + 

7.08

Self-Contained 

Commercial 

Self-Contained 

(SC).

Vertical 

Closed 38 (M) ≥32 VCT.SC.M 0.04 × V + 

1.07
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Refrigerators and 

Commercial 

Freezers With 

Doors

Transparent 

(VCT) 0 (L) <32 VCT.SC.L 0.22 × V + 

1.21

Vertical 

Closed Solid 

(VCS)

38 (M) ≥32 VCS.SC.M 0.03 × V + 

0.53

0 (L) <32 VCS.SC.L 0.13 × V + 

0.43

Horizontal 

Closed 

Transparent 

(HCT)

38 (M) ≥32 HCT.SC.M 0.02 × V + 

0.51

0 (L) <32 HCT.SC.L 0.11 × V + 

0.6

Horizontal 

Closed Solid 

(HCS)

38 (M) ≥32 HCS.SC.M 0.02 × V + 

0.37

0 (L) <32 HCS.SC.L 0.12 × V + 

0.42

Service 

Over 

Counter 

(SOC)

≥32 SOC.SC.M 0.32 × TDA + 

0.53

0 (L) <32 SOC.SC.L 0.67 × TDA + 

1.12

Self-Contained 

Commercial 

Refrigerators 

with Transparent 

Doors for PullDown 

Temperature 

Applications

Self-Contained 

(SC).

Pull-Down 

(PD) 38 (M) ≥32 PD.SC.M 0.03 × V + 

0.83

Commercial IceCream Freezers. Remote (RC)

Vertical 

Open (VOP)

-15 (I) ≤-5**

VOP.RC.I 2.68 × TDA + 

8.08

Semivertical 

Open (SVO) SVO.RC.I 2.68 × TDA + 

8.08

Horizontal 

Open (HZO) HZO.RC.I 0.72 × TDA + 

8.74

Vertical 

Closed 

Transparent 

(VCT)

VCT.RC.I 0.51 × TDA + 

2.37

Horizontal 

Closed 

Transparent 

(HCT)

HCT.RC.I 0.35 × TDA + 

0.27

Vertical 

Closed Solid 

(VCS)

VCS.RC.I 0.25 × V + 

0.58

Horizontal 

Closed Solid 

(HCS)

HCS.RC.I 0.25 × V + 

0.58

Service 

Over 

Counter 

(SOC)

SOC.RC.I

1.19 x0.97 ×

TDA + 0.26

21
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Self-Contained 

(SC).

Vertical 

Open (VOP) VOP.SC.I

5.35 x4.81 ×

TDA + 14.48

13.03

Semivertical 

Open 

(SVO).

SVO.SC.I

5.23 x4.79 ×

TDA + 13.88

12.72

Horizontal 

Open 

(HZO).

HZO.SC.I 2.44 × TDA + 

9.0

Vertical 

Closed 

Transparent 

(VCT).

VCT.SC.I 0.52 × TDA + 

2.56

Horizontal 

Closed 

Transparent 

(HCT).

HCT.SC.I 0.49 × TDA + 

0.37

Vertical 

Closed Solid 

(VCS).

VCS.SC.I 0.35 × V + 

0.81

Horizontal 

Closed Solid 

(HCS).

HCS.SC.I 0.35 × V + 

0.81

Service 

Over 

Counter 

(SOC)

SOC.SC.I

1.67 x35 ×

TDA + 0.36

29

* The meaning of the letters in this column is indicated in the columns to the left.

** Ice-cream freezer is defined in 10 CFR 431.62 as a commercial freezer that is designed to operate at or 

below -5 °F *(-21 °C) and that the manufacturer designs, markets, or intends for the storing, displaying, or 

dispensing of ice cream.

(2) For commercial refrigeration equipment with two or more compartments (i.e., 

hybrid refrigerators, hybrid freezers, hybrid refrigerator-freezers, and non-hybrid 

refrigerator-freezers), the maximum daily energy consumption for each model shall be 

the sum of the MDEC values for all of its compartments. For each compartment, measure 

the TDA or volume of that compartment, and determine the appropriate equipment class 

based on that compartment’s equipment family, condensing unit configuration, and 

designed operating temperature. The MDEC limit for each compartment shall be the 

calculated value obtained by entering that compartment’s TDA or volume into the 

standard equation in paragraph (e)(1) of this section for that compartment’s equipment 
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class. Measure the CDEC or TDEC for the entire case as described in §431.66(d)(2)(i)

through (iii), except that where measurements and calculations reference ARI Standard 

1200-2006 (incorporated by reference, see §431.63), AHRI Standard 1200 (I-P)-2010 

(incorporated by reference, see §431.63) shall be used. 

(3) For remote condensing and self-contained wedge cases, measure the CDEC or 

TDEC according to the AHRI Standard 1200 (I-P)-2010 test procedure (incorporated by 

reference, see §431.63). For wedge cases in equipment classes for which a volume metric 

is used, the MDEC shall be the amount derived from the appropriate standards equation 

in paragraph (e)(1) of this section. For wedge cases of equipment classes for which a 

TDA metric is used, the MDEC for each model shall be the amount derived by 

incorporating into the standards equation in paragraph (e)(1) of this section for the 

equipment class a value for the TDA that is the product of:

(i) The vertical height of the air curtain (or glass in a transparent door) and (ii) 

The largest overall width of the case, when viewed from the front.

(ii) The largest overall width of the case, when viewed from the front.