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CHAPTER 1. INTRODUCTION

TABLE OF CONTENTS

1.1 PURPOSE OF THE DOCUMENT ................................................................................. 1-1

1.2 OVERVIEW OF STANDARDS FOR RESIDENTIAL PORTABLE AIR 

CONDITIONERS............................................................................................................ 1-1

1.3 PROCESS FOR SETTING ENERGY CONSERVATION STANDARDS ................... 1-2

1.4 STRUCTURE OF THE DOCUMENT............................................................................ 1-5

LIST OF TABLES

Table 1.3.1 Analyses Under the Process Rule ........................................................................ 1-4
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CHAPTER 1. INTRODUCTION

1.1 PURPOSE OF THE DOCUMENT

This preliminary technical support document (TSD) is a stand-alone report that provides 

the technical analyses and results supporting the information presented in the preliminary notice 

of public meeting (NOPM) and executive summary for residential portable air conditioners 

(ACs). This preliminary TSD reports on the preliminary activities and analyses conducted in the 

period preceding the notice of proposed rulemaking (NOPR) of this rulemaking.

1.2 OVERVIEW OF STANDARDS FOR RESIDENTIAL PORTABLE AIR 

CONDITIONERS

The Energy Policy and Conservation Act (EPCA) of 1975, Pub. L. 94-163 (42 United 

States Code (U.S.C.) 6291–6309), established an energy conservation program for major 

household appliances. Part A of title III of EPCA (42 U.S.C. 6291-6309) establishes the “Energy 

Conservation Program for Consumer Products Other Than Automobiles”, which covers 

consumer products and certain commercial products (hereinafter referred to as “covered 

products”).a EPCA authorizes the U.S. Department of Energy (DOE) to establish technologically 

feasible, economically justified energy conservation standards for covered products or equipment 

that would be likely to result in significant national energy savings. (42 U.S.C. 

6295(o)(2)(B)(i)(I)–(VII))

In addition to specifying a list of covered residential and commercial products, EPCA 

contains provisions that enable the Secretary of Energy to classify additional types of consumer 

products as covered products. For a given product to be classified as a covered product, the 

Secretary must determine that (1) classifying the product as a covered product is necessary for 

the purposes of EPCA; and (2) the average annual per-household energy use by products of each 

type is likely to exceed 100 kilowatt-hours (kWh) per year. (42 U.S.C. 6292(b)(1))

There are currently no DOE test procedures or energy conservation standards for portable 

ACs. In a notice of proposed determination (NOPD) published in the Federal Register on July 5, 

2013 (hereinafter referred to as the “July 2013 NOPD”), DOE outlined its tentative 

determination that portable ACs fulfill the criteria for being added as a covered product pursuant 

to 42 U.S.C. 6292(b)(1). 78 FR 40403, 40404.

For the Secretary to prescribe an energy conservation standard pursuant to 42 U.S.C. 

6295(o) and (p) for covered products added pursuant to 42 U.S.C. 6292(b)(1), he or she must 

 

a For editorial reasons, upon codification in the U.S. Code, Part B was re-designated Part A.
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also determine that (1) the average household energy use of the products has exceeded 150 kWh

per household for a 12-month period; (2) the aggregate 12-month energy use of the products has 

exceeded 4.2 terawatt-hours (TWh); (3) substantial improvement in energy efficiency is 

technologically feasible; and (4) application of a labeling rule under 42 U.S.C. 6294 is unlikely 

to be sufficient to induce manufacturers to produce, and consumers and other persons to 

purchase, covered products of such type (or class) that achieve the maximum energy efficiency 

that is technologically feasible and economically justified. (42 U.S.C. 6295(l)(1))

1.3 PROCESS FOR SETTING ENERGY CONSERVATION STANDARDS

Under EPCA, when DOE is studying new or amended standards, it must consider, to the 

greatest extent practicable, the following seven factors (42 U.S.C. 6295 (o)(2)(B)(i)):

1) the economic impact of the standard on the manufacturers and consumers of the affected 

products; 

2) the savings in operating costs throughout the estimated average life of the product 

compared to any increases in the initial cost or maintenance expense; 

3) the total projected amount of energy savings likely to result directly from the imposition 

of the standard; 

4) any lessening of the utility or the performance of the products likely to result from the 

imposition of the standard; 

5) the impact of any lessening of competition, as determined in writing by the Attorney 

General, that is likely to result from the imposition of the standard; 

6) the need for national energy conservation; and 

7) other factors the Secretary considers relevant.

Other statutory requirements are set forth in 42 U.S.C. 6295(o)(1)–(2)(A), (2)(B)(ii)–(iii), 

and (3)–(4).

DOE considers stakeholder participation to be a very important part of the process for 

setting energy conservation standards. Through formal public notifications (i.e., Federal Register

notices), DOE actively encourages the participation and interaction of all stakeholders during the 

comment period in each stage of the rulemaking. Beginning with the framework document and 

during subsequent comment periods, interactions among stakeholders provide a balanced 

discussion of the information that is required for the standards rulemaking.
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Before DOE determines whether to adopt a proposed energy conservation standard, it 

must first solicit comments on the proposed standard. (42 U.S.C. 6295(m)(2)(B)) Any new or 

amended standard must be designed to achieve significant additional conservation of energy and 

be technologically feasible and economically justified. (42 U.S.C. 6295(o)(2)(A)) To determine 

whether economic justification exists, DOE must review comments on the proposal and 

determine that the benefits of the proposed standard exceed its burdens to the greatest extent 

practicable, weighing the seven factors listed above. (42 U.S.C. 6295 (o)(2)(B)(i))

After the publication of the framework document, the energy conservation standards 

rulemaking process involves three additional formal public notices, which DOE publishes in the 

Federal Register. The first of the rulemaking notices is a NOPM, which is designed to publicly 

vet the models and tools used in the preliminary rulemaking and to facilitate public participation 

before the NOPR stage. The second notice is the NOPR, which presents a discussion of

comments received in response to the NOPM and the preliminary analyses and analytical tools; 

analyses of the impacts of potential amended energy conservation standards on consumers, 

manufacturers, and the Nation; DOE’s weighting of these impacts of amended energy 

conservation standards; and the proposed energy conservation standards for the product. The 

third notice is the final rule, which presents a discussion of the comments received in response to 

the NOPR; the revised analyses; DOE’s weighting of these impacts; the amended energy 

conservation standards DOE is adopting for the product; and the compliance dates of the 

amended energy conservation standards.

In the July 2013 NOPD, DOE announced that it tentatively determined that portable ACs

meet the criteria for covered products because classifying products of such type as covered 

products is necessary or appropriate to carry out the purposes of EPCA, and the average U.S. 

household energy use for portable ACs is likely to exceed 100 kWh per year. 78 FR 40403–05. 

DOE also estimated that 973.7 thousand units were shipped in North America in 2012, with a 

projected growth to 1743.7 thousand units by 2018, representing nearly 80-percent growth in 6 

years.b The July 2013 NOPD is available at: 

http://www.regulations.gov/#!documentDetail;D=EERE-2013-BT-STD-0033-0001.

On May 9, 2014, DOE published in the Federal Register a notice of data availability

(NODA) (hereinafter referred to as the “May 2014 NODA”), in which it evaluated available 

industry test procedures to determine whether their methodologies may be suitable for 

incorporation in a future DOE test procedure, should DOE determine that portable ACs are a 

covered product. DOE conducted testing on a range of portable ACs to determine typical cooling

capacities and cooling energy efficiencies based on the existing industry test methods and other 

modified approaches. 79 FR 26639, 26640 (May 9, 2014). The May 2014 NODA document is 

available at: http://www.regulations.gov/#!documentDetail;D=EERE-2014-BT-TP-0014-0001.

 

b Transparency Media Research, Air Conditioning Systems Market - Global Scenario, Trends, Industry Analysis, 

Size, Share and Forecast, 2012 – 2018, January 2013.
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DOE uses public meetings as an opportunity to inform and facilitate involvement of 

interested parties in the rulemaking process. The analytical framework presented at the public 

meetings describes the different analyses, such as the engineering analysis and the consumer 

economic analyses (i.e., the life-cycle cost (LCC) and payback period (PBB) analyses), the 

methods proposed for conducting them, and the relationships among the various analyses.

Table 1.3.1 Analyses Under the Process Rule

Preliminary Analyses NOPR Final Rule

Market and technology assessment Revised preliminary analyses Revised NOPR analyses

Screening analysis Life-cycle cost sub-group 

analysis

Engineering analysis Manufacturer impact analysis

Energy use determination Emissions impacts analysis

Markups for equipment price 

determination

Monetization of emissions 

analysis

Life-cycle cost and payback period 

analysis

Utility impact analysis

Shipments analysis Employment impact analysis

National impact analysis Regulatory impact analysis

Preliminary manufacturer impact analysis

In response to the July 2013 NOPD and May 2014 NODA, interested parties commented 

on numerous issues related to the analyses listed in Table 1.3.1. DOE attempted to address these 

issues during this preliminary analysis and summarized the comments and DOE’s responses in 

chapter 2 of the preliminary TSD.

As part of the information gathering and sharing process, DOE organized and held 

interviews with manufacturers of the portable ACs considered in this rulemaking as part of the 

engineering analysis and preliminary manufacturer impact analysis. DOE selected companies 

that represented production of all types of products, ranging from small to large manufacturers, 

and included the Association of Home Appliance Manufacturers (AHAM) member companies. 

DOE had four objectives for these interviews: (1) solicit manufacturer feedback on inputs to the 

engineering analysis; (2) solicit feedback on topics related to the preliminary manufacturer 

impact analysis; (3) provide an opportunity, early in the rulemaking process, to express 

manufacturers’ concerns to DOE; and (4) foster cooperation between manufacturers and DOE.

DOE incorporated the information gathered during the interviews with manufacturers 

into its engineering analysis (chapter 5) and the preliminary manufacturer impact analysis 

(chapter 12). Following the publication of the NOPM and the public meeting, DOE intends to 
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hold additional meetings with manufacturers as part of the consultative process for the 

manufacturer impact analysis conducted during the NOPR phase of the rulemaking.

DOE developed spreadsheets for the LCC, PBP, and national impact analyses for 

portable ACs. DOE developed an LCC spreadsheet that calculates the LCC and PBP at various 

energy efficiency levels. DOE also developed a national impact analysis spreadsheet that 

calculates the national energy savings (NES) and national net present values (NPVs) at various 

energy efficiency levels. This spreadsheet includes a model that forecasts the impacts of 

amended energy conservation standards at various levels on product shipments. All of these 

spreadsheets are available on the DOE website for residential portable ACs at:

http://www1.eere.energy.gov/buildings/appliance_standards/product.aspx/productid/79.

1.4 STRUCTURE OF THE DOCUMENT

This preliminary TSD outlines the analytical approaches used in this rulemaking. The

TSD consists of 17 chapters and supporting appendices.

Chapter 1 Introduction: provides an overview of the appliance standards program 

and how it applies to this rulemaking, and outlines the structure of the 

document.

Chapter 2 Analytical Framework, Comments from Interested Parties, and DOE 

Responses: describes the rulemaking process.

Chapter 3 Market and Technology Assessment: characterizes the market for the 

considered products and the technologies available for increasing 

product efficiency.

Chapter 4 Screening Analysis: identifies all the design options that improve 

efficiency of the considered products, and determines which technology 

options are viable for consideration in the engineering analysis.

Chapter 5 Engineering Analysis: discusses the methods used for developing the 

relationship between increased manufacturer price and increased 

efficiency.

Chapter 6 Markups for Equipment Price Determination: discusses the methods 

used for establishing markups for converting manufacturer prices to 

customer product costs.
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Chapter 7 Energy Use Analysis: discusses the process used for generating energyuse estimates for the considered products as a function of standard 

levels.

Chapter 8 Life-Cycle Cost and Payback Period Analysis: discusses the effects of 

standards on individual customers and users of the products and 

compares the LCC and PBP of products with and without higher 

efficiency standards.

Chapter 9 Shipments Analysis: discusses the methods used for forecasting 

shipments with and without higher efficiency standards, including how 

product purchase decisions are economically influenced and how DOE 

models this relationship with econometric equations.

Chapter 10 National Impact Analysis: Discusses the methods used for forecasting 

national energy consumption and national economic impacts based on 

annual product shipments and estimates of future product energy 

efficiency distributions in the absence and presence of amended energy 

conservation standards.

Chapter 11 Consumer Subgroup Analysis: discusses the effects of standards on 

different subgroups of consumers and compares the LCC and PBP of 

products with and without higher efficiency standards for these 

consumers.

Chapter 12 Preliminary Manufacturer Impact Analysis: discusses the effects of 

standards on the finances and profitability of product manufacturers.

Chapter 13 Emission Impact Analysis: discusses the effects of standards on three 

pollutants—sulfur dioxide (SO2), nitrogen oxides (NOx), and mercury—

as well as carbon dioxide emissions.

Chapter 14 Monetization of Emissions Reductions Benefits.

Chapter 15 Utility Impact Analysis: discusses certain effects of the considered on 

electric and gas utilities.

Chapter 16 Employment Impact Analysis: discusses the effects of standards on 

national employment.

Chapter 17 Regulatory Impact Analysis: discusses the impact of non-regulatory 

alternatives to efficiency standards.

Appendix 5A Engineering Analysis Interview Guide
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Appendix 7A Correlating Weather Station Data Mapping to Sample Buildings

Appendix 7B Energy Use in Commercial Applications

Appendix 8A User Instructions for Life-Cycle Cost and Payback Period Spreadsheets

Appendix 8B Uncertainty and Variability in LCC Analysis

Appendix 8C Calculating Energy Prices for Portable Air Conditioners

Appendix 8D Lifetime Distributions 

Appendix 8E Distributions for Discount Rates

Appendix 10A User Instructions for National Impact Analysis Spreadsheet Model

Appendix 10B Full-Fuel-Cycle Multipliers

Appendix 10C National Net Present Value of Consumer Benefits Using Alternative 

Product Price Forecasts

Appendix 10D National Energy Savings and Net Present Value Using Alternative 

Growth Scenarios

Appendix 12A Manufacturer Impact Analysis Interview Guide