# /77) U.S.Departmentof Energy June 1999 BASELINE AND TRIAL STANDARD LEVEL RESULTS FOR THE CONSUMER SUB-GROUP ANALYSIS FORRESIDENTIAL WATER HEATEREFFICIENCY STANDARDS Summary of Results The consumer sub-group analysis (CSG)examines the economic impacts on different population groups ofconsumers from possible revisions to U.S. residential water heater energyefficiency standards. Life-cycle cost represents the consumer's cost ofpurchasing and installing a water heater and operating it for its lifetime. The analysis determines whether or not aparticular segment ofconsumers would be adversely affected fromdifferent design option combinations in terms ofreduced or increased life-cycle cost. The mean life-cycle cost change is also estimated. Negative numbers indicate a life-cycle cost decrease, which is a benefit to consumers. Please refer to the Life-Cycle Cost Analysis document for details and features ofthe trial-standard levels. Summary ofDelta LCC Results Product Class Trial Standard Low-Income Senior-Only Level Delta LCC Delta LCC Mean (1998$) %Winners Mean (1998$) % Winners Electric Trial Standard 1 -55 100 -56 100 Trial Standard2 -48 98 -51 98 Trial Standard 3 25 22 22 25 Trial Standard 4 25 22 22 25 Gas-Fired Trial Standard 1 -16 100 -17 100 Trial Standard 2 -33 95 -27 90 Trial Standard 3 24 51 29 47 Trial Standard 4 173 7 180 5 Oil-Fired Trial Standard 1 -14 100 -15 100 Trial Standard 2 -14 100 -15 100 Trial Standard 3 -4 73 -8 78 Trial Standard 4 263 0 300 0 The Consumer Sub-Group analysis forwater heaters estimates the energy consumption and life-cycle costs under different trial standard levels for several thousand households. Of particular interest is thepotential effect ofstandards on households with low-income levels and on senior-only residents. Atthe workshop, stakeholders generally agreed that DOE should analyze the low-income and seniors-only consumer subgroups. Data Used in the Analysis Variations in energy use ofwaterheaters between households depends on the following factors: size and type ofwater heater, climate, number and age ofpeople in a household, and presence ofhot water-using appliances. Using water heater energy and hot watermodels, we estimate annual energy use for several thousand households. The models are derived from test procedures and field measurements. We used the1993 Residential Energy Consumption Survey 1(RECS) data for household characteristics in combination with a wateruse equation and an energy use equation, (WHAM, see Price-Efficiency Web page) to calculate hot wateruse, energy consumption, andfuel price. With data from 5222 ofthe 7041 RECS households, we account for the variability offactors between households that affect water heater energy use intheresidential sector. The 5222 households represent 70,587,617 households inthe United States, 73% ofthe household population. The households used inthe analysis have the following features: (1) running hot water; (2) thewater heater provides hot water to a single-family housing unit; (3)use one offour fuels (natural gas, LPG, fuel oil, or electricity); (4)billing information that permitted usto calculate the marginal fuel or electric rate; and (5) information on water heater size. Table 1 shows the composition ofthe consumer sub-group sample. Tables 2 and 3 show households we did not use inthe analysis. The numbers ofhousing records in Table 2 do notadd up to 1819 because one housing record may fall into more than one category for rejection. Table 1: Profile ofRECS Households Used in Consumer Sub-Group Analysis Category # ofRECS Housing Records % ofHousehold Population (weighted) Fuel Type Total Low- SeniorIncome Only Natural Gas 2475 50.9 46.8 50.5 LPG 248 3.6 5.3 4.7 Fuel Oil 176 2.6 1.0 2.6 Electricity 2323 42.9 46.9 42.2 Water HeaterSize Small 1110 21.5 32.8 25.8 Medium 2845 56.0 50.4 51.6 Large 1267 22.5 16.8 22.6 Table 2: Profile of RECS Households Not Used in Consumer Sub-Group Analysis Category # ofRECS Housing Records Household Population (weighted) Unused Sample Size 1819 25,525,034 # of RECS Housing Records %Household Population (weighted) Other Fuel Types 54 0.78 Water Heater Size 1151 16.75

Shared WH Unit 742 11.37 Table 3: Number ofRECS Households With No Marginal Rate Information Marginal Rate

Information

No Natural Gas 1104 17.3 No Electric 532 7.3 2Life-Cycle Cost Determination DOE uses life-cycle cost (LCC) as the metric to determine consumer impacts. LCC isthe total consumer expense over the life ofawater heater, including (1) purchase price, (2) installation cost, and (3) operating cost. The purchase price and installation costs ofbaseline model water heaters came from a database ofretail stores and wholesale waterheater distributors.*The operating cost calculation requires knowing three things: (1) the quantity ofhot water used, (2) the amount ofenergy used, and; (3) the energy price. The operating cost is largely determined by the amount ofhot water used bythe household. The amount ofhot waterused varies widely between households; itis dependent on: (1) the number, age, and employment status ofthepeople who live in the home; (2) the climate in which the home is situated; (3) thepresence ofhot water-using appliances; (4) thetank size and thermostat setpoint ofthe water heater; and (5) whether the household pays for the water heating fuel. Using these five characteristics, we calculated the average daily hot water use. The average daily hot wateruse and the waterheater characteristics determine the energy use which, when combined with the energy cost, results inthe operating cost. Figure 1shows the distribution of numbers ofpeople inhomes across the country. Figure 2 shows the variation inwater heater thermostat setpoint temperature inthe United States. Figure 3 shows the average daily hotwater use. Figure 1: Number ofPeople per Household

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### Bycomparing the LCC ofall consumers tothe LCC ofthetwo consumer sub-groups of interest, we can determine ifthe proposed trial standards affectthose sub-groups differently. DOE made these determinations foreach trial standard level for low-income and senior-only households. Figures 4 and 5 show the distribution oflow-income and senior-only households throughout the country. Figures 6through 8 show the baseline waterheater life-cycle costfor three population groups: the entire sample population, low-income households, and senior-only households. The baseline level assumes a water-blown baseline waterheater for every household.

4Table 4: Trial Standard Levels forNatural Gas, LPG, Fuel Oil, and Electric Water Heaters Trial StandardLevel Natural Gas and LPG Fuel Oil Electricity I Heat Traps Heat Traps Heat Traps +Insulated Tank bottom 2 Heat Traps + 78% RE Flue Heat Traps +2.5" H20 Heat Traps + 2.5" H20 Baffle + 2" H20 Insulation Insulation Insulation +Insulated Tank Bottom 3 Heat Traps + 2.5" H20 Heat Traps + 3"H20 Heat Traps +3" H20 Insulation + 80% RE Flue Insulation +78% RE + Insulation +Plastic Tank Baffle Interrupted Ignition 4 Heat Traps, +3" H20 Heat Traps, + 3" H20 Heat Traps +3" H20 Insulation + Side Arm Insulation + 82% Heat Insulation +Plastic Tank Heater + 80% RE Flue Exchanger +Interrupted Baffle +Plastic Tank Ignition Figure 4: Low-Income Households, Percentage ofRegion



## '"*.'. Figure 5: Senior-Only Households, Percentage ofRegion

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### i~~~~~~Figure 6: Life-Cycle Costfor All Households in Sample -- Baseline Level

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Figure 7: Life-Cycle Costfor SeniLow-IncomeHouseholds - Baseline Level 

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### Figure 8:Life-Cycle CostforSenior-Only Households- BaselineLevel

6Figures 9-20 show the changes in life-cycle costs given four standard levels for the entire sample population, low-income households, and senior-only households. Savings are indicated by negative numbers. The trial standard levels are shown in Table 4. Figure 9: Delta Life-Cycle Cost for All Households in Sample - Trial Standard Level One

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### tadrdLvenOverall, referring to Figure 13, Delta LCC for low income households, for trial standard level two, one can see thatmost ofthe US regions benefit by $50 while some may have up to $150 benefit. These benefits outweigh the region ofMontana and eastern Washington that has an adverse impact up to $50. Similarly, in figure 14, benefits outweigh the adverse impacts but to a slightly lesser extent. Figure 12: Delta Life-Cycle Cost for All Households in Sample - Trial Standard Level Two

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II. 2 Figure 13: Delta Life-Cycle Cost for Low-Income Households - Trial Standard Level Two (.*-.

Figure 14: Delta Life-Cycle Cost for Senior-Only Households - Trial Standard Level Two

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8Figure 15: Delta Life-Cycle Costfor All Households in Sample - Trial Standard Level Three

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### Figure 17: DeltaLife-Cycle Cost forSenior-Only Households- Trial Standard Level Three

9Figure 18: Delta Life-Cycle Cost forAll Households in Sample - Trial Standard Level Four

Figure 19: Delta Life-Cycle Cost for Low-Income Households - Trial Standard Level Four



### f :--+ · Figure 20: Delta Life-Cycle Cost for Senior-Only Households - Trial Standard Level Four

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