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U.S. DEPARTMENT OF ENERGY 

PUBLIC MEETING ON THE NOTICE OF PROPOSED RULEMAKING 

FOR CERTAIN COMMERCIAL AIR CONDITIONING, HEATING, AND 

WATER-HEATING EQUIPMENT 

Room 8E-089 

U.S. Department of Energy 

1000 Independence Avenue, S.W. 

Washington, D.C. 20585 

9:00 a.m. 

Tuesday, April 7, 2009 

 DOUG BROOKMAN, Facilitator 

U.S. Department of Energy Attendees

 MOHAMMAD KHAN 

 FRANCINE PINTO, ESQ. 

 ERIC STAS, ESQ. 

 BRENDA EDWARDS 

 

Attendees

 KARIM AMRANE, Ph.D., Vice President 

 Regulatory and Research 

 Air Conditioning, Heating and Refrigeration 

 Institute (AHRI) 

 2111 Wilson Boulevard, Suite 500 

 Arlington, Virginia 22201-3001 

 ASHLEY ARMSTRONG, Managing Consultant 

 Navigant Consulting, Inc. 

 1801 K Street, NW, Suite 500 

 Washington, D.C. 20006 

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 TIMOTHY BALLO, Esq., Associate Attorney 

 EarthJustice 

 1625 Massachusetts Avenue, Suite 702 

 Washington, D.C. 20036 

 BELINDA CARR, Administrative Analyst 

 Energetics, Inc. 

 7067 Columbia Gateway Drive 

 Columbia, Maryland 21046 

Attendees

 ADAM DARLINGTON, Consultant 

 Navigant Consulting 

 1801 K Street, NW, Suite 500 

 Washington, D.C. 20006-1301 

 NERY DURON-LICONAS, Energy Manager 

 Naval Facilities Engineering Command 

 1013 O Street, SE 

 Building 166, Suite 100N 

 Washington, D.C. 20384-5018 

 JEFF HARRIS, Vice President for Programs 

 Alliance to Save Energy (ASE) 

 500 S. Myrtle Street 

 Seattle, Washington 98108 

 MARK KENDALL, Manager 

 Engineering and Research 

 Burnham Hydronics 

 P.O. Box 3079 

 Lancaster, Pennsylvania 17603 

 GRAHAM B. PARKER, Senior Staff Engineer 

 Technology Planning and Development 

 Pacific Northwest National Laboratory 

 902 Battelle Boulevard 

 P.O. Box 999, MSIN K6-05 

 Richland, Washington 99352 

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 KRISTEN RAYMOND, ESQ. 

 U.S. Department of Justice - Antitrust 

 450 5th Street, NW 

 Washington, D.C. 

 

 HARVEY SACHS, Ph.D., Senior Fellow 

 Buildings Program 

 American Council for an Energy-Efficient 

 Economy (ACEEE) 

 529 14th Street, NW, Suite 900 

 Washington, D.C. 20004 

Attendees

 

 FRANK STANONIK, Chief Technical Advisor 

 Air Conditioning, Heating and Refrigeration 

 Institute (AHRI) 

 2111 Wilson Boulevard, Suite 500 

 Arlington, Virginia 22201-3001 

 DAVID WINIARSKI, Senior Research Engineer 

 Energy and Engineering Division 

 Pacific Northwest National Laboratory 

 P.O. Box 999, MSIN K5-08 

 Richland, Washington 99352 

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A G E N D A 

ITEM: PAGE: 

 

Welcome 5 

 U.S. Department of Energy 

Rulemaking Overview 5 

 Mohammed Khan 

Opening Remarks, Introductions and 7 

Agenda Review 

 Doug Brookman 

Brief Opening Remarks from Interested No 

Parties Comments Made 

 Doug Brookman 

Determination of Scope and Test Procedures 11 

 Adam Darlington 

Market Assessment and Engineering Analysis 38 

 Adam Darlington 

Life-Cycle Cost and Payback Period Analyses 51 

 David Winiarski 

National Impact Analysis 76 

 David Winiarski 

Proposed Standard Levels 98 

 Mohammed Khan 

Discussion of Proposed Standard Levels, 99 

Other Issues and Final Remarks from Interested 

Parties 

 Doug Brookman 

Next Steps and Closing Remarks 104 

 Mohammed Khan 

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1 P R O C E E D I N G S 

2 (9:10 a.m.) 

3 Welcome

4 MR. KHAN: Good morning, everyone. Welcome 

5 and thank you for participating in today’s Public 

6 Meeting on Energy Conservation Standards for Certain 

7 Equipment that are covered in ASHRAE 90.1. 

8 My name’s Mohammed Khan and I am the 

9 department’s project manager for this rulemaking 

10 activity. 

11 I’ll be providing a brief overview of the 

12 rulemaking and throughout the day, we’ll hear from 

13 analysts from Navigant Consulting as well as from the 

14 Pacific Northwest National Laboratory on the details 

15 of the various analyses that the department has 

16 performed on this rulemaking. 

17 Rulemaking Overview

18 MR. KHAN: There are several purposes of 

19 today’s meeting. First, we want to explain the 

20 analysis methodologies and characterize our analysis 

21 results. 

22 Second, we want to have a two-way 

23 discussion. We want to discuss some specific issues 

24 associated with this rulemaking and also hear and 

25 listen to your thoughts and potential concerns. 

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1 And the last thing, we want to describe what 

2 the next steps are and what you should anticipate from 

3 the department. 

4 According to USC 6313, the Energy Policy and 

5 Conservation Act requires DOE to consider amending its 

6 Energy Conservation Standards coincident with 

7 amendments to the ASHRAE 90.1 Standard. 

8 Additionally, DOE must either adopt the new 

9 ASHRAE amendments or promulgate more stringent 

10 standards if clear and convincing evidence 

11 demonstrates that significant additional energy 

12 savings would result and it would be both 

13 technologically feasible and economically justified. 

14 Typically at this juncture, we would allow 

15 participants to provide their opening comments or 

16 remarks, but I don’t think there were any requests at 

17 this time. 

18 Regarding the second bullet, Comments from 

19 Participants, again I can’t over-emphasize the 

20 importance of your feedback. 

21 Today, throughout the day, we’ll be asking 

22 for your input on certain aspects of the analyses and, 

23 as I said earlier, since we want to have a two-way 

24 discussion, you’re all encouraged to ask questions and 

25 add to today’s exchange. 

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1 Additionally, you’re invited to submit 

2 comments, written comments before the close of the 

comment period which is June 3rd 3 . 

4 Okay. I now will turn to Doug. 

5 Opening Remarks, Introduction and Agenda Review

6 MR. BROOKMAN: We’ll provide an opportunity 

7 for each person to introduce him or herself and say 

8 your name and organizational affiliation. I’ll start 

9 over here with Tim. 

10 MR. BALLO: Tim Ballo, EarthJustice. 

11 DR. SACHS: Harvey Sachs, American Counsel 

12 for an Energy Efficient Economy. 

13 MR. STANONIK: Frank Stanonik, Air 

14 Conditioning, Heating and Refrigeration Institute. 

15 MR. HARRIS: Jeff Harris, Alliance to Save 

16 Energy. 

17 DR. AMRANE: Karim Amrane, Air Conditioning, 

18 Heating and Refrigeration Institute. 

19 MR. BROOKMAN: Please. 

20 MS. Raymond: Kristen Raymond, Department of 

21 Justice. 

22 MR. BROOKMAN: Thank you. You want to say 

23 your name, please. There’s a microphone right there. 

24 MR. DURON-LICONAS: Nery Duron, Department 

25 of the Navy. 

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1 MR. BROOKMAN: Thank you. 

2 MR. PARKER: Graham Parker, Pacific 

3 Northwest National Laboratory. 

4 MS. ARMSTRONG: Ashley Armstrong, Navigant 

5 Consulting. 

6 MS. PINTO: Francine Pinto, General 

7 Counsel’s Office, DOE. 

8 MR. STAS: Eric Stas, DOE, General Counsel. 

9 MR. KHAN: Mohammed Khan, DOE. 

10 MR. DARLINGTON: Adam Darlington, Navigant 

11 Consulting. 

12 MR. WINIARSKI: David Winiarski, Pacific 

13 Northwest National Laboratory. 

14 MR. BROOKMAN: Do the mikes work okay? 

15 Yeah. That’s okay, that’s okay. It’s a matter of 

16 courtesy. 

17 I think all of you are familiar with these 

18 proceedings and the specific kinds of analyses that 

19 are performed. I’m going to run through the agenda 

20 very quick. 

21 Following this brief Agenda Review, there is 

22 another Rulemaking Overview and then another 

23 opportunity for each of you to make brief comments, 

24 issues that are important to you, summary remarks, if 

25 you will, at the outset. 

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1 Following that, we’ll have a description of 

2 the Determination of the Scope and Test Procedures. 

3 We’ll take a break midmorning, as required. Following 

4 that, Market Assessment and Engineering Analysis and 

5 then Life-Cycle Cost and Payback Period Analyses. 

6 If we -- we’ll go as quickly as we can, 

7 efficiently as we can, and still cover all this 

8 material effectively. If we’re still going at 12:30, 

9 we’ll take lunch, and following that, National Impact 

10 Analysis. We’ll take a break mid-afternoon, as 

11 needed, Proposed Standard Levels following that, and 

12 then, once again, in the late afternoon, if that’s the 

13 correct time for this, there’s another opportunity for 

14 each of you to make summary remarks, raise other 

15 issues that haven’t been raised so far, and add your 

16 comments one more time to the record. 

17 Then we’ll finish with Next Steps and 

18 Closing Remarks from the Department of Energy. 

19 That’s the plan for the day. Questions? 

20 Comments here at the outset? 

21 (No response.) 

22 MR. BROOKMAN: I ask for your consideration. 

23 Please speak one at a time. Please say your name for 

24 the record. This will be a recorded session. There 

25 will be a complete transcript of the meeting available 

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1 on the DOE website. 

2 I’m going to be queuing people to speak. I 

3 also wish to encourage follow-on comments. I’ll be 

4 trying to recognize you by name as best I can and then 

5 if you would, please, keep the focus here. Turn off 

6 your cell phones or put them on silent and if you 

7 could be concise, focused, share the air time with 

8 your colleagues, that would be a great thing, and 

9 that’s all I think that I want to cover. 

10 Do you wish to introduce yourself? 

11 MR. KENDALL: Mark Kendall with Burnham 

12 Hydronics. 

13 MR. BROOKMAN: Thank you, Mark. I think we 

14 gave everybody a chance to do that. Okay. So now is 

15 an opportunity for anybody that wishes to do so, to 

16 make brief summary remarks here at the outset, issues 

17 of concern, focus areas that you’d like to raise at 

18 this time? 

19 (No response.) 

20 MR. BROOKMAN: No takers at this time. 

21 Okay. So then let’s proceed. All of you have 

22 received a packet of the slides that will be covered 

23 in the presentation format. There are query boxes 

24 throughout the slides to specifically ask for your 

25 comments and also you’ve received a copy of the 

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1 Federal Register Notice. 

2 So let’s proceed with the presentation. 

3 Determination of Scope and Test Procedures

4 MR. DARLINGTON: Okay. Good morning, 

5 everyone. My name’s Adam Darlington. 

6 I’m going to be discussing the first several 

7 stages of our NOPR Analyses for the review of ASHRAE 

8 Standard 90.1-2007. 

9 The first stage was the Determination of 

10 Scope. Then I’ll talk about the Test Procedures, the 

11 Market Assessment and Engineering Analysis, and then 

12 I’ll be turning it over to my colleagues at PNNL, 

13 Pacific Northwest National Lab, and they’ll discuss 

14 the Life-Cycle Cost and Payback Period Analysis as 

15 well as the National Impact Analysis. 

16 Now, ASHRAE Standard 90.1-2007 covers a 

17 multitude of equipment types and basically the Energy 

18 Policy and Conservation Act directs DOE to consider 

19 amended standards only for certain commercial air 

20 conditioning, heating, and water-heating equipment for 

21 which ASHRAE Standard 90.1 increases the efficiency 

22 level in comparison to existing Federal standard 

23 levels. So, therefore, DOE began by determining the 

24 scope of its review. 

25 Now, in order to begin the determination of 

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1 the scope, DOE first looked at all the equipment 

2 classes in ASHRAE Standard 90.1-2007 where it appeared 

3 that Standard 90.1-2007 had changed the efficiency 

4 levels in comparison to the existing Federal 

5 standards. Then DOE went through each equipment type 

6 one by one to determine whether or not there was in 

7 fact a change in efficiency level from the Federal 

8 standards. 

9 And this slide shows a summary of the 

10 equipment classes where there appeared to be a change 

11 between the ASHRAE Standard 90.1-2007 levels and the 

12 existing Federal levels, and it also shows the DOE’s 

13 preliminary determination. So I’ll briefly go through 

14 each equipment class. 

15 So first, for gas-fired commercial warm air 

16 furnaces, ASHRAE Standard 90.1-2007 changed the 

17 efficiency metric from thermal to combustion 

18 efficiency and added three design requirements for 

19 this type of equipment. 

20 DOE reviewed the change in the efficiency 

21 metric and upon comparing the definition between the 

22 thermal efficiency requirement and the existing 

23 Federal standards in the combustion efficiency 

24 requirement as it related to ASHRAE Standard 90.1-

25 2007, DOE determined that they both had the same 

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1 definition which was 100 percent minus the flue 

2 losses, and therefore the change was in name only and 

3 did not constitute an actual change or affect the 

4 efficiency of these products. 

5 And with regard to the design requirements, 

6 they did not change the performance standard 

7 efficiency level, so there was no change there. 

8 Similarly, for oil-fired commercial warm air 

9 furnaces, ASHRAE Standard 90.1-2007 adds three design 

10 requirements and these do not affect the actual 

11 efficiency level and therefore DOE was not required to 

12 perform any further action. 

13 And then, next, we have three-phase, small14 duct, high-velocity air-cooled air conditioners and 

15 heat pumps. Sorry. I actually skipped the three16 phase through the wall. 

17 So we have three-phase through the wall air18 cooled air conditioners and heat pumps and they’re 

19 kind of similar to a three-phase, small-duct, high20 velocity air-cooled air conditioners and heat pumps, 

21 so I’ll talk about them both. 

22 Basically, ASHRAE Standard 90.1-2007 breaks 

23 each of these equipment classes into a separate 

24 equipment class and sets a standard -- sets an 

25 efficiency level -- I’m sorry -- for them where there 

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1 had been none before. And both of these equipment fall 

2 into a more general equipment class of small-duct air 

3 conditioning -- I’m sorry -- of three-phase air 

4 conditioning and heating equipment, less than 65,000 

5 BTUs per hour, and the Energy Independence and 

6 Security Act of 2007 sets standards for that equipment 

7 and these standards and the Energy Independence and 

8 Security Act of 2007 would supersede any ASHRAE 

9 Standard 90.1-2007 efficiency levels and so DOE must 

10 enforce those standards. 

11 So next on the table is commercial packaged 

12 air-cooled air conditioners with a cooling capacity at 

13 or above 760,000 BTUs per hour, and ASHRAE Standard 

14 90.1-2007 sets standards for this equipment. However, 

15 in EPCA, EPCA defines commercial packaged air 

16 conditioning and heating equipment in terms of small, 

17 large and very large and the capacities only go up to 

18 760,000 BTUs per hour. 

19 So DOE did not have the authority to 

20 consider equipment larger than 760,000 BTUs per hour 

21 and therefore did not do any further action on these 

22 products. 

23 With regard to water-cooled and 

24 evaporatively-cooled commercial packaged air 

25 conditioners and heat pumps with the cooling capacity 

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1 at or above 135,000 BTUs and less than 240,000 BTUs 

2 per hour, basically ASHRAE Standard 90.1-2007 sets 

3 efficiency levels for this equipment differentiated by 

4 the type of heating that the equipment uses. 

5 Now, Federal standards do not set separate 

6 standard levels based on the type of heating and one 

7 of the heating types that ASHRAE Standard 90.1-2007 

8 sets the level for is actually below the current 

9 Federal standards and therefore that would possibly 

10 allow for backsliding there and DOE cannot consider 

11 those levels. 

12 The next equipment class was water-cooled 

13 and evaporatively-cooled commercial packaged air 

14 conditioners and heat pumps with a cooling capacity at 

15 or above 240,000 BTUs per hour and less than 760,000 

16 BTUs per hour, and for these equipment no Federal 

17 standard currently exists. 

18 ASHRAE Standard 90.1-2007 does set 

19 efficiency levels for this equipment and they are 

20 within DOE’s definitions of small, large and very 

21 large air conditioning and heating equipment and 

22 therefore DOE did further consider the ASHRAE Standard 

23 90.1-2007 efficiency levels for this equipment. 

24 And next we have commercial packaged boilers 

25 for which ASHRAE Standard 90.1-2007 separates the 

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1 existing two equipment classes into 10 equipment 

2 classes. It changes the efficiency levels for all the 

3 equipment classes and for eight of those 10 equipment 

4 classes, it changes the efficiency metric from 

5 combustion to thermal efficiency, and in this case DOE 

6 again determined that it would further consider the 

7 ASHRAE Standard 90.1-2007 efficiency levels as well as 

8 higher levels as mandated by EPCA. 

9 MR. BROOKMAN: Let’s pause here and take 

10 some comments on DOE’s preliminary determination. 

11 Frank? 

12 MR. STANONIK: Frank Stanonik with AHRI. 

13 Just a couple quick comments. 

14 First of all, just to make sure everyone is 

15 aware, as far as the gas-fired commercial water heater 

16 and furnaces, there’s finally officially -- it was 

17 approved in January -- an ASHRAE Addendum to 90.1 that 

18 in fact makes the change from the descriptor of 

19 combustion efficiency back to thermal efficiency for 

20 furnaces. 

21 So that was actually -- I’ll just say there 

22 was some confusion within ASHRAE 90.1 and there is an 

23 addenda because I just checked on this. If you call 

24 ASHRAE, you will not get a printed version of that 

25 addenda, but it’s been finalized. It’s been approved. 

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1 They just aren’t going to print one until they do the 

2 2010 edition of 90.1, but it was approved by the 

3 ASHRAE Board in January. 

4 So it just reinforces your decision, but 

5 they basically acknowledge that it should be -- the 

6 correct descriptor was thermal efficiency for warm air 

7 furnace. 

8 As far as the -- and this is more of a 

9 clarification I’ll ask Francine. For the stuff over 

10 the commercial packaged AC over 760,000 (BTUs), okay, 

11 you’re saying DOE doesn’t have the authority. I guess 

12 I just want to make sure I understand that. They 

13 don’t -- they’ve not been assigned the authority, but 

14 isn’t there some provision that if the Secretary 

15 determined that there was some, you know, opportunity 

16 to save energy they could? 

17 They’re not necessarily absolutely 

18 constrained to what was specifically assigned in the 

19 legislation, right? 

20 MS. PINTO: I’m going to defer to you. 

21 MR. STAS: I think it’s the definition of 

22 the different units. 

23 MR. BROOKMAN: Eric Stas, get close to the 

24 microphone. 

25 MR. STAS: If I recall, EPCA defines these 

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1 air conditioning units, you know, small, medium and 

2 large, yeah, and that’s where the size limitations 

3 come in. This would be that provision where the 

4 Secretary can look at additional equipment. 

5 MS. PINTO: The whole process to go through. 

6 MR. STANONIK: Yeah. Okay. And it’s not a 

7 big point. It’s more to just kind of reinforce what I 

8 tried to remember, I think I remember. Obviously in 

9 this product, this is just, you know, -- again, it’s 

10 not a big deal because at the moment there’s not a lot 

11 to talk about. 

12 I just wanted to ask the question, and then, 

13 lastly, it finally clicked as Adam was describing it, 

14 for the equipment in the 135 to 240,000 BTU range, 

15 90.1 has a slightly lower specification if you’re not 

16 using electric resistance heating and that was put in 

17 there because basically they’re using a gas heater. 

18 Okay. 

19 You now have introduced into that system a 

20 heat exchanger which causes some pressure drop that 

21 doesn’t exist otherwise and I thought that adjustment 

22 was just recognizing the physical effect of that 

23 heating element. 

24 MR. BROOKMAN: Karim? 

25 DR. AMRANE: Karim Amrane, AHRI. I guess 

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1 two things here. I mean that product category has 

2 been in 90.1 for a long time. 

3 My understanding is it was revised in 1999. 

4 ASHRAE 90.1 had the two levels of efficiency for 

5 products with gas heating equipment and for products 

6 without gas heating equipment. It was there. It was 

7 a footnote in ASHRAE 90.1 that DOE did not pick up at 

8 that time. 

9 So in 2001, when DOE adopted ASHRAE 90.1-99, 

10 DOE adopted just one level of efficiencies and now 

11 DOE’s saying, well, you know, it’s going to be a 

12 backsliding of the standards. Well, it was already 

13 there. It has always been there and actually it 

14 exists for all the large packaged equipment. 

15 If you look at the air-cooled products, you 

16 have a 0.2 reduction. So it’s just for the category, 

17 DOE missed, you know, it in 2001, but ASHRAE never 

18 backslided the standard. It has always been there. 

19 MR. BROOKMAN: And you’re going to address 

20 backsliding in a moment. 

21 Frank, do you want to keep going or are you 

22 finished? 

23 MR. STANONIK: Oh, no. That was it. I 

24 mean, I want to hit every one there, I think, with the 

25 scope. 

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1 MR. BROOKMAN: Harvey? Harvey Sachs. 

2 DR. SACHS: Harvey Sachs, ACEEE. I guess 

3 the question for my colleagues at AHRI, with respect 

4 to the packaged air conditioners larger than 760,000 -

5 - 740 -- whatever, 760,000 BTUs per hour, are annual 

6 sales in the range of 10, 100, 1,000? Is this a 

7 significant manufacturing class? 

8 DR. AMRANE: Right. This is Karim Amrane, 

9 AHRI. I guess, you know, your interpretation of the 

10 law is right. The impact does not go beyond 760,000 

11 BTUs. So I guess we agree with that. 

12 To be honest with you, there are no products 

13 that cool in that capacity range anyway. So there is 

14 no need to have a standard for that product. 

15 DR. SACHS: Harvey Sachs repeating. There 

16 is no equipment currently manufactured larger than 

17 760,000 BTUs per hour as commercial packaged air 

18 conditioners? 

19 DR. AMRANE: Karim Amrane. That’s correct. 

20 DR. SACHS: Thank you. 

21 MR. BROOKMAN: Thank you. Tim Ballo? 

22 MR. BALLO: Tim Ballo, EarthJustice. Just 

23 reiterating a point we made in written comments on the 

24 Notice of Data Availability, we believe that the 

25 department’s interpretation that requires them to only 

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1 review ASHRAE levels when there has been an amendment 

2 that results in a strengthening of the ASHRAE 

3 Standard, we believe that’s incorrect and hope that 

4 the new Administration, the people that are coming in, 

5 will be willing to take a look at this provision of 

6 the statute again and reconsider the department’s 

7 interpretation. 

8 MR. BROOKMAN: Would you give a citation or 

9 is that just in your written comments? 

10 MR. BALLO: It would be in the written 

11 comments. It’s the one cited at the outset here, 42 

12 U.S. Code 6313(a)(6). 

13 MR. BROOKMAN: Thank you. Additional 

14 comments about the department’s preliminary 

15 determinations as shown in this slide? Because we’re 

16 going to move on otherwise. Karim? 

17 DR. AMRANE: Karim Amrane. I guess I’ll 

18 have general comments about the three-phase through 

19 the wall and the three-phase small-duct, high 

20 velocity. 

21 First of all, on the small-duct, high22 velocity, ASHRAE 90.1, yes, indeed, included that 

23 product class, I believe, in the 2007 version by 

24 mistake. It was removed and somehow when the final 

25 standard was put together, that product class ended up 

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1 in the standard, but ASHRAE 90.1 today doesn’t have a 

2 product class for small-duct, high-velocity system, 

3 and it’s because those products on the residential 

4 side under NAECA are covered through the -- I guess 

5 there is a product class for them but the DOE has 

6 allowed manufacturers to apply for waivers and I think 

7 that has worked for the manufacturers. 

8 So I don’t think we’re advocating for 

9 product class for small-duct, high-velocity systems. 

10 On the other hand, with the through-the-wall 

11 products, what 90.1 tried to do -- and the 90.1 

12 Committee, by the way, is willing to be consistent 

13 with the residential rulemaking. It is DOE that 

14 established product class for through-the-wall product 

15 and it is DOE that established an efficiency standard 

16 for through-the-wall at the 10.9 SEER that we have 

17 today because of good reasons. There are issues with 

18 the product. 

19 ASHRAE tried to be consistent with DOE and 

20 adopted the same product classes, the same efficiency. 

21 Now, the ASHRAE Standard was amended well before the 

22 Energy Independence and Conservation Act was enacted 

23 and the Energy Independence and Conservation Act never 

24 intended to have that apply to the through-the-wall 

25 product. That was not the intent. The intent was for 

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1 that to apply to the conventional, you know, central 

2 air conditioner product. 

3 So I guess I’m confused. If DOE does not 

4 intend to be consistent with the NAECA product, I 

5 guess that’s what DOE is saying, is DOE intending to 

6 have a separate product class for through-the-wall as 

7 the level of the other product which DOE, by the way, 

8 couldn’t justify what DOE did in its rulemaking on 

9 central AC? It does not make sense. 

10 So I guess if DOE does not intend to adopt 

11 the same levels as the NAECA levels for similar 

12 products, then we will be recommending that there be 

13 no product classes for through-the-wall because it’s 

14 going to be confusing to the marketplace. We’re going 

15 to have products under NAECA with one level and you’re 

16 going to have through-the-wall products covering their 

17 impact with a different level. It does not make sense 

18 to have the same product with a single phase and a 

19 three-phase. 

20 So either we are consistent all the way or 

21 we are not but in either case, let’s not create a 

22 product class -- 

23 MR. BROOKMAN: So would you restate just 

24 your recommendation briefly? 

25 DR. AMRANE: My recommendation is either we 

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1 are consistent with NAECA and we adopt the levels that 

2 we have in NAECA today for through-the-wall products. 

3 This is what we recommended -- this is what ASHRAE 

4 90.1 did, but if DOE for legal reasons cannot adopt 

5 those levels, then let’s not create a product class 

6 for through-the-wall products under impact because 

7 it’s going to be confusing to the marketplace. 

8 MR. BROOKMAN: Thank you. Thank you. Okay. 

9 DR. SACHS: Clarification. 

10 MR. BROOKMAN: Yes. Yes, Harvey Sachs. 

11 DR. SACHS: Harvey Sachs, ACEEE. With 

12 respect to the small-duct, high-velocity air-cooled 

13 air conditioners and heat pumps, the record is pretty 

14 confusing but the intent is clear. 

15 The point I want to make is that these 

16 products use outdoor units, condensing units that are 

17 bought from manufacturers other than the integrators 

18 who are the small-line or high-velocity manufacturers. 

19 So what we’re seeing is a combination of 

20 somebody’s three-phase condensing unit instead of 

21 their one-phase condensing unit to make the final 

22 product and we think the consistency with the 

23 standards for the single-phase, small-duct, high24 velocity is quite appropriate under those 

25 circumstances. 

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1 MR. BROOKMAN: Okay. Thank you. Additional 

2 and perhaps final comments on these preliminary 

3 determinations before we move on? 

4 (No response.) 

5 MR. BROOKMAN: So let’s go then. 

6 MR. DARLINGTON: Now for commercial boilers, 

7 DOE had to be sure that the ASHRAE Standard 90.1-2007 

8 efficiency levels were in fact an increase as compared 

9 to the Federal standard levels. So DOE had to 

10 determine whether the levels would or would not 

11 violate EPCA’s anti-backsliding clause. 

12 Basically, what the anti-backsliding clause 

13 is, as the slide shows, it’s a clause in EPCA that 

14 mandates that the Secretary may not prescribe any 

15 amended standard that increases the maximum allowable 

16 energy use or decreases the minimum required energy 

17 efficiency. 

18 Now, in many cases ensuring that some -- 

19 that a product is not -- I’m sorry -- a new standard 

20 is not violating the anti-backsliding clause is as 

21 simple as just comparing two efficiency levels. 

22 However, in the case of commercial packaged 

23 boilers that was not the case because of the 

24 efficiency metric change. Basically, there’s no 

25 direct relationship between thermal and combustion 

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1 efficiency, no way to easily mathematically convert 

2 from one to the other and because of this, DOE had to 

3 rely on an analytical approach to determine the 

4 relative stringency of the thermal efficiency levels 

5 in ASHRAE Standard 90.1-2007 compared with the 

6 existing Federal standard levels. 

7 Basically in order to compare the different 

8 levels, DOE looked at the average relationship between 

9 the thermal -- the relationship between the average 

10 thermal efficiency and the combustion efficiency for 

11 equipment that was currently available in the market 

12 that minimally complied with the existing Federal 

13 standard levels which that would be equipment very 

14 near 80 percent combustion efficiency for gas-fired 

15 equipment and 83 percent combustion efficiency for 

16 oil-fired equipment. And basically DOE used the 

17 relationship between the combustion and thermal 

18 efficiencies for this equipment to establish a 

19 relationship between thermal and combustion efficiency 

20 for each equipment class. 

21 DOE reviewed the Institute of Boiler and 

22 Radiator Manufacturers’ (IBR) Directory as well as 

23 manufacturer literature which provided the thermal and 

24 combustion efficiency ratings that DOE used in its 

25 analysis. 

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1 Now, in addition to DOE’s analytical 

2 approach, DOE also realized that there were several 

3 other important factors to consider when determining 

4 whether or not the ASHRAE Standard 90.1-2007 levels 

5 would be backsliding in comparison to the existing 

6 Federal levels. 

7 And the first factor, as shown here on the 

8 slide, is the accuracy of the thermal efficiency 

9 ratings currently being reported in the equipment 

10 literature and in the IBR database. 

11 Now, since there is no existing requirement 

12 for thermal efficiency, DOE has not mandated that 

13 manufacturers test for thermal efficiency and 

14 therefore manufacturers may have several different 

15 ways of reporting thermal efficiency and one way might 

16 be to test using the methods specified in the 

17 Hydronics Institute Boiler Testing Standard 2000 which 

18 is the industry test standard for commercial boilers. 

19 Some manufacturers may test for it using a 

20 different method or may estimate it from the results 

21 of the combustion efficiency testing or some 

22 manufacturers seem to just assume that the thermal 

23 efficiency is the same as the combustion efficiency 

24 rating and report that number for both thermal and 

25 combustion efficiency or they may estimate it based on 

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1 any combustion of factors as really there’s no 

2 indication of how that’s done in manufacturer 

3 literature. 

4 Now, this can in turn lead to inaccurate 

5 thermal efficiency reporting which would add some 

6 uncertainty to DOE’s analytical approach described on 

7 the last slide in comparing thermal and combustion 

8 efficiency. And now with DOE’s proposed standards, the 

9 thermal efficiency testing would be required which 

10 would give customers a better idea of the true 

11 efficiency of this equipment which leads to a second 

12 point which are the benefits of switching to the 

13 thermal efficiency metric. 

14 It’s a more complete efficiency metric. It 

15 accounts for both the flue losses and the jacket 

16 losses as opposed to combustion efficiency which only 

17 accounts for the flue losses and leaves jacket losses 

18 unaccounted for. 

19 Thermal efficiency better reflects the total 

20 energy losses and rating commercial boilers using 

21 thermal efficiency will give customers a better use of 

22 the actual -- a better idea of the actual energy use, 

23 as I said. 

24 And then the third factor, which DOE also 

25 gives some weight to, is that there will be an overall 

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1 energy savings if DOE does adopt the ASHRAE Standard 

2 90.1-2007 efficiency levels. 

3 So based on all of these factors and the 

4 analytical approach results, DOE has tentatively 

5 concluded that the ASHRAE Standard 90.1-2007 levels do 

6 represent an increase in efficiency when compared to 

7 the existing Federal standard levels and as a result, 

8 DOE performed further analysis on the ASHRAE Standard 

9 90.1-2007 efficiency levels as well as higher levels, 

10 levels more stringent than the ASHRAE Standard 90.1-

11 2007 efficiency levels. 

12 MR. BROOKMAN: Let’s pause there. Comments 

13 on these two slides, more details on the department’s 

14 approach? Frank? 

15 MR. STANONIK: Frank Stanonik, AHRI. Yeah. 

16 Just a quick comment on this issue about the 

17 backsliding. 

18 While I think to some degree, whether it was 

19 directly or indirectly, I’m glad that it’s been kind 

20 of recognized that because of the fact there’s not any 

21 fixed constant relationship between thermal efficiency 

22 and combustion efficiency, that the question of 

23 backsliding is not simply, if you will, looking at two 

24 numbers, and what I want to emphasize, because I’m not 

25 sure in an earlier rulemaking that it really got 

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1 completely, I’ll say, appreciated, is that even if you 

2 had as an example, if I had a product today that was 

3 83 percent combustion efficiency, it could have a 

4 thermal efficiency quite a bit lower. 

5 Let’s say for sake of discussion, let’s say 

6 80 percent thermal efficiency, all right, and if the 

7 requirement, just call that Frank’s model, okay, if 

8 the requirement was now that I had to have an 81 or an 

9 82 percent thermal efficiency, okay, -- I did that 

10 backwards. I’m sorry. 

11 I’m trying to make the point that you could 

12 have a product that would meet the thermal efficiency 

13 requirement, might have a lower combustion efficiency, 

14 but it is still a more efficient product than what the 

15 current minimum requires and so that was -- I think 

16 that this analysis is starting to recognize, if you 

17 will, the significance of the thermal efficiency and 

18 how it’s not just a question of, you know, is 83 

19 higher than 82. Well, just look at the numbers and, 

20 you know, the absolute values and say yes, but there’s 

21 a little more to it, and I think the analysis is 

22 starting to capture that. 

23 MR. BROOKMAN: You’re endorsing the 

24 Department’s approach? 

25 MR. STANONIK: Yes. 

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1 MR. BROOKMAN: Just want to be clear. Jeff? 

2 MR. HARRIS: Jeff Harris, Alliance to Save 

3 Energy. Just out of curiosity, given that there might 

4 be some concern that some manufacturers report the 

5 same number for thermal and combustion efficiency as a 

6 test of this analysis, were those cases where such -- 

7 where you had the same numbers screened out? 

8 MR. DARLINGTON: Yes, they were. DOE did 

9 not use any efficiency ratings where the same number 

10 was reported for both thermal and combustion 

11 efficiency ratings. So DOE used only those where the 

12 combustion efficiency was in fact higher than the 

13 thermal efficiency. 

14 MR. BROOKMAN: Thank you, Adam. So 

15 additional comments on the backsliding slides before 

16 we move on to Test Procedures? 

17 (No response.) 

18 MR. BROOKMAN: Okay. Then we’ll move on to 

19 Test Procedures then. 

20 MR. DARLINGTON: Okay. I’ll now give a 

21 brief overview of the Test Procedure changes that DOE 

22 is proposing in order to facilitate the proposed 

23 standards for commercial packaged boilers. 

24 Now, because DOE is proposing to adopt 

25 efficiency levels that use the thermal efficiency 

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1 metric, DOE is also going to be required to add a 

2 definition of thermal efficiency to its test 

3 procedures for commercial packaged boilers and now the 

4 definition DOE is proposing to add is here on the 

5 slide and it is consistent with the current definition 

6 in the Hydronics Institute Boiler Testing Standard 

7 2000. 

8 In addition, DOE will need to amend the 

9 current definition of combustion efficiency. 

10 Currently, there’s a statement in there that refers to 

11 combustion efficiency as the efficiency descriptor for 

12 packaged boilers and since that would now be thermal 

13 efficiency for several equipment classes, that would 

14 no longer be true. 

15 So DOE is -- so this definition shown on the 

16 slide is the same as the current definition without 

17 that statement. And now, as I think Doug mentioned 

18 earlier, throughout the presentation today we’ve got 

19 several issues we’d like to highlight and they’re 

20 shown in the blue comment boxes at the bottom. 

21 And so the first issue today, DOE’s seeking 

22 comment on its proposed definitions for thermal 

23 efficiency and combustion efficiency for commercial 

24 packaged boilers. 

25 So now I’ll turn it over to Doug. 

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1 MR. BROOKMAN: Thank you. So comments on 

2 these listed definitions? Frank? 

3 MR. STANONIK: Frank Stanonik, AHRI. I 

4 mean, we certainly -- it’s certainly within the 

5 concept of those, we agree with them. I mean, you 

6 know, I’ll compare them against what we have in our 

7 own test procedures guides, but I think they’re very, 

8 very similar, if not the same. 

9 MR. BROOKMAN: Thank you. That’s helpful. 

10 Additional comments on the definitions? 

11 (No response.) 

12 MR. BROOKMAN: Okay. 

13 MR. DARLINGTON: All right. So, in addition 

14 to the changes to the definitions, DOE is proposing 

15 additional changes to the test procedure. Basically, 

16 there are two types of changes DOE’s proposing. 

17 The first type would become effective 180 

18 days after the publications of the final rule and 

19 these procedures are basically changes that would 

20 update the existing DOE test procedure to reference 

21 the most recent version of the Hydronics Institute 

22 Boiler Testing Standard 2000 and that was the revision 

23 that was released in June of 2007. 

24 And, in addition, these changes would 

25 eliminate a reference to an alternate testing method 

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for steel boilers which expired on October 23rd 1 , 2006, 

2 and is therefore no longer necessary to include. 

3 Then the second type of changes are changes 

4 that are necessary to facilitate the standards using 

5 the thermal efficiency metric as opposed to the 

6 combustion efficiency metric and basically these are 

7 just requiring testing for the thermal efficiency as 

8 using the method in the Hydronics Institute Boiler 

9 Testing Standard 2000 for those equipment classes 

10 where the thermal efficiency metric is being used and 

11 these would become effective -- these changes would 

become effective on March 3rd 12 , 2012, which would be the 

13 effective date of the standard. 

14 MR. BROOKMAN: Frank? 

15 MR. STANONIK: Frank Stanonik, AHRI. Just a 

16 quick note on that and we’ll send in a comment. 

17 But with the merger and everything else, 

18 we’re in the middle of changing all of the standards 

19 that existed within either organization to be 

20 designated as AHRI Standards and so I’ll send you a 

21 comment to indicate officially what the name change is 

22 going to be for Boiler Testing Standard (BTS)-2000. 

23 The document doesn’t change, just literally the front 

24 cover. I’ll let you know what we’re calling it now. 

25 MR. BROOKMAN: Thank you. 

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1 MR. DARLINGTON: Okay. Now this brings us 

2 to the test procedures for dual output boilers. 

3 Dual output boilers are boilers capable of 

4 producing either heat or steam or hot water. Now, the 

5 current standards for all commercial boilers, both 

6 steam and hot water, are specified in terms of the 

7 combustion efficiency and the current DOE test 

8 procedure allows dual output boilers to be tested for 

9 their combustion efficiency in steam mode only and 

10 then rated using the results of the steam mode testing 

11 in both steam and hot water modes. 

12 Now, for DOE’s proposed standards, for its 

13 small commercial packaged boilers, which would be 

14 commercial packaged boilers with input capacity of 

15 less than 2.5 million BTU per hour, for dual output 

16 boilers of that size, both steam and hot water have 

17 proposed standard levels that would be specified in 

18 thermal efficiency and for those boilers DOE is 

19 proposing to continue to allow these boilers to be 

20 tested only in steam mode and then rated for their 

21 thermal efficiency in both steam and hot water modes. 

22 Now, for large boilers which are boilers 

23 larger than 2.5 million BTU per hour, for hot water 

24 boilers DOE is proposing standards specified using the 

25 combustion efficiency metric while for the steam 

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1 boilers, for large steam boilers, DOE is proposing 

2 standards using the thermal efficiency metric. 

3 Now, DOE is proposing to continue to allow 

4 these boilers to be tested only in the steam mode and 

5 then rated in both steam and hot water modes. 

6 However, DOE does note that this now would require two 

7 tests in the steam mode, one test for combustion 

8 efficiency to be used when rating the boiler in hot 

9 water mode and then one test for the thermal 

10 efficiency to be used when rating the boiler in steam 

11 mode. 

12 And, in addition, manufacturers could still 

13 test and rate dual output boilers separately in each 

14 mode if they choose to do so. 

15 MR. BROOKMAN: So comments on any of this? 

16 Frank? 

17 MR. STANONIK: Frank Stanonik, AHRI. On 

18 this last point, we really haven’t had internally a 

19 lot of discussion about it. I’m not really sure how 

20 significant a burden it will be. 

21 Obviously, the issue will cause a lot of hot 

22 water boilers -- I mean just to make sure everyone 

23 understands the reason it specifies combustion 

24 efficiency is because for product types of 2.5 

25 million, we may be talking about products 5-6-10 

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1 million BTUs per hour to try and run water through 

2 that boiler at a 70 degree rise, whatever it specified 

3 to rise, for any specified length of time is -- both 

4 takes a very long time to set up to get the steady 

5 state condition and then also is really a very energy6 intensive test. 

7 And so in that case that’s why ASHRAE 

8 continued to use the combustion efficiency. It just 

9 becomes a very time-consuming, expensive in many ways 

10 or at many levels, test to run a boiler of that size 

11 and see what it consumes to heat water in 

12 significantly large volumes. 

13 But as far as this issue of, you know, as a 

14 burden of having to test both combustion and thermal 

15 in the steam mode, I mean unless Mark has a point set 

16 on that, we really haven’t talked about it much yet. 

17 MR. BROOKMAN: So maybe in your written 

18 comments you can address that. 

19 MR. STANONIK: Oh, yes, we definitely will. 

20 MR. BROOKMAN: Okay. Mark? 

21 MR. KENDALL: Mark Kendall with Burnham. 

22 Just to clarify, you’re saying you’ll continue to 

23 allow boilers that can generate water and steam to be 

24 rated for combustion efficiency in steam-only mode 

25 above 2.5 million BTUs per hour and then use that 

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1 rating to determine compliance with the hot water 

2 boiler standard. You’re saying you have to test it 

3 both ways? 

4 MR. DARLINGTON: No. 

5 MR. BROOKMAN: Ashley? 

6 MS. ARMSTRONG: What you would need to do is 

7 you can use the steam-only mode but you have to run 

8 both types. You have to run the thermal and the 

9 combustion. 

10 MR. KENDALL: Okay. 

11 MS. ARMSTRONG: Because you have two 

12 different structures there. So you could still use 

13 the results of the steam for the water. 

14 Market Assessment and Engineering Analysis

15 MR. DARLINGTON: And moving on, this brings 

16 us to the NOPR analysis for the review of ASHRAE 

17 Standard 90.1-2007 and so the next step would be the 

18 Market Assessment for the equipment where DOE 

19 determined that it was within the scope of review and 

20 I’ll remind you that was for commercial packaged 

21 boilers as well as for water-cooled and evaporatively22 cooled commercial packaged air conditioners and heat 

23 pumps with a coolant capacity at or above 240,000 BTUs 

24 per hour and less than 760,000 BTUs per hour. 

25 Now, DOE performed a Market Assessment for 

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1 commercial packaged boilers. However, in the case of 

2 the water-cooled and evaporatively-cooled commercial 

3 packaged air conditioners and heat pumps with the 

4 cooling capacity at or above 240,000 BTUs per hour and 

5 less than 760,000 BTUs per hour, DOE began a Market 

6 Assessment but could not identify any equipment 

7 currently available on the -- that fell into that 

8 equipment category and then, therefore, DOE was unable 

9 to do any further analysis for that type of equipment 

10 and only did further analysis for commercial packaged 

11 boilers which is the focus of the rest of this 

12 presentation. 

13 Now, the purpose of the Market Assessment is 

14 basically to determine the available equipment 

15 efficiencies, the manufacturers and shipments 

16 information and for the market assessment, DOE 

17 typically gathers and reviews information from various 

18 sources, usually product directories, manufacturer 

19 catalogs, SEC 10-K reports for any publicly-traded 

20 manufacturers as well as various other publications. 

21 Now, when analyzing equipment, DOE typically 

22 begins by categorizing the equipment into equipment 

23 classes based upon the type of energy used, the 

24 capacity and any other performance-related features 

25 that the Secretary deems necessary to justify the 

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1 establishment of separate energy conservation 

2 standards. 

3 Now, DOE is proposing to subdivide the 

4 existing two commercial boiler equipment classes into 

5 10 equipment classes, based on input capacity, fuel 

6 type, output type, and draft type, and the resulting 

7 10 equipment classes are shown here on the slide. 

8 These are consistent with the equipment classes in 

9 ASHRAE Standard 90.1-2007. 

10 Okay. So the Market Analysis focused on 

11 overall market characteristics as well as 

12 characteristics for each individual equipment class 

13 and just briefly some overall characteristics. 

14 DOE estimated that there were 36,000 

15 commercial package boilers shipped in 2007. These 

16 were marketed and manufactured under 46 different 

17 brand names. 

18 The Market Analysis, as I said, the data 

19 comes from various sources. One of the main sources 

20 for this Market Analysis was the Institute of Boiler 

21 and Radiation Manufacturers Ratings for Commercial 

22 Boilers and it lists the efficiency of the IBR23 certified boilers as well as defining characteristics, 

24 such as the fuel type, input rating, output type and 

25 draft type. 

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1 In addition to this, DOE also reviewed the 

2 Canadian Standards Association International Boiler 

3 Database along with the South Coast Air Quality 

4 Management District’s Boiler Database to find any non5 AHRI member commercial boiler manufacturers and then 

6 for those manufacturers where sufficient information 

7 was available through their online manufacturer 

8 catalogs and datasheets DOE would add the information 

9 for those boilers to its analysis to be included in 

10 the analysis. 

11 And now more details about the Market 

12 Analysis as well as the results of the Market Analysis 

13 for each individual equipment class of commercial 

14 packaged boiler are in Chapter 2 of the TSD that 

15 accompanied the NOPR. 

16 Now, dual output boilers, as I mentioned 

17 previously, are capable of delivering either steam or 

18 hot water. Now many of the boilers listed were 

19 capable of delivering steam and hot water and many of 

20 these boilers had only a single efficiency rating or 

21 the same efficiency rating in both modes of operation 

22 and now when that was the case, due to the test 

23 procedure which allows these boilers to be tested only 

24 in steam mode and then rated in both steam and hot 

25 water mode, since that was the case, DOE considered 

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1 boilers with only one efficiency rating. 

2 They were classified as only steam boilers 

3 because DOE believed that that was -- the rating 

4 reflective of the efficiency in steam mode due to the 

5 test procedure requirements. 

6 And then this is the second issue for which 

7 DOE is seeking comment and that would be just 

8 basically any data or information that would allow DOE 

9 to correlate the two ratings, the hot water mode and 

10 the steam mode ratings. 

11 MR. BROOKMAN: So you can see the question 

12 box there for your consideration. Frank? 

13 MR. STANONIK: Frank Stanonik, AHRI. On 

14 that particular issue, -- 

15 MR. BROOKMAN: Converting the steam ratings 

16 -- 

17 MR. STANONIK: Right. 

18 MR. BROOKMAN: -- in the IBR Directory. 

19 MR. STANONIK: Right. Well, historically, I 

20 think you’ve -- the analysis has recognized 

21 historically within the HI Boiler Certification 

22 Program. They simply allowed the hot water rating to 

23 be the same as the combustion efficiency rating. 

24 I’ll get back with our members. I’m not 

25 sure there really is all that much data of 

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1 measurements. I mean, clearly, as this rule goes 

2 forward, that’s likely to change, but right now I’m 

3 not sure we have a lot of, you know, real information, 

4 real data on that simply because in the past it was 

5 acknowledged that if you took that steam product and 

6 you add the hot water test, it would be at least as 

7 good. 

8 MR. BROOKMAN: Mark? 

9 MR. KENDALL: Mark Kendall with Burnham. 

10 You wanted this information so that you can have a 

11 larger population of hot water boiler ratings for your 

12 analysis? Is that the purpose? 

13 MR. DARLINGTON: Yes, to get a better idea 

14 of the efficiency in hot water mode. 

15 MR. BROOKMAN: Additional comments about 

16 this issue? 

17 (No response.) 

18 MR. DARLINGTON: Okay. The next step in 

19 DOE’s review of ASHRAE Standard 90.1-2007 levels for 

20 commercial packaged boilers was an Engineering 

21 Analysis. 

22 Now, the purpose of the Engineering Analysis 

23 is to characterize the relationship between increased 

24 efficiency and the additional costs necessary to 

25 achieve the related increases in efficiency. 

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1 Now, DOE developed a set of cost efficiency 

2 results that demonstrate the increase in equipment 

3 costs to a mechanical contractor that result from 

4 achieving increased efficiency for a number of 

5 representative commercial packaged boilers and the 

6 results of this analysis, as shown, is used in the 

7 downstream analysis, the Life-Cycle Cost and Payback 

8 Period Analysis as well as the National Impacts 

9 Analysis. 

10 DOE’s general approach to the Engineering 

11 Analysis was an efficiency level approach which DOE 

12 chose due to the wide variety of boiler designs 

13 available in the market in each equipment class. 

14 Now, this allows DOE to examine the relative 

15 costs of increasing the energy efficiency without 

16 having to focus on specific design options that 

17 manufacturers would employ to achieve these increases 

18 in efficiency. 

19 So DOE considered only the efficiency levels 

20 that were available in the market as determined in the 

21 Market Assessment and DOE gathered baseline costs and 

22 costs for incremental increases in efficiency through 

23 discussions with mechanical contractors. 

24 DOE chose to focus on several representative 

25 output, gross output capacities for data collection. 

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1 DOE looked at the output capacities as opposed to the 

2 input capacities because the size of the commercial 

3 boiler is most often specified based on the gross 

4 output required for the application and the input 

5 capacity would vary, based on the thermal efficiency 

6 of the boiler. 

7 So DOE focused its data collection efforts 

8 on the four representative gross output capacities 

9 that were previously identified in the April 2000 

10 analysis and those were 400, 800 and 1,500 KBTU per 

11 hour for small commercial packaged boilers and 3,000 

12 KBTU per hour for large commercial packaged boilers. 

13 MR. BROOKMAN: Harvey Sachs? 

14 DR. SACHS: Harvey Sachs, ACEEE. I would 

15 like to turn to Slide 20 and point out again that 

16 this, and the analysis described on Slide 21, are 

17 assertions and challenge the Department to go back and 

18 document their validity. 

19 It is clearly the case at some point in time 

20 there’s an increase in cost for increasing efficiency. 

21 We do not believe that the Department has established 

22 at any time that if we look at a time series, 

23 including the improvements in manufacturing, 

24 improvements in design, that costs to the buyer 

25 increase, even with significant changes in efficiency. 

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1 That may even be true for this class of 

2 products which are not produced in huge numbers, but 

3 we are concerned that the Department continues to 

4 adopt methodologies -- to utilize a methodology which 

5 has not been verified, although there is an abundant 

6 record from the Department’s own proceedings to allow 

7 that empirical review to be done. 

8 We think this is an important point as we go 

9 forward on all of these standards rulemakings, not 

10 just this one. 

11 MR. BROOKMAN: Okay. Thank you. Karim? 

12 DR. AMRANE: Karim Amrane, AHRI. Again, I 

13 disagree with Harvey on this. 

14 I think there’s plenty of evidence that as 

15 efficiency increases the cost of the equipment 

16 increases. I mean, there are rulemakings and there’s 

17 data available. So I don’t think we need to go into 

18 that in this discussion today, but there is a lot of 

19 evidence. 

20 MR. KHAN: Mohammed Khan, DOE. I appreciate 

21 both comments, but I just want to add that, again to 

22 help the Department make its analysis as accurate, 

23 complete and robust as possible, we’re always looking 

24 for additional data, any new data that would become 

25 available to help in that regard. 

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1 DR. SACHS: Harvey Sachs. Thank you very 

2 much, Mohammed and Karim. 

3 The point of my prior comment was to call 

4 for the Department to do that review off its estimates 

5 of increased costs versus the historical record. 

6 There are some indications for some product classes in 

7 the peer-reviewed literature, some of which was 

8 commissioned by the Department. 

9 Karim has pointed out an important issue. 

10 Implicitly, that we have to control for unpredicted 

11 changes in the prices of commodities for changes in 

12 refrigerants and things like this. 

13 Nonetheless, to continue for many years to 

14 use an asserted -- to use a methodology that is 

15 asserted to be true without an effort to verify seems 

16 to me to be something which is unfair to the entire 

17 community, including the manufacturers. 

18 MR. BROOKMAN: Okay. Thank you. 

19 MR. DARLINGTON: Okay. And continuing on 

20 with the Engineering Analysis, so DOE’s Engineering 

21 Analysis involved first collecting the data, then 

22 aggregating the data and identifying the relationship 

23 between costs and efficiency. 

24 Now, to collect data DOE identified several 

25 groupings of equipment with similar construction 

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1 across a range of efficiencies and different 

2 manufacturers and utilizing different designs for each 

3 equipment class, and then for the equipment that DOE 

4 identified, DOE contacted mechanical contractors and 

5 obtained pricing for the selected equipment. 

6 Now, for the small commercial boiler 

7 equipment classes in particular, DOE collected data at 

8 the three aforementioned representative capacities, 

9 then normalized the data by capacity to get one 

10 representative capacity of 800 KBTU per hour and that 

11 was the median of the three small representative 

12 capacities. 

13 Now then, for each of the equipment classes, 

14 DOE aggregated all of the cost efficiency data and fit 

15 a curve that best characterized the cost efficiency 

16 relationship. 

17 Then DOE treated the levels in the ASHRAE 

18 Standard 90.1-2007 as a baseline for comparison 

19 purposes and subtracted those costs to get the 

20 incremental costs of increasing -- of going to 

21 efficiency levels higher than ASHRAE Standard 90.1-

22 2007. 

23 Now, the results of the Engineering Analysis 

24 are a set of cost efficiency results that show the 

25 average costs to increase the efficiency of a boiler 

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1 in each equipment class and it should be noted that 

2 they don’t represent any manufacturer or single boiler 

3 construction or design or material but instead are an 

4 average of the average cost efficiency relationship 

5 across all manufacturers and designs for the given 

6 equipment class and the results data and additional 

7 details are provided in Chapter 3 of the TSD. 

8 MR. BROOKMAN: Comments on the method? 

9 Frank? 

10 MR. STANONIK: Frank Stanonik, AHRI. And 

11 this is just really a question for my understanding. 

12 It’s certainly not a criticism. 

13 When you were looking at the costs of 

14 boilers, I’m assuming you just said, okay, here’s a 

15 certain efficiency level and what does this -- you 

16 know, steam or hot water, what would be the cost of 

17 it, and you didn’t necessarily look at, let’s say, the 

18 specific design or the specific basic construction. 

19 What I’m trying to differentiate is clearly 

20 you have a lot of cast iron boilers, you have what 

21 might be called a copper tube boiler or whatever, all 

22 of which will be in this range. They all compete. 

23 I just wonder in the analysis whether there 

24 was some looking at those differences. 

25 MS. ARMSTRONG: This is Ashley. I can say 

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1 that they were all included. 

2 MR. STANONIK: Okay. 

3 MS. ARMSTRONG: So we looked for a variety 

4 and that’s why Adam pointed out at the end that the 

5 results are aggregated, so that you have a bunch of 

6 different types where you might see large differences 

7 in costs because of the material or the specific 

8 construction, but all those types were included in the 

9 analysis. 

10 MR. STANONIK: Okay. 

11 MR. KHAN: Mohammed Khan, DOE. Another way 

12 that was captured was the fact that we didn’t look at 

13 just one manufacturer’s design. We were looking 

14 across manufacturers. We were automatically going to 

15 capture the different kinds of designs for those. 

16 MR. BROOKMAN: Harvey Sachs. 

17 DR. SACHS: You may have put this in the TSD 

18 and it may have slipped by me. This is Harvey Sachs. 

19 In your cost curves, did you include the 

20 discontinuities represented by condensing units and 

21 then try to interpolate from those back down into the 

22 non-condensing? 

23 MR. DARLINGTON: No. 

24 MS. ARMSTRONG: No. We got separate costs 

25 for each. 

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1 MR. BROOKMAN: Ashley, thank you. All set? 

2 MR. DARLINGTON: Thank you. 

3 MR. BROOKMAN: Okay. Additional comments on 

4 this? 

5 (No response.) 

6 MR. DARLINGTON: Okay. And that’s the end 

7 of mine. So with that, I’ll turn it over to Dave 

8 Winiarski. 

9 MR. BROOKMAN: Thank you. You want to take 

10 a break here? Yeah? Okay. Let’s take a break here. 

11 (Recess.) 

12 MR. BROOKMAN: So let’s start back up and 

13 Dave Winiarski is going to be presenting Life-Cycle 

14 Cost and Payback Period Analysis. 

15 Life-Cycle Cost and Payback Period Analysis

16 MR. WINIARSKI: Okay. All right. Well, as 

17 Doug said, my name’s David Winiarski. I’m with 

18 Pacific Northwest National Laboratory, and I’ll be 

19 explaining some of DOE’s Life-Cycle Cost and Payback 

20 Period Analysis that was done for the commercial 

21 boiler products as well as following that explaining 

22 DOE’s National Impact Analysis. 

23 To start off with, what’s the purpose of the 

24 Life-Cycle Cost Analysis? 

25 Essentially, what DOE’s trying to do is to 

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1 characterize the reduction in operational expenses 

2 that will occur for adoption of higher-efficiency 

3 standard levels for commercial boilers as well as the 

4 increases in installed costs, first costs and 

5 installation costs, that would also come with those 

6 higher-efficiency boilers, and then to bring those 

7 together into a resultant life-cycle cost to a 

8 customer, the total net expenses over the life of the 

9 commercial boiler. 

10 In addition to the Life-Cycle Cost Analysis, 

11 DOE also does an analysis of simple payback periods 

12 for higher-efficiency standards for commercial 

13 boilers. When I say higher standards, I’m referring 

14 to standards higher than what DOE has determined to be 

15 the appropriate baseline for this analysis which is 

16 the 90.1-2007 efficiency levels for the 10 classes of 

17 commercial packaged boilers that were identified 

18 previously. 

19 The Life-Cycle Cost Analysis is primarily 

20 composed of three different components. The first of 

21 those is an attempt to estimate the energy use that 

22 would -- and the reduction in energy use that would 

23 come from higher-efficiency boilers. 

24 In addition, in order to come up -- because 

25 this is done from the customer’s perspective, in order 

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1 to come up with what the customer’s cost for purchase 

2 of those higher-efficiency boilers is, we have to take 

3 the data that was developed in the Engineering 

4 Analysis which was based on contractor prices, and 

5 convert that to a customer cost, and we do that by 

6 looking at the mark-ups for a simplified distribution 

7 chain, going from the contractor’s first purchase to 

8 the actual installation at the customer site. 

9 With those two sections of the analysis, we 

10 bring them together into actually doing life-cycle 

11 cost calculations and simple payback calculations. 

12 Those calculations are relatively straightforward. We 

13 do have to bring in some other data to do that and 

14 I’ll discuss some of that data and the sources in 

15 subsequent slides. 

16 So how do we develop life-cycle costs? 

17 Well, the life-cycle cost is done in terms of the 

18 initial installation date for the boiler. It’s 

19 basically constructed -- we look at the operating 

20 costs over time for the life of the boiler. We then 

21 discount all those operating costs which include both 

22 energy costs as well as repair and maintenance costs 

23 for higher-efficiency boilers. We discount those down 

24 to a present value with the year of discount being the 

25 same year as the initial purchase of the boiler by the 

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1 customer. 

2 The installed cost for the boiler on that 

3 first year is equal to the customer price which is 

4 developed using the Engineering Analysis and the mark5 ups and an estimate of the installation costs for 

6 those higher-efficiency boilers. 

7 Once those are in constant years dollars, 

8 after the discounting of all the operating costs, we 

9 simply combine them and we produce life-cycle costs 

10 results for each different efficiency level analyzed. 

11 DOE actually presents those results in terms 

12 of life-cycle cost savings, if there are savings, 

13 which is equal to the baseline life-cycle costs minus 

14 the standard level life-cycle costs, and, in addition, 

15 DOE does a simple payback analysis based on the first 

16 year’s energy costs and the initial differences in 

17 installed costs between the baseline and higher18 efficiency boilers. 

19 So to start off with, I’ll explain a little 

20 bit how we did the energy analysis. 

21 The analysis methodology that we used here 

22 was very similar to what was used in DOE’s 2000 

23 Screening Analysis and in fact we used much of the 

24 same data set. We used what’s called a full-load 

25 equivalent operating hour (FLEOH) approach. 

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1 The full-load equivalent operating hour is 

2 essentially the ratio of the boiler’s annual heating 

3 load that it satisfies to the boiler capacity that was 

4 installed and those FLEOH values were developed based 

5 on some commercial building simulations that were done 

6 back in 2000. 

7 Those simulations use seven different 

8 building types and 11 different climate locations. 

9 Those climate locations were then converted into 

10 specific climate regions and estimates of the total 

11 boiler stock in those regions was used to weight the 

12 results of the full-load equivalent operating hours 

13 that were developed for each combination of region and 

14 building type. 

15 So there were seven building types, 11 

16 regions, that’s 77 separate market sectors, and that 

17 formed sort of the basis of the loads analysis for 

18 commercial boilers. 

19 I’ll skip the middle part there for a 

20 second. The annual energy consumption for the 

21 commercial boilers at each efficiency level is then 

22 estimated based on for each market segment, the full23 load equivalent operating hours times the specific 

24 boiler capacity that we’re analyzing. The FLEOH’s 

25 sort of a normalized value appropriate to lots of 

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1 different sizes of boilers. That’s multiplied by the 

2 boiler capacity to get back the original annual load 

3 estimate and that’s divided by an estimate of the 

4 efficiency of the boiler at each level. 

5 I’ve shown seasonal efficiency here. We 

6 actually used the thermal efficiency rating for each 

7 of the non-condensing classes of boilers. When we got 

8 up to the high-efficiency condensing boilers, we 

9 recognized that there’s a concern that the actual 

10 performance of the boiler is a function of the entire 

11 hydronic system and particularly the return water 

12 temperature back to the boilers and so we adjusted -- 

13 used some analysis to adjust that thermal efficiency 

14 for the condensing boilers to a value of about 88 

15 percent annually. 

16 Yes? 

17 MR. BALLO: Tim Ballo, EarthJustice. Is 

18 that not also the case for non-condensing boilers? 

19 MR. WINIARSKI: They are not so much 

20 affected by the return water temperature in general. 

21 It has to do with the boiler design, but once you get 

22 into condensing boilers, effectively what you can do 

23 is you can get a very, very high efficiency on a 

24 condensing boiler, 99 percent plus, as long as you 

25 have a very low return water temperature, 60 degrees, 

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1 but 60 degrees is not appropriate for most commercial 

2 building designs today, and since the majority of the 

3 market is a replacement market, we have to kind of 

4 look at what’s sort of the most typical applications 

5 today for those boilers. 

6 MR. BROOKMAN: Harvey Sachs. 

7 DR. SACHS: Harvey Sachs, ACEEE. I 

8 understand the point, but I would like to comment in 

9 two respects. 

10 First, and by far the more important 

11 technically, is that even with non-condensing boilers, 

12 and I claim no great expertise on commercial boilers, 

13 there’s room for modulation for outdoor reset 

14 equivalent, and I would assert that’s true in almost 

15 every system, that there’s a long history of controls 

16 changes giving real savings. 

17 To ignore that in non-condensing boilers, 

18 while computing small differences in life-cycle costs, 

19 seems to be rather grotesque. 

20 MR. WINIARSKI: And I will be a little more 

21 clear then. We did not ignore that. What we did do 

22 is we looked at essentially a typical commercial 

23 building air-handler and recognized that during 

24 periods when you’ve got sort of the peak heating load 

25 from the building, that’s typically when it’s coldest 

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1 outside during the year, to meet those peak heating 

2 loads that air-handler and the coil within that air3 handler have been designed for a certain supply water 

4 temperature and that supply water temperature, in 

5 conjunction with the load, provides a certain return 

6 water temperature back. Right? 

7 The boiler efficiency under those conditions 

8 is constrained to some extent by that return water 

9 temperature and by the fact that you’re not 

10 modulating, you’re at full load capacity, and then we 

11 looked at different time periods over the year to sort 

12 of estimate how much that efficiency will change as we 

13 do reset the return water temperature. 

14 DR. SACHS: Harvey Sachs again. Dave, our 

15 middle models of the typical application are clearly 

16 very different, that your model is that this is 

17 providing supplemental heat in a VAV system. That 

18 seems to be what you’ve described. 

19 My middle model for the more typical 

20 application, particularly in the replacement market, 

21 is this is providing hydronic heat, either as base 

22 heat or as perimeter heat, but it’s the hydronic 

23 application for which temperature modulation is highly 

24 applicable as long as you maintain that necessary 

25 return temperature. 

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1 There are a lot of ways you can get there 

2 and I’m very concerned and would very much like to see 

3 the assumptions that you’ve used in your analysis made 

4 much more explicit. 

5 MR. WINIARSKI: Okay. 

6 DR. SACHS: Again, when we’re trying to make 

7 decisions on efficiency levels on the basis of very 

8 small life-cycle cost percentages, if we’re assuming 

9 things that may be of larger impact in our analytical 

10 methods but not carrying that sensitivity through, 

11 sir, we may have a problem. 

12 MR. WINIARSKI: Right. Actually, I would -- 

13 I can talk a little more, if you want, a little more 

14 in depth. There’s a discussion in, I forget which 

15 appendix it is, that discusses sort of the general 

16 approach we used, which was actually not based on a 

17 VAV system but rather based more on a system design 

18 like you discuss, serving a load that is primarily a 

19 function of outside air conditions and outside air 

20 temperature and varying essentially linearly. 

21 DR. SACHS: I think we can take this 

22 offline. 

23 MR. WINIARSKI: Yeah. 

24 DR. SACHS: I look forward to reading the 

25 appendix. I’m not prepared to take a test on it yet. 

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1 MR. WINIARSKI: Sure. Okay. 

2 DR. SACHS: Thank you. 

3 MR. BROOKMAN: Tim? 

4 MR. BALLO: Tim Ballo, EarthJustice. One 

5 follow-up question. 

6 I can understand the impact being greater on 

7 condensing boilers, but suppose you decrease the 

8 efficiency by roughly maybe three percent or so on the 

9 90+ percent efficiency boilers. So am I to understand 

10 that for a non-condensing boiler, it’d be something 

11 less than one percent, the efficiency would be 

12 impacted? 

13 MR. WINIARSKI: Yeah. And we did not 

14 separately adjust the thermal efficiencies for non15 condensing equipment, based on how they might change 

16 with a reset water temperature, for instance. 

17 MR. BROOKMAN: Other comments on these 

18 issues? 

19 DR. SACHS: Harvey Sachs again. I’d just 

20 like to follow up again by stating I’m far from an 

21 expert on boilers, but the argument that we’ve just 

22 walked through is very much parallel to the basis 

23 under which the advocates and industry negotiated a 

24 consensus agreement on residential boilers. That 

25 consensus agreement to consider the benefits of 

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1 specific types of controls was rejected by the 

2 department a couple of years ago, but it’s a very 

3 parallel argument and consequently I am concerned 

4 about its treatment in this analysis. 

5 MR. BROOKMAN: Thank you. Frank? 

6 MR. STANONIK: Frank Stanonik, AHRI. Just a 

7 little, I guess, caution about getting too caught up 

8 in this question of your conditions of, let’s say, 

9 outgoing water temperature and return water 

10 temperature. 

11 We are at AHRI, we’re involved in putting 

12 together some, I’ll say, basic, I’ll daresay, rules 

13 for commercial boiler manufacturers to actually 

14 provide additional information on how the model will 

15 operate at different inlet water pairs, if you will, 

16 okay, because in fact, you know, we are getting 

17 information from my members that that’s -- when you 

18 get into the commercial market, certainly you get into 

19 a little more professional designers of systems and so 

20 they want that information because they have some 

21 ideas of how they intend to, -- there are obviously 

22 new applications -- you know, design the system. 

23 My point here is that, so you get into this 

24 commercial market, there is, I believe, a broader 

25 range of what might be considered the design 

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1 conditions of what they want to come out of the boiler 

2 and how they want it to come back and so I understand 

3 what Harvey’s saying, but I have a little caution 

4 about let’s not get too involved in that because it’s 

5 not going to be one set of numbers. 

6 DR. SACHS: But it will certainly be the 

7 best set of numbers. 

8 MR. STANONIK: I don’t know -- 

9 DR. SACHS: It won’t be a worse set of 

10 numbers. 

11 MR. STANONIK: Well, it may be worse. I’m 

12 not sure about the best. 

13 (Laughter.) 

14 MR. STANONIK: Universal best, quite 

15 obviously. 

16 MR. WINIARSKI: Thank you, Frank. 

17 MR. BROOKMAN: Mark? 

18 MR. KENDALL: Mark Kendall with Burnham. 

19 I’m not sure of the relevance to the whole discussion, 

20 but I’ll join in. 

21 MR. BROOKMAN: Well, would it be useful for 

22 the department, the pairings that you’re talking 

23 about? 

24 MR. STANONIK: It will certainly be useful 

25 information, but we’re not ready yet. 

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1 MR. BROOKMAN: Okay. 

2 MR. STANONIK: I mean, we have an internal 

3 working group trying to work that out because within 

4 our Certification Program, also, you know, it will 

5 have some value for us there, too, to obviously, you 

6 know, determine you comply with Federal requirements 

7 and then have this, if you will, guidelines by which 

8 you have some uniformity of what other information 

9 manufacturers provide to their customers. 

10 MR. BROOKMAN: Mark, please. 

11 MR. KENDALL: Dave, what you said, would it 

12 be then accurate to say that in your analysis, you 

13 considered outdoor reset for condensing boilers but 

14 not for non-condensing boilers? 

15 MR. WINIARSKI: Well, technically, what we 

16 probably did is we considered the effect that outdoor 

17 air temperature reset on the boiler supply water would 

18 have on the efficiency when we looked at loads 

19 throughout the year for the condensing equipment and 

20 we really didn’t look at that effect on non-condensing 

21 equipment at all. 

22 MR. KENDALL: So the building simulation, 

23 did that consider energy losses through distribution 

24 losses? 

25 MR. WINIARSKI: We have to be kind of 

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1 careful here. The original FLEOH analysis, full-load 

2 equivalent operating hour analysis, really only looks 

3 at the loads and we didn’t actually do a building 

4 simulation of the operation of different boiler 

5 efficiency levels. 

6 MR. KENDALL: Okay. 

7 MR. WINIARSKI: We’ve just done sort of a 

8 loads analysis and then sort of scaled those loads 

9 with efficiency to come up with what the energy would 

10 be and the seasonal analysis is more of a hand 

11 calculation for condensing boilers. 

12 MR. KENDALL: Okay. Thank you. 

13 MR. WINIARSKI: Okay. So once DOE had 

14 sort-of annual energy use numbers for each efficiency 

15 level and for each class of boiler, we turned our 

16 attention to a mark-up analysis. 

17 We did a fairly simplified mark-up analysis. 

18 For those of you who’ve been involved in other rules, 

19 we basically described two general distribution 

20 channels for commercial boilers, boilers that are 

21 going to new construction and boilers that are going 

22 to replace existing boilers that have failed. 

23 For the replacements, we assumed that the 

24 primary distribution channel is essentially just the 

25 mechanical contractor. The owner is having him come 

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1 in and replace a boiler. For new construction, we had 

2 both mark-ups that were from the mechanical contractor 

3 as well as additional mark-ups from general 

4 contractors who would basically be purchasing the 

5 service of the mechanical contractor in a new 

6 construction situation. 

7 DOE went down a route that some of you are 

8 familiar with here where we actually tried to develop 

9 baseline mark-ups which were applied to sort of the 

10 base cost for commercial boilers at the ASHRAE 90.1-

11 2007 efficiency levels and incremental mark-ups which 

12 were applied to the incremental costs to go to 

13 contractor costs for higher-efficiency boilers. 

14 In order to generate those mark-ups, DOE 

15 used financial data from mechanical contractors, used 

16 a combination of data from ACCA, Air Conditioning 

17 Contractors of America, and U.S. Census Bureau data 

18 that was available for plumbing, heating and air 

19 conditioning contractors. 

20 For general contractors, we used a separate 

21 set of U.S. Census Bureau data from 2002 for all 

22 commercial building and institutional building 

23 contractors. 

24 In addition, one aspect of the mark-up 

25 analysis is to try to capture the impact of sales tax 

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1 and state by state sales tax data was used to assess 

2 how much that increases the mark-up on average. I 

3 think the national average sales tax is like seven 

4 percent and that tax is certainly seen by the eventual 

5 customer. 

6 Because we had two different distribution 

7 channels, we had to develop a split between what 

8 fraction of the mark-ups went to new construction 

9 versus replacement. The estimate that was developed 

10 was roughly two-thirds to one-third, one-third going 

11 to new construction. 

12 From the analysis, the financial analysis we 

13 developed resulted in baseline mark-ups, again 

14 starting from the contractors, mechanical contractors’ 

15 purchase price to the customer of about 1.48 for the 

16 replacement market and 1.77 for new construction, 

17 again reflecting the general contractor costs. This 

18 averaged with weightings about 1.56 for the entire 

19 market. Again that’s the baseline mark-ups applied to 

20 baseline contractor costs for the 90.1-2007 levels. 

21 DOE also developed the incremental mark-ups 

22 that were applied to the increased costs. Those were 

23 1.2 for the replacement market and 1.29 for the new 

24 construction market, including sales tax. 

25 Next, another input that’s important in the 

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1 LCC Analysis is what’s going to be the impact of fuel 

2 prices going into the future. The lifetime for the 

3 boilers was assumed to be 30 years in this analysis 

4 starting from the initial installation date and so we 

5 had to characterize what natural gas and fuel oil 

6 prices in the commercial sector would look like out to 

7 essentially mid or early 2040s. 

8 To do that, we relied on some fuel cost 

9 indices that come from the Annual Energy Outlook that 

10 DOE publishes. This was the 2008 Outlook. Those 

11 indices go out from 2020 to 2030 -- pardon me. They 

12 go out to 2030. 

13 We then had to forecast out for the 

14 remainder of the analysis period what those indices 

15 and increases in fuel costs would look like and that 

16 was done by basically extrapolating the last 10 years 

17 of data that EIA had, from 2020 to 2030. 

18 In addition, the LCC Analysis was actually 

19 done on a state by state level. So we used state 

20 average commercial oil and natural gas prices that 

21 were available from EIA. We then made some fuel price 

22 adjustments for each of the different building types 

23 by developing sort of ratios of the average costs 

24 that’s represented in the 2003 Commercial Building 

25 Energy Use Consumption Survey for the specific 

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1 building categories to the national averages in the 

2 commercial sector for that year, and so we had some 

3 slight fuel price adjustments for each building type 

4 that were applied to the state level data and then we 

5 forecasted those, as I explained, in the future, out 

6 to the end of the analysis period. 

7 One thing I do want to point out here is for 

8 DOE’s LCC Analysis, the analysis period for boilers is 

9 the same period for both boilers at the ASHRAE energy 

10 level and developed in the life-cycle cost savings and 

11 for boilers at higher-efficiency levels. 

12 The reason we did that full 30 years is even 

13 though we recognized that there is a time difference, 

14 whether DOE adopts standards that are based on ASHRAE 

15 versus DOE trying to go further in its analysis 

16 period, for life-cycle costing, it’s the analysis from 

17 the customer perspective and the customer makes one 

18 purchase. He doesn’t do it at two different times. 

19 So we kept the same analysis period for both the 

20 analysis of life-cycle cost at the ASHRAE level and 

21 life-cycle cost at higher-efficiency levels. 

22 In addition, other LCC inputs included 

23 estimates of installation costs for commercial 

24 boilers. We essentially used data that was available 

25 in Means Cost Works for 2008 for natural gas, hot 

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1 water and steam boilers in looking for the baseline 

2 installation costs and in looking at that data, 

3 there’s also some data there for oil boilers. It 

4 didn’t differ very much and in most cases but for 

5 certain classes of boilers, there were not substantial 

6 differences, depending on where you looked and so we 

7 just assumed that baseline installation costs would be 

8 essentially identical for hot water and for oil-fired 

9 boilers. 

10 DOE also tried to develop installation cost 

11 adders that would be appropriate for boilers with 

12 higher combustion efficiency levels that would require 

13 the use of non-corrosive venting. It’s a fairly 

14 simplified analysis of that which I’ll talk about a 

15 little later, but essentially I think for hot water 

16 boilers, it looks like for boiler efficiencies, 

17 combustion efficiencies above about 83 percent, DOE 

18 assumed that there would be some additional costs for 

19 dealing with the installation of non-corrosive 

20 venting. 

21 For boilers that went to the replacement 

22 market, it was assumed that they would actually have 

23 to replace existing venting. For boilers that went to 

24 the new construction market, the analysis only 

25 included sort of the differential costs between the 

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1 stainless steel-type L vents and the baseline, I 

2 think, Type B venting. 

3 In addition, because the analysis was done 

4 at the state level, the installation costs were 

5 adjusted using means cost work data for each state, 

6 reflecting differences in labor rates primarily. 

7 DOE developed discount rates based on data 

8 from the businesses that would be appropriate to the 

9 seven classes of commercial buildings. The primary 

10 source for that was the private businesses. For 

11 public assembly and education, we used public sector 

12 discount rates and I think roughly those discount 

13 rates in real terms were about four to five percent 

14 for the private businesses, like office and retail, 

15 and a little higher than two percent for the public 

16 sector businesses. 

17 As I said, equipment lifetime was 30 years. 

18 DOE also developed baseline repair costs, again using 

19 MARS Facility Cost Database for Commercial Buildings. 

20 The repair costs were assumed -- for higher-efficiency 

21 levels, repair costs were assumed to increase 

22 proportional to the increase in the price of the 

23 boiler, reflecting assumedly that you paid more for a 

24 piece of equipment, you’ve got more expensive 

25 components in that equipment, and you have to replace 

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1 those. 

2 DOE also developed maintenance costs based 

3 on the RS Means cost works but assumed that those 

4 costs would be essentially preventative maintenance 

5 and would not vary by efficiency level. 

6 Any questions? 

7 (No response.) 

8 MR. WINIARSKI: So this gets into some 

9 issues that DOE would like to get any public comment 

10 on. 

11 One is the development of installation costs 

12 for higher-efficiency levels. DOE’s analysis was 

13 admittedly fairly simple here. We looked at 

14 essentially replacing a 35-foot flue length that we 

15 assumed might be appropriate for commercial boilers, 

16 going from a Type B to a Type L venting, and received 

17 costs for that by going out to separate Internet sites 

18 for vendors of that type of venting. 

19 In addition, we assumed that there were some 

20 additional costs, although relatively small, for 

21 control modifications for higher-efficiency boilers 

22 and for condensate removal for both near-condensing 

23 and condensing boilers. 

24 Yes? 

25 DR. SACHS: Harvey Sachs, ACEEE. With 

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1 respect to bullet 2 of slide 30, does this mean that 

2 in your purchase price assumptions for the lowest 

3 efficiency boilers, you’re assuming a naked boiler and 

4 not a replacement of the control package with one 

5 specific to that boiler? 

6 MR. WINIARSKI: I think for the ASHRAE 

7 level, that is true. 

8 DR. SACHS: First of all, by your 

9 assumptions, a third of the boilers are new 

10 installations, so they have to come with a control 

11 package and even for the replacement market, it would 

12 seem that a reasonable level of understanding of both 

13 the potential of a controls package shipped with that 

14 base boiler and how many manufacturers are selling it 

15 as a naked boiler without controls? Both of these 

16 would -- in other words, I’m challenging the 

17 assumption that there are no control costs for the 

18 lowest- efficiency boilers as shipped. 

19 I don’t know that to be the case, but it 

20 seems to be an assumption worth thinking about. 

21 MR. WINIARSKI: Yeah. And I don’t disagree 

22 with you. I think that the -- I forget the total 

23 control cost. I think it was on the order of a couple 

24 hundred dollars, $500 maybe, equivalent to a control 

25 point or so for the system, and we did not necessarily 

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1 assume explicitly that there were no controls shipped 

2 with the boiler or not, but we did include a 

3 differential control cost for the higher-efficiency 

4 boilers and I think you could make a question of 

5 whether that would actually be needed or not. 

6 MR. BROOKMAN: I was wondering whether data 

7 exist, Frank, about -- are these things associated 

8 with modular? I was wondering if the controls -- how 

9 often -- 

10 MR. STANONIK: Frank Stanonik with AHRI. 

11 I’m not aware of any available data that would really 

12 address this specific issue of, say, the difference in 

13 control costs for, let’s say, condensing versus a 

14 standard of efficiency. 

15 I mean, certainly, at least in one aspect on 

16 the condensing product, there probably is going to be 

17 some type of control to monitor that you’re getting 

18 rid of the condensate, you know. If you have some 

19 kind of blockage in your condensate line, it’s going 

20 to probably turn the thing off or send some kind of 

21 signal. So that would be a control you wouldn’t have 

22 otherwise. 

23 But as far as any other real data, we don’t 

24 have any. I’ve already made a note to the specific 

25 question and we would certainly see if we could 

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1 provide some information on what are the, you know, 

2 increased installation costs for higher-efficiency 

3 equipment, particularly when you get into any issues, 

4 and we’ll ask the members. I don’t have anything 

5 right now. 

6 MR. WINIARSKI: Right. And certainly, you 

7 know, one of the control costs that’s obviously in 

8 question is how do you incorporate reset controls 

9 which are key to the operation of some of the higher10 efficiency boilers and when those come in and may be 

11 less key to the operation of more standard efficiency 

12 boilers. 

13 MR. BROOKMAN: So additional comments on how 

14 installation costs could change or potentially 

15 increase with higher-efficiency commercial packaged 

16 boilers, with respect especially to venting? Any 

17 other comments on that? 

18 (No response.) 

19 MR. BROOKMAN: Okay. No additional comments 

20 on that. Okay. Dave, keep going. 

21 MR. WINIARSKI: Yeah. And obviously we 

22 pointed out here that we don’t have a lot of data to 

23 calibrate that, so any information that could be 

24 provided would be great from the audience here. 

25 So then, in the NOPR, basically DOE 

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1 expresses the LCC savings as national average LCC 

2 savings for higher-efficiency levels as well as looks 

3 at a distribution of LCC savings that might be 

4 expected for higher standards based on its assessment 

5 from the market assessment of what efficiencies are 

6 actually being sold into the market today and which 

7 fraction of the public would actually be impacted by 

8 standards set at different levels. 

9 Oh, and to add to that, in the distribution 

10 of LCC savings, because you’ve got different markets 

11 with different loads, you get just a standard 

12 distribution, even if you didn’t consider the impact 

13 of what efficiencies are being sold into the market, 

14 but customers that have high heating loads versus 

15 lower heating loads and the different building sectors 

16 and different climates. 

17 Also within the NOPR, DOE expresses not just 

18 the LCC but the payback period results for different 

19 classes of commercial boilers, both in terms of a 

20 national average payback as well as in terms of a 

21 distribution of paybacks for the boiler market. 

22 MR. BROOKMAN: Frank? 

23 MR. STANONIK: Frank Stanonik, AHRI. Dave, 

24 I’m thinking back just a little bit here. 

25 In this analysis, specifically on the 

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1 condensing boiler, did you include any factor for 

2 possible requirement of having to, I’ll say, treat the 

3 condensate? 

4 MR. WINIARSKI: Not explicitly, no. 

5 MR. STANONIK: Okay. 

6 MR. WINIARSKI: No, no, and if there’s any 

7 data that could be provided that would be great. We 

8 did not have any for the commercial boilers. 

9 National Impact Analysis

10 MR. WINIARSKI: Shall I go on? Okay. If 

11 there’s no questions on LCC, I’ll describe briefly the 

12 National Impact Analysis that DOE did. 

13 National Impact Analysis looks at both 

14 national energy savings over a 30-year analysis period 

15 for commercial boilers, in this case ending in 2042, 

16 as well as looks at the economic impact to the nation 

17 as represented by what it calls a national net present 

18 value estimate for each class of commercial boilers at 

19 each efficiency level. 

20 Again, the purpose was to look at adoption 

21 of commercial packaged boilers higher than ASHRAE 

22 Standard 90.1-2007 levels. However, in order to do 

23 that we actually have to look at because there is this 

24 shift in timing between whether DOE adopts ASHRAE and 

25 puts standards in place in 2012 or DOE decides to go 

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1 higher and put standards -- higher than ASHRAE and 

2 puts standards in place in 2014, we have to actually 

3 look at or make an estimate of the current -- what the 

4 base case would look like without adoption of the 

5 ASHRAE Standards. 

6 Then we’d come up with savings for adoption 

7 of ASHRAE and then savings for going higher than 

8 ASHRAE. The analysis components that are principal 

9 for the National Impact Analysis include an assessment 

10 of shipments into the future going out through the 

11 2042 analysis period, the national energy savings 

12 calculations which are based primarily on national 

13 average values developed in the LCC Analysis for 

14 things like energy costs impacts for the first year 

15 and first cost impacts for boilers, and the remainder 

16 of the national net present value calculations. 

17 To start with, I want to discuss the 

18 Shipments Analysis real quickly. Basically, the 

19 purpose was to estimate commercial boiler shipments 

20 over time for each equipment class. DOE didn’t have a 

21 lot of data, historical data on shipments for that and 

22 so it essentially took data that was provided by GAMA 

23 for 2007 commercial boiler shipments for the classes 

24 that would be covered by this rulemaking. I think 

25 that was about 36,000 boilers. 

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1 It then used data from the Market Assessment 

2 to disaggregate that data into shipments by each of 

3 the 10 classes of commercial boilers. It put that 

4 aside for a second. It then had to make some 

5 assumptions in order to generate sort of a shipment 

6 profile into the future and one of those assumptions 

7 was that on a sort of boiler capacity per square foot 

8 basis the new construction market is assumed to look 

9 or have the same saturation as the current stock of 

10 commercial boilers. 

11 It then looked at an average boiler life of 

12 30 years which means that essentially the stock that’s 

13 out there gets replaced on average about one out of 

14 every 30 years or about three? percent of the boiler 

15 market is replaced in any given year. 

16 It looked at, for new construction, -- well, 

17 for those two things, those two assumptions 

18 essentially allow us to look at the existing boiler 

19 stock being replaced, one every 30 years, and if we 

20 know the total square footage out there for the 

21 existing commercial stock for buildings using boilers 

22 and we know the rate of new construction growth, we 

23 can then basically develop a ratio between the 

24 fraction of boilers that are expected to go to new 

25 construction versus the fraction of boilers that are 

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1 expected to go to replacements. 

2 It then took the -- for all future new 

3 construction in any outyear, it ratioed the growth in 

4 boiler shipments for new construction in that year to 

5 the 2007 number, based on the ratio of building stock 

6 projected for that -- or building growth projected in 

7 that year to the 2007 number. That allowed us to make 

8 estimates of what the boiler shipments going to new 

9 construction would be. 

10 For the stock, it’s a little more difficult. 

11 For the stock, we have to actually look at a boiler 

12 replacement scenario where some fraction of the 

13 boilers are removed from the stock and those are 

14 replaced but the stock is also continually being added 

15 to by new construction and so the shipments model 

16 basically used a lifetime for commercial boilers. 

17 This time they didn’t use a simple 30-year 

18 life but actually used a distribution of lifetimes for 

19 commercial boilers and looked at essentially a 

20 vintaging process, trying to make an estimate of 

21 what’s the vintage in the commercial stock for each 

22 year and then what fraction of, say, boilers that are 

23 20 years old are going to need to be replaced in any 

24 outyear, based on the stock, and that allows us to 

25 develop an assessment of the boiler shipments into the 

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1 stock. 

2 We’ve already got a shipment of boilers in 

3 the new construction and you add those together and 

4 you get a total assessment of the boiler shipments. 

5 MR. BROOKMAN: Harvey? 

6 DR. SACHS: David -- Harvey Sachs, ACEEE. 

7 This sounds very elegant and you’ve thought about a 

8 lot of parameters. I’m a little confused about a 

9 couple of things, though. 

10 I’d like to draw our attention to Bullet 2 

11 under Methodologies, Slide 34. By saturation rate, 

12 you mean basically BTUs per square foot? 

13 MR. WINIARSKI: Or in our case, it was -- 

14 more explicitly, it’s assuming that the 36,000 boilers 

15 that are shipped in 2007 on a per square foot basis, 

16 you’re going to get essentially the same type of total 

17 shipments out there, but it’s not really explicitly in 

18 terms of the BTUs, but essentially that’s it. The 

19 boilers per square foot. 

20 DR. SACHS: This would seem to be 

21 problematic on several grounds. One of them is we 

22 certainly seem to see replacements of larger boilers 

23 with trains of smaller boilers and large-scale 

24 retrofit construction for a variety of different 

25 reasons. I do not have quantitative numbers on that. 

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1 It seems as a second point that since 

2 boilers are rated on input capacity but output rises 

3 with efficiency for a given input, that there’s 

4 automatically some trend towards smaller sizes, even 

5 if the envelope standards for new construction have 

6 not changed. 

7 So taking all of these factors into account, 

8 at least for that one-third of the market which are 

9 assumed to be new commercial, which we assume means -- 

10 includes large-scale retrofits, that we may have 

11 substantial changes in your model that are not 

12 accounted for in terms of shipments, and I haven’t 

13 even talked about what we assume to be very large 

14 over-sizing which may be getting a sharper pencil in 

15 terms of replacements and new construction than has 

16 historically been the case. 

17 Low cost of incremental capacity has 

18 certainly led to anecdotal suggestions that 

19 residential boilers, and I assume commercial boilers 

20 are way over-sized relative to actual loads, and that 

21 circles back to the controls question, as well. 

22 MR. WINIARSKI: Right, right. And I can try 

23 to respond maybe a little bit to what I think was 

24 maybe the first point there, which is the issue about 

25 sort of replacing larger boilers with modular boilers, 

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1 and in fact based on how we did this, the real 

2 assumption here is that the boiler stock -- maybe it’s 

3 not a correct assumption, but that the boiler stock in 

4 terms of total BTUs of boilers out there would look 

5 very similar to the current shipment distribution. 

6 So if there’s a -- what we’re essentially 

7 assuming here, because we’re trying to develop the 

8 ratio between shipments to new and shipments to 

9 existing stock, is essentially that the total 

10 shipments or that the market looks very similar 

11 between those two and maybe that’s a good way to -- 

12 your assumption that’s basically on BTU capacity basis 

13 is probably the cleanest way to think about that. 

14 We are actually assuming that I need to 

15 replace this fraction of the square footage, however 

16 that’s served, whether it’s large or small boilers, 

17 with something that looks very similar to what’s 

18 shipped in the current market. 

19 DR. SACHS: What I’m trying to drive at on 

20 that point -- Harvey Sachs again -- is that the 

21 explicit goal of 90.1-2010 is a 30 percent load 

22 reduction relative to ’99. 2007, which is what’s on 

23 the table today, is partway down that curve or of that 

24 curve. 

25 So that, again, I don’t know how it comes 

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1 out and we want to fully support the agreements we 

2 came into the room with, but in terms of ongoing 

3 analytical methodologies, the assumption seems to be a 

4 good zero order of approximation but I’m not sure it’s 

5 first order. 

6 MR. WINIARSKI: Right, right, right. 

7 DR. SACHS: Thank you. 

8 MR. BROOKMAN: Thank you. Frank, you okay? 

9 MR. STANONIK: No. I mean -- Frank 

10 Stanonik, AHRI. I mean, as Harvey said, clearly there 

11 is some replacement situations where a large boiler 

12 gets replaced with either modular boilers or even a 

13 set of staged boilers and I don’t really have any, you 

14 know, information as to what level that occurs. 

15 I mean, you know, we all see that it happens 

16 and there’s certain reasons why in some applications 

17 it makes a lot of sense. 

18 On this 90.1 issue, I mean certainly the 

19 focus of 90.1 has been trying to promote, well, first 

20 of all, better sizing and better system design, 

21 certainly was a target to reduce overall consumption 

22 by 30 percent compared to ASHRAE 90.1-1999. 

23 I mean those were all factors, but beyond 

24 recognizing that, I don’t have any remote idea of how 

25 much they really matter or what effect they have. 

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1 Obviously they have some effect. 

2 MR. WINIARSKI: Right, right. So I guess 

3 the only last point on there is because we didn’t have 

4 good shipment data on the vintages and the existing 

5 stock going out, you know, going back 30 years or 

6 however long boilers last, we had to make an 

7 assessment of what those vintages might look like and 

8 that assessment was fairly -- again, maybe it’s a zero 

9 order approximation, but it was assumed that within 

10 that stock we had sort of a steady state shipment of 

11 commercial boilers in that stock and then using the 

12 survival function with its average 30-year life tried 

13 to make an assessment of, you know, what fraction of 

14 those boilers in older buildings were, you know, 

15 getting ready to be replaced or nearing the end of 

16 their life versus those in newer buildings which might 

17 last longer. 

18 So once we got the Shipment Analysis, we 

19 actually start really doing the National -- yeah. Go 

20 ahead. 

21 DR. SACHS: I’m sorry. Harvey Sachs again. 

22 MR. WINIARSKI: Should I go back to 

23 Shipments? 

24 DR. SACHS: Please. 

25 MR. WINIARSKI: Okay. 

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1 DR. SACHS: You piqued my interest with the 

2 reference to a survival function in the last primary 

3 bullet. 

4 MR. WINIARSKI: Mm-hmm. 

5 DR. SACHS: That would imply a fair fraction 

6 of very early replacements and a long low replacement 

7 life that want to start dying at the same time, dying 

8 quickly. 

9 Is there any evidence for a lot of early 

10 replacements in the commercial boiler market or how do 

11 you handle not having that occur? 

12 MR. WINIARSKI: I’m not sure I understand 

13 the question. When you say a lot of early 

14 replacements? 

15 DR. SACHS: It depends on a lot of infant 

16 mortality, stuff that’s -- 

17 MR. WINIARSKI: Well, the function basically 

18 gives us a -- I think there’s in the TSD, there’s a 

19 picture of what the life-cycle or the survival 

20 function looks like, but essentially what it does is 

21 instead of just stopping at 30 years, what we actually 

22 see is that some fraction of the boilers are dying 

23 maybe at the 20-year time frame and some are lasting 

24 out to the 40-45, but in that particular function, 

25 there are very, very few early, really early 

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1 replacements. There’s sort of a general trend that 

2 goes out to 20 and then slows down. 

3 MR. BROOKMAN: Go ahead, Frank. 

4 MR. STANONIK: One other factor, admittedly 

5 regional, okay, but one of my favorite places is 

6 Southern California. They have been very aggressive 

7 with NOX emissions regulations on boilers and to the 

8 extent I would say they’ve put in some requirements 

9 that in fact would promote the replacement of boilers 

10 not because they’ve failed but in fact because they 

11 wanted -- because of their air pollution needs and so 

12 they’ve actually put in some programs that -- because 

13 I’ve been involved in those discussions -- that you 

14 could say, well, this boiler is only nine years old 

15 but, unfortunately, you installed it back at the wrong 

16 time and we want to have ones that only emit, you 

17 know, 50 nanograms, so you’re going to need to replace 

18 it by three or four years down the road. 

19 So that might be -- my only point is that 

20 other influencing factors are going on, I think, in 

21 many places that affect how long you kept that boiler 

22 that you bought. 

23 MR. WINIARSKI: Right. So, as I said, the 

24 national energy savings was calculated for a period 

25 that started from 2012 through 2042 for all efficiency 

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1 levels. However, for levels that were higher than the 

2 actual baseline, it was assumed that that would only 

3 go in place in 2014. So it is an effect of this two4 year delay for not adopting the ASHRAE Standards and 

5 that does have an effect on the total energy savings 

6 over the life of the product. 

7 The national net present value calculations 

8 cover the total life-cycle cost and installation and 

9 operational expenses that occur for all the equipment 

10 shipments in that original energy savings analysis 

11 period which means that boilers that are shipped out 

12 in 2042 would last till the end of their life which 

13 goes all the way out to, in this analysis, 2085. 

14 I think by 2085 there’s something like one 

15 percent of the boiler stock that hasn’t been replaced 

16 and we just said that was good. 

17 Let’s see here. As I said, there was a two18 year delay that was taken into account. Energy 

19 savings for adoption of the ASHRAE Standard 90.1-2007 

20 levels were based on Market Assessment of the average 

21 of thermal efficiency of boiler shipments and the 

22 stock below that ASHRAE efficiency level and replacing 

23 those boilers. 

24 The analysis is again based on national 

25 average values from the life-cycle cost, including 

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1 customer prices, annual energy use and energy prices, 

2 annual repair and maintenance expenditures from the 

3 LCC Analysis. 

4 Because we have to look at the operational 

5 costs over this long life period, we actually have to 

6 extend or make estimates for fuel prices going out to 

7 2085 which is something I was really loathe to do, as 

8 you might guess, but we’ll talk about that in a 

9 second. 

10 Let’s see here. The analysis used a 

11 distribution of boiler shipments assumed to be the 

12 base case distribution for those of you who are 

13 familiar with other rules. That distribution was 

14 again based on the Market Assessment which was itself 

15 based largely on estimates of the models available at 

16 each efficiency level. 

17 As higher energy standards were assumed to 

18 come into place, including the ASHRAE Standard, as 

19 well as higher ones, the effect of that on the 

20 distribution of efficiencies in the market was assumed 

21 to essentially roll up the efficiencies for all 

22 products that, in the base case, were shipped below 

23 the assumed standard level up to the standard level. 

24 It was also assumed to not have any impact 

25 on the shipments of higher-efficiency boilers, the 

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1 underlying assumption being there that purchasers of 

2 higher-efficiency boilers have already done their 

3 economic analysis and they’ve decided this is the 

4 level that was satisfactory to them and they would not 

5 be affected by a change in the national standards, 

6 national minimum standards. 

7 This is the fuel crisis. It’s just like the 

8 LCC Analysis. They’re based on an extrapolation of 

9 the EIA data from AEO2008, 2020 to 2030. Of course, 

10 because you’ve got operational costs extending out to 

11 2085, that’s a long ways to extrapolate those type of 

12 gas and oil prices and we’re fully cognizant of that. 

13 So we welcome any better suggestions on how that could 

14 be done. 

15 MR. BROOKMAN: Harvey? 

16 DR. SACHS: For Lane Burt with NRDC, when 

17 did you include a carbon factor? 

18 MR. WINIARSKI: Well, -- 

19 DR. SACHS: When did you begin including a 

20 carbon factor? 

21 MR. WINIARSKI: -- we have not actually done 

22 that yet. 

23 DR. SACHS: Thank you. 

24 MR. WINIARSKI: However, I will talk a 

25 little bit to that. 

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1 As DOE was working through the process of 

2 this rule and trying to follow the law as outlined in 

3 EPCA, which basically said that DOE had to carry 

4 through sort of an LCC and an NIA Analysis, that’s 

5 sort of a shortened list to get to this point in the 

6 rulemaking. 

7 DOE was not required to do certain other 

8 steps that actually exist for other rulemakings for 

9 other products, including with those was a 

10 manufacturer impact analysis which some of you have 

11 seen before. 

12 Also included was an environmental 

13 assessment. However, to address that point and to 

14 address other concerns within NEPA, DOE is going 

15 through the process of developing an environmental 

16 assessment for boilers. 

17 MR. BROOKMAN: Tim, you have a comment? 

18 MR. BALLO: Tim Ballo, EarthJustice. First, 

19 I’m not clear on why the Department thinks that part 

20 of the analysis was not required at the NOPR stage for 

21 this rulemaking. 

22 MR. BROOKMAN: Ashley? 

23 MS. ARMSTRONG: Like Dave said, it’s being 

24 done right now. It’s going to be online as part of 

25 the NOPR comment period. 

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1 MR. BALLO: Oh, okay. So it will be 

2 available? 

3 MS. ARMSTRONG: It will be available online, 

4 so it’s coming. It’s just not -- it wasn’t published 

5 in the NOPR. 

6 MR. STAS: And if we could go back in time, 

7 we would have put it in there. 

8 MR. BROOKMAN: Thank you, Eric. Tim? 

9 MR. BALLO: Second question. In the 

10 rulemakings concerning residential products that are 

11 fossil fuel-fired, the department has begun 

12 calculating the impact of the efficiency standards at 

13 various levels along the actual price of energy, on 

14 the price of natural gas that is consumed? 

15 I’d encourage the department to do something 

16 similar in this rulemaking. I don’t know if that’s on 

17 the table or not, but it was shown in the preliminary 

18 TSD to be a very significant economic impact and there 

19 may be a significant economic impact here, as well. 

20 MR. BROOKMAN: Okay. Frank? 

21 MR. STANONIK: Frank Stanonik, AHRI. A 

22 different question and I just want to make sure I 

23 understand this. 

24 So when you looked at this analysis and you 

25 had this distribution of efficiencies, you didn’t -- 

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1 besides -- except for the roll-up, you didn’t assume 

2 any change in that distribution? As an example, you 

3 know, clearly for other products, we have seen growth 

4 in the condensing product market, driven by, you know, 

5 market forces and other things. 

6 So in this analysis, you didn’t assume as an 

7 example that there would be some, let’s say, steady 

8 growth in condensing, certainly gas-condensing 

9 commercial boilers over the years? 

10 MR. WINIARSKI: We didn’t, and we actually 

11 have a question for what might be a better assumption 

12 or what data we might be able to use to develop a 

13 better assumption of how the market might change in 

14 the absence of DOE setting standards or even in the 

15 case where DOE does set standards but there’s more 

16 room left in the market. 

17 MR. STANONIK: We are -- we’ve -- well, let 

18 me separate residential from commercial. Commercial, 

19 I think we’re still in the process of trying to in 

20 fact create some statistics program that would try and 

21 capture that growth, but if we can, we’ll certainly at 

22 this stage try and give you what we would see as at 

23 least a good estimate. 

24 We can’t go back and recreate the historical 

25 data we don’t have. We’ll try and answer at least 

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1 part of that question. 

2 MR. BROOKMAN: Let’s go to the Questions 

3 slide. 

4 MR. WINIARSKI: Right here. SO DOE in its 

5 National Impact Analysis, in review of that analysis, 

6 came up with three separate issues that I wanted to 

7 discuss here. 

8 The first one is based around the term I’m 

9 not sure everyone’s familiar with which is “rebound 

10 effect” in the analysis. A rebound effect is 

11 essentially what might happen to the market in terms 

12 of energy use for boilers if you change the efficiency 

13 of a product, raise the efficiency from an 80 to, say, 

14 an 85 percent. 

15 Will people actually use the boiler more at 

16 the 85 percent level because it’s less costly to 

17 operate and therefore you don’t capture all the energy 

18 savings that you might have if you just looked at the 

19 change in efficiency levels and sort of a constant 

20 load, you don’t capture all that because there’s this 

21 rebound in energy use based on greater utilization of 

22 the product? 

23 DOE, in this analysis, did not examine the 

24 rebound effect or what the implications might be. 

25 Generally, the idea is that if there is a rebound 

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1 effect, the total energy savings you calculate for 

2 higher-efficiency products is less than you would 

3 calculate if you didn’t assume that. 

4 I think for the primary reason DOE is not 

5 assuming one is basically that these are for 

6 commercial buildings. It’s assumed that those 

7 buildings are basically providing a constant level of 

8 service in keeping the space temperatures appropriate 

9 and there would be no additional utilization of 

10 boilers just because they’re more efficient. 

11 MR. BROOKMAN: Briefly describe the other 

12 two questions. 

13 MR. WINIARSKI: The other ones gets to what 

14 Frank was talking about. If there’s -- on DOE’s 

15 assumptions about the market and anything that results 

16 in over-estimation of the savings that can be based on 

17 the assumptions about the baseline market for boilers, 

18 and DOE requests any data that would allow it to 

19 better characterize increases in packaged boiler 

20 efficiencies that would occur over the analysis 

21 period, absent amended standards. Exactly what you 

22 were saying, Frank. 

23 DOE also seeks comment on its forecasted 

24 base case distribution of efficiencies and how that 

25 amended energy conservation standards might affect 

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1 that distribution of efficiencies. Primarily, DOE’s 

2 getting at the issue of is it a simple roll-up or in 

3 fact if DOE sets a standard at a higher level, will 

4 the market shift to purchase -- greater purchases of 

5 equipment at even higher levels? The idea that maybe 

6 there’s some fraction of the market that purchases two 

7 percent over whatever the base standard is. 

8 MR. BROOKMAN: So three questions for you to 

9 consider, if you have responses to those. 

10 MR. STANONIK: Well, we don’t really have 

11 anything right now, but we’ll submit something -- 

12 MR. BROOKMAN: Okay. 

13 MR. STANONIK: -- in our written comments. 

14 MR. BROOKMAN: Thank you. 

15 MR. WINIARSKI: So the NOPR presents the 

16 national energy savings that were calculated for each 

17 of the efficiency levels analyzed and for each product 

18 class or equipment class. 

19 DOE calculates the net present value 

20 savings. Because those are discounted in the future, 

21 DOE uses both three and seven percent as sort of 

22 spanning the range of discount rates that might be 

23 appropriate for the analysis, and again the net 

24 present value assumes that in the ASHRAE case, the 

25 standards go in place in 2012 and DOE adopting higher 

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1 standards, those standards would not go in place until 

2 2014. 

3 And I think that’s it for National Impact 

4 Analysis. 

5 MR. BROOKMAN: So no additional -- okay. So 

6 thank you, David. 

7 Now, there’s another opportunity for anybody 

8 that wishes to make supplementary remarks, bring any 

9 other issues to the floor that haven’t been mentioned 

10 so far, make concluding summary remarks, that sort of 

11 thing. 

12 So if anybody wishes to do so before we hear 

13 from Mohammed, his closing comments? Yes, Mark? 

14 MR. KENDALL: Mark Kendall from Burnham. 

15 I’ll just say that from Burnham’s perspective, we 

16 support the direction DOE is heading in its NOPR and 

17 we urge you to carry it to its natural conclusion and 

18 issue a final rule as soon as you can possibly do it. 

19 MR. BROOKMAN: Thank you. Harvey Sachs. 

20 DR. SACHS: Harvey Sachs, ACEEE. We 

21 appreciate the department’s work. Some pieces of the 

22 ASHRAE 2007 Standards involve a consensus among 

23 manufacturers and certain members of the advocacy 

24 community and we are bound by those agreements. 

25 MR. KENDALL: Oh, gee, what an overwhelming 

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1 endorsement. 

2 (Laughter.) 

3 MS. ARMSTRONG: Can I do one follow-up just 

4 to clarify those consensus for boilers? 

5 DR. SACHS: Now you’re putting me on the 

6 spot. 

7 MR. BROOKMAN: And those binding agreements, 

8 they’re pretty much reflected in what’s here. 

9 DR. SACHS: Yes. 

10 MR. BROOKMAN: Also for the record, yes. 

11 Frank? 

12 MR. STANONIK: Frank Stanonik with AHRI. 

13 Just want to make sure everybody keeps this in mind 

14 and it’s something we certainly -- I’ve said probably 

15 too many times. 

16 In a bigger picture way, you know, 

17 supporting where DOE is going with this, there is a, 

18 I’ll call it, residual value from changing over to 

19 thermal efficiency, you know. We, unfortunately, have 

20 had to debate twice this whole how this combustion 

21 efficiency compares to thermal efficiency for boilers 

22 and all of that. 

23 If we make this transition as we go forward 

24 and between what ASHRAE’s trying to do and what now is 

25 in Federal regulations, you know, these requirements 

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1 will be revisited with obviously an eye towards 

2 increasing them somewhere down the -- in the future. 

3 I mean if ASHRAE doesn’t do something, I 

4 think DOE has to look at commercial requirements every 

5 seven years. Anyhow, so there are things in place 

6 that, you know, these will be discussed further in the 

7 future with an eye towards obviously raising them, but 

8 making this transition to thermal efficiency certainly 

9 now better positions us all to discuss reasonably and 

10 with -- you know, let’s say focusing on how we do save 

11 more energy without worrying about how the hell we 

12 measure it in the future and that is -- you know, 

13 that’s not an insignificant value in this whole 

14 rulemaking. 

15 MR. BROOKMAN: Thank you. Additional final 

16 comments? 

17 (No response.) 

18 MR. BROOKMAN: Okay. Then yes. 

19 Proposed Standard Levels

20 MR. KHAN: I just wanted to get these on the 

21 screen here. We already talked about, I guess, some 

22 of the last and final comments that you may have. 

23 These were in the Notice obviously. This is a Summary 

24 of the Standard Levels, okay, and again just to 

25 conclude and summarize about submitting comments, 

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1 again they’re very, very appreciated and we would like 

2 to get whatever comments and data, of course, that you 

3 can provide and the way to do that, Brenda Edwards, 

4 she’s not in the room right now, I think she might be 

5 outside, we would like for you to please submit your 

6 written comments to her via these ways here, then 

7 again, by the close of the comment period which is 

June 3rd 8 , 2009. 

9 So I think we’ve had a very good exchange of 

10 information here and all of your comments and concerns 

11 we will address and consider fully. 

12 Discussion of Proposed Standard Levels, Other Issues 

13 and Final Remarks from Interested Parties

14 MR. BROOKMAN: Harvey Sachs. 

15 DR. SACHS: Harvey Sachs, ACEEE. Mohammed, 

16 thank you very much for a well-organized process. 

17 I guess with respect to the preceding Slide 

18 40, I don’t understand the last column, Effective Date 

March 2nd 19 , 2022. Where did that come from? 

20 MR. WINIARSKI: I can maybe speak to that. 

21 MR. BROOKMAN: Dave Winiarski, find a 

22 microphone. 

23 MR. WINIARSKI: My understanding was that in 

24 the development of the ASHRAE 90.1 efficiency levels, 

25 for certain classes of boilers, ASHRAE effectively 

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1 said that -- and I think it’s the natural draft steam 

2 boilers, that in 2020, in the standard, that the 

3 ASHRAE Standard efficiency levels would be raised for 

4 those classes of boilers from what was being proposed 

5 to be the standard in 2010, moved up, I think, like 

6 two percentage points or something like that. 

7 MS. ARMSTRONG: Yes, 0.77. 

8 MR. WINIARSKI: Right. So because of that 

9 effectively, DOE, when it set standards, has to 

10 incorporate that in its final language, standards 

11 language. 

12 DR. SACHS: Well, I don’t understand how 

13 that extrapolates from natural draft steam boilers to 

14 all the other product classes. 

15 MS. ARMSTRONG: It’s just the way it’s shown 

16 here. 

17 DR. SACHS: I’m sorry. I’m not a lawyer. 

18 I’m pretty naïve, but this column seems to bear the 

19 intent of the Department to declare an effective 

20 standard of, for example in the first row, 80 percent 

21 E of T for hot water commercial packaged boilers that 

22 are gas-fired between 300,000 and 2.5 million BTUs per 

23 hour and I think that’s far beyond the scope of what’s 

24 been discussed. 

25 MR. WINIARSKI: You mean the second column? 

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1 DR. SACHS: Yes, the second column, the 

2 second yellow column, the far right column, Effective 

3 Date March 2022. 

4 I would request that the Department delete 

5 that column entirely. I don’t think it’s relevant to 

6 this rulemaking. 

7 MR. BROOKMAN: I see. We get your point. 

8 MS. ARMSTRONG: We get your point and Dave’s 

9 point is that you’re anticipating something that might 

10 -- do you know it’s going to happen? 

11 MS. ARMSTRONG: No. Where it says 77 to 79, 

Harvey’s saying just retain that March 2nd 12 , 2022, 

13 effective date for just those two equipment classes, 

14 leave the other ones out. 

15 DR. SACHS: I’m suggesting, now that I -- 

16 and again, this is new to me. I hadn’t expected to 

17 see this and it’s my deficiency in not doing all the 

18 homework. I didn’t think this would be on the test. 

19 But I do not believe it’s appropriate in a 

rulemaking about effective date March 2nd 20 , 2012, to 

21 pre-ordain any standards for -- to be effective March 

2nd 22 of 2022. 

23 MS. ARMSTRONG: Even those two Tier ones 

24 that were set by ASHRAE? 

25 DR. SACHS: I cannot see any reason why the 

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1 department would choose to bind itself today to any 

2 standards in 2022. I don’t believe that was the 

3 subject of any of the ASHRAE discussions. 

4 MR. STANONIK: Well, it wasn’t. 

5 MR. BROOKMAN: Frank? 

6 MR. STANONIK: Frank Stanonik with AHRI. I 

7 can -- specifically to the issue of the steam natural 

8 draft, in this case we would disagree with Harvey. 

9 It is, from our view, worth having that 

10 second level with the effective date. It was part of 

11 the ASHRAE discussions and really what’s behind all 

12 that is, first of all, this category, natural draft 

13 steam gas-fired boiler, very roughly small part of the 

14 market, and what was -- what we were trying to do 

15 then, it was actually part of the negotiations, what 

16 we were trying to do is some, I’ll daresay, initial 

17 incremental change and essentially agreed to allow a 

18 little more time to really make a bigger efficiency 

19 change for this small segment of the market and so the 

20 reason we would prefer -- it’s here because it does 

21 indicate to the people making that product, okay, you 

22 know, this first level has some effect but be aware 

23 that essentially in 10 years, we want -- well, the 

24 agreement was that that steam product would be as 

25 efficient as other -- well, in this case the non-

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1 natural draft, I think it is. 

2 MR. BROOKMAN: Okay. Thank you for those 

3 comments, both those comments. 

4 DR. SACHS: Harvey Sachs, ACEEE. I will go 

5 back to those who were involved on our side, but at 

6 this point, my request would be that the right-most 

7 column be deleted unless our comments indicate that we 

8 are bound by the two rows for atmospheric or natural 

9 draft. 

10 MR. BROOKMAN: Okay. Thank you. Yes, Mark? 

11 MR. KENDALL: Mark Kendall with Burnham. 

12 The levels in the proposed rulemaking are going to 

13 result in energy savings. They’re going to result in 

14 boilers being modified, boilers being taken off the 

15 market. 

16 That’s no more clear than in the gas natural 

17 draft steam boiler products which essentially are 

18 being eliminated by this standard in 2022 and the 

19 accommodation was given to those products to have an 

20 extra 10 years because commercial buildings with 

21 basement with boiler rooms that have a low head room 

22 currently have no product that can be used in those 

23 applications, except for these products, and the 

24 general feeling of ASHRAE, I suppose, was that this 

25 extra 10 years can help building owners and 

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1 manufacturers decide what to do about that. 

2 The presentation format by the Department, I 

3 would agree, does mislead people to think that these 

4 rules have been determined for all the other nine 

5 product classes for the next 20-30 years which 

6 certainly isn’t ASHRAE’s intent and wasn’t the intent 

7 of the negotiating party that made the proposal to 

8 ASHRAE. 

9 But regardless, it’s DOE’s prerogative to 

10 change those any time ASHRAE makes a change and that 

11 column will, if it shows up in the rule, will just be 

12 there until it’s changed. 

13 DR. SACHS: Point well taken, Mark, but the 

14 dynamic at ASHRAE would be -- would likely be 

15 influenced by reference to what DOE has done. 

16 MR. BROOKMAN: Okay. I think we’ve heard 

17 it. Thank you. 

18 Then closing remarks from Mohammed and I 

19 would encourage all of you, at the back of your packet 

20 there’s an Evaluation Form, please take a few seconds 

21 to fill it out. The department reads them carefully. 

22 Next Steps and Closing

23 MR. KHAN: Again, thank you for the final 

24 comments regarding these final slides here and the 

25 clarifying points that everyone has just made, as 

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1 well. 

2 We will make that clear in the final rule, 

3 what the intent is, and again I just want to express 

4 our appreciation for your participation and please get 

5 us the comments that you will submit. 

6 Thank you very much. 

7 MR. BROOKMAN: Thank you. 

8 (Whereupon, at 11:45 a.m., the public 

9 meeting was concluded.) 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 REPORTER'S CERTIFICATE

23 

24 This is to certify that the attached proceedings 

25 before: 

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1 UNITED STATES DEPARTMENT OF ENERGY 

2 In the Matter of: 

3 PUBLIC MEETING ON THE NOTICE OF PROPOSED RULEMAKING 

4 FOR CERTAIN COMMERCIAL AIR CONDITIONING, HEATING, AND 

5 WATER-HEATING EQUIPMENT 

6 

7 Were held as herein appears and that this is the 

8 original transcript thereof for the file of the 

9 Department, Commission, Board, Administrative Law Judge 

10 or the Agency. 

11 Further, I am neither counsel for or related to any 

12 party to the above proceedings. 

13 

14 

15 Wendy Greene 

16 Official Reporter 

17 Dated: April 10, 2009 

18 

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