CHAPTER 1. INTRODUCTION

TABLE OF CONTENTS

**1.1 PURPOSE**  **OF THE**  **DOCUMENT**

**................................................................................. 1­1** 

**1.2 OVERVIEW OF COMMERCIAL EQUIPMENT STANDARDS................................. 1­1** 

**1.3 OVERVIEW**  **OF PACKAGED**  **TERMINAL AIR**  **CONDITIONER AND**  **PACKAGED**

**TERMINAL HEAT**  **PUMP STANDARDS** 

**.................................................................... 1­2** 

**1.4 STRUCTURE**  **OF THE**  **DOCUMENT............................................................................ 1­4** 

**1­i 1­ii** CHAPTER 1. INTRODUCTION

1.1 PURPOSE OF THE DOCUMENT

**This technical**  **support document**  **(TSD) is**  **a stand­alone**  **report that**  **documents the** 

**technical analyses**  **and results**  **in support**  **of the**  **information presented**  **in the**  **final rule**  **(FR) for** 

**establishing energy**  **conservation standards**  **for packaged**  **terminal air**  **conditioners (PTACs)**  **and**

**packaged terminal**  **heat pumps**  **(PTHPs).**

1.2 OVERVIEW OF COMMERCIAL EQUIPMENT STANDARDS

**Part A**  **of Title**  **III of**  **the Energy**  **Policy and**  **Conservation Act**  **(EPCA) of**  **1975, Public** 

**Law 94­163,**  **as amended**  **by the**  **National Energy**  **Conservation Policy**  **Act of**  **1978 (NECPA),** 

**Public Law**  **95­619; the**  **National Appliance**  **Energy Conservation**  **Act of**  **1987 (NAECA),**  **Public**

**Law 100­12;**  **the National**  **Appliance Energy**  **Conservation Amendments**  **of 1988**  **(NAECA**

**1988), Public**  **Law 100­357;**  **the Energy**  **Policy Act**  **of 1992**  **(EPACT 1992),**  **Public Law**  **102­486;**

**and the**  **Energy Policy**  **Act of**  **2005 (EPACT**  **2005), Public**  **Law 109­58,**  **established the**  **Energy**

**Conservation Program**  **for Consumer**  **Products other**  **than Automobiles.**  **(42 U.S.C.**  **6291­6309)**

**Part A­1**  **a of**  **Title III**  **established a**  **program for**  **“Certain Industrial**  **Equipment,” which**  **includes**

**PTACs and**  **PTHPs. (42**  **U.S.C. 6311(1)(I))**  **EPACT 1992**  **also amended**  **EPCA with**  **respect to** 

**air­conditioning equipment,**  **providing definitions**  **in section**  **122(a), test**  **procedures in**  **section**

**122(b), labeling**  **provisions in**  **section 122(c),**  **energy­efficiency standards**  **in section**  **122(d), and** 

**enforcement requirements**  **in section**  **122(e). (42**  **U.S.C. 6311,**  **6313­15) These**  **amendments**

**expanded the**  **Department of**  **Energy (DOE)’s**  **energy conservation**  **program to**  **include PTACs** 

**and PTHPs,**  **the focus**  **of this**  **document.**

**EPCA, as**  **amended by**  **EPACT 1992,**  **established Federal**  **energy conservation**  **standards**

**that correspond**  **to the**  **levels in**  **American Society**  **of Heating,**  **Refrigerating and**  **Air­Conditioning**

**Engineers, Inc.**  **(ASHRAE)/Illuminating Engineering**  **Society of**  **North America**  **(IESNA)**

**Standard 90.1**  **in effect**  **on October**  **24, 1992.**  **The statute**  **further provides**  **that if**  **the efficiency** 

**levels in**  **ASHRAE Standard**  **90.1“** Energy Standard for Buildings Except Low­Rise Residential

Buildings” **(ASHRAE Standard**  **90.1­1992) are**  **amended after**  **that date**  **for any**  **of the**  **covered**

**products, including**  **PTACs and**  **PTHPs, the**  **Secretary of**  **Energy (Secretary)**  **must establish**  **an**

**amended uniform**  **national standard**  **for such**  **equipment at**  **the new**  **minimum level**  **for each** 

**effective date**  **specified in**  **ASHRAE Standard**  **90.1, unless**  **the Secretary**  **determines, through**  **a**

**rulemaking supported**  **by clear**  **and convincing**  **evidence, that**  **a more**  **stringent standard**  **would**

**result in**  **significant additional**  **conservation of**  **energy and**  **is technologically**  **feasible and** 

**economically justified.**  **(42 U.S.C.**  **6313(a)(6)(A)(ii)(II))**

**a This**  **part was**  **originally titled**  **Part C.**  **However, it**  **was redesignated**  **Part A­1**  **after Part**  **B of**  **Title III**  **of EPCA**  **was**

**repealed by**  **Pub. L.**  **109­58.**

**1­1 EPCA**  **provides that**  **in determining**  **whether new**  **or amended**  **standards are** 

**technologically feasible**  **and economically**  **justified, DOE**  **must consider**  **to the**  **greatest extent** 

**practicable, the**  **following seven**  **factors:**

**(1) the**  **economic impact**  **of the**  **standard on**  **the manufacturers**  **and consumers**  **of the** 

**products subject**  **to the**  **standard;**

**(2) the**  **savings in**  **operating costs**  **throughout the**  **estimated average**  **life of**  **the products**  **in**

**the type**  **(or class)**  **compared to**  **any increases**  **in the**  **price, initial**  **charges, or**  **maintenance**

**expenses for**  **the products**  **that are**  **likely to**  **result from**  **the imposition**  **of the**  **standard;**

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

**imposition of**  **the standard;** 

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

**imposition of**  **the standard;** 

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

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

**(6) the**  **need for**  **national energy**  **conservation; and** 

**(7) other**  **factors the**  **Secretary considers**  **relevant. (42**  **U.S.C. 6316(a);**  **42 U.S.C.** 

**6295(o)(2)(B)(i)­(ii))**

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

**setting energy**  **conservation standards.**  **DOE actively**  **encourages the**  **participation and**  **interaction**

**of all**  **stakeholders during**  **the comment**  **period in**  **each stage**  **of the**  **rulemaking. During**  **comment**

**periods, interactions**  **among stakeholders**  **provide a**  **balanced discussion**  **of the**  **information that**  **is**

**required for**  **the standards**  **rulemaking.**

**In conducting**  **test procedure**  **and energy**  **conservation standards**  **rulemakings, DOE** 

**involves stakeholders**  **through formal**  **public notifications**  **(i.e.,** Federal Register **notices). Before** 

**DOE determines**  **whether to**  **adopt a**  **proposed energy**  **conservation standard,**  **it must**  **first solicit** 

**comments on**  **the proposed**  **standard. (42**  **U.S.C. 6316(a);**  **42 U.S.C.**  **6295(o)(2)(B)(i)­(ii)) Any** 

**new or**  **amended standard**  **must be**  **designed to**  **achieve significant**  **additional conservation**  **of**

**energy and**  **be technologically**  **feasible and**  **economically justified.**  **(42 U.S.C.** 

**6313(a)(6)(A)(ii)(II)) To**  **determine whether**  **economic justification**  **exists, DOE**  **must review** 

**comments on**  **the proposal**  **and determine**  **that the**  **benefits of**  **the proposed**  **standard exceed**  **its**

**burdens to**  **the greatest**  **extent practicable,**  **weighing the**  **seven factors**  **listed above.** 

1.3 OVERVIEW OF PACKAGED TERMINAL AIR CONDITIONER AND

PACKAGED TERMINAL HEAT PUMP STANDARDS

**On October**  **29, 1999,**  **ASHRAE’s board**  **of directors**  **approved ASHRAE**  **Standard 90.1­** 

**1999 “**  Energy Standard for Buildings Except Low­Rise Residential Buildings” **(ASHRAE**

**1­2 Standard**  **90.1­1999), which**  **addressed efficiency**  **levels for**  **34 categories**  **of commercial**  **heating,**

**ventilating, and**  **air­conditioning (HVAC)**  **and water**  **heating equipment**  **covered by**  **EPCA. The** 

**new ASHRAE**  **Standard 90.1­1999**  **revised the**  **efficiency levels**  **in the**  **existing ASHRAE** 

**Standard 90.1­1989**  **for certain**  **commercial equipment**  **including PTACs**  **and PTHPs.**  **For the** 

**remaining equipment,**  **ASHRAE left**  **the preexisting**  **levels in**  **place, after**  **considering revision**  **of**

**the levels**  **for some**  **equipment and**  **deferring consideration**  **of others.** 

**Following the**  **publication of**  **ASHRAE Standard**  **90.1­1999, DOE**  **performed a**  **screening**

**analysis that**  **covered 24**  **of the**  **categories of**  **equipment to**  **help decide**  **what action**  **it would**  **take**

**with respect**  **to the**  **new efficiency**  **levels. For**  **each equipment**  **type of**  **equipment, the**  **screening**

**analysis examined**  **a range**  **of efficiency**  **levels that**  **included the**  **levels specified**  **in EPCA**  **and**

**ASHRAE Standard**  **90.1­1999, as**  **well as**  **levels associated**  **with the**  **lowest life­cycle**  **cost.**

Screening Analysis for EPACT­Covered Commercial HVAC and Water­Heating Equipment

**(commonly referred**  **to as**  **the 2000**  **Screening Analysis)**  **summarizes the**  **analysis and**  **estimates**

**the annual**  **national energy**  **consumption and**  **the potential**  **for energy**  **savings that**  **would result**  **if**

**EPACT­covered products**  **were to**  **meet these**  **efficiency levels.**  **b The**  **analysis also**  **estimates**

**additional energy­savings**  **potential for**  **the EPACT­covered**  **products if**  **they were**  **to exceed**  **the**

**efficiency levels**  **prescribed in**  **ASHRAE Standard**  **90.1­1999. The**  **baselines for**  **the comparison** 

**were the**  **corresponding levels**  **specified in**  **ASHRAE Standard**  **90.1­1999 and**  **EPCA. On** 

**January 12,**  **2001, DOE**  **published a**  **final rule**  **concluding that**  **the 2000**  **Screening Analysis** 

**indicated at**  **least a**  **reasonable possibility**  **of finding**  **“clear and**  **convincing evidence”**  **that more** 

**stringent standards**  **“would be**  **technologically feasible**  **and economically**  **justified and**  **would**

**result in**  **significant additional**  **conservation of**  **energy” for**  **PTACs and**  **PTHPs. 66**  **FR 3349­50.** 

**According to**  **EPCA, these**  **are the**  **criteria for**  **the adoption**  **of standards**  **more stringent**  **than those** 

**in ASHRAE**  **Standard 90.1.**  **(42 U.S.C.**  **6313(a)(6)(A)(ii)(II))**

**On March**  **13, 2006,**  **DOE issued**  **a Notice**  **of Availability**  **(NOA) announcing**  **the**

**availability of**  **a technical**  **support document**  **(TSD) DOE**  **used in**  **assessing whether**  **to adopt,**  **as**

**uniform national**  **standards, energy**  **conservation standards**  **contained in**  **amendments to**  **the**

**ASHRAE Standard**  **90.1­1999 for**  **certain types**  **of commercial**  **equipment including**  **PTACs and** 

**PTHPs. 71**  **FR 12634.**  **DOE revised**  **its energy**  **savings analysis**  **used in**  **the 2000**  **Screening**

**Analysis and**  **summarized the**  **assumptions and**  **results in**  **this TSD.**  **DOE also**  **stated that**  **even**

**though the**  **potential energy**  **savings in**  **the revised**  **analysis has**  **been reduced**  **for seeking**  **a more** 

**stringent standard**  **compared to**  **the efficiency**  **levels specified**  **in ASHRAE**  **90.1­1999, DOE** 

**believes there**  **is a**  **possibility of**  **clear and**  **convincing evidence,**  **which would**  **warrant further** 

**evaluation of**  **more stringent**  **standard levels**  **for PTACs**  **and PTHPs.**  **Therefore, DOE**  **stated in** 

**this notice**  **that it**  **was inclined**  **to seek**  **a more**  **stringent standard**  **level than**  **the efficiency**  **levels in** 

**ASHRAE Standard**  **90.1­1999 for**  **PTACs and**  **PTHPs through**  **a separate**  **rulemaking process.**  **71**

**FR 12639.** 

**b On**  **April 2000,**  **the DOE**  **published the**  **Screening Analysis**  **for EPACT­Covered**  **Commercial HVAC**  **and Water** 

**Heating Equipment**  **which covered**  **PTAC and**  **PTHP products.** 

**1­3 DOE**  **proposed energy**  **conservation standards**  **for PTACs**  **and PTHPs**  **in a**  **notice of** 

**proposed rulemaking**  **(NOPR) published**  **on April**  **7, 2008.**  **73 FR**  **18858. In**  **conjunction with** 

**the NOPR,**  **DOE also**  **published on**  **its website**  **the complete**  **TSD for**  **the NOPR,**  **which**

**incorporated the**  **final analyses**  **that DOE**  **conducted and**  **technical support**  **documentation of**  **each**

**analysis. The**  **NOPR TSD**  **included the**  **LCC spreadsheets,**  **the national**  **impact analysis** 

**spreadsheets, and**  **the manufacturer**  **impact analysis**  **(MIA) spreadsheet–all**  **of which**  **are available** 

**on DOE’s**  **PTAC and**  **PTHP webpage**  **at:**

**http://www1.eere.energy.gov/buildings/appliance_standards/commercial/packaged_ac_hp.html.**

**The NOPR**  **also included**  **additional background**  **information on**  **the history**  **of this** 

**rulemaking. 73**  **FR 18862–63.**  **DOE held**  **a public**  **meeting in**  **Washington, DC,**  **on May**  **1, 2008,** 

**to accept**  **oral comments**  **on and**  **solicit information**  **relevant to**  **the proposed**  **rule.**

**Subsequent to**  **the NOPR**  **publication on**  **April 2008,**  **DOE revised**  **its NOPR**  **analyses in** 

**preparation for**  **publishing this**  **final rule.**  **A list**  **of the**  **analyses and**  **the corresponding**  **Chapter**

**number is**  **presented in**  **the next**  **section. A**  **summary of**  **each analysis**  **conducted can**  **be found**  **in**

**Chapter 2**  **of this**  **TSD.**

1.4 STRUCTURE OF THE DOCUMENT

**This final**  **rule TSD**  **outlines the**  **analytical approaches**  **used in**  **this rulemaking.**  **The TSD** 

**consists of**  **15 chapters,**  **a report**  **for regulatory**  **impact analysis,**  **and appendices.** 

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

**and how**  **it applies**  **to the**  **PTAC and**  **PTHP rulemaking,**  **and outlines**  **the**

**structure of**  **the document.** 

**Chapter 2**  **Analytical Plan:**  **describes the**  **rulemaking process**  **step by**  **step.**

**Chapter 3**  **Market and**  **Technology Assessment:**  **characterizes the**  **PTAC and**  **PTHP**

**market and**  **the technologies**  **available for**  **increasing equipment**  **efficiency.**

**Chapter 4**  **Screening Analysis:**  **determines which**  **technology options**  **are viable**  **for**

**consideration in**  **the engineering**  **analysis.**

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

**relationship between**  **increased manufacturer**  **price and**  **increased**

**efficiency.**

**Chapter 6**  **Markups for**  **Equipment Price**  **Determination: discusses**  **the methods**  **used**

**for establishing**  **markups for**  **converting manufacturer**  **prices to**  **customer**

**equipment prices.** 

**1­4 Chapter**  **7 Energy**  **Use Characterization:**  **discusses the**  **process used**  **for generating** 

**energy use**  **estimates of**  **PTACs and**  **PTHPs for**  **a variety**  **of equipment** 

**classes, climate**  **locations, and**  **standard levels.** 

**Chapter 8**  **Life­Cycle Cost**  **and Payback**  **Period Analyses:**  **discusses the**  **economic**

**effects of**  **standards on**  **individual customers**  **and users**  **of the**  **equipment**

**and compares**  **the LCC**  **and PBP**  **of equipment**  **with and**  **without higher** 

**efficiency standards.** 

**Chapter 9**  **Trial Standard**  **Levels: discusses**  **the trial**  **standard levels**  **and the**  **methods**

**used to**  **derive the**  **energy­efficiency equations**  **corresponding to**  **the**

**amended energy**  **conservation standards.** 

**Chapter 10**  **Shipments Analysis:**  **discusses the**  **methods used**  **for forecasting** 

**shipments with**  **and without**  **higher efficiency**  **standards, including**  **how**

**equipment purchase**  **decisions are**  **economically influenced**  **and modeled** 

**with econometric**  **equations.**

**Chapter 11**  **National Impact**  **Analysis: discusses**  **the methods**  **used for**  **forecasting**

**national energy**  **consumption and**  **national economic**  **impacts based**  **on**

**annual equipment**  **shipments and**  **estimates of**  **future equipment**  **efficiency**

**distributions in**  **the absence**  **and presence**  **of higher**  **efficiency standards.** 

**Chapter 12**  **Life­Cycle Cost**  **Sub­Group Analysis:**  **discusses the**  **effects of**  **standards**

**on a**  **subgroup of**  **PTAC and**  **PTHP equipment**  **customers and**  **compares the** 

**LCC and**  **PBP of**  **equipment with**  **and without**  **higher efficiency**  **standards**

**for these**  **customers.**

**Chapter 13**  **Manufacturer Impact**  **Analysis: discusses**  **the effects**  **of amended**  **energy**

**conservation standards**  **on the**  **finances and**  **profitability of**  **equipment**

**manufacturers.**

**Chapter 14**  **Utility Impact**  **Analysis: discusses**  **the effects**  **of amended**  **energy**

**conservation standards**  **on the**  **installed generation**  **capacity of**  **electric**

**utilities.**

**Chapter 15**  **Employment Impact**  **Analysis: discusses**  **the effects**  **of amended**  **energy**

**conservation standards**  **on National**  **employment.**

**Chapter 16**  **Environmental Assessment:**  **discusses the**  **effects of**  **amended energy** 

**conservation standards**  **on certain**  **environmental indicators.** 

**Regulatory Impact**  **Analysis for**  **Packaged Terminal**  **Air Conditioners**  **and Packaged** 

**Terminal Heat**  **Pumps: discusses**  **the present**  **regulatory actions**  **as well**  **as**

**the impact**  **of non­regulatory**  **alternatives to**  **setting new**  **energy**

**conservation standards.** 

**1­5 Appendix**  **A Detailed**  **Data for**  **Equipment Price**  **Markups: accompanies**  **Chapter 6,** 

**Markups for**  **Equipment Price**  **Determination**

**Appendix B**  **Internal Loads**  **Schedules and**  **Part­Load Performance**  **Curves for**  **PTACs**

**and PTHPs:**  **accompanies Chapter**  **7, Energy**  **Use Characterization** 

**Appendix C**  **Typical Meteorological**  **Year (TMY2)**  **Assignments: accompanies** 

**Chapter 7,**  **Energy Use**  **Characterization**

**Appendix D**  **User Instructions**  **for Life­Cycle**  **Cost Spreadsheet:**  **accompanies Chapter** 

**8, Life­Cycle**  **Cost and**  **Payback Period**  **Analysis**

**Appendix E**  **Detailed Life­Cycle**  **Cost Output:**  **accompanies Chapter**  **8, Life­Cycle** 

**Cost and**  **Payback Period**  **Analysis**

**Appendix F**  **User Instructions**  **for National**  **Energy Savings**  **and Net**  **Present Value** 

**Spreadsheet: accompanies**  **Chapter 11,**  **National Impact**  **Analysis**

**Appendix G**  **Detailed National**  **Energy Savings**  **and National**  **Net Present**  **Value Output:** 

**accompanies Chapter**  **11, National**  **Impact Analysis** 

**Appendix H**  **Estimation of**  **Marginal Heat**  **Rates and**  **Site­to­Source Conversion**  **Factors:**

**accompanies Chapter**  **11, National**  **Impact Analysis** 

**Appendix I**  **Government Regulatory**  **Impact Model**  **(GRIM): accompanies**  **Chapter 13,** 

**Manufacturer Impact**  **Analysis**

**Appendix J**  **Estimation of**  **Utility and**  **Environmental Results**  **from NEMS­BT**  **Output:**

**accompanies Chapter**  **14, Utility**  **Impact Analysis** 

**Appendix K**  **Manufacturer Impact**  **Analysis Interview**  **Guides: accompanies**  **Chapter**

**13, Manufacturer**  **Impact Analysis** 

**1­6**