1 | Building Technologies Program eere.energy.gov The Parker Ranch installation in Hawaii 

### BUILDING TECHNOLOGIES PROGRAM



## Energy Conservation Program for Appliance

Standards:

SNOPR Public Meeting for Microwave Ovens March 14, 2012

Wes Anderson 

### Department of Energy 

### Energy Efficiency & Renewable Energy2 | Building Technologies Program eere.energy.gov 

# Introduction

Purpose of the Public Meeting

 To present revised methodologies based on stakeholder feedback, and characterize results for analyses

 To discuss specific issues related to each analysis

 To seek input from attendees on methodologies, assumptions and

data sources

 To describe remaining steps before issuance of Final Rule3 | Building Technologies Program eere.energy.gov 

# Introduction

DOE welcomes comments, data, and information concerning its analysis on microwave ovens. Throughout this presentation, issues that correspond to issues raised in DOE’s published material from this analysis are raised for discussion in boxes like this one. Nonetheless, comments are welcome on any part of DOE’s analysis.



# Issues for Comment4 | Building Technologies Program eere.energy.gov 

# Introduction

NOPR

SNOPR (Standby Power)



###  Framework Document made available by DOE on March 15, 2006. (71 FR 15059)

 ANOPR issued by DOE on November 15, 2007 (72 FR 64432) (ANOPR Public Meeting on December 13, 2007)

 NOPR issued by DOE on October 17, 2008 (73 FR 62034) (NOPR Public Meeting on November 13, 2008). Comments from stakeholders led DOE to continue 

### rulemaking for microwave oven standby power.

 Final Rule issued by DOE on April 8, 2009 addressing cooking efficiency standards. (74 FR 16040) DOE determined that new cooking efficiency standards for microwave ovens were not justified. 

## Steps in the Microwave Oven Energy Conservation Standards Rulemaking

Final

Rule (Cooking Efficiency) ANOPR Framework Document

Final Rule (Standby Power)5 | Building Technologies Program eere.energy.gov 

# Introduction

Purpose of the SNOPR

 The October 2008 NOPR analyzed microwave standby power as a measure of 

### energy consumption separate from cooking efficiency, and proposed new prescriptive standards for standby power.

 DOE received comments that it should consider an updated version of the international standby power standard (International Electrotechnical Commission (IEC) 62301), which was expected shortly.

 Therefore, the rulemaking for microwave oven standby power was continued rather than included in the April 2009 Final Rule to allow DOE to consider IEC 62301 Second Edition



# • EPCA’s statutory requirement to consider the “most current version”



# • International harmonization

 The SNOPR analysis also addresses comments on other topics received on the NOPR.

 This SNOPR presents the revised analysis and proposes new standard levels for comment.6 | Building Technologies Program eere.energy.gov 

# Introduction

 SNOPR for microwave oven standby power issued by DOE on January 31, 2012 (SNOPR Public Meeting today, March 14, 2012)

 Comments on SNOPR from interested parties



# • Transcript records oral comments from today’s public meeting



# • Written comments (comment period closes April 16, 2012)

 DOE reviews and considers all comments submitted on a timely basis.

 Final Rule Publication



# • In accordance with EPCA, as amended by EISA 2007.



# SNOPR Schedule7 | Building Technologies Program eere.energy.gov 

# Introduction

Test Procedure

 DOE published an interim final rule for the microwave oven test procedure on March 9, 2011, to incorporate measures of standby mode and off mode energy use.

 The test procedure amendments are based on IEC 62301 First Edition, 

## which was the most current at the time that the interim final rule was finalized.



# • IEC Standard 62301 Second Edition published on January 27, 2011.

 DOE received comments on the interim final rule supporting the incorporation by reference of the second edition.

 DOE published an SNOPR on November 23, 2011, to propose amendments based on IEC 62301 Second Edition and to address covered products.



# • DOE is currently considering comments received.8 | Building Technologies Program eere.energy.gov 

## Proposed Amended Energy Conservation Standards for Microwave



## Oven Standby Power (TSL 3 ) 

# Proposed Standards

 The compliance date of these standards would be three years from the publication of the final rule.

DOE invites comments on these newly proposed energy conservation standards

.

Product Class Proposed Energy Conservation Standards
Microwave

- Only Ovens and Countertop Combination Microwave Ovens Maximum Standby Power = 1.0 watt
Built

- In and Over

- the

- Range Combination Microwave Ovens Maximum Standby Power = 2.2 watts9 | Building Technologies Program eere.energy.gov



# Opening Remarks and Comments from Interested Parties on the Proposed Energy Conservation Standards

At this time, DOE welcomes opening remarks from interested parties on the SNOPR for microwave oven standby power.10 | Building Technologies Program eere.energy.gov 

### The SNOPR analyses consist of revisions to the NOPR analyses. Screening Analysis Engineering Analysis

Energy Use

Characterization

Shipments Analysis National Impact Analysis Markups to Determine Product Price Life

- Cycle Cost and Payback Period Analyses Market & Technology Assessment Proposed Standard Levels Employment Impact Analysis Utility & Environmen

tal Impact Analysis Life

- Cycle Cost Subgroup Analysis Manufacturer Impact Analysis Revise NOPR Analysis Trial Standard Levels Regulatory Impact Analysis 

# SNOPR Analyses Flow Diagram11 | Building Technologies Program eere.energy.gov 

# Market Assessment

SNOPR Updates: Product Classes

 DOE divides covered products into classes by:



# • the type of energy used,



# • capacity, or



# • other performance

- related features that affect consumer utility and efficiency.



##  DOE defines a microwave oven as follows: “A class of kitchen ranges/ovens which is a household cooking appliance consisting of a compartment designed to cook or heat food by means of microwave energy.”



##  In the 2008 NOPR, DOE proposed a single product class encompassing microwave ovens with and without browning (thermal) elements,



# • Did not include microwave ovens incorporating convection systems 

### (“combination microwave ovens”).



##  In response to comments, DOE reassessed the covered products.



# • Determined that combination microwave ovens would also be considered covered products under the regulatory definition because they are capable of cooking or heating food by means of microwave energy.12 | Building Technologies Program eere.energy.gov 

# Market Assessment

Product Classes

 DOE investigated whether there are any performance related features that would justify separate energy conservation standards based on:



# • Microwave

- only vs. Combination



# • Configuration:



## Countertop Built

- In Over

- the

- Range13 | Building Technologies Program eere.energy.gov 

# Market Assessment

Product Classes: Microwave

- Only Over

- the

- Range vs. Countertop

 DOE conducted a survey of over

- the

- range microwave

- only units available on the U.S. market.



# • Display technologies used are similar to those used in countertop microwave

only units (i.e., LED displays, LCDs, and VFDs).



# • In

- store standby mode testing on a limited sample of over

- the

- range microwave

only units showed similar standby power consumption as countertop microwave

only units.



##  DOE tentatively concludes that over

- the

- range microwave

- only units would not warrant a separate product class from microwave

- only countertop units.



# • May have additional components that are energized during active mode operation.



# • However, DOE’s testing showed that the presence of such features did not increase the standby power consumption.14 | Building Technologies Program eere.energy.gov 

# Market Assessment

Product Classes: Countertop Combination vs.

Microwave

- Only

 DOE also conducted standby power testing on a sample of 13 representative combination microwave ovens.

 Countertop Combination Microwave Ovens:



# • Use similar display technologies as countertop microwave

- only units.



# • Standby power consumption ranging from 1.2 W to 4.7 W, similar to the standby power consumption for countertop microwave

- only units.

 DOE tentatively concludes that countertop combination microwave ovens would not warrant a product class separate from microwave

only ovens

.15 | Building Technologies Program eere.energy.gov 

# Market Assessment

Product Classes: Built

- In and Over

- the

- Range

Combination

 DOE testing showed standby power consumption for these products ranged from 4.1 W to 8.8 W, higher than the standby power consumption for other microwave oven product types.

 DOE’s reverse

- engineering analysis suggests that additional features for these products are required to handle the thermal loads 

## associated with their installation and to provide consumer utility.

 Require a significant number of additional relays on the control board and thus require a larger power supply for the control of such relays.16 | Building Technologies Program eere.energy.gov 

# Market Assessment

Product Classes

 DOE believes that a separate product class should be established for built

- in and over

- the

- range combination microwave ovens.

Product Class 1. Microwave

- Only Ovens and Countertop Combination Microwave Ovens 2. Built

- in and Over

- the

- Range Combination Microwave Ovens



## Issue 7 : DOE requests information on any utility or performance

impacts to built

- ins at the standard level proposed by DOE.17 | Building Technologies Program eere.energy.gov 

# Technology Assessment

SNOPR Updates: Operating Modes

 The DOE test procedure, as amended in the interim final rule, 

## provides definitions for standby mode and off mode in microwave

ovens :



# • “ Standby mode means any mode in which a ... microwave oven is connected to a mains power source and offers one or more of the following user

- oriented or protective functions which may persist for an indefinite time:

– To facilitate the activation of other modes (including activation or deactivation of active mode) by remote switch (including remote control), internal sensor, or timer;

– Continuous functions, including information or status displays (including clocks) or sensor

- based functions. A timer is a continuous clock function 

### (which may or may not be associated with a display) that allows for regularly scheduled tasks and that operates on a continuous basis.”



# • “ Off mode means a mode in which a ... microwave oven is connected to a mains power source and is not providing any active mode or standby mode function and where the mode may persist for an indefinite time. An indicator that only shows the user that the product is 

## in the off position is included within the classification of an off mode.”18 | Building Technologies Program eere.energy.gov 

# Technology Assessment

Operating Modes

 In the NOPR, DOE noted that it observed no microwave ovens in its test sample that were capable of operation in off mode, and further that its research suggested that no microwave ovens available in the United States are capable of off mode operation.

 DOE received no comments or data indicating that microwave ovens with an off mode are currently available or expected to become available on the U.S. market.



##  DOE investigated the potential for microwave ovens with an on/off switch to operate in off mode.



# • Such units would be capable of off mode.



# • Zero energy would be consumed in off mode.

 DOE did not propose in the SNOPR standards for off mode because there would be no benefit associate with such a standard.

Issue 1 : DOE requests i nput and data regarding off mode power for microwave ovens.19 | Building Technologies Program eere.energy.gov 19 

# Technology Assessment

SNOPR Updates: Technology Options

 In the NOPR, DOE identified features which affect standby power:



# • Cooking sensors;



# • Display technologies; and



# • Control strategies and associated control boards, including a function to turn off power to components during standby mode.

 Additional testing showed that standby power characteristics for countertop combination microwave ovens and over

- the

- range microwave

- only units are similar to that of countertop microwave

- only units.

 Tests on over

- the

- range combination microwave ovens showed that standby power for these products also depend largely on the features listed above.20 | Building Technologies Program eere.energy.gov 

# Technology Assessment

Technology Options: Cooking Sensors

 DOE noted in the NOPR that zero

- standby power piezoelectric steam sensors were available in microwave ovens in the U.S. market, and that other sensors (infrared, weight, relative humidity sensors) had either been applied in microwave ovens sold elsewhere or had been identified as feasible for these applications.



##  Commenters raised concerns about:



# • Availability, reliability, and accuracy;



# • Intellectual property issues.

 DOE conducted additional research, and notes:



# • Alternate sensor technologies have been available on the market internationally for years.



# • It is not aware of data showing that these sensors would have reliability and accuracy significantly different than the absolute humidity sensors commonly employed in U.S. microwave ovens.



# • It is not aware of any intellectual or patent infringement issues for any of the above

- listed sensors.21 | Building Technologies Program eere.energy.gov 

# Technology Assessment

Technology Options: Display Technologies

 DOE identified three display technologies for microwave ovens:



# • Light

- emitting diode (LED) displays



# • Liquid crystal displays (LCDs) with and without backlighting



# • Vacuum fluorescent displays (VFDs)

 Commenters submitted information on the utility of display technologies:



# • Reliability in higher

- heat installations, such as over

- the

- range;



# • Viewing angle and visibility;



# • Availability of sizes and colors demanded by consumers of higher

- end products and which allow manufacturers to provide a consistent appearance among products in a suite.

 Additional DOE research indicates:



# • Each display technology is currently incorporated in multiple over

- the

- range models.



# • Temperature ratings for the three types of displays are comparable.



# • Each display technology offers acceptable brightness, viewing angle, and ability to display complex characters in both countertop and over

- the

- range microwave ovens.



# • No microwave oven display had intermittent backlighting or other features that lessen utility.

 DOE continues to believe that all display technologies can be integrated in 

### countertop and over

- the

- range microwave ovens with no loss of utility.22 | Building Technologies Program eere.energy.gov 

## Issue 2 : DOE requests i nput and data on the utility provided by specific features that contribute to microwave oven standby power. In particular, DOE seeks information on the utility of display technologies, as well as on cooking sensors that do not require standby power. 

# Issue for Public Comment23 | Building Technologies Program eere.energy.gov 

# Technology Assessment

Technology Options: Power Supply and Control Boards

 DOE determined for the NOPR that switching power supplies could improve standby power by increasing power supply and control board efficiency.



# • Up to 75

- percent conversion efficiency with 0.2 W or less standby power.



# • DOE believed such power supplies were unproven in long

- term microwave oven 

### applications.



##  Additional DOE research indicates:



# • Switching power supplies are found in many consumer products and appliances, suggesting adequate reliability and durability.



# • No data suggests that reliability is significantly worse than conventional linear 

### power supplies over the lifetime of a microwave oven.



# • While switching power supplies in other consumer applications may achieve 92

- percent efficiency, DOE is unaware of any switching power supplies suitable for application in microwave ovens that exceed 75

- percent efficiency.



##  DOE observed switching power supplies in certain combination microwave ovens in its recent test sample.24 | Building Technologies Program eere.energy.gov 

# Technology Assessment

Technology Options: Automatic Power

- Down

 Automatic power

- down allows manufacturers to make design tradeoffs between incorporating standby power

- consuming features (such as displays or cooking sensors) and including a function to cut power to those components during standby mode.

 Commenters requested DOE consider a user

- activated control to turn off the display.



# • With the display switched off, the microwave oven would be in off mode unless other features associated with standby mode remain energized.



# • DOE is not aware of any products incorporating such a user

- activated control.



# • DOE also does not have information on how often consumers might make use of this feature.



# • Although DOE is unable to consider user

- activated controls for turning off the display as a design feature, manufacturers are not precluded by the proposed standards from incorporating it in their products.25 | Building Technologies Program eere.energy.gov 

## Issue 3 : DOE requests i nput and data on control strategies available to 

## enable manufacturers to make design tradeoffs between incorporating standby

- power - consuming features such as displays or cooking sensors and including a function to turn power off to these components during standby mode. DOE also seeks comment on the viability and cost of microwave 

## oven control board circuitry that could accommodate transistors to switch off cooking sensors and displays.

Issue 4: Whether switching or similar modern power supplies can

operate successfully inside a microwave oven and the associated efficiency impacts on standby power. 

# Issues for Public Comment26 | Building Technologies Program eere.energy.gov

Screening Analysis Engineering Analysis

Energy Use

Characterization

Shipments Analysis National Impact Analysis Markups to Determine Product Price Life

- Cycle Cost and Payback Period Analyses Market & Technology Assessment Proposed Standard Levels Employment Impact Analysis Utility & Environmen

tal Impact Analysis Life

- Cycle Cost Subgroup Analysis Manufacturer Impact Analysis Revise NOPR Analysis Trial Standard Levels Regulatory Impact Analysis 

# SNOPR Analyses Flow Diagram27 | Building Technologies Program eere.energy.gov 

# Engineering Analysis

Standby Power Levels

– Product Class 1

 For the NOPR, DOE established the following standby power levels for analysis:

 DOE believes that the TSLs and associated analyses are still valid for 

## product class 1. Standby Power Level (TSL) Source Standby Power (W) Baseline Baseline 4.0 1 FEMP Procurement Efficiency Recommendation 2.0 2 Gap Fill 1.5 3 IEA 1

- Watt Program 1.0 4 Max Tech 0.0228 | Building Technologies Program eere.energy.gov 

# Engineering Analysis

Standby Power Levels

– Product Class 2

 For the SNOPR, DOE reverse

- engineered a representative sample of built

- in and over

- the

- range combination microwave ovens.



# • Analyzed the various components that contribute to the standby power consumption.



# • Measured standby power consumption of individual components.

Standby Power Level (TSL) Description Standby Power (W) Baseline Baseline 4.5 1 Zero

- standby cooking sensor 3.7 2 Switch mode power supply 2.7

3 Solid state relays and optimized switch mode

power supply 2.2

4 Max Tech

– automatic power down 0.0429 | Building Technologies Program eere.energy.gov 

# Engineering Analysis

Incremental Manufacturing Costs

– Product Class 1

 DOE believes the standby power levels and corresponding incremental manufacturing costs presented in the NOPR remain 

## fundamentally valid for product class 1.

 Scaled incremental costs to 2010$ using the Producer Price Index.

Standby 

### Power Level Standby Power (W) Incremental Cost (2010$) Baseline 4.0 N/A 1 2.0 $0.27 2 1.5 $0.60 3 1.0 $1.31 4 0.02 $4.5830 | Building Technologies Program eere.energy.gov 

# Engineering Analysis

Incremental Manufacturing Costs

– Product Class 2

 To evaluate the built

- in and over

- the

- range combination microwave oven product class, DOE conducted analyses on a test sample of 13 

## combination microwave ovens.



# • Product teardowns



# • Control board cost analyses

 DOE estimated the cost associated with each standby power level by using quotes from various component suppliers to determine the cost of the components used in each design option.

Standby Power Level Standby Power (W) Incremental Cost (2010$) Baseline 4.5 N/A 1 3.7 $0.00 2 2.7 $2.29 3 2.2 $9.44 4 0.04 $5.1831 | Building Technologies Program eere.energy.gov 

## Issue 5 : DOE requests i nput and data on the estimated incremental manufacturing costs, as well as the assumed approaches to 

## achieve TSL 3 for microwave oven standby mode and off mode. DOE also seeks comment on whether any intellectual property or patent infringement issues are associated with the design options considered in the analyses. 

# Issue for Public Comment32 | Building Technologies Program eere.energy.gov

Screening Analysis Engineering Analysis

Energy Use

Characterization

Shipments Analysis National Impact Analysis Markups to Determine Product Price Life

- Cycle Cost and Payback Period Analyses Market & Technology Assessment Proposed Standard Levels Employment Impact Analysis Utility & Environmen

tal Impact Analysis Life

- Cycle Cost Subgroup Analysis Manufacturer Impact Analysis Revise NOPR Analysis Trial Standard Levels Regulatory Impact Analysis 

# SNOPR Analyses Flow Diagram33 | Building Technologies Program eere.energy.gov 

# Life

- Cycle Cost and Payback Period 

# Analysis LCC and PBP Analysis Inputs Update

Inputs October 2008 NOPR Changes for the SNOPR

Affecting Installed Costs

Product Cost Derived by multiplying manufacturer cost by manufacturer, distributor markups and sales tax. Used experience curve fits to forecast a price scaling index to forecast product prices. Affecting Operating Costs
Annual Energy Use Annual energy use determined from the annual usage (average daily use cycles). No change

Energy Prices Electricity: Updated using EIA’s 2006 Form 861 data. Variability: Regional energy prices determined for 13 regions. Electricity: Updated using EIA’s 2009 Form 861 data. Variability: No change.
Energy Price Trends Energy: Forecasts updated with EIA’s Annual Energy Outlook 2008 (AEO 2008). Reference Case, High Growth, and Low Growth forecasts updated with EIA’s AEO 2010 May Release.
Repair and Maintenance Costs Assumed no repair or maintenance costs. No change

Affecting Present Value of Annual Operating Cost Savings

Product Lifetime Developed a Weibull probability distribution based on an average lifetime of 9 years. No change

Discount Rates Average value: 4.8%. Variability: Characterized using Weibull probability distributions. No change

Affecting Installed and Operating Costs

Effective Date of New Standard 2012 201434 | Building Technologies Program eere.energy.gov



# Base and Standards Case Efficiency Distributions 

# Life

- Cycle Cost and Payback Period Analysis

 LCC and PBP analysis typically analyzes standard levels relative to a baseline efficiency level

 Not all consumers purchase products at baseline levels



# • Must account for consumers purchasing more efficient products to accurately estimate consumer economic impacts



##  Base

- Case efficiency distributions define the percentage of products 

## being purchased at various efficiency levels



# • Consumers already purchasing products at efficiencies greater than or equal to a prospective standard level are not impacted by the standard



##  Base

- Case Efficiency Distributions



# • Determined from tests conducted on 52 units by DOE and AHAM.



##  Standards

- Case Efficiency Distributions



# • Applied a “roll

- up” approach to estimate the distribution for each standards

case.35 | Building Technologies Program eere.energy.gov 

# Life

- Cycle Cost and Payback Period Analysis

Base and Standards Case Efficiency Distributions

 DOE maintained the shipments

- weighted standby power and annual energy use shown in the following tables throughout the forecast 

## period, 2014

– 2043.

Microwave and Countertop Combination Ovens : Standby Energy Consumption Distributions in 2014 for Base and Standards Cases

Stand

- by Power (W) Annual Energy Use (kWh/yr) Market Share (%)

Base Case Standby Power Level

1 2 3 4

4.00 34.8 46%

2.00 17.4 35% 81%

1.50 13.0 19% 19% 100%

1.00 8.69 0% 0% 0% 100%

0.02 0.17 0% 0% 0% 0% 100%
Shipments Weighted Standby Power 2.83 1.90 1.50 1.00 0.02

Shipments Weighted Annual Energy Use 24.6 16.5 13.0 8.7 0.1736 | Building Technologies Program eere.energy.gov 

# Life

- Cycle Cost and Payback Period Analysis

Base and Standards Case Efficiency Distributions

 DOE maintained the shipments

- weighted standby power and annual energy use shown in the following tables throughout the forecast period, 2014

– 2043.

Over the Range Combination Ovens : Standby Energy Consumption Distributions in 2014 for Base and Standards Cases

Stand

- by Power (W) Annual Energy Use (kWh/yr) Market Share (%)

Base Case Standby Power Level

1 2 3 4

4.50 39.1 100%

3.70 32.1 0% 100%

2.70 23.5 0% 0% 100%

2.20 19.1 0% 0% 0% 100%

0.04 0.35 0% 0% 0% 0% 100%
Shipments Weighted Standby Power 4.50 3.70 2.70 2.20 0.04
Shipments Weighted Annual Energy Use 39.1 32.1 23.5 19.1 0.3537 | Building Technologies Program eere.energy.gov 

## Issue 6 : DOE requests i nput and data on the estimated market share of microwave ovens at the standby power consumption stipulated by the proposed standards (1.0 W for countertop; 2.2 W for combination) 

# Issue for Public Comment38 | Building Technologies Program eere.energy.gov

Screening Analysis Engineering Analysis

Energy Use

Characterization

Shipments Analysis National Impact Analysis Markups to Determine Product Price Life

- Cycle Cost and Payback Period Analyses Market & Technology Assessment Proposed Standard Levels Employment Impact Analysis Utility & Environmen

tal Impact Analysis Life

- Cycle Cost Subgroup Analysis Manufacturer Impact Analysis Revise NOPR Analysis Trial Standard Levels Regulatory Impact Analysis 

# SNOPR Analyses Flow Diagram39 | Building Technologies Program eere.energy.gov 

# Shipments Analysis

Inputs 2008 NOPR Description Changes for the SNOPR

Number of Product Classes One product class. Market share data

provided by AHAM. Two product classes: (1) all microwave oven

only and countertop microwave oven

combination; (2) over

- the

- range microwave

oven

- combination. Market share data provided by AHAM; 99% product class #1 and 1% product class #2. Product class market shares held constant over forecast period.

New Construction Shipments Housing forecasts updated with EIA

AEO 2009 April release forecasts for the Reference case, High growth case, and Low growth case. No change in approach. Housing forecasts updated with EIA AEO 2010 forecasts for the Reference case, High growth case, and Low growth case.

Replacements Determined by tracking total product

stock by vintage and establishing the failure of the stock using retirement functions from the LCC and PBP analysis. Retirement functions revised to be based on Weibull lifetime distributions. No change. 

##  Shipments Analysis Inputs 1 through 340 | Building Technologies Program eere.energy.gov 

# Shipments Analysis

Inputs 2008 NOPR Description Changes for the 

## SNOPR
Historical Shipments Data sources include AHAM data submittal and Appliance magazine. No change.

Purchase Price, Operating Cost, and Household Income Impacts due to Efficiency Standards Developed “relative price” elasticity, which accounts for the purchase price and the present value of operating cost savings divided by household income. Used purchase price and efficiency data specific to residential refrigerators, clothes washers, and dishwashers between 1980 and 2002 to determine a “relative price” elasticity of demand of

- 0.34. No change.

Fuel Switching Not considered. No change. 

##  Shipments Analysis Inputs 4 through 641 | Building Technologies Program eere.energy.gov 

## Inputs 2008 NOPR Description Changes for the SNOPR

Base

- Case Forecasted Efficiencies Shipment

- weighted efficiency (SWEF)

determined in 2005. SWEF held constant over forecast period. No change.

Standards

- Case Forecasted Efficiencies Analyzed as one product class. Roll

- up

scenario used for determining SWEF in the year that standards become effective for each standards case. SWEF held constant over forecast period. Analyzed as two product classes. Roll

- up scenario used for determining SWEF in the year that standards become effective for each standards case. SWEF held constant over forecast period. Annual Energy Consumption per Unit Annual weighted

- average values as a

function of SWEF. No change.

Total Installed Cost per Unit Annual weighted

- average values as a

function of SWEF. Incorporated learning rate to forecast product prices.

Energy Cost per Unit Annual weighted

- average values as a

function of the annual energy consumption per unit and energy prices

. No change. 

# Impact Analyses

 NIA inputs 1 through 5; NIA generates necessary outputs for utility, environmental, employment, and regulatory impact analyses42 | Building Technologies Program eere.energy.gov 

## Inputs 2008 NOPR Description Changes for the SNOPR

Repair Cost and Maintenance Cost per Unit Assumed no increase in repair and

maintenance costs as a function of standby power. No change.

Escalation of Energy Prices AEO 2008 forecasts (to 2030);

extrapolated to 2042. Updated to AEO 2010 May release forecasts (to 2035); extrapolated to 2043. Energy Site

- to

Source Conversion Conversion varies yearly and is generated

by DOE/EIA’s NEMS program (a time

series conversion factor; includes electric generation, transmission, and distribution losses). No change.

Discount Rate 3 and 7 percent real. No change.

Present Year Future expenses discounted to 2007. Future expenses discounted to 2011. 

# Impact Analyses

 NIA inputs 6 through 10; NIA generates necessary outputs for utility, environmental, employment, and regulatory impact analyses43 | Building Technologies Program eere.energy.gov 

# Trial Standard Levels

Trial Standard Level Standby Power (W)

Product Class 1: Microwave

Only and Countertop Combination Product Class 2: Built

- In and Over

- the

- Range Combination

1 2.00 3.70

2 1.50 2.70

3 1.00 2.20

4 0.02 0.04 

##  The TSLs analyzed are equivalent to the standby power levels44 | Building Technologies Program eere.energy.gov

Screening Analysis Engineering Analysis

Energy Use

Characterization

Shipments Analysis National Impact Analysis Markups to Determine Product Price Life

- Cycle Cost and Payback Period Analyses Market & Technology Assessment Proposed Standard Levels Employment Impact Analysis Utility & Environmen

tal Impact Analysis Life

- Cycle Cost Subgroup Analysis Manufacturer Impact Analysis Revise NOPR Analysis Trial Standard Levels Regulatory Impact Analysis 

# SNOPR Analyses Flow Diagram45 | Building Technologies Program eere.energy.gov 

# Manufacturer Impact Analysis

SNOPR Updates

 DOE updated the MIA results based on several changes to other analyses that impact the MIA:



# • Engineering Analysis

- Updated manufacturing production costs (MPCs) for Product Class 1, new MPCs for Product Class 2, and all costs converted to 2010$.



# • NIA

- Updated total shipments and efficiency distributions, used a new analysis period (2014

- 2043) and base year (2011), and incorporated price trends into the analysis;

 DOE also updated the conversion costs



# • To segment total product and capital conversion costs between Product 

## Class 1 and Product Class 2, DOE used the same split between these two product classes as used in the NIA



# • DOE used the same per

- platform costs at each standby power level for both product classes, but converted these product and capital conversion costs to 2010$ using the PPI.46 | Building Technologies Program eere.energy.gov 

# Manufacturer Impact Analysis

Summary of Results at the Proposed Standards Level

 At TSL 3, the impacts on INPV range from approximately

- $52.9 million to

- $73.6 million (a change in INPV of

- 4.7 percent to

- 6.5 percent).



# • Base case industry value is estimated to be $1.1 billion in $2010.



# • The required conversion costs are estimated to be $94.7 million at TSL 3. As an indication of the magnitude of these conversion costs, industry cash flow decreases by approximately 29.9 percent, to $59.0 million, compared to the base

- case value of $84.2 in the year before the 

## compliance date of the standard.



# • The incremental MPCs at TSL 3 are estimated to be $1.31 for Product Class 1 and $9.44 for Product Class 2. The range of the impacts on INPV and cash flow at TSL 3 varies depending on the ability of manufacturers to pass on these increases in MPCs to their customers.



##  The vast majority of microwave ovens are imported and the employment impacts in the GRIM are small.47 | Building Technologies Program eere.energy.gov

Screening Analysis Engineering Analysis

Energy Use

Characterization

Shipments Analysis National Impact Analysis Markups to Determine Product Price Life

- Cycle Cost and Payback Period Analyses Market & Technology Assessment Proposed Standard Levels Employment Impact Analysis Utility & Environmen

tal Impact Analysis Life

- Cycle Cost Subgroup Analysis Manufacturer Impact Analysis Revise NOPR Analysis Trial Standard Levels Regulatory Impact Analysis 

# SNOPR Analyses Flow Diagram48 | Building Technologies Program eere.energy.gov 

# Proposed Standards

 DOE considered four TSLs for standby power, beginning with the most efficient level (TSL 4) and worked down to a level where the benefits of potential standards outweighed the burdens.



# • DOE tentatively concludes that at TSL 4, the benefits of energy savings, economic gain, and emissions reductions would be outweighed by the potential economic burden on consumers from loss of product utility and the large capital conversion costs that would result in a reduction in INPV for manufacturers.



# • DOE tentatively concludes that TSL 3 saves a significant amount of 

## energy and is technologically feasible and economically justified. 

# Selection of Proposed Standard49 | Building Technologies Program eere.energy.gov 

# Proposed Standards

Microwave

- Only and Countertop Combination Ovens Built

- In and Over

the

- Range Combination Ovens Proposed standard level 3 3

National Energy Savings (quads) 0.41 0.01

Net Present Value (2010$ billion) 3% discount rate 3.58 0.02

7% discount rate 1.81 0.01

Industry Net Present Value 2010$ million 1031.6 to 1050.6 22.3 to 23.9

% change (6.5) to (4.8) (7.1) to (0.3)50 | Building Technologies Program eere.energy.gov 

# Closing

How to Submit Comments...



#  Public Meeting

– oral comments will be captured in the transcript and become part of the public record.



#  Written comments

– Reference docket #: EERE

- 2011

- BT

- STD

- 0048 and/or RIN #: 1904

- AC07

Email: MWO

- 2011

- BT

- STD

- 0048@ee.doe.gov

Mail: Mrs. Brenda Edwards

U.S. Department of Energy Building Technologies Program 1000 Independence Avenue, SW, Mailstop EE

- 2J Washington, DC 20585

- 0121 Courier: Mrs. Brenda Edwards

U.S. Department of Energy Building Technologies Program 950 L'Enfant Plaza, 6th Floor 

## Washington, DC 20024 Telephone: (202) 586

- 294551 | Building Technologies Program eere.energy.gov 

# APPENDIX52 | Building Technologies Program eere.energy.gov 

# Introduction

Statutory Authority

– the Energy Policy and Conservation Act (EPCA) as Amended

 EPCA (42 U.S.C. 6291 et seq .) set forth criteria and procedures for DOE’s adoption and amendment of energy conservation standards and test procedures for covered products.

 Energy Independence and Security Act of 2007 (EISA 2007) Amendments to EPCA



# • Any final rule establishing or revising a standard for a covered product, adopted after July 1, 2010, shall incorporate standby and off mode energy use into a single standard if feasible. If not feasible, DOE shall prescribe a separate standard for standby and off mode energy use, if justified.

 New microwave oven standby power standards are being considered as part of a rulemaking that also initially covered residential dishwashers, dehumidifiers, and 

### conventional cooking products and commercial clothes washers.



# • Amended dishwasher and dehumidifier standards were established by EISA 2007.



# • Standards for conventional cooking products and microwave ovens as to cooking efficiency were addressed in a final rule in April 2009.



# • Amended commercial clothes washer standards were adopted by final rule in 

### January 2010.53 | Building Technologies Program eere.energy.gov



## The Energy Policy and Conservation Act (EPCA) directs DOE to consider seven factors when setting energy conservation standards

Factor Analysis

1. Economic impact on consumers and manufacturers Life

- cycle cost analysis Manufacturer impacts analysis



### 2. Lifetime operating cost savings Life

- cycle cost analysis

3. Total projected energy savings National impact analysis

4. Impact on utility or performance Screening analysis Engineering analysis

5. Impact of any lessening of competition Manufacturer impacts analysis

6. Need for national energy conservation National impact analysis

7. Other factors the Secretary considers relevant Environmental assessment Utility impact analysis Employment impact analysis 

# Introduction54 | Building Technologies Program eere.energy.gov 

# Introduction

Test Procedure Background

 DOE’s test procedure for microwave ovens appears at appendix I to part 430 subpart B of Title 10 of the Code of Federal Regulations.

 DOE repealed the regulatory provisions establishing the cooking efficiency test procedure for microwave ovens under EPCA in a final 

## rule published on July 22, 2010.



# • DOE determined that the microwave oven test procedure provisions to measure cooking efficiency do not produce accurate and repeatable test results.



# • Was unaware of any test procedures that have been developed that 

## address the concerns with the DOE microwave oven cooking efficiency test procedure.

 EISA 2007 Amendments to EPCA direct DOE to incorporate a measure of standby and off mode energy consumption into its microwave oven test procedure by March 31, 2011.55 | Building Technologies Program eere.energy.gov 

# Engineering Analysis

Efficiency Metric

 DOE eliminated the active mode cooking efficiency test procedure provisions in a July 2010 Test Procedure Final Rule.



# • Existing provisions did not produce accurate and repeatable results.



# • Absence of active mode provisions result in a de facto separate energy use descriptor for microwave oven standby mode and off mode energy

use.

 Proposed standards are based on a maximum average standby power, in Watts (W).56 | Building Technologies Program eere.energy.gov 

# Engineering Analysis

Incremental Manufacturing Costs

 From product testing and reverse engineering, DOE observed correlations between:



# • Specific components and technologies, or combinations thereof, and



# • Measured standby power

 DOE obtained preliminary incremental manufacturing costs associated with standby power levels by considering combinations of those components as well as other technology options identified to reduce standby power.

 DOE presented manufacturing cost estimates based on quotes obtained from:



# • suppliers,



# • interviews with manufacturers and subject matter experts,



# • research and literature review, and



# • numerical modeling.57 | Building Technologies Program eere.energy.gov



# Baseline and Incremental Markups



# ■ Markups relate customer price to cost of goods sold (CGS)



# ■ Baseline markups relate price to cost prior to a change in efficiency



# • Baseline markups indicate a customer price that covers all of a retailer’s expenses plus profit.



# • Direct labor costs (salaries, payroll, rental and occupancy) are included.



# ■ Incremental markups relate the incremental change in customer price to the incremental change in CGS beyond baseline



# • Some distribution costs remain constant with CGS increases.



# • Incremental markups cover only expenses that vary with CGS

– in this case, 

### expenses that increase due to an increase in equipment efficiency.



## • For example, direct labor costs (salaries, payroll, rental and occupancy) do not vary with efficiency

- induced changes in CGS.



# • DOE assumes other operating costs and profit will scale proportionally with CGS. 

# Markups to Determine Equipment 

# Price58 | Building Technologies Program eere.energy.gov



# Estimates of Retail Market Competition



# ■ DOE assumed that competition in the retail market, combined with 

## inelastic demand, will put downward pressure on retail margins, supporting the incremental markup approach.



# ■ To confirm that retail markets are competitive, DOE used a commonly

used index of market concentration, the Four Firm Concentration Ratio (FFCR).*



# ■ An FFCR < 40% indicates a relatively unconcentrated market, while an FFCR > 70% indicates a concentrated market (oligopoly).



# ■ FFCRs were evaluated for major appliance sales in three retail channels: 

## Electronics and Appliance Stores, Building and Material and Supplies Dealers, and General Merchandise Stores. In each case, the resulting FFCR was well below the 40% threshold.

* The Department of Justice uses a more complete index, the Herfindahl

- Hirschman Index (HHI), but DOE lacked the information necessary for calculating an HHI. 

# Markups to Determine Equipment 

# Price59 | Building Technologies Program eere.energy.gov 

# Life-Cycle Cost and Payback Period 

# Analysis
LCC and PBP Analysis Inputs

-

r- 

# .. -

-



# ..

- 

## , r



## ... •



## ,**~** 

# --{

•



# .. 

# .. ..

r-



### -



### r--60 | Building Technologies Program eere.energy.gov 

# ■ Background



# • DOE must publish an initial regulatory flexibility analysis if it cannot certify that the rule will not have a significant economic impact on a substantial number of small entities.



# ■ Findings



# • DOE identified no small business manufacturer of microwave ovens for which there would be a significant economic impact 

# Regulatory Flexibility Act61 | Building Technologies Program eere.energy.gov 

# Summary of Results

TSL 1 TSL 2 TSL 3 TSL 4 (Max Tech)

National Energy Savings (quads) 0.21 0.30 0.41 0.63

NPV of Consumer Benefits (2010$ billion) 7% discount rate 1.02 1.42 1.82 2.25

3% discount rate 1.98 2.78 3.59 4.60

Maximum Industry NPV Change (2010$ billion) (27.1) to (29.3) (45.2) to

(52.4) (52.9) to

(73.6) (90.4) to

(165.7) Maximum Industry NPV Change (%) (2.4) to (2.6) (4.0) to

(4.6) (4.7) to

(6.5) (8.0) to

(14.7) Mean LCC Savings (2010$) Microwave

- Only Ovens and Countertop Combination Microwave Ovens 7 10 13 12

Built

- In and Over

- the

- Range Combination Microwave Ovens 6 11 4 27

Present Value of CO 2 Emissions Savings (2010$ billion) 70 to 1,066 101 to

1,539 139. to

2,118 213 to

3,259

Proposed Level