1 U.S. DEPARTMENT OF ENERGY OFFICE OF ENERGY EFFICIENCY AND RENEWABLE ENERGY

+ + + + + ENERGY CONSERVATION PROGRAM FOR CONSUMER PRODUCTS AND COMMERCIAL AND INDUSTRIAL EQUIPMENT PUBLIC MEETING ON PROPOSED FISCAL YEAR 2005 PRIORITIZATION

+ + + + + Wednesday, June 9, 2004

+ + + + + The meeting was held in Conference Room 1E-245 in the Forrestal Building, 1000 Independence Avenue, N.W., Washington, D.C., at 9:00 a.m., DOUGLAS R. BROOKMAN, Facilitator, presiding. PRESENT: DOUGLAS R. BROOKMAN KARIM AMRANE BRYAN BERRINGER DONALD BRUNDAGE DAVID CALABRESE JIM CRAWFORD DAVE DELAQUILA ANDREW DELASKI KATHERINE DELVES TOM DePRIEST TOM ECKMAN ED GRAY KIT KENNEDY MICHAEL McCABE

(202) 234-4433 Facilitator Air Conditioning and Refrigeration Institute Department of Energy Southern Company Services Association of Home Appliance Manufacturers Trane Gas Appliance Manufacturers Association Appliance Standards Awareness Project Natural Resources of Canada Department of Energy Northwest Power and Conservation Council National Electrical Manufacturers Association Natural Resources Defense Council Department of Energy 

### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 

### u.s. DEPARTMENT OF ENERGY OFFICE OF ENERGY EFFICIENCY AND RENEWABLE ENERGY

+ + + + + ENERGY CONSERVATION PROGRAM FOR CONSUMER PRODUCTS AND COMMERCIAL AND INDUSTRIAL EQUIPMENT PUBLIC MEETING ON PROPOSED FISCAL YEAR 2005 PRIORITIZATION

+ + + + +

Wednesday, June 9, 2004

+ + + + + 1

The meeting was held in Conference Room 1E-245 in the Forrestal Building, 1000 Independence Avenue, N.W., Washington, D.C., at 9:00 a.m., DOUGLAS R. BROOKMAN, Facilitator, presiding. PRESENT: DOUGLAS R. BROOKMAN KARIM AMRANE BRYAN BERRINGER DONALD BRUNDAGE DAVID CALABRESE JIM CRAWFORD DAVE DELAQUILA ANDREW DELASKI KATHERINE DELVES TOM DePRIEST TOM ECKMAN ED GRAY KIT KENNEDY MICHAEL McCABE Facilitator Air Conditioning and Refrigeration Institute Department of Energy Southern Company Services Association of Home Appliance Manufacturers Trane Gas Appliance Manufacturers Association Appliance Standards Awareness Project Natural Resources of Canada Department of Energy Northwest Power and Conservation Council National Electrical Manufacturers Association Natural Resources Defense Council Department of Energy NEALR.GROSS (202)234-4433 COURTREPORTERSANDTRANSCRIBERS 1323 RHODEISLANDAVE., N,W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com2 PRESENT (Continued): DEBORAH MILLER HARRY MISURIELLO STEVE NADEL FRANCINE PINTO STEVE ROSENSTOCK HARVEY SACHS DAVID STEINER CHARLIE STEPHENS BARBARA TWIGG LARRY WETHJE TED WILLIAMS

(202) 234-4433 Air Conditioning and Refrigeration Institute Alliance to Save Energy American Council for an Energy Efficient Economy Department of Energy Edison Electric Institute American Council for an Energy Efficient Economy Maytag Oregon Office of Energy Department of Energy Association of Home Appliance Manufacturers American Gas Association



### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com PRESENT (Continued) DEBORAH MILLER HARRY MISURIELLO STEVE NADEL FRANCINE PINTO STEVE ROSENSTOCK HARVEY SACHS DAVID STEINER CHARLIE STEPHENS BARBARA TWIGG LARRY WETHJE TED WILLIAMS 2

Air Conditioning and Refrigeration Institute Alliance to Save Energy American Council for an Energy Efficient Economy Department of Energy Edison Electric Institute American Council for an Energy Efficient Economy Maytag Oregon Office of Energy Department of Energy Association of Home Appliance Manufacturers American Gas Association

NEALR. GROSS (202)234-4433 COURTREPORTERSANDTRANSCRIBERS 1323 RHODEISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com3

I-N-D-E-X AGENDA ITEM PAGE Welcoming Remarks 4 Agenda Review and Introductions 6 Overview of Priority-Setting Process and 13 Presentation of Draft Priorities Discussion of Issues 26

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com I-N-D-E-X AGENDA ITEM Welcoming Remarks Agenda Review and Introductions Overview of Priority-Setting Process and

Presentation of Draft Priorities Discussion of Issues

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www.nealrgross.com4 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 P-R-O-C-E-E-D-I-N-G-S (9:09 a.m.) MR. McCABE: Good morning. I am Michael McCabe. I am the program manager for the building technologies program. And I would like to welcome everybody to the appliance standards priority-setting meeting. As an aside, things are going to be rather hectic here in D.C. for the next few days with President Reagan, the events surrounding President Reagan' s funeral. There may be a number of people who want to leave to go witness that. We do have for the benefit of those a map up here.

Activities are going to start around 5:00 o'clock this afternoon. For anybody who wants to go, we strongly recommend taking the Metro and going to the Archives subway station, which is at 7th and Constitution Avenue.

It will be a parade. The procession will go from 16th and Constitution Avenue to the Capitol Building. And at somewhere between 6:00 and 7:00, 6:00 and 7:00 o'clock this afternoon, the procession will be passing there.

We would encourage people to look to stand on the north side of Constitution Avenue with a view NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 4 1 P-R-O-C-E-E-D-I-N-G-S 2 (9:09 a.m.) 3 MR. McCABE: Good morning. I am Michael 4 McCabe. I am the program manager for the building 5 technologies program. And I would like to welcome 6 everybodyto the appliance standardspriority-setting 7 meeting. 8 As anaside, things are goingtobe rather 9 hectic here in D.C. for the next few days with 10 President Reagan, the events surrounding President 11 Reagan's funeral. Theremaybe a number ofpeoplewho 12 want to leave to go witness that. We do have for the 13 benefit of those a map up here. 14 Activities are going to start around 5:00 15 o'clock this afternoon. For anybody who wants to go, 16 we strongly recommend taking the Metro and going to 17 the Archives subway station, which is at 7th and 18 Constitution Avenue. 19 It will be a parade. The processionwill 20 go from 16th and Constitution Avenue to the Capitol 21 Building. And at somewhere between 6:00 and 7:00, 22 6:00 and 7:00 o'clock this afternoon, the procession 23 will be passing there. 24 We wouldencouragepeopletolookto stand 25 on the north side of Constitution Avenue with a view

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of the southern sky because as the procession passes that point, there will be 22 F-15's that will be flying over. And it will be a rather awesome sight. The last one based on the practice run last night is just going to be run from the Capitol straight up into the sky. And we will lose sight of it.

So it will be a caisson being pulled by six identical horses with military honor guard. It should be quite an impressive parade. Then there will be at 7:00 o'clock a private viewing by members of Congress in the Capitol. And then after that, it will be open to the public.

They are putting barricades up for the public viewing stand in the queue. They go from the Capitol building to 7th Street, which is about three-quarters of a mile. So they are expecting quite a crowd. Traffic in the town, that is going to be very difficult to get around. So if you are going to go out to the northern suburbs, it would be best to leave as early as possible because of the traffic.

Andrews Air Force Base in Prince George's County, the process is going to come through town to the Pentagon, then come back into town. So the roads around the mall and to the Pentagon are all going to NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 5 1 of the southern sky because as the procession passes 2 that point, there will be 22 F-15's that will be 3 flying over. And it will be a rather awesome sight. 4 The last one based on the practice run last night is 5 just going tobe run from the Capitol straight up into 6 the sky. And we will lose sight of it. 7 So it will be a caisson being pulled by 8 six identical horses with military honor guard. It 9 shouldbe quite animpressiveparade. Thentherewill 10 be at 7:00 o'clock a private viewing by members of 11 Congress inthe Capitol. Andthen afterthat, itwill 12 be open to the public. 13 They are putting barricades up for the 14 public viewing stand in the queue. They go from the 15 Capitol building to 7th Street, which is about 16 three-quarters of a mile. So theyare expectingquite 17 a crowd. 18 Traffic in the town, that is going to be 19 very difficult to get around. So if you are going to 20 go out to the northern suburbs, it would be best to 21 leave as early as possible because of the traffic. 22 AndrewsAir Force Base in Prince George's 23 County, the process is going to come through town to 24 the Pentagon, then come back into town. So the roads 25 around the mall and to the Pentagon are all going to

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be blocked off. And it is going to be very difficult to get around them.

So we will try to get this priority-setting meeting done as quickly as possible, hear everybody's input. We are interested in hearing your thoughts, your comments, your suggestions. And hopefully we will end this in time so that everybody will have the time to go wherever they want to and do whatever they wish. We will have this map around so that at the break if anybody wants to take a look at it, they may.

Again, I would like to extend a welcome to everybody and encourage and appreciate your full participation. Thank you.

FACILITATOR BROOKMAN: Good morning, everybody. My name is Doug Brookman. I will be facilitating today's meeting. I am from Baltimore.

Does everybody have a copy of the agenda? It is in your packet. You can see the purpose of the meeting there listed at the top of the page.

How many of you have participated in similar meetings to this in the past? Please raise your hands.

(202) 234-4433 (Whereupon, there was a show of hands.)

FACILITATOR BROOKMAN: So better than half



### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 6 1 be blocked off. And it is going to be very difficult 2 to get around them. 3 So we will try to get this 4 priority-settingmeeting done as quickly as possible, 5 hear everybody's input. We are interested inhearing 6 your thoughts, your comments, your suggestions. And 7 hopefully we will end this in time so that everybody 8 will have the time to go wherever they want to and do 9 whatever they wish. We will have this map around so 10 that at the break if anybody wants to take a look at 11 it, they may. 12 Again, I wouldlike toextenda welcome to 13 everybody and encourage and appreciate your full 14 participation. Thank you. 15 FACILITATOR BROOKMAN: Good morning, 16 everybody. My name is Doug Brookman. I will be 17 facilitating today's meeting. I am from Baltimore. 18 Does everybodyhave a copy of the agenda? 19 It is inyour packet. You can see the purpose of the 20 meeting there listed at the top of the page. 21 How many of you have participated in 22 similar meetings to this in the past? Please raise 23 your hands. 24 (Whereupon, there was a show of hands.) 25

(202)234-4433 FACILITATORBROOKMAN: Sobetterthanhalf NEALR. GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODE ISLANDAVE., NW. WASHINGTON, D.C. 20005-3701 www.nealrgross.com1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 7

of you, I would say. And how many of you specifically participated in this priority-setting workshop in previous years, the same group? (Whereupon, there was a show of hands.) FACILITATOR BROOKMAN: And how many of you are just here because you want to attend the Reagan ceremonies? Just kidding. Okay.

I want to just point to the general plan for the day. We are doing the agenda review. I will follow this agenda review by asking each person to introduce him or herself and say your organizational affiliation. We will be then reviewing a bunch of slides that will provide an overview of the priority-setting process and the presentation of draft priorities. We will begin the discussion period right about 10:00. Until 10:30, you can see the three different subsets that we anticipate discussing at that point. Right about 10:30 we will take a break. We will continue with the discussion following the break around about 10:45 to around about 1:00.

We are not certain how long this meeting will take today. The Federal Register notice suggested we could go from 9:00 to 4:00. In the past,

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 7 1 of your I would say. Andhowmanyof you specifically 2 participated in this priority-setting workshop in 3 previous yearsr the same group? 4 (Whereuponr there was a show of hands.) 5 FACILITATORBROOKMAN: Andhowmanyofyou 6 are just here because you want to attend the Reagan 7 ceremonies? Just kidding. Okay. 8 I want to just point to the general plan 9 for the day. We are doing the agenda review. I will 10 follow this agenda review by asking each person to 11 introduce him or herself and say your organizational 12 affiliation. 13 We will be then reviewing a bunch of 14 slides that will provide an overview of the 15 priority-settingprocessandthepresentationofdraft 16 priorities. 17 We will begin the discussionperiodright 18 about 10:00. Until 10:30r you can see the three 19 different subsets that we anticipate discussing at 20 that point. Right about 10:30 we will take a break. 21 We will continue with the discussion following the 22 break around about 10:45 to around about 1:00. 23 We are not certain how long this meeting 24 will take today. The Federal Register notice 25 suggestedwe couldgo from 9:00 to 4:00. Inthepastr

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our experience has been that we have done this in less time. And so we are thinking that probably we will get done today sometime mid-day.

You can see it lists in the agenda discussion of issues from 10:45 to 1:00, other issues, and next steps. And then it says, 1:00 p.m. lunch, if needed. So we intend to largely press on with the work at hand, go until 1:00, see where we stand. If we need to take lunch at that point, we will do so and then reconvene after lunch and continue with the work if that is necessary. That is the general plan.

Questions and comments at this point about the agenda? (No response.)

FACILITATOR BROOKMAN: I would like to ask your consideration. In the previous workshops and today, I would ask your consideration in helping to adhere to these norms. I am going to ask that you speak one at a time.

Please say your name for the record. As you can see, there are microphones everywhere. I am going to ask anybody that is not seated at the table immediately that wishes to make a comment to please come to that microphone there and speak.

Please listen as an ally. The quality of

NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 8 1 ourexperience has beenthat we have done this in less 2 time. And so we are thinking that probably we will 3 get done today sometime mid-day. 4 You can see it lists in the agenda 5 discussionof issues from 10:45 to 1:00, other issues, 6 andnext steps. And then it says, 1:00 p.m. lunch, if 7 needed. So we intend to largely press on with the 8 work at hand, go until 1:00, see where we stand. If 9 we need to take lunch at that point, we will do so and 10 then reconvene after lunch and continue with the work 11 if that is necessary. That is the general plan. 12 Questionsandcomments atthispointabout 13 the agenda? 14 (No response.) 15 FACILITATORBROOKMAN: I wouldliketoask 16 your consideration. In the previous workshops and 17 today, I would ask your consideration in helping to 18 adhere to these norms. I am going to ask that you 19 speak one at a time. 20 Please say your name for the record. As 21 you can see, there are microphones everywhere. I am 22 going to ask anybody that is not seated at the table 23 immediately that wishes to make a comment to please 24 come to that microphone there and speak. 25

(202)234-4433 Please listen as an ally. The quality of NEALR. GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 9

the discussion hinges entirely on the quality of the listening. I'm going to ask that you keep the focus here. Please turn off your cell phones. If you need to take a cell phone call, I will understand that you have to take it out of the room. If you need to have a side bar conversation that is more than about 20 seconds, I will also understand if you take that out of the room.

I am going to be cuing people to speak. That means I will be literally recognizing people and individuals by name and pointing to them as well for those of you I don't know. I also want to encourage follow-on comments. We want to keep this as interactive as possible and still have some amount of form in the discussion.

Finally, there are a few housekeeping items. For those of you who haven't been here before, there are restrooms at both ends of the hall. Please make sure you wear your badge or identification materials as you leave this room. They will stop you if you don't wear something. As we get to the coffee break, I will describe the other amenities.

Anything else we need to cover at this point at the outset? Michael? 

### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 9 1 the discussion hinges entirely on the quality of the 2 listening. I'm going to ask that you keep the focus 3 here. 4 Please turn off your cell phones. If you 5 need to take a cell phone call, I will understand that 6 you have to take it out of the room. If you need to 7 have a side bar conversation that is more than about 8 20 seconds, I will also understand if you take that 9 out of the room. 10 I am going to be cuing people to speak. 11 That means I will be literallyrecognizingpeople and 12 individuals by name and pointing to them as well for 13 those of you I don't know. I also want to encourage 14 follow-on comments. We want to keep this as 15 interactive as possible and still have some amount of 16 form in the discussion. 17 Finally, there are a few housekeeping 18 items. Forthose ofyouwho haven't beenherebefore, 19 there are restrooms at both ends of the hall. Please 20 make sure you wear your badge or identification 21 materials as you leave this room. They will stop you 22 if you don't wear something. As we get to the coffee 23 break, I will describe the other amenities. 24 Anything else we need to cover at this 25 point at the outset? Michael?

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2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 10 MR. McCABE: Michael McCabe. Question, Doug, as far as we may have people on the phone. If they want to chime in, how will they do that?

FACILITATOR BROOKMAN: Let's ask if there is anybody there now. Is anybody on the phone?

(No response.) FACILITATOR BROOKMAN: Not yet. Typically when people join us on the phone, they will say something to get our attention. And then typically if you hit -- is it the "start" button or is it the pound button that will make a beep? Pound. Both. So both of them work. We will ask them to hit the pound button to cue us that they wish to make a comment.

Yes, please? PARTICIPANT: One question. Will the attendee list for this workshop be circulated?

FACILITATOR BROOKMAN: Right now? PARTICIPANT: Yes. FACILITATOR BROOKMAN: Today or -- PARTICIPANT: Subsequently. FACILITATOR BROOKMAN: Today. PARTICIPANT: Thank you. FACILITATOR BROOKMAN: Presently we will just start by having everyone introduce him or herself. Please start by saying your name and

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 10 1 MR. McCABE: Michael McCabe. Question, 2 Doug, as far as we may have people on the phone. If 3 they want to chime in, how will they do that? 4 FACILITATOR BROOKMAN: Let's ask if there 5 is anybody there now. Is anybody on the phone? 6 (No response.) 7 FACILITATORBROOKMAN: Notyet. Typically 8 when people join us on the phone, they will say 9 somethingtoget ourattention. Andthen typicallyif 10 youhit

-- is it the "start" button or is it thepound 11 button that will make a beep? Pound. Both. So both 12 of them work. We will ask them to hit the pound 13 button to cue us that they wish to make a comment. 14 Yes, please? 15 PARTICIPANT: One question. Will the 16 attendee list for this workshop be circulated? 17 FACILITATOR BROOKMAN: Right now? 18 PARTICIPANT: Yes. 19 FACILITATOR BROOKMAN: Today or -- 20 PARTICIPANT: Subsequently. 21 FACILITATOR BROOKMAN: Today. 22 PARTICIPANT: Thank you. 23 FACILITATOR BROOKMAN: Presently we will 24 just start by having everyone introduce him or 25 herself.

(202)234-4433 Please start by saying your name and NEALR. GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com11

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 organizational affiliation. This may not all be on the record, all of these introductions. However, the rest of the meeting will be on the record. I want to start with you, Katherine. MS. DELVES: Katherine Delves from Natural Resources of Canada.

MR. WETHJE: Larry Wethje with the Association of Home Appliance Manufacturers.

MR. GRAY: Ed Gray with the National Electrical Manufacturers Association.

MR. DELAQUILA: Dave Delaquila, Gas Appliance Manufacturers Association.

MR. AMRANE: Karim Amrane with the Air Conditioning and Refrigeration Institute.

MS. MILLER: Deborah Miller, ARI. MR. ROSENSTOCK: Steve Rosenstock, Edison Electric Institute.

MR. WILLIAMS: Ted Williams, American Gas Association. MR. ECKMAN: Tom Eckman, Northwest Power and Conservation Council.

MR. STEPHENS: Charlie Stephens, Oregon Department of Energy.

(202) 234-4433 MS. KENNEDY: Kit Kennedy, NRDC. NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 11 1 organizational affiliation. 2 This maynot all be on the record, all of 3 these introductions. However, therest of themeeting 4 will be on the record. I want to start with you, 5 Katherine. 6 MS. DELVES: KatherineDelvesfromNatural 7 Resources of Canada. 8 MR. WETHJE: Larry Wethje with the 9 Association of Home Appliance Manufacturers. 10 MR. GRAY: Ed Gray with the National 11 Electrical Manufacturers Association. 12 MR. DELAQUILA: Dave Delaquila, Gas 13 Appliance Manufacturers Association. 14 MR. AMRANE: Karim Amrane with the Air 15 Conditioning and Refrigeration Institute. 16 MS. MILLER: Deborah Miller, ARI. 17 MR. ROSENSTOCK: Steve Rosenstock, Edison 18 Electric Institute. 19 MR. WILLIAMS: TedWilliams, AmericanGas 20 Association. 21 MR. ECKMAN: Tom Eckman, Northwest Power 22 and Conservation Council. 23 MR. STEPHENS: Charlie Stephens, Oregon 24 Department of Energy. 25

(202)234-4433 MS. KENNEDY: Kit Kennedy, NRDC. NEALR.GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODEISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com1

2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 12 MR. MISURIELLO: Harry Misuriello, Alliance to Save Energy.

MR. SACHS: Harvey Sachs, American Council for an Energy Efficient Economy.

MR. NADEL: Steve Nadel, ACEEE. MR. DELASKI: Andrew Delaski, Appliance Standards Awareness Project.

MR. BRUNDAGE: Don Brundage, Southern Company.

Energy. MR. McCABE: Michael McCabe, Department of

MR. BERRINGER: Bryan Berringer, Department of Energy.

MS. TWIGG: Barbara Twigg, Department of Energy. MS. PINTO: Francine Pinto, Office of General Counsel.

MR. DePRIEST: And Tom DePriest, Office of General Counsel, Department of Energy.

MR. CALABRESE: David Calabrese, Association of Home Appliance Manufacturers.

MR. JOHNSON: Sam Johnson, Department of Energy. MR. HOOVER: Fred Hoover, National Association of Safe Energy Officials.

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 12 1 MR. MISURIELLO: Harry Misuriello, 2 Alliance to Save Energy. 3 MR. SACHS: HarveySachs, AmericanCouncil 4 for an Energy Efficient Economy. 5 MR. NADEL: Steve Nadel, ACEEE. 6 MR. DELASKI: Andrew Delaski, Appliance 7 Standards Awareness Project. 8 MR. BRUNDAGE: Don Brundage, Southern 9 Company. 10 MR. McCABE: MichaelMcCabe, Departmentof 11 Energy. 12 MR. BERRINGER: Bryan Berringer, 13 Department of Energy. 14 MS. TWIGG: Barbara Twigg, Department of 15 Energy. 16 MS. PINTO: Francine Pinto, Office of 17 General Counsel. 18 MR. DePRIEST: AndTomDePriest, Officeof 19 General Counsel, Department of Energy. 20 MR. CALABRESE: David Calabrese, 21 Association of Home Appliance Manufacturers. 22 MR. JOHNSON: Sam Johnson, Department of 23 Energy. 24 MR. HOOVER: Fred Hoover, National 25 Association of Safe Energy Officials.

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### R.GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODEISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com13 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 MR. HOLT: John Holt, NRECA. MR. McMAHON: Jim McMahon, Lawrence Berkeley National Lab.

(Whereupon, further introductions were made.) FACILITATOR BROOKMAN: Thank you. Did we miss anybody? Did I forget to say anything that I should have said? Lots of things, huh? We'll get to that at the break.

So let's, then, start. Barbara Twigg is going to start us off with an overview presentation. And then we will proceed from there to more specific questions and comments.

I would ask as Barbara is presenting, if you have got a clarifying question, please feel free to ask it on the presentation itself. However, we want to confine the bulk of the comments to the section following the presentation. Okay?

MS. TWIGG: Good morning, everyone. I am going to give you a brief overview presentation on presenting our draft priorities and telling you a little bit of the process that we took leading up to determine them.

The most important purpose of today's meeting is clearly to listen to your views. We are

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 13 1 MR. HOLT: John Holt, NRECA. 2 MR. McMAHON: Jim McMahon, Lawrence 3 Berkeley National Lab. 4 (Whereupon, further introductions were 5 made.) 6 FACILITATOR BROOKMAN: Thankyou. Didwe 7 miss anybody? Did I forget to say anything that I 8 should have said? Lots of things, huh? We'll get to 9 that at the break. 10 So let's, then, start. Barbara Twigg is 11 going to start us off with an overview presentation. 12 And then we will proceed from there to more specific 13 questions and comments. 14 I would ask as Barbara is presenting, if 15 you have got a clarifying question, please feel free 16 to ask it on the presentation itself. However, we 17 want to confine the bulk of the comments to the 18 section following the presentation. Okay? 19 MS. TWIGG: Goodmorning, everyone. I am 20 going to give you a brief overview presentation on 21 presenting our draft priorities and telling you a 22 little bit of the process that we took leading up to 23 determine them. 24 25 The most important purpose of today's meeting is clearly to listen to your views. We are

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very appreciative that you have come to Washington. We certainly always try to provide interesting historic events for this priority-setting meeting. You remember back when many of you were here on September 11th, 2001. And this time, of course, we have the major funeral.

If you have time to stay through this evening or tomorrow, it is an interesting opportunity to go down to the Capitol and view the President's casket in the Rotunda. I can't imagine how long a line there might be, but it certainly is a unique opportunity. This shows you the priority schedule that we are following this year. On April 30th, we put all of the supporting materials on the Web after we published our Federal Register notice and sent out an e-mail to all of the stakeholders on the list that we had notifying everyone that we had put the materials on the Web. So if you did not receive that, please be sure that you sign in at our desk. And we'll add you to our list for next year when we brief our process.

I will call your attention to the July 9th deadline after this meeting. You will have another month to submit written comments to the Department of Energy.

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 14 1 very appreciative that you have come to Washington. 2 We certainly always try to provide interesting 3 historic events for this priority-setting meeting. 4 You remember back when many of you were here on 5 September 11th, 2001. And this time, of course, we 6 have the major funeral. 7 If you have time to stay through this 8 evening or tomorrow, it is an interesting opportunity 9 to go down to the Capitol and view the President's 10 casket in the Rotunda. I can't imagine how long a 11 line there might be, but it certainly is a unique 12 opportunity. 13 This shows you thepriority schedule that 14 we are following thisyear. OnApril 30th, we put all 15 of the supporting materials on the Web after we 16 published our Federal Register notice and sent out an 17 e-mail to all of the stakeholders on the list that we 18 had notifying everyone that we had put the materials 19 on the Web. So ifyou didnot receive that, pleasebe 20 sure that you sign in at our desk. And we'll add you 21 to our list for next year when we brief our process. 22 I will callyour attentiontotheJuly 9th 23 deadline after this meeting. You will have another 24 month to submit written comments to the Department of 25 Energy.

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8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 15 This just gives a snapshot of the legislative history, the draft compliance standards program. It started as early as 1975. And we added industrial and commercial products in 1992 with EPCA.

I know a lot of you here have been involved for a long time with this program. I don't if per chance there is anyone here who has been involved from the very beginning. I know that there is at least one person in our office who has been here since the very beginning. And we are very appreciative of his institutional memory.

In addition to our legislation, there have been a couple of other key policy events that have shaped our program. Many of you in this room I'm sure have helped work on the process improvement rule back in '96. It's hard to believe it has been eight years since that already. That was designed to establish guidelines to make our process more open to stakeholders. Having meetings like this is certainly part of the suggestions that came out of that process.

In 2001, we also had the President issue the national energy policy development guideline. That recommended that we look for additional products that we could cover, in addition to the ones that were specified in our authorizing legislation. 

### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 15 1 This just gives a snapshot of the 2 legislative history, the draft compliance standards 3 program. It started as early as 1975. And we added 4 industrial and commercial products in 1992 withEPCA. 5 I know a lot of you here have been 6 involved for a long time with this program. I don't 7 if per chance there is anyone here who has been 8 involved from the very beginning. I know that there 9 is at least oneperson in ouroffice who has beenhere 10 since the very beginning. And we are very 11 appreciative of his institutional memory. 12 Inadditiontoourlegislation, therehave 13 been a couple of other key policy events that have 14 shapedourprogram. Many ofyou inthis room I'm sure 15 have helpedwork on the process improvement rule back 16 in '96. It's hard to believe it has been eight years 17 since that already. That was designed to establish 18 guidelines to make our process more open to 19 stakeholders. Having meetings like this is certainly 20 part of the suggestions that came out of thatprocess. 21 In 2001, we also had the President issue 22 the national energy policy development guideline. 23 That recommended that we look for additional products 24 that we couldcover, in additionto the ones thatwere 25 specified in our authorizing legislation.

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of these factors that we should consider in priority-setting. First and foremost at the top of the list is potential energy savings. That is what has received the most analysis in our process. In addition, we have potential economic benefits, environmental, and security benefits, and the applicable deadlines for rulemakings, incremental DOE resources required to complete the rulemaking process. That means budget, staffing restraints.

Other regulations actions affecting products. We're aware of cumulative burden on any one particular industry. Stakeholder recommendations. That's where shoppers keep part of that process. Evidence of energy efficiency gains in the market absent new or revised standards, status of required changes to the test procedures. And it also gives us the opportunity to consider other relevant factors. A couple of those might e fuel neutrality, peak electricity demand, and impact on small business.

I'm going to tell you just a little bit about what we have done in the process so far. There have been three pre-steps: preparation, analysis, and the results and documentation.

We started shortly after we completed the

NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 16 1 The process improvement rule set out all 2 of these factors that we should consider in 3 priority-setting. First and foremost at the top of 4 the list is potential energy savings. That is what 5 has received the most analysis in our process. In 6 addition, we have potential economic benefits, 7 environmental, and security benefits, and the 8 applicable deadlines for rulemakings, incremental DOE 9 resourcesrequiredtocompletetherulemakingprocess. 10 That means budget, staffing restraints. 11 Other regulations actions affecting 12 products. We're aware of cumulativeburdenonanyone 13 particular industry. Stakeholder recommendations. 14 That's where shoppers keep part of that process. 15 Evidence of energy efficiency gains in the market 16 absent new or revised standards, status of required 17 changes to the test procedures. And it also gives us 18 the opportunity to consider other relevant factors. 19 A couple of those might be fuel neutrality, peak 20 electricity demand, and impact on small business. 21 I'm going to tell you just a little bit 22 about what we have done in the process so far. There 23 havebeenthreepre-steps: preparation, analysis, and 24 the results and documentation. 25 We started shortly afterwe completedthe

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2004 priority report last October. The first thing we needed to do was identify what products needed to be evaluated and then which of those products were in need of analytical updating.

We had not done a new TSD when we did last year's priority-setting. So we wanted to take a more comprehensive approach this year. So we completed a completely new TSD with detailed analysis on 18 products. And we had three appendices that we saw on the Web. We used these principles for estimating the energy savings. We used the best available information with existing studies wherever possible. That might mean government studies, be they federal, state, or local studies by trade associations, studies by the energy efficiency advocates.

We tried to simply the market dynamics assuming no change in the number of units in use. We assume that replacements occur at a constant rate over the average lifetime of product.

You might notice that this is a less rigorous analytical process than what is used in the rulemaking. We are looking for just ballpark estimates here and not going into the level of detail and rigor that we would use in a rulemaking. For

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 17 1 2004 priorityreport last October. The first thingwe 2 needed to do was identify what products needed to be 3 evaluated and then which of those products were in 4 need of analytical updating. 5 We hadnot done a newTSD whenwe didlast 6 year's priority-setting. So we wanted to take a more 7 comprehensive approach this year. So we completed a 8 completely new TSD with detailed analysis on 18 9 products. And we had three appendices that we saw on 10 the Web. 11 We used these principles for estimating 12 the energy savings. We used the best available 13 information with existing studies wherever possible. 14 That might mean government studies, be they federal, 15 state, orlocal studiesbytrade associations, studies 16 by the energy efficiency advocates. 17 We tried to simply the market dynamics 18 assuming no change in the number of units inuse. We 19 assume that replacements occurat a constant rate over 20 the average lifetime of product. 21 You might notice that this is a less 22 rigorous analytical process than what is used in the 23 rulemaking. We are looking for just ballpark 24 estimates here and not going into the level of detail 25 and rigor that we would use in a rulemaking. For

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instance, if we were doing something like this in the formal standards rulemaking, the shipment for pass would be different for each individual year. But here we keep it simplified and held constant.

The last item shows the time frame that we have used for energy savings for the new analyses that we performed this year saying that in 2010 and in 2035. You will see in some of the data sheets that were not revised that they have slightly different energy savings time frames.

We evaluated four categories of products: first and foremost, the existing covered products that the legislation directs us to cover; second of all, products in the coverage process. I will tell you more about that in a minute. Those are new products that we are considering for standards rulemaking. Then there are products in potential federal legislation should that ever be passed. And then we have the appendix C products that are not covered products. These are things that we looked at a couple of years ago, in addition to the program, but, for various reasons, inadequate potential energy savings, we elected not to add them to our program.

I mentioned the coverage process. This gives you a snapshot of the complex coverage process.

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 18 1 instancet if we were doing something like this in the 2 formal standards rulemakingt the shipment for pass 3 wouldbe different for each individualyear. But here 4 we keep it simplified and held constant. 5 The last itemshows the time frame thatwe 6 have used for energy savings for thenew analyses that 7 we performed this year saying that in 2010 and in 8 2035. You will see in some of the data sheets that 9 were not revised that they have slightly different 10 energy savings time frames. 11 We evaluated four categories ofproducts: 12 first andforemostt the existingcoveredproductsthat 13 the legislation directs us to cover; second of alIt 14 products in the coverage process. I will tell you 15 more about that in a minute. Those are new products 16 that we are considering for standards rulemaking. 17 Then there are products in potential federal 18 legislation should that ever be passed. And then we 19 have the appendix C products that are not covered 20 products. These are things that we lookedat a couple 21 of years ago t in addition to the program t butt for 22 various reasonst inadequatepotential energy savingst 23 we elected not to add them to our program. 24 I mentioned the coverage process. This 25 gives you a snapshot of the complex coverage process.

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This is a rulemaking process that enables the department to add new products beyond those specified in our authorizing legislation for the appliance standards program.

Following this route, we actually start from scratch with the definitions. And since coverage depends on products meeting thresholds of energy use based on households, the department also has to define literally what a household is. We are working on a notice right now for that.

And we also would need if we are going to do commercial products a comparable analog for those commercial products. It takes a lot longer than having legislation simply name a product and say, you know, "Do standards and test procedures for this."

The next slide shows these are the products that are currently in our coverage process. We have looked at a lot of products through the national energy policy group suggestions. And these were the ones that we selected to start covering: beverage merchandisers and beverage vending machines; ceiling fans; the commercial reach-in refrigerators, freezers, and refrigerator-freezers; the ER/BR-shaped reflector lamps; and torchieres.

Should an energy bill ever ultimately be

NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 19 1 This is a rulemaking process that enables the 2 department to add newproducts beyond those specified 3 in our authorizing legislation for the appliance 4 standards program. 5 Following this route, we actually start 6 from scratchwiththe definitions. And since coverage 7 depends on products meeting thresholds of energy use 8 basedonhouseholds, the department alsohas to define 9 literally what a household is. We are working on a 10 notice right now for that. 11 And we also would need if we are going to 12 do commercial products a comparable analog for those 13 commercial products. It takes a lot longer than 14 having legislation simplyname a product and say, you 15 know, "Do standards and test procedures for this." 16 The next slide shows these are the 17 products that are currently in our coverage process. 18 We have looked at a lot of products through the 19 national energy policy group suggestions. And these 20 were the ones that we selected to start covering: 21 beveragemerchandisers andbeveragevendingmachines; 22 ceiling fans; the commercial reach-in refrigerators, 23 freezers, andrefrigerator-freezers; the ER/BR-shaped 24 reflector lamps; and torchieres. 25 Should an energy bill ever ultimately be

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passed, they had mentioned covering these nine products. The first four are already in our coverage process. So we started work on those. The next five are not in our coverage process. So we would only be working on those if an energy bill would finally be passed and direct us to do so.

If an energy bill would be passed, we could stop all of the preliminary work on the coverage process on those top four products and just start to do a conventional standards rulemaking.

Before we get to the presentation again of our draft priorities, I wanted to just review what the department considers as our interpretations of the definitions for the three priority levels: high, medium, low. For high, it means we are actively carrying out analysis for the intended purpose of issuing rules of determinations. Medium means we are conducting activities in support of a potential rulemaking. We may be gathering information. Low we are taking no action whatsoever in this fiscal year. Often that is because we have recently completed a rulemaking on that particular product.

Now we will start again with showing the priorities that many of you have already looked at in detail. The way we have arranged them, on the left we NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 20 1 passed, they had mentioned covering these nine 2 products. The first four are already in our coverage 3 process. So we startedwork on those. The next five 4 are not in our coverage process. So we would onlybe 5 working on those if an energy bill would finally be 6 passed and direct us to do so. 7 If an energy bill would be passed, we 8 couldstop all of thepreliminaryworkonthe coverage 9 process on those top four products and just start to 10 do a conventional standards rulemaking. 11 Beforewe get tothepresentationagainof 12 ourdraft priorities, I wantedtojustreviewwhat the 13 department considers as our interpretations of the 14 definitions for the three priority levels: high, 15 medium, low. For high, it means we are actively 16 carrying out analysis for the intended purpose of 17 issuing rules of determinations. Mediummeans we are 18 conducting activities in support of a potential 19 rulemaking. We maybe gathering information. Low we 20 are taking no action whatsoever in this fiscal year. 21 Often that is because we have recently completed a 22 rulemaking on that particular product. 23 Now we will start again with showing the 24 priorities that many of youhave already looked at in 25 detail. The waywe have arranged them, on the leftwe

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show the priorities of the products from last year, on the right the proposed priorities for this year.

First, you will note the department is proposing we are maintaining high priority for all of these important products on the left. The first change you see is the low priority for the central air conditioner and heat pump single duct priority philosophy. I am going to read my sentence exactly on this because it is somewhat complicated. Those of you who have followed the court decision are intimately familiar with it, but if not, it's kind of tricky the way the rulemakings are interacting at this point.

They have been reduced to low priority for standards because those products were covered in the January 22nd, 2001 final rule, which was recently reinstated by the court decision which overturned the 2002 final rule. The U.S. Court of Appeals decision in January of this year reestablished the 13 standard, which includes the single duct priority philosophy products. So since they are already included in a rulemaking on the books, they can return again to low priority. Thirdly, note that the single package vertical units were not prioritized at all in 2004, NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 

### 21 1 showthepriorities of theproducts from last year, on 2 the right the proposed priorities for this year. 3 

### First, you will note the department is 4 proposing we are maintaininghighpriority for all of 5 

### these important products on the left. The first 6 changeyou see is the lowpriorityfor the central air 7 conditioner and heat pump single duct priority 8 philosophy. 9 I am going to readmy sentence exactlyon 10 thisbecause it is somewhat complicated. Those ofyou 11 who have followed the court decision are intimately 12 familiar with it, but if not, it's kind of tricky the 13 way the rulemakings are interacting at this point. 14 Theyhavebeenreducedtolowpriorityfor 15 standards because those products were covered in the 16 January 22nd, 2001 final rule, which was recently 17 reinstatedby the court decisionwhich overturned the 18 2002 final rule. The U.S. Court of Appeals decision 19 inJanuaryof thisyearreestablishedthe 13 standard, 20 which includes the single duct priority philosophy 21 products. So since they are already included in a 22 rulemaking on the books, they can return again to low 23 priority. 24 Thirdly, note that the single package 25 vertical units were not prioritized at all in 2004,

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but now they have been set to high priority. DOE has been working on the definitions of industry. There were some issues that needed resolving there.

And since we have gone to resolving them, those products can also be considered as part of the ASHRAE products rulemaking.

Finally, note that the department proposed a high priority be maintained for the five products in the ASHRAE products rulemaking. No standards rulemaking analysis has been conducted, published, or completed to date. It is possible that the eventual outcome could be to adopt the ASHRAE 90.1 1999 efficiency levels or possibly even more stringent levels. Next slide. No change on this slide. We have two products in the determination process by which we are looking to determine whether or not the Department of Energy should go forward with the rulemaking. The five bottom products are the ones in the coverage process that we maintain high priority for. Next slide. My favorite product since I worked on the test procedure last year. This is maintaining at medium priority. We did publish a new test procedure in the fall of last year, and we are NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 

### 22 1 but now they have been set to high priority. DOE has 2 been working on the definitions of industry. There 3 were some issues that needed resolving there. 4 And since we have gone to resolving them/ 5 those products can also be considered as part of the 6 ASHRAE products rulemaking. 7 Finally/ notethatthedepartmentproposed 8 a highprioritybemaintained for the five products in 9 

### the ASHRAE products rulemaking. No standards 10 rulemaking analysis has beenconducted/ published/ or 11 completed to date. It is possible that the eventual 12 outcome could be to adopt the ASHRAE 90.1 1999 13 efficiency levels or possibly even more stringent 14 levels. 15 

### Next slide. No change on this slide. We 16 have two products in the determination process by 17 which we are looking to determine whether or not the 18 Department of Energy should go forward with the 19 rulemaking. The five bottomproducts are the ones in 20 the coverage process that we maintain high priority 21 for. 22 Next slide. My favorite product since I 23 

### worked on the test procedure last year. This is 24 maintaining at mediumpriority. We did publish a new 25 test procedure in the fall of last year/ and we are

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waiting for the manufacturer to test that new test procedure and see what that data looks like. So they are a medium priority.

Moving on to test procedures, you see we maintain high priority for all of the primary test procedures there. One change, clothes washers. We again published a test procedure last fall, which I worked on, too. We resolved some spin feed and test cloth issues. So that can go back to low priority, at least for the time being.

The five products in the coverage process were not listed at all in last year's priority. So we decided since the products were a high priority for standards, we would also make the test procedures high priority. This is something we are particularly interested in having your input on because in the coverage process and how long it is going to take and where we are in it, we are wondering if perhaps these test procedures should be medium, rather than high. So we would appreciate your thoughts regarding that issue. Here is another set of products we are especially interested in your views, these medium priority test procedures. For both of these, the department considered a change to low priority this

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 23 1 waiting for the manufacturer to test that new test 2 procedure and see what that data looks like. So they 3 are a medium priority. 4 Moving on to test procedures I you see we 5 maintain high priority for all of the primary test 6 procedures there. One changeI clothes washers. We 7 again published a test procedure last fall l which I 8 worked on l too. We resolved some spin feed and test 9 clothissues. So that cangoback to lowpriorityI at 10 least for the time being. 11 The five products in the coverageprocess 12 were not listedat all in lastyearls priority. Sowe 13 decided since the products were a high priority for 14 standards I we wouldalsomake the testprocedureshigh 15 priority. This is something we are particularly 16 interested in having your input on because in the 17 coverage process and how long it is going to take and 18 where we are in it l we are wondering if perhaps these 19 test procedures should be medium l rather than high. 20 So we would appreciate your thoughts regarding that 21 issue. 22 Here is another set of products we are 23 especially interested in your views I these medium 24 priority test procedures. For both of these I the 25 department considered a change to low priority this

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year because the changes that are being considered for these test procedures could potentially affect the standard levels for those products.

And, as most of you know, if you change a test procedure and that changes the energy consumption figures for products and possibly affects the compliance with the standard, we would then need to change the standard itself. So we are considering perhaps changing those to low.

During the past year, we have already had some other issues raised by stakeholders. I am going to run through those with you. First of all is the commercial, the residential style commercial clothes washers. We received requests to consider covering these under the standards for the residential clothes washers because those machines were very similar to the residential machines. We studied this extensively and ended up concluding that the department did not have the authority to cover those machines under our existing legislation.

The same situation held for the large unitary air conditioners. We concluded that we did not have authority to cover those.

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### 1 yearbecause thechanges that arebeingconsideredfor 2 these test procedures could potentially affect the 3 standard levels for those products. 4 And, as most of you know, if you change a 5 testprocedure andthat changesthe energyconsumption 6 figures for products and possibly affects the 7 compliance with the standard, we would then need to 8 

### change the standard itself. So we are considering 9 perhaps changing those to low. 10 During the past year, we have alreadyhad 11 some other issues raised by stakeholders. I am going 12 

### to run through those with you. First of all is the 13 commercial, the residential style commercial clothes 14 

### washers. We received requests to consider covering 15 these under the standards for the residential clothes 16 washers because those machines were very similar to 17 the residentialmachines. We studiedthisextensively 18 and ended up concluding that the department did not 19 have the authority to cover those machines under our 20 existing legislation. 21 

### The same situation held for the large 22 

### unitary air conditioners. We concluded that we did 23 not have authority to cover those. 24 

### The next one is late breaking news. Just 25 last week the Secretaryof Energy received a petition

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refrigerator rulemaking. This is something that we had ranked as low priority because we had a new standard that took effect in 2001. So it was not time again to look at refrigerators, but the petition will certainly cause us to reevaluate the priority of that product. And we are very interested in having your views on that.

We printed our copies of the whole petition that was submitted to the Secretary. And those are in your packet to review during this meeting or afterwards if you wish to submit written comments.

The last one is expediting the rulemaking for commercial refrigeration equipment. Two of those products we already have in our coverage process.

The next slide shows the whole set of products, but the ones on which we are taking no action we didn't feel it was appropriate to cover at this time. Next slide. Again, for your record, this shows all of the materials on the Web site, where they are, our three appendices. I should add that appendix B also includes the data sheets on the two determinations, but we didn't put that in the title because it would have been an even longer title for

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 25 1 requesting that the department look at the 2 refrigerator rulemaking. This is something that we 3 had ranked as low priority because we had a new 4 standardthat took effect in2001. So itwas not time 5 again to look at refrigerators, but the petitionwill 6 certainly cause us to reevaluate the priorityof that 7 product. And we are very interested in having your 8 views on that. 9 We printed our copies of the whole 10 petition that was submitted to the Secretary. And 11 those are inyourpacket toreviewduring thismeeting 12 or afterwards if youwish to submit written comments. 13 The last one is expediting the rulemaking 14 for commercial refrigerationequipment. Two of those 15 products we already have in our coverage process. 16 The next slide shows the whole set of 17 products, but the ones on which we are taking no 18 action we didn't feel it was appropriate to cover at 19 this time. 20 Next slide. Again, for your record, this 21 shows all of the materials ontheWeb site, where they 22 are, ourthree appendices. I shouldadd that appendix 23 B also includes the data sheets on the two 24 determinations, but we didn't put that in the title 25 because it would have been an even longer title for

(202)234-4433 NEALR. GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com26 1 that appendix B. 2 I did hear that at least one person had 3 trouble downloading the materials from the Web. So we 4 made up a couple of a few CDs that I have here that 5 you could take materials with you if per chance you 6 think your computers would balk at downloading these 7 fairly lengthy documents. 8 Next. Again, our comment period concludes 9 on the 9th. We love electronic comments if you can 10 include your electronic signature in that. If you 11 can't, we request that you authenticate your comments 12 by sending in signed hard copies through the mail. 13 So that gives you an overview for 14 discussion. And I turn it back over to Doug to hear 15 your thoughts. Thank you. 16 FACILITATOR BROOKMAN: Yes, Andrew? 17 MR. DELASKI: Is now an appropriate time 18 to ask any clarifying questions on what has been 19 presented? 20 FACILITATOR BROOKMAN: Yes. I would like 21 to take clarifying questions first and then go rather 22 systematically into the slides kind of, especially 23 product by product, and discuss them. Okay. So 24 l f

--

p ease, now, or 25 MR. DELASKI: I have a couple of them.

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### 1 that appendix B. 2 I did hear that at least one person had 3 troubledownloading thematerials fromtheWeb. Sowe 4 made up a couple of a few CDs that I have here that 5 you could take materials with you if per chance you 6 

### think your computers would balk at downloading these 7 

### fairly lengthy documents. 8 Next. Again, ourcommentperiodconcludes 9 on the 9th. We love electronic comments if you can 10 

### include your electronic signature in that. If you 11 can't, we request that you authenticate your comments 12 by sending in signed hard copies through the mail. 13 

### So that gives you an overview for 14 discussion. And I turn it back over to Doug to hear 15 your thoughts. Thank you. 16 

### FACILITATOR BROOKMAN: Yes, Andrew? 17 

### MR. DELASKI: Is now an appropriate time 18 to ask any clarifying questions on what has been 19 presented? 20 

### FACILITATOR BROOKMAN: Yes. I would like 21 to take clarifying questions first and then go rather 22 systematically into the slides kind of, especially 23 

### product by product, and discuss them. Okay. So 24 please, now, for

-- 25 MR. DELASKI: I have a couple of them.

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2 3 4

6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 27 FACILITATOR BROOKMAN: And everybody please say your name for the record, please.

MR. DELASKI: Andrew Delaski, Appliance Standards Awareness Project.

Two questions on the presentation, overall questions that are clarifying in nature. One is, can the department spend a little bit more time describing what you mean by high priority, medium priority, and low priority?

You have asked us for input on whether the test procedures should be medium priority or high priority and other standards should be medium priority versus high priority. I'm a bit unclear what it means to be a high priority for the department and what it means to be a medium priority at the department.

MR. BERRINGER: Bryan Berringer, Department of Energy.

The way we have really applied the standard was its original purpose. Again, the ones that we are actively doing analysis on are high priorities. Again, medium priorities, one of the things is that we do background information. They would be like the next ones in the cue.

So, I mean, we are actively doing analysis on all of our high priority rulemakings. So I am not NEAP R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 27 1 

### FACILITATOR BROOKMAN: And everybody 2 please say your name for the 

### recordt please. 3 

### MR. DELASKI: Andrew Delaskit Appliance 4 

### standards Awareness Project. 5 

### Twoquestionsonthepresentationt overall 6 

### questions that are clarifying innature. One 

### iS t 

### can 7 

### thedepartment spenda littlebitmoretime describing 8 

### what you mean by high

### prioritYt medium prioritYt and 9 

### low priority? 10 

### Youhave askedus for input onwhetherthe 11 

### test procedures should be medium priority or high 12 

### priorityandotherstandards shouldbemediumpriority 13 

### versus highpriority. 

### Itma bitunclearwhat itmeans 14 

### to be a high priority for the department and what it 15 

### means to be a medium priority at the department. 16 

### MR. BERRINGER: Bryan 

### Berringert 17 Department of Energy. 18 

### The way we have really applied the 19 

### standard was its original purpose. Againt the ones 20 that we are actively doing analysis on are high 21 

### priorities. Againt medium prioritiest 

### one of the 22 

### things is that we do background information. They 23 would be like the next ones in the cue. 24 So

### t I 

### meant we areactivelydoinganalysis 25 on all of ourhighpriority rulemakings. So I am not

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sure if you have specific questions on priority. Low priority, again, we said we're not doing anything at all. Either we have done a recent rulemaking or we have not. It's just not -- there's no work done because of resources that are available.

Do you have specific -- MR. DELASKI: On the ASHRAE products that you are proposing as high priorities, I believe Barbara said that you have done no analysis on those.

MR. BERRINGER: We have done some analysis. On those, we're looking at again on ASHRAE whether we should pursue a higher standard or if we should just adopt ASHRAE. Those are two options.

So we have done some background analysis. We have not done the extent of the analysis that we are doing with the three major rulemakings: the transformers, furnaces and boilers, and commercial air conditioning. So we are doing impact analysis on them but not to the extent of manufacturing impact and all of that other analysis.

MR. NADEL: Steve Nadel. Just to clarify, I know you did some analysis back in 2000-2001. I thought Barbara say you hadn't done any analysis in the past year. Are you saying that was a misunderstanding? 

### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 28 1 sure if you have specific questions onpriority. Low 2 priority, again, we said we're not doing anything at 3 all. Either we have done a recent rulemaking or we 4 have not. It's just not there's no work done 5 because of resources that are available. 6 Do you have specific

-- 7 MR. DELASKI: On theASHRAE products that 8 you are proposing as high priorities, I believe 9 Barbara said that you have done no analysis on those. 10 MR. BERRINGER: We have done some 11 analysis. On those, we're looking at again onASHRAE 12 whether we should pursue a higher standard or if we 13 should just adopt ASHRAE. Those are two options. 14 So we have done some background analysis. 15 We have not done the extent of the analysis that we 16 are doing with the three major rulemakings: the 17 transformers, furnaces andboilers, andcommercial air 18 conditioning. Sowe are doing impact analysis onthem 19 but not to the extent of manufacturing impact and all 20 of that other analysis. 21 MR. NADEL: Steve Nadel. 22 Just to clarify, I know you did some 23 analysisback in2000-2001. I thought Barbara sayyou 24 hadn't done any analysis in the past year. Are you 25 saying that was a misunderstanding?

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1 MR. BERRINGER: Well , I think she said -- 2 MS. TWIGG: We haven't completed or 3 published any, no. 4 MR. NADEL: Okay. 5 MR. BERRINGER: We have not made any. It 6 has all been internal work that has been done. We 7 have been working, actually, with ASHRAE on some of 8 what Barbara said are the definitions on some of those 9 products and the efficiency levels that were 10 addressed. 11 There was some change as far as 12 descriptors . So we are still looking at those issues 13 when we talk about change in thermal efficiency. 14 FACILITATOR BROOKMAN: Let me just 15 inquire. Are you going to be able to hear the 16 discussion? You can't hear it. Maybe, at a minimum, 17 Brenda, we can get the A/V people to turn up the bi i l 18 volume a l tt e t. 19 We are trying to consider other options 20 about whether this room is going to be viable for the 21 remainder of this workshop or not. So we are checking 22 into another room, one, but it would have to be 23 rewired for sound to pick up all of the comments and 24 everything, which is not something that gets done from 25 the staff in 20 minutes . So if we can hang in here, 

### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 29 1 MR. BERRINGER: Well, I think she said 2 MS. TWIGG: We haven't completed or 3 published any, no. 4 MR. NADEL: Okay. 5 MR. BERRINGER: We have not made any. It 6 has all been internal work that has been done. We 7 have been working, actually, with ASHRAE on some of 8 what Barbara saidare the definitions on some of those 9 products and the efficiency levels that were 10 addressed. 11 There was some change as far as 12 descriptors. So we are still looking at those issues 13 when we talk about change in thermal efficiency. 14 FACILITATOR BROOKMAN: Let me just 15 inquire. Are you going to be able to hear the 16 discussion? You can't hear it. Maybe, at a minimum, 17 Brenda, we can get the A/V people to turn up the 18 volume a little bit. 19 We are trying to consider other options 20 about whether this room is going to be viable for the 21 remainderof this workshop ornot. Sowe are checking 22 into another room, one, but it would have to be 23 rewired for sound to pick up all of the comments and 24 everything, whichisnot somethingthat getsdone from 25 the staff in 20 minutes. So if we can hang in here,

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5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 it would be a lot more convenient. Also, I think we have sent an emissary or two to see if we can get them to dampen down the noise a little bit. And, if necessary, I will go back there with my baseball bat. In the meantime, I would like to ask you to speak really loud if you can.

Steve Rosenstock? MR. ROSENSTOCK: Quick clarifying question. Is that okay?

FACILITATOR BROOKMAN: Yes, please. MR. ROSENSTOCK: Bryan, you talked about the three products for F.Y. 2004 that seem to be getting the most analysis: the furnaces, boilers; the transformers; and I wasn't sure what the third one

was.

conditioner. MS. TWIGG: Commercial.

MR. BERRINGER: Commercial air

MR. ROSENSTOCK: Commercial? Just for everybody's notice, is there a timetable for F.Y. 2004 for any products in terms of ANOPRs or any other things down the pipe that we should be aware of to help us with the 2005 thoughts?

FACILITATOR BROOKMAN: Could you hear Steve since he spoke into the microphone? Could you

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 30 1 it would be a lot more convenient. 2 Also, I thinkwe have sent an emissary or 3 two to see ifwe canget themto dampendown the noise 4 a littlebit. And, if necessary, I will gobackthere 5 with my baseball bat. In the meantime, I would like 6 to ask you to speak really loud if you can. 7 Steve Rosenstock? 8 MR. ROSENSTOCK: Quick clarifying 9 question. Is that okay? 10 FACILITATOR BROOKMAN: Yes, please. 11 MR. ROSENSTOCK: Bryan, you talked about 12 the three products for F.Y. 2004 that seem to be 13 gettingthemost analysis: the furnaces, boilers; the 14 transformers; and I wasn't sure what the third one 15 was. 16 MS. TWIGG: Commercial. 17 MR. BERRINGER: Commercial air 18 conditioner. 19 MR. ROSENSTOCK: Commercial? Just for 20 everybody'snotice, isthere a timetable for F.Y. 2004 21 for any products in terms of ANOPRs or any other 22 things down the pipe that we should be aware of to 23 help us with the 2005 thoughts? 24 FACILITATOR BROOKMAN: Could you hear 25 Steve since he spoke into the microphone? Could you

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We're hoping that those three rulemakings that were just discussed, the transformers, furnaces and boilers, and commercial air conditioning, will be coming out soon.

MR. ROSENSTOCK: Steve Rosenstock, EEI. Do you mean the ANOPRs? MR. BERRINGER: The ANOPRs, correct. MR. ROSENSTOCK: Thank you very much. FACILITATOR BROOKMAN: Yes? MR. DELASKI: A follow-up on my earlier question about --

FACILITATOR BROOKMAN: Give your name for the record. MR. DELASKI: Andrew Delaski, Appliance Standards Awareness Project.

When you described what it means to be a high priority for the office of Energy Efficiency in the analysis that you do, does that then apply to the department as a whole? Is there an understanding within other parts of the department that have to move these rules what it means to be a high priority and NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 31 1 hear him? Yes? Thank you. 2 Okay. Bryan? 3 MR. BERRINGER: Bryan Berringerl 4 Department of Energy. 5 We/re hoping that those three rulemakings 6 that were just discussed l the transformers I furnaces 7 and boilers l and commercial air conditioning l will be 8 coming out soon. 9 MR. ROSENSTOCK: Steve Rosenstockl EEl. 10 Do you mean the ANOPRs? 11 MR. BERRINGER: The ANOPRs l correct. 12 MR. ROSENSTOCK: Thank you very much. 13 FACILITATOR BROOKMAN: Yes? 14 MR. DELASKI: A follow-up on my earlier 15 question about

-- 16 FACILITATOR BROOKMAN: Give your name for 17 the record. 18 MR. DELASKI: Andrew Delaski l Appliance 19 Standards Awareness Project. 20 When you described what it means to be a 21 high priority for the Office of Energy Efficiency in 22 the analysis that you dOl does that then apply to the 23 department as a whole? I s there an understanding 24 withinotherparts of the department that have tomove 25 these rules what it means to be a high priority and

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how that impacts moving the standard ahead? Is it a high priority for you, energy efficiency, or is it a high priority for the Department of Energy?

MR. McCABE: This is Michael McCabe, Department of Energy.

These are high priorities for the department. MR. DELASKI: Thank you.

FACILITATOR BROOKMAN: Additional clarifying questions that would relate to Barbara's slide presentation at this point? Yes, please? Your name for the record.

MR. STEINER: David Steiner with Maytag Corporation. I am wondering if, Barbara, someone could respond to the issue on residential clothes washers, commercial clothes washers, on page 19. You indicate that the department has determined that it does not have the authority to cover these products under existing legislation. Is there some type of public notification that explained that so that it was available to all?

MS. TWIGG: There has not been anything publicly conveyed. We understand that David Garman had made some personal calls to the parties who were

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 32 1 how that impacts moving the standard ahead? Is it a 2 high priority for your energy efficiencYr or is it a 3 high priority for the Department of Energy? 4 MR. McCABE: This is Michael McCaber 5 Department of Energy. 6 These are high priorities for the 7 department. 8 MR. DELASKI: Thank you. 9 FACILITATOR BROOKMAN: Additional 10 clarifying questions that would relate to Barbarars 11 slide presentation at this point? Yesr please? Your 12 name for the record. 13 MR. STEINER: David Steiner with Maytag 14 Corporation. 15 I am wondering ifr Barbarar someone could 16 respond to the issue on residential clothes washersr 17 commercial clothes washersr onpage 19. You indicate 18 that the department has determined that it does not 19 have the authority to cover these products under 20 existing legislation. Is there some type of public 21 notification that explained that so that it was 22 available to all? 23 MS. TWIGG: There has not been anything 24 publicly conveyed. We understand that David Garman 25 had made some personal calls to the parties who were

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most interested in this issue, but we have not put anything in writing at this point.

MR. McCABE: This is Michael McCabe. Let me add to that. As far as a notice that is generally published, there has not been one. There have been a number of letters that have been sent in response to inquiries on this which have gone out stating that. And those we will be happy to make available. FACILITATOR BROOKMAN: Yes, please?

MR. DELAQUILA: Dave Delaquila with GAMA. I just noticed in the April 27th table that was published earlier, I guess, around April 27th, I guess, in the table, it shows residential furnaces and boilers being moved to low priority. But in the table that you presented, it shows that it is maintained a high priority. So I am just curious why, what the change was since April.

MR. NADEL: I believe he is referring to the fact that last November they were high priority. It went down to low priority in this interim federal agenda. There was no public process. And I believe DOE published the notice in the Federal Register to change that. 25 11 I'll let Mike or Bryan address that.

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### NEAP R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 33 1 most interested in this issue, but we have not put 2 anything in writing at this point. 3 MR. McCABE: This is Michael McCabe. 4 Let me add to that. As far as a notice 5 that is generally published, there has not been one. 6 There have been a number of letters that have been 7 sent in response to inquiries on this which have gone 8 out stating that. And those we will be happy to make 9 available. 10 FACILITATOR BROOKMAN: Yes, please? 11 MR. DELAQUILA: Dave Delaquilawith GAMA. 12 I just noticed in the April 27th table 13 that was published earlier, I guess, around April 14 27th, I guess, in the table, it shows residential 15 furnaces andboilersbeingmovedto lowpriority. But 16 in the table that you presented, it shows that it is 17 maintaineda highpriority. So I amjust curiouswhy, 18 what the change was since April. 19 MR. NADEL: I believe he is referring to 20 the fact that last November they were high priority. 21 It went down to low priority in this interim federal 22 agenda. There was no public process. And I believe 23 DOE published the notice in the Federal Register to 24 change that. 25 I'll let Mike or Bryan address that.

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2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 34 FACILITATOR BROOKMAN: That was Steve Nadel speaking. Go ahead.

MR. BERRINGER: Yes. Bryan Berringer,

DOE. Steve is correct. We did at one point change the residential furnaces and boilers to low on the regulatory agenda. And then we did do a correction notice. So we are maintaining the furnaces and boilers at high priority.

MR. McCABE: This is Michael McCabe. Just to add to that, in the process improvement rule, we had described the procedures that we would be following. And we laid out that we would be establishing the priorities in the priority setting and with regard to standards that high priorities would initiate a rulemaking, that a rulemaking could result in a final rule that would amend the standards. But it could be terminated at some point in between.

It is changing the priority from high to low, as had been done in the regulatory agenda, inconsistent with the priority-setting rules. And that was the reason why on April 27th we changed it back to high priority.

(202) 234-4433 FACILITATOR BROOKMAN: Please?

MR. DELAQUILA: Dave Delaquila, GAMA.

NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 34 1 FACILITATOR BROOKMAN: That was Steve 2 Nadel speaking. Go ahead. 3 MR. BERRINGER: Yes. Bryan Berringer, 4 DOE. 5 Steve is correct. We did at one point 6 change the residential furnaces andboilers to low on 7 the regulatory agenda. And then we did do a 8 correctionnotice. Sowe aremaintainingthe furnaces 9 and boilers at high priority. 10 MR. McCABE: This is Michael McCabe. 11 Just to add to that, in the process 12 improvementrule, we haddescribedtheproceduresthat 13 we would be following. And we laid out that we would 14 beestablishingtheprioritiesintheprioritysetting 15 and with regard to standards that high priorities 16 would initiate a rulemaking, that a rulemaking could 17 result ina final rule that would amend the standards. 18 But it could be terminated at some point in between. 19 It is changing the priority from high to 20 low, as had been done in the regulatory agenda, 21 inconsistent with the priority-setting rules. And 22 that was the reason why on April 27th we changed it 23 back to high priority. 24 25

(202)234-4433 FACILITATOR BROOKMAN: Please? MR. DELAQUILA: Dave Delaquila, GAMA. NEALR.GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODEISLANDAVE., N,W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com1

2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 35 Maybe I am confused on what the priorities are in the table for April 27, but it says, "Summary of Draft Fiscal Year 2005 Priorities."

FACILITATOR BROOKMAN: What page are you referring to, please?

MR. DELAQUILA: The April 27, 2004 -- FACILITATOR BROOKMAN: Which is in your packets, folks.

MR. DELAQUILA: I am just trying to get clarification. I guess this is test procedure. It does show that residential furnaces and boilers are low priority products. Is that --

MR. McCABE: This is Michael McCabe. The high priority, if you look under "Standards" in that same table, you will see residential furnaces and boilers.

FACILITATOR BROOKMAN: Other clarifying questions at this point?

(No response.) FACILITATOR BROOKMAN: I was thinking that it might be easiest if we just start with the products that are listed on page -- well, we can start as early as page, say, 11 or 12, but the more comprehensive listing is on page 14. We will start with that as our point of departure. If there are any additional

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 35 1 Maybe I amconfusedonwhat thepriorities 2 are in the table for April 27, but it says, "Summary 3 of Draft Fiscal Year 2005 Priorities." 4 FACILITATOR BROOKMAN: What page are you 5 referring to, please? 6 MR. DELAQUILA: The April 27, 2004

-- 7 FACILITATOR BROOKMAN: Which is in your 8 packets, folks. 9 MR. DELAQUILA: I am just trying to get 10 clarification. I guess this is test procedure. It 11 does show that residential furnaces and boilers are 12 low priority products. Is that

-- 13 MR. McCABE: This is Michael McCabe. 14 The high priority, if you look under 15 "Standards" in that same table, you will see 16 residential furnaces and boilers. 17 FACILITATOR BROOKMAN: Other clarifying 18 questions at this point? 19 (No response.) 20 FACILITATORBROOKMAN: I wasthinkingthat 21 itmight be easiest ifwe just start withtheproducts 22 that are listedonpage -- well, we can start as early 23 as page, say, 11 or 12, but the more comprehensive 24 listing is onpage 14. We will start withthat as our 25 point of departure. If there are any additional

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things you would like to cover prior to those pages, we will go there first.

I see Michael McCabe. MR. McCABE: Michael McCabe. Doug, the one issue that is cross-cutting that folks may want to touch on first, as we laid out in the agenda, is the factors in the priority-setting.

FACILITATOR BROOKMAN: Thank you. That is on page 6. These factors, these are in the process improvement rule. Comments on these? Steve Nadel?

MR. NADEL: Before we go back, I have one cross-cutting question that I believe will affect that. I also have one other cross-cutting issue that I would suggest we get to after that. Would now be appropriate to ask my cross-cutting question?

FACILITATOR BROOKMAN: Yes. MR. NADEL: One of the issues when it comes to product coverage is when does preemption of state standards begin? I have heard lots of interpretations of the law.

The law, frankly, is not very clear. I've heard interpretations anywhere from the first step of coverage is to effectively preempt. Then we begin a rulemaking. So preemption would begin at 6 to 12

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 36 1 things you would like to cover prior to those pages, 2 we will go there first. 3 I see Michael McCabe. 4 MR. McCABE: Michael McCabe. 5 Doug, the one issue that is cross-cutting 6 that folks may want to touch on first, as we laid out 7 inthe agenda, is the factors inthepriority-setting. 8 FACILITATORBROOKMAN: Thankyou. That is 9 on page 6. 10 These factors, these are in the process 11 improvement rule. Comments on these? Steve Nadel? 12 MR. NADEL: Before we go back, I have one 13 cross-cutting question that I believe will affect 14 that. I also have one other cross-cutting issue that 15 I would suggest we get to after that. would now be 16 appropriate to ask my cross-cutting question? 17 FACILITATOR BROOKMAN: Yes. 18 MR. NADEL: One of the issues when it 19 comes to product coverage is when does preemption of 20 state standards begin? I have heard lots of 21 interpretations of the law. 22 The law, frankly, isnotveryclear. I've 23 heard interpretations anywhere from the first step of 24 coverage is to effectively preempt. Then we begin a 25 rulemaking.

(202)234-4433 So preemption would begin at 6 to 12 NEALR. GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODEISLANDAVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com37 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 years before a federal standard takes effect. I have heard other interpretations saying, No. Preemption doesn't begin until a federal standard takes effect." Then there are a whole bunch of in-between interpretations.

I would appreciate it if general counsel can give their interpretation because I think this will very much affect feedback that you get on what the priority is for coverage because that is going to be a key consideration in weighing people's reactions as well as weighing energy savings over the next decade. MR. DePRIEST: Tom DePriest, Office of General Counsel.

It is our reading of the statute that preemption occurs with the time a product becomes a covered product.

FACILITATOR BROOKMAN: Steve? MR. NADEL: Steve Nadel again. Does the product need to become a covered product for a rulemaking to begin?

MR. DePRIEST: Yes. We don't have rulemakings on products that we don't have authority to regulate, to set standards for, test procedures. Therefore, it must become a covered product before we

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 37 1 years before a federal standard takes effect. 2 I haveheardotherinterpretationssaying, 3 "No. Preemption doesn't begin until a federal 4 standard takes effect." Then there are a whole bunch 5 of in-between interpretations. 6 I would appreciate it if general counsel 7 can give their interpretation because I think this 8 will very much affect feedback that you get on what 9 the priority is for coverage because that is going to 10 be a key consideration inweighingpeople's reactions 11 as well as weighing energy savings over the next 12 decade. 13 MR. DePRIEST: Tom DePriest, Office of 14 General Counsel. 15 It is our reading of the statute that 16 preemption occurs with the time a product becomes a 17 covered product. 18 FACILITATOR BROOKMAN: Steve? 19 MR. NADEL: Steve Nadel again. 20 Does the product need to become a covered 21 product for a rulemaking to begin? 22 MR. DePRIEST: Yes. We don't have 23 rulemakings on products that we don't have authority 24 to regulate, to set standards for, test procedures. 25 Therefore, it must become a coveredproduct before we

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could begin a standard or a test procedure rulemaking.

FACILITATOR BROOKMAN: Andrew? MR. DELASKI: Andrew Delaski, Appliance Standards Awareness Project.

What is the general counsel's opinion on how a determination notice on products that are subject to determination notices affects preemption, state preemption?

These are the two products. Help me out, Steve. You've got it.

MR. ROSENSTOCK: The two products under determination right now -- this is Steve Rosenstock, EEI -- are HID lamps and small electric motors. I guess that's a clarification.

MR. DePRIEST: I am sorry. Could you repeat the question because I didn't understand what you were talking about?

MR. DELASKI: There are two products for which the department is doing work leading up to a determination notice: small electric motors and HID lamps. What is the department's opinion on where state preemption stands or how it might be affected by those determination notices?

MR. McCABE: This is Michael McCabe.

NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 38 1 couldbegina standardora testprocedurerulemaking. 2 FACILITATOR BROOKMAN: Andrew? 3 MR. DELASKI: Andrew Delaski, Appliance 4 Standards Awareness Project. 5 What is the general counsel's opinion on 6 how a determination notice on products that are 7 subject to determination notices affects preemption, 8 state preemption? 9 These are the two products. Help me out, 10 Steve. You've got it. 11 MR. ROSENSTOCK: The two products under 12 determination right now -- this is Steve Rosenstock, 13 EEl

-- are HID lamps and small electric motors. I 14 guess that's a clarification. 15 MR. DePRIEST: I am sorry. Could you 16 repeat the question because I didn't understand what 17 you were talking about? 18 MR. DELASKI: There are two products for 19 which the department is doing work leading up to a 20 determination notice: small electric motors and HID 21 lamps. 22 What is the department's opinion onwhere 23 statepreemption stands orhow itmightbe affectedby 24 those determination notices? 25

(202)234-4433 MR. McCABE: This is Michael McCabe. NEALR. GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODEISLANDAVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com1

2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 39 Just to jump in to add some information, the reason why you singled those two products out, as opposed to the five that are specifically mentioned in the legislation? And the question is whether or not the legislation may treat them differently than products which we would be adding to the program. Is that correct?

The two products for the determinations we're working on are specifically identified in the legislation. So it is my understanding that you are asking about those because it's whether or not their preemption would be different than for any products which we would be adding to the program that are not explicitly mentioned in the legislation, correct?

MR. McCABE : Right. Thank you. MR. DePRIEST: This is Tom DePriest, General Counsel, again.

The statute already covers, declares as covered product, HID and small motors. So those are through the action of the statute preempted from the state action because they have been covered products ever since those provisions of the statute were enacted.

(202) 234-4433 FACILITATOR BROOKMAN: Steve Nadel?

MR. NADEL: Could you please point out,

NEAL R. GROSS COURTREPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 39 1 Just to jump in to add some information, 2 the reasonwhy you singled those two products out, as 3 opposedtothe five that are specificallymentionedin 4 the legislation? And the question is whether or not 5 the legislation may treat them differently than 6 products which we would be adding to the program. Is 7 that correct? 8 The two products for the determinations 9 we're working on are specifically identified in the 10 legislation. So it is my understanding that you are 11 asking about those because it's whether or not their 12 preemption would be different than for any products 13 which we would be adding to the program that are not 14 explicitly mentioned in the legislation, correct? 15 MR. McCABE: Right. Thank you. 16 MR. DePRIEST: This is Tom DePriest, 17 General Counsel, again. 18 The statute already covers, declares as 19 covered product, HID and small motors. So those are 20 through the action of the statute preempted from the 21 state action because they have been covered products 22 ever since those provisions of the statute were 23 enacted. 24 25

(202)234-4433 FACILITATOR BROOKMAN: Steve Nadel? MR. NADEL: Could you please point out, NEALR.GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODEISLANDAVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com2

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maybe at a break or something? I would be curious the specific section of the legislation. I didn't see it when there is a list of covered products that it is listed there.FACILITATOR BROOKMAN: We will look for it.

Company. MS. TWIGG: We will look for it.

FACILITATOR BROOKMAN: Yes. Don? MR. BRUNDAGE: Don Brundage, Southern

I've got a related question on preemption. There have been products in the past the department has decided it was in the best interest to set a standard on for a variety of reasons. One that comes to mind is heat pump water heaters.

If you decide to not issue a standard on a product but you haven't issued a standard, does that mean that the states are preempted from issuing or are they free to issue their own standards for such products? MR. GRAY: This is Ed Gray from the National Electrical Manufacturers Association.

I am awaiting the answers to all of these, too, very carefully because we made a number of comments on these issues and we are in a lawsuit in

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 40 1 maybe at a break or something? I wouldbe curious the 2 specific section of the legislation. I didn't see it 3 when there is a list of covered products that it is 4 listed there. 5 FACILITATOR BROOKMAN: We will look for 6 it. 7 MS. TWIGG: We will look for it. 8 FACILITATOR BROOKMAN: Yes. Don? 9 MR. BRUNDAGE: Don Brundage, Southern 10 Company. 11 I'vegota relatedquestiononpreemption. 12 There have been products in the past the department 13 has decided it was in the best interest to set a 14 standard on for a variety of reasons. One that comes 15 to mind is heat pump water heaters. 16 If you decide to not issue a standard on 17 a product but youhaven't issueda standard, does that 18 mean that the states arepreemptedfromissuingorare 19 they free to issue their own standards for such 20 products? 21 MR. GRAY: This is Ed Gray from the 22 National Electrical Manufacturers Association. 23 I amawaitingthe answers to all of these, 24 too, very carefully because we made a number of 25 comments on these issues and we are in a lawsuit in

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 California. The injunction issued last June in there

basically took the same position as we have discussed here, covered products, covered equipment. And it talked about the question of gaps, which I think is what we are talking about here.

The State of California took the position that if the government does enact and it creates a regulatory gap that they are free to fill with decisions on their own and the judge in that proceeding -- and this is in the appeals process now. The judge in that proceeding made it very clear that in his opinion, there aren't any gaps. Once Congress has acted, once the Energy Department has acted, these products are federally granted.

MR. DePRIEST: If I can respond to Steve's question, the statutory citation is 42 USC section 6317. The title is "Energy Conservation Standards for High Intensity Discharge Lamps, Distribution Transformers, and Small Electric Motors."

So those are covered products under the statute. FACILITATOR BROOKMAN: I wasn't that was your question, Don.

MR. BRUNDAGE: What is the status if the

NEAL R. GROSS COURT REPORTERSAND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 4-433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 41 1 California. 2 The injunction issued last June in there 3 basically took the same position as we have discussed 4 here, covered products, covered equipment. And it 5 talked about the question of gaps, which I think is 6 what we are talking about here. 7 The State of California took the position 8 that if the government does enact and it creates a 9 regulatory gap that they are free to fill with 10 decisions on their own and the judge in that 11 proceeding and this is in the appeals process now. 12 The judge in that proceeding made it very clear that 13 in his opinion, there aren't any gaps. Once Congress 14 has acted, oncethe EnergyDepartment has acted, these 15 products are federally granted. 16 MR. DePRIEST: If I canrespondto Steve's 17 question, the statutory citation is 42 USC section 18 6317. The title is "EnergyConservationStandards for 19 High Intensity Discharge Lamps, Distribution 20 Transformers, and Small Electric Motors." 21 So those are covered products under the 22 statute. 23 FACILITATOR BROOKMAN: I wasn't that was 24 your question, Don. 25

(202)23r.-4433 MR. BRUNDAGE: What is the status if the NEALR.GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODEISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com1

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department decides implicitly to not issue a standard on a product? Does that leave the states free to set their own standards or is there a mechanism the department needs to go through to state that our decision is a no standard, it's not that we are just failing to act?

MR. NADEL: Steve Nadel, ACEEE. FACILITATOR BROOKMAN: Go ahead. MR. NADEL: I am looking at 6317, and I don't see it use the term. Yes, it mentioned those products, but I don't see it used the word "covered" products. Are you saying that that is assumed or implied or am I missing something?

MR. DePRIEST: There are provisions of the statute. And we are not going to go into this at length. There are provisions of the statute that provide cross-references to part B. Those cross-references include all sorts of administrative provisions and so forth and so on.

Those products in that section that I referenced to you are covered products.

MR. NADEL: Steve Nadel again. I guess I would state for the record from lawyers we consulted with, this is a questionable view and could be challenged. So I want to reserve the

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 42 1 department decides implicitlyto not issue a standard 2 on a product? Does that leave the states free to set 3 their own standards or is there a mechanism the 4 department needs to go through to state that our 5 decision is a no standard l it/s not that we are just 6 failing to act? 7 MR. NADEL: Steve Nadell ACEEE. 8 FACILITATOR BROOKMAN: Go ahead. 9 MR. NADEL: I am looking at 6317 1 and I 10 don/t see it use the term. Yes l it mentioned those 11 products I but I don't see it used the word "covered" 12 products. Are you saying that that is assumed or 13 implied or am I missing something? 14 MR. DePRIEST: Thereareprovisionsof the 15 statute. And we are not going to go into this at 16 length. There are provisions of the statute that 17 provide cross-references to part B. Those 18 cross-references include all sorts of administrative 19 provisions and so forth and so on. 20 Those products in that section that I 21 referenced to you are covered products. 22 MR. NADEL: Steve Nadel again. 23 I guess I would state for the record from 24 lawyerswe consultedwith l this is a questionableview 25 and could be challenged. So I want to reserve the

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2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 II from NRDC.

(202) 234-4433 43 right to question this as well as the previous statement about you have to make something covered before you can do any work.

FACILITATOR BROOKMAN: Thank you. MR. NADEL: It falls in the legal gray

area. FACILITATOR BROOKMAN: Let's note that and turn to Don. Don, I'm not sure we still have gone to you yet. MR. BRUNDAGE: Don Brundage again.

I don't know. And I'll get back to you with an acceptable answer, but I was just curious on that topic.

again. MR. GRAY: This is Ed Gray from NEMA

I suggest you check again the California. What is it, the Eastern District Federal Court for the State of California? This specific question was addressed, including the one Don raised as to if the Department of Energy intentionally decided not to regulate something, what was the status of that product? And that court held that it was a covered product. MS. KENNEDY: Yes. This is Kit Kennedy



### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 43 1 right to question this as well as the previous 2 statement about you have to make something covered 3 before you can do any work. 4 FACILITATOR BROOKMAN: Thank you. 5 MR. NADEL: It falls in the legal gray 6 area. 7 FACILITATORBROOKMAN: Let'snotethatand 8 turn to Don. Don, I'mnot sure we still have gone to 9 you yet. 10 MR. BRUNDAGE: Don Brundage again. 11 I don't know. And I'll get back to you 12 with an acceptable answer, but I was just curious on 13 that topic. 14 MR. GRAY: This is Ed Gray from NEMA 15 again. 16 I suggest you check againthe California. 17 What is it, the EasternDistrict Federal Court for the 18 State of California? This specific question was 19 addressed, including the one Don raised as to if the 20 Department of Energy intentionally decided not to 21 regulate something, what was the status of that 22 product? And that court held that it was a covered 23 product. 24 25 from NRDC.

(202)234-4433 MS. KENNEDY: Yes. This is Kit Kennedy

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2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 44 If I may, we don't need to get into this, but I'm not sure --

MS. PINTO: Let's not get into it. MS. KENNEDY: -- you are characterizing that decision correctly because that case is more about testing standards than about standards itself.

I just wanted to add -- FACILITATOR BROOKMAN: Kit, not yet. Just

a moment , please.

Seeing as how the question has been directed to the department, does the department wish to respond at this time or is it something you wish to

MS. PINTO: I don't think we have an answer to Don's question.

FACILITATOR BROOKMAN: You don't have an answer at this time for Don. Okay.

Kit, please? MS. KENNEDY: And I wanted to ask the Office of General Counsel if you could provide in writing at some point your analysis on the point of preemption for products that become covered products.

It is an important point for us as we look at the priority list because although many of us prefer national standards that are set at the right NEAL R. GROSS COURTREPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 44 1 If I may, we don't need to get into this, 2 but I'm not sure 3 MS. PINTO: Let's not get into it. 4 MS. KENNEDY:

-- you are characterizing 5 that decision correctly because that case is more 6 about testing standards than about standards itself. 7 I just wanted to add

-- 8 FACILITATORBROOKMAN: Kit, notyet. Just 9 a moment, please. 10 Seeing as how the question has been 11 directed to the department, does the department wish 12 to respond at this time or is it somethingyouwish to 13 14 MS. PINTO: I don't think we have an 15 answer to Don's question. 16 FACILITATOR BROOKMAN: You don't have an 17 answer at this time for Don. Okay. 18 Kit, please? 19 MS. KENNEDY: And I wanted to ask the 20 Office of General Counsel if you could provide in 21 writing at some point your analysis on the point of 22 preemption for products that become coveredproducts. 23 It is an importantpoint forus as we look 24 at the priority list because although many of us 25 prefer national standards that are set at the right

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level, if we feel that making a product a covered product during the duration of the rulemaking, which may take years and years, is going to preempt affected state standards, that changes the picture for us and changes our answer on what the priority is.

So it would be helpful to have your analysis so that we can review it and see where we come out. MR. DePRIEST: This is Tom DePriest, Office of General Counsel.

There is no present plan to have a written statement of that analysis. We don't think it's appropriate to have a legal debate in this forum or, really, in any forum.

If you disagree, you know, that is your right. You can send a legal memo, write a letter to the Secretary. If you want to settle it through litigation, you know, we will deal with it when that happens. But there is no written legal memorandum. And I can tell you, frankly, you know, that if we decided today that we were going to have one, you know, you might get it in 18-24 months.

It's just the way the office works. Getting a formal written statement like that involves

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 45 1 level, if we feel that making a product a covered 2 product during the duration of the rulemaking, which 3 maytakeyears andyears, isgoingtopreempt affected 4 state standards, that changes the picture for us and 5 changes our answer on what the priority is. 6 So it would be helpful to have your 7 analysis so that we can review it and see where we 8 come out. 9 MR. DePRIEST: This is Tom DePriest, 10 Office of General Counsel. 11 There isnopresentplantohave a written 12 statement of that analysis. We don't think it's 13 appropriate to have a legal debate in this forum or, 14 really, in any forum. 15 If you disagree, you know, that is your 16 right. You can send a legal memo, write a letter to 17 the Secretary. If you want to settle it through 18 litigation, you know, we will deal with it when that 19 happens. 20 But there is no written legal memorandum. 21 And I can tell you, frankly, you know, that if we 22 decided today that we were going to have one, you 23 know, you might get it in 18-24 months. 24 It's just the way the office works. 25 Getting a formal written statement like that involves

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getting a lot of people to sign off on it. And so there isn't one.

MS. KENNEDY: Okay. I guess I also do have kind of a cross-cutting comment about the priority-setting.

FACILITATOR EROOKMAN: That's what we're stacking up now, folks. So gather your cross-cutting issues. We're going to do all of them right now.

MS. KENNEDY: I just want to go back to the point of the question Andrew raised about what it means to be a priority. The concern that NRDC has we have stated in the past is that while it is okay to talk about priorities and how we are going to focus our efforts and that may make sense on some level, it is not okay to miss statutory deadlines repeatedly. And we are concerned that the Department of Energy has done that for a number of products, 18 by our count, including the products which the Department of Energy calls high priority products.

Of course, we're still waiting for the ANOPRs on the furnaces and the transformers. That is a serious concern. It is a concern not only because of the statutory deadlines that are in the law that we care about but because I think in this room, there is a large consensus that national appliance standards NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 46 1 getting a lot of people to sign off on it. And so 2 there isn/t one. 3 MS. KENNEDY: Okay. I guess I also do 4 have kind of a cross-cutting comment about the 5 priority-setting. 6 FACILITATOR BROOKMAN: 7 stacking up now 1 folks. So gather your cross-cutting 8 issues. We/re going to do all of them right now. 9 MS. KENNEDY: I just want to go back to 10 the point of the questionAndrew raised about what it 11 means to be a priority. The concern that NRDC has we 12 have stated in the past is that while it is okay to 13 talk about priorities and how we are going to focus 14 our efforts and that may make sense on some level l it 15 is not okay to miss statutory deadlines repeatedly. 16 Andwe are concernedthat theDepartment of Energyhas 17 done that for a number of products I 18 by our count I 18 including the products which the Department of Energy 19 calls high priority products. 20 Of course I we Ire still waiting for the 21 ANOPRs on the furnaces and the transformers. That is 22 a serious concern. It is a concern not only because 23 of the statutorydeadlines that are inthe lawthat we 24 care about but because I think in this room l there is 25 a large consensus that national appliance standards

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are a good thing from an energy perspective, an environmental perspective, a consumer perspective.

And by having so many delays, we lose the benefits of those standards. And we also then get into debates, which we might not otherwise get into, about state standards versus national standards.

So we will address this in our comments, but we would like the Department of Energy in the priority-setting process to: a) identify the statutory deadlines which apply to each product, take those deadlines, many of which are passed into accounting, setting priorities, and clarify that high priority products are not the only ones on which rulemaking actions will be taken because I guess in our perspective, having a priority doesn't mean that you don't work on other standards and that you don't work to meet other statutory deadlines.

We are sensitive to the Department of Energy's budgetary constraints, but they don't affect your legal responsibilities in our view. And we would really like to know what the schedule is going to be, both on the high priority products and the medium and low priority products, how the Department of Energy intends to kind of get back into compliance with the variety of deadlines in the statute. 

### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 47 1 are a good thing from an energy perspective, an 2 environmental perspective, a consumer perspective. 3 And byhaving somany delays, we lose the 4 benefits of those standards. And we also then get 5 into debates, which we might not otherwise get into, 6 about state standards versus national standards. 7 So we will address this in our comments, 8 but we would 1ike the Department of Energy in the 9 priority-setting process to: a) identify the 10 statutorydeadlines which apply to eachproduct, take 11 those deadlines, many of which are passed into 12 accounting, settingpriorities, and clarifythat high 13 priority products are not the only ones on which 14 rulemaking actions will be taken because I guess in 15 our perspective, having a priority doesn't mean that 16 you don't work on other standards and that you don't 17 work to meet other statutory deadlines. 18 We are sensitive to the Department of 19 Energy's budgetary constraints, but theydon't affect 20 your legal responsibilities inourview. Andwe would 21 really like to know what the schedule is going to be, 22 both on the highpriorityproducts and the medium and 23 low priority products, how the Department of Energy 24 intends to kind of get back into compliance with the 25 variety of deadlines in the statute.

(202)234-4433 NEAL

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2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 48 MR. McCABE: Michael McCabe with the Department of Energy.

I can appreciate the comments and the frustration. The staff throughout the department shares that. We use this process and the regulatory agenda to provide the schedule as it exists.

We are behind schedule. We have missed legislative deadlines for many of the products. Those we will never be able to catch up to. We are actively working to get the high priority standards, ANOPRs.

As Bryan had indicated, he hopes that it will be soon. I would describe that as being very soon. We are in the process of contacting a variety of organizations and individuals to update the mailing lists so we can send those out. We are in the final stages of those ANOPRs.

The commercial equipment test procedures, which are a high priority, are also very close to being published as final rules. With that, we will be updating the regulatory agenda to indicate what the schedules are.

We try to stick to those, but given how complex the rulemakings are for the levels of review and the attention that is given by various levels within the organization, both staff, mid management, NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 48 1 MR. McCABE: Michael McCabe with the 2 Department of Energy. 3 I can appreciate the comments and the 4 frustration. The staff throughout the department 5 shares that. We use this process and the regulatory 6 agenda to provide the schedule as it exists. 7 We are behind schedule. We have missed 8 legislativedeadlines formanyof theproducts. Those 9 we will neverbe able to catchup to. We are actively 10 working to get the high priority standards, ANOPRs. 11 As Bryan had indicated, he hopes that it 12 will be soon. I would describe that as being very 13 soon. We are in the process of contacting a variety 14 oforganizationsandindividualstoupdatethemailing 15 lists so we can send those out. We are in the final 16 stages of those ANOPRs. 17 The commercial equipment testprocedures, 18 which are a high priority, are also very close to 19 beingpublishedas final rules. Withthat, we will be 20 updating the regulatory agenda to indicate what the 21 schedules are. 22 We try to stick to those, but given how 23 complex the rulemakings are for the levels of review 24 and the attention that is given by various levels 25 within the organization, both staff, mid management,

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senior management, that we have had many delays, which are unacceptable. And I can appreciate yours and other organizations' frustrations.

And the frustrations come from many different reasons, from those who are in the community who are promoting, pushing for, such as your community, looking, arguing the energy savings loss that accommodates, goes along with those delays. I can appreciate that.

Looking at the manufacturing community, it affects them as well because they are making plans for product, product investment in engineering and capital equipment. And so it has negative effects on them as far as the delays.

We're not proud of them. My staff is working to try to overcome that and to meet the schedules. And my apologies. We are going to continue to focus our efforts and try to meet these schedules. Schedules that we published are ones at the time that we publish and that we believe are reasonable and can be achieved.

MS. KENNEDY: I appreciate that answer. There will be a forward-looking schedule set out at the time the ANOPR comes out about when there will be a proposed rule and when there will be a final rule. NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 49 1 seniormanagement, thatwe havehadmanydelays, which 2 are unacceptable. And I can appreciate yours and 3 other organizations' frustrations. 4 And the frustrations come from many 5 different reasons, fromthosewho are inthe community 6 who are promoting, pushing for, such as your 7 community, looking, arguing the energy savings loss 8 that accommodates, goes along with those delays. I 9 can appreciate that. 10 Lookingatthemanufacturingcommunity, it 11 affects themas well because theyaremakingplans for 12 product, productinvestment inengineeringandcapital 13 equipment. And so it has negative effects on them as 14 far as the delays. 15 We're not proud of them. My staff is 16 working to try to overcome that and to meet the 17 schedules. And my apologies. We are going to 18 continue to focus our efforts and try to meet these 19 schedules. Schedules that we published are ones at 20 the time that we publish and that we believe are 21 reasonable and can be achieved. 22 MS. KENNEDY: I appreciate that answer. 23 There will be a forward-looking schedule set out at 24 the time the ANOPR comes out about when there will be 25 a proposed rule and when there will be a final rule.

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Is that a fair concept? MR. McCABE: In the next publication of the regulatory agenda, it will be updated to reflect the current thinking at that point in time. And I fully hope that the advanced notice of proposed rulemakings for the three products and the final rules for the four test procedures, commercial test procedures, will have been published by then and in enough time that the regulatory agenda could be updated. It is entirely possible that if the publication of the ANOPR final rule is close to the time that the regulatory agenda is published, that that may not capture that and we will have to find some way to make the public aware of what those schedules are.

MS. KENNEDY: Okay. And I do want to clarify. I think I have made this clear that by participating in the priority-setting process, we are not buying into the concept that it is okay to miss other deadlines or to extend the period by which other deadlines are not met.

FACILITATOR BROOKMAN: Those last two comments were from Kit, NRDC.

Any other cross-cutting issues people wish

NEAL R. GROSS COURT REPORTERSAND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 50 1 Is that a fair concept? 2 MR. McCABE: In the next publication of 3 the regulatory agenda, it will be updated to reflect 4 the current thinking at that point in time. And I 5 fully hope that the advanced notice of proposed 6 rulemakings for thethreeproducts andthe final rules 7 for the four test procedures, commercial test 8 procedures, will have been published by then and in 9 enough time that the regulatory agenda could be 10 updated. 11 It is entirely possible that if the 12 publication of the ANOPR final rule is close to the 13 time that the regulatory agenda is published, that 14 that may not capture that and we will have to find 15 some way to make the public aware of what those 16 schedules are. 17 MS. KENNEDY: Okay. And I do want to 18 clarify. I think I have made this clear that by 19 participating in the priority-settingprocess, we are 20 not buying into the concept that it is okay to miss 21 otherdeadlines orto extendtheperiodbywhichother 22 deadlines are not met. 23 FACILITATOR BROOKMAN: Those last two 24 comments were from Kit, NRDC. 25 Anyothercross-cuttingissuespeoplewish

(202)234-4433 NEALR.GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODEISLANDAVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com51 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 to raise at this point? MR. CALABRESE: This is David Calabrese with AHAM. I have a comment and a --

FACILITATOR BROOKMAN: I am going to ask that everybody speak into that microphone right square into your face, please.

MR. CALABRESE: David Calabrese with AHAM. I have a comment, somewhat of a cross-cutting comment, also a question for legal counsel more specifically on one of the issues.

On the preemption issue, we have been discussing some of the legalities when preemption begins and when coverage begins. We have a more fundamental concern about the department extending and being somewhat reluctant to use its preemption authority in instances where it is clearly authorized and clearly needed.

We will be discussing this more particularly, I imagine, when we get to the product coverage for commercial clothes washers, which was mentioned, clearly a strong case for federal and DOE intervention in this area and also one that is coming, residential clothes washers, one again where DOE has no reason not to extend or to keep its federal preemption of that product. 

### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 51 1 to raise at this point? 2 MR. CALABRESE: This is David Calabrese 3 with AHAM. I have a comment and a 4 FACILITATOR BROOKMAN: I am going to ask 5 that everybody speakinto thatmicrophone right square 6 into your face, please. 7 MR. CALABRESE: DavidCalabresewithAHAM. 8 I have a comment, somewhat of a 9 cross-cutting comment, also a question for legal 10 counsel more specifically on one of the issues. 11 On the preemption issue, we have been 12 discussing some of the legalities when preemption 13 begins and when coverage begins. We have a more 14 fundamental concernabout thedepartmentextendingand 15 being somewhat reluctant to use its preemption 16 authority in instances where it is clearly authorized 17 and clearly needed. 18 We will be discussing this more 19 particularly, I imagine, when we get to the product 20 coverage for commercial clothes washers, which was 21 mentioned, clearly a strong case for federal and DOE 22 interventioninthis area and also one that is coming, 23 residential clothes washers, one again where DOE has 24 no reason not to extend or to keep its federal 25 preemption of that product.

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2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 52 So, again, we think that there is a more fundamental generic issue that needs to be addressed that needs to be strengthened and that the department needs to enhance and maintain the federal preemption that is required by law.

A more specific question -- this may go back to the previous part of our discussion going back to what is in priority-setting. It is in regards to -- and we may want to discuss it when we get to this -- the petition that was mentioned for refrigerators.

I guess my question for legal counsel and for Mike perhaps is its status within this priority-setting process. I understand we will be talking about this today, but this, of course, is a legal formal petition.

As far as written responses, as far as how is the department is going to proceed on that, does this priority-setting meeting suffice to be the hearing, the so-called due process requirement under law for that petition or will there be a separate process whereby stakeholders and interested parties will be afforded the opportunity to respond and provide?

(202) 234-4433 FACILITATOR BROOKMAN: Francine Pinto?

MS. PINTO: Francine Pinto.



### NEAP R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 52 1 So, again, we think that there is a more 2 fundamental generic issue that needs to be addressed 3 that needs to be strengthened and that the department 4 needs to enhance and maintain the federal preemption 5 that is required by law. 6 A more specific question

-- this may go 7 backto thepreviouspart of ourdiscussiongoingback 8 to what is in priority-setting. It is in regards to 9 and we may want to discuss it when we get to this 10 the petitionthat was mentioned for refrigerators. 11 I guess my question for legal counsel and 12 for Mike perhaps is its status within this 13 priority-setting process. I understand we will be 14 talking about this today, but this, of course, is a 15 legal formal petition. 16 As far aswrittenresponses, as far ashow 17 is the department is going to proceed on that, does 18 this priority-setting meeting suffice to be the 19 hearing, the so-called due process requirement under 20 law for that petition or will there be a separate 21 process whereby stakeholders and interested parties 22 will be afforded the opportunity to respond and 23 provide? 24 25

(202)234-4433 FACILITATOR BROOKMAN: Francine Pinto? MS. PINTO: Francine Pinto. NEALR. GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODEISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com1

2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 53 My recollection of the statute is there is no provision for a hearing. We do have to responds to your petition.

MR. CALABRESE: It's not my petition. (Laughter.) MS. PINTO: No petitions. MR. CALABRESE: Well, we are proposing a petition. MS. PINTO: Petition for refrigerators. We do have to respond to it, but there is not a provision for a hearing.

FACILITATOR BROOKMAN: I think we will be discussing this in a little more detail as we go along. MS. PINTO: There is criteria set in the statute that the department has to consider, and we have to respond to that.

MR. CALABRESE: Yes, under your specific specifications. David Calabrese with AHAM. Under basic constitutional law or other provisions, there is a requirement for due process for a petition or something in which there is going to be a new rule or a notice, et cetera, that I am curious as to how that will be addressed in regards to a petition that could lead to a formal rulemaking. 

### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 53 1 My recollectionofthe statuteis thereis 2 noprovision for a hearing. We dohave to responds to 3 your petition. 4 MR. CALABRESE: It's not my petition. 5 (Laughter.) 6 MS. PINTO: No petitions. 7 MR. CALABRESE: Well, we are proposing a 8 petition. 9 MS. PINTO: Petition for refrigerators. lOWe do have to respond to it, but there is not a 11 provision for a hearing. 12 FACILITATOR BROOKMAN: I think we will be 13 discussing this in a little more detail as we go 14 along. 15 MS. PINTO: There is criteria set in the 16 statute that the department has to consider, and we 17 have to respond to that. 18 MR. CALABRESE: Yes, under your specific 19 specifications. David Calabrese with AHAM. Under 20 basicconstitutional laworotherprovisions, thereis 21 a requirement for due process for a petition or 22 something in which there is going to be a new rule or 23 a notice, et cetera, that I am curious as to how that 24 will be addressed in regards to a petition that could 25 lead to a formal rulemaking.

(202)234-4433 NEALR.GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODEISLANDAVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com54 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Counsel. MR. DePRIEST: Tom DePriest, General

We obviously wouldn't undertake a standards rulemaking without complying with the process rule, the Administrative Procedures Act, notice and comment, et cetera. We don't just get a petition, "Oh, my God. That's a great idea. The standard is now doubled." No, it doesn't work that way. MS. PINTO: This is Francine Pinto.

Petition, our acting on the petition, is different than the rulemaking process. We do all of the usual stuff for the rulemaking process.

MR. CALABRESE: Thank you. FACILITATOR BROOKMAN: This gentleman. Your name? MR. MISURIELLO: Harry Misuriello, Alliance to Save Energy.

Just to follow up on some of the cross-cutting comments regarding the regulatory agenda and the schedule for the standards, we recommend that in the future, to better prepare the public for the priority-setting process, to include the following information on the priority-setting data sheets that come out.

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 54 1 MR. DePRIEST: Tom DePriestt General 2 Counsel. 3 We obviously wouldntt undertake a 4 standards rulemaking without complying with the 5 process rule t the Administrative Procedures Actt 6 notice and commentt et cetera. We dontt just get a 7 petitiont "Oh t my God. Thatts a great idea. The 8 standard is now doubled." NOt it doesntt work that 9 way. 10 MS. PINTO: This is Francine Pinto. 11 Petitiont our acting on the petitiont is 12 different than the rulemaking process. We do all of 13 the usual stuff for the rulemaking process. 14 MR. CALABRESE: Thank you. 15 FACILITATOR BROOKMAN: This gentleman. 16 Your name? 17 MR. MISURIELLO: Harry Misuriellot 18 Alliance to Save Energy. 19 Just to follow up on some of the 20 cross-cuttingcommentsregardingtheregulatoryagenda 21 and the schedule for the standardst we recommend that 22 in the futuret to better prepare the public for the 23 priority-setting process t to include the following 24 information on the priority-setting data sheets that 25 come out.

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1 It should include the legislative 2 enactment date; the congressionally mandated due date; 3 and dates, anticipated dates, for the ANOPR, the NOPR, 4 and the final rule. 5 We feel that including this information on 6 the data sheets provides more intelligent feedback to 7 the department about the priorities in the first 8 place. 9 It is very difficult to go back over the 10 76 agenda items in this rulemaking, in this priority 11 setting, and bring this information out. I think it 12 was readily available to the department and they 13 should include that in the future. 14 Thank you. 15 FACILITATOR BROOKMAN: Thank you. 16 Any cross-cutting issues? Actually, I saw 17 your hand first. 18 MR. DELASKI: Yes, please. Just to follow 19 up on Kit's earlier point and Michael's response, I 20 share the frustration with the lack of progress 21 towards getting the ANOPR published. I am glad to i 22 ng out very soon.

hear they are com 23 If they were to come out tomorrow, it 24 would have taken about three years from the time they 25 became high priority for the department. Under the

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 55 1 It should include the legislative 2 enactmentdatei thecongressionallymandatedduedatei 3 anddates, anticipateddates, fortheANOPR, theNOPR, 4 and the final rule. 5 We feel that includingthisinformationon 6 the data sheets provides more intelligent feedback to 7 the department about the priorities in the first 8 place. 9 It is very difficult to go back over the 10 76 agenda items in this rulemaking, in this priority 11 setting, and bring this information out. I think it 12 was readily available to the department and they 13 should include that in the future. 14 Thank you. 15 FACILITATOR BROOKMAN: Thank you. 16 Anycross-cuttingissues? Actually, I saw 17 your hand first. 18 MR. DELASKI: Yes, please. Just to follow 19 up on Kit's earlier point and Michael's response, I 20 share the frustration with the lack of progress 21 towards getting the ANOPR published. I am glad to 22 hear they are coming out very soon. 23 If they were to come out tomorrow, it 24 would have taken about three years from the time they 25 became high priority for the department.

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department's procedures, publishing in the Code of Federal Regulations and developing the process rule, it is supposed to take about 18 months.

After the process rule was published in '96, the department issued several rules subsequently and was able to stick to the schedule, which under the procedures is envisioned to take about three years.

So I appreciate the hard work that the staff is doing to catch up on that schedule and the consultants who support you. And I wish you all due speed in being able to make up that lost time.

FACILITATOR BROOKMAN: Steve Nadel? MR. NADEL: Okay. I had two things I wanted to say in terms of cross-cutting issues. One that seems appropriate now is we have a very large group of products that are high priority. These range from things that are receiving extensive attention at the Secretary's office, that are under very active review. We keep talking about the three major rulemakings. There are other things that some people probably haven't even heard of before, some of these new vertical air conditioner products.

There are some things. The ASHRAE products have been high priorities for a number of

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 56 1 department's procedures, publishing in the Code of 2 Federal Regulations and developing the process rule, 3 it is supposed to take about 18 months. 4 After the process rule was published in 5 '96, the department issued several rules subsequently 6 andwas able to stickto the schedule, whichunder the 7 procedures is envisioned to take about three years. 8 So I appreciate the hard work that the 9 staff is doing to catch up on that schedule and the 10 consultants who support you. And I wish you all due 11 speed in being able to make up that lost time. 12 FACILITATOR BROOKMAN: Steve Nadel? 13 MR. NADEL: Okay. I had two things I 14 wanted to say in terms of cross-cutting issues. One 15 that seems appropriate now is we have a very large 16 group ofproducts that arehighpriority. These range 17 from things that are receiving extensive attention at 18 the Secretary's office, that are under very active 19 review. 20 We keep talking about the three major 21 rulemakings. There are other things that some people 22 probably haven't even heard of before, some of these 23 new vertical air conditioner products. 24 There are some things. The ASHRAE 25 products have been high priorities for a number of

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years. And little, if any, visible work has taken place. We have a medium priority category, which is, by and large, not very used. I am wondering whether it is appropriate to revise the categories a bit to make clearer to everybody, both outside and inside the department, about what is going to get done. My thinking is we maybe need a very high priority category, which appears to be the three rules that are getting extensive attention at the Secretary's office. There would then be a high priority category, which is moving actively in the current year. Then there would be a medium priority category that might be more of the things, yeah, we are trying to do, but as time allows and we can't promise. We have all of these lumped together in high, and it is very difficult for us or, as Mike said, gee, these are priorities for the whole department. I imagine it is difficult for the rest of the department to say, "Okay. You have these 18 things," whatever the number is. "Which are your real priorities?" 25 11 So I was wondering if the department had

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 57 1 years. And little, if any, visible work has taken 2 place. 3 We have a mediumprioritycategory, which 4 is, by and large, not very used. I am wondering 5 whether it is appropriate to revise the categories a 6 bit to make clearer to everybody, both outside and 7 inside the department, about what is going to get 8 done. 9 My thinking is we maybe need a very high 10 prioritycategory, whichappears tobe thethree rules 11 that are getting extensive attention at the 12 Secretary's office. There would then be a high 13 priority category, which is moving actively in the 14 current year. Then there would be a medium priority 15 category that might be more of the things, yeah, we 16 are trying to do, but as time allows and we can't 17 promise. 18 We have all of these lumped together in 19 high, and it is very difficult for us or, as Mike 20 said, gee, these are priorities for the whole 21 department. I imagine it is difficult for the rest of 22 the department to say, "Okay. You have these 18 23 things," whatever thenumber is. "Whichareyourreal 24 priorities?" 25 So I was wondering if the department had

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thought about this and will consider this. I would be interested in other comments as well where this would be useful across all of the products to help everybody focus on, "Yes, this is really happening," "This may be happening," "Well, we hope this happens."

MR. McCABE: This is Michael McCabe. We would encourage and entertain comments from others on that point. The staff, their activities range and differ depending upon the product that is being addressed, the three products that are the ANOPRs. We certainly have staff, both within energy efficiency and renewable energy, general counsel, and policy, who are actively working on that. For some of the other products, it is the energy efficiency and renewable energy staff that is working very closely with representatives of industry as well as the organizations such as ASHRAE to resolve some of the issues in order to be able to go into a rulemaking phase, the published documents.

So there is very active work that is happening throughout the department at one level or another on all of them, but it differs by the type of where the product is in the rulemaking process, whether or not an ANOPR is about to be published or a NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 58 1 thought about this andwill considerthis. I wouldbe 2 interested in other comments as well where this would 3 beuseful across all of theproducts tohelpeverybody 4 focus on, "Yes, this is really happening," "This may 5 be happening," "Well, we hope this happens." 6 MR. McCABE: This is Michael McCabe. 7 We would encourage and entertaincomments 8 from others on that point. The staff, their 9 activitiesrange anddifferdependingupontheproduct 10 that is being addressed, the three products that are 11 the ANOPRs. 12 We certainly have staff, both within 13 energy efficiency and renewable energy, general 14 counsel, andpolicy, who are activelyworkingonthat. 15 For some of the other products, it is the energy 16 efficiency and renewable energy staff that is working 17 very closelywith representatives of industry as well 18 as the organizations suchasASHRAE to resolve some of 19 the issues inorder tobe able to go into a rulemaking 20 phase, the published documents. 21 So there is very active work that is 22 happening throughout the department at one level or 23 another on all of them, but it differs by the type of 24 where the product is in the rulemaking process, 25 whether or not anANOPR is about to be published or a

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final rule or just resolve issues that exist within an ASHRAE standard.

A comment in your comments I would appreciate as to whether or not you think that splitting the high priorities into different cohorts, very high, medium high, low high, whether or not that may affect and delay and cause some delays on the low high end that would otherwise not occur.

MR. CRAWFORD: Jim Crawford, Trane Company. At the risk of agreeing with Steve, --

(Laughter.) MR. CRAWFORD : -- I am very sympathetic to the point that Steve is making because if the priorities don't really tell us what is the priority in the sense of some concept of the evolving timetable, then they don't serve the constituencies outside the department at all well, no matter which side of the table you are on.

FACILITATOR BROOKMAN: Thank you. Are there other comments that are related to cross-cutting-related issues? These are process comments so far. Are there other cross-cutting issues that people wish to raise? Please?

We have only had one area of agreement so

NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 59 1 final rule orjust resolve issues that exist withinan 2 ASHRAE standard. 3 A comment in your comments I would 4 appreciate as to whether or not you think that 5 splittingthe highpriorities into different cohorts, 6 very high, mediumhigh, lowhigh, whether or not that 7 may affect and delay and cause some delays on the low 8 high end that would otherwise not occur. 9 MR. CRAWFORD: Jim Crawford, Trane 10 Company. 11 At the risk of agreeing with Steve,

-- 12 (Laughter.) 13 MR. CRAWFORD: - - I amverysympathetic to 14 the point that Steve is making because if the 15 priorities don't really tell us what is the priority 16 in the sense of some concept of the evolving 17 timetable, then they don't serve the constituencies 18 outside the department at all well, no matter which 19 side of the table you are on. 20 FACILITATOR BROOKMAN: Thank you. 21 Are there other comments that are related 22 to cross-cutting-related issues? These are process 23 comments so far. Are there othercross-cuttingissues 24 that people wish to raise? Please? 25

(202)234-4433 We have only had one area of agreement so NEALR.GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODEISLANDAVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com60 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 far. MR. MULLIN: Jim Mullin, Lennox. I will

compose the second thing.

I wanted to make sure something doesn't get lost in this conversation. It is good to talk about priorities, but I think it is mostly in the focus of rulemakings. There is a real issue that if the test procedures are not up to date, the rulemakings may be meaningless.

So I think, however it is done, the real time focus needs to be on getting the test procedures done so that we have good rulemakings at the end.

FACILITATOR BROOKMAN: Thank you. Other cross-cutting issues at this point? MR. GRAY: This is Ed Gray from NEMA. I don't know that this is cross-cutting or not, but I think there was on page 12 of the presentation a product inadvertently left off not in the coverage product, process at the bottom.

I think the latest edition of the energy bill had the compact fluorescent lamps in there as a product to be considered as a possibly covered product for the future.

(202) 234-4433 MR. NADEL: This is Steve Nadel.

Yes. H.R. 6 as passed by the House and

NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 60 1 far. 2 MR. MULLIN: Jim Mullin, Lennox. I will 3 compose the second thing. 4 I wanted to make sure something doesn't 5 get lost in this conversation. It is good to talk 6 about priorities, but I think it is mostly in the 7 focus of rulemakings. There is a real issue that if 8 the test procedures are not up to date, the 9 rulemakings may be meaningless. 10 So I think, however it is done, the real 11 time focus needs to be on getting the test procedures 12 done so that we have good rulemakings at the end. 13 FACILITATOR BROOKMAN: Thank you. 14 Other cross-cutting issues at thispoint? 15 MR. GRAY: This is Ed Gray from NEMA. 16 I don'tknowthatthis iscross-cuttingor 1 7 not, but I think there was on page 12 of the 18 presentation a product inadvertently left off not in 19 the coverage product, process at the bottom. 20 I think the latest edition of the energy 21 bill had the compact fluorescent lamps in there as a 22 product tobe consideredas a possiblycoveredproduct 23 for the future. 24 25

(202)234-4433 MR. NADEL: This is Steve Nadel. Yes. H.R. 6 as passed by the House and NEALR.GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com1

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the freer version as passed by the Senate both include specific standards for CFL lamps.

FACILITATOR BROOKMAN: Yes, Steve Nadel? MR. NADEL : Since we seem to have finished the other issues, I wanted to get to Mike's question about as a cross-cutting issue, are there any factors, comments on page 6?

FACILITATOR BROOKMAN: Thank you for referring to the page.

MR. NADEL: In light of the earlier conversation, I believe that a key part of considering potential energy savings is factoring in potential lost energy savings if state standards are and the department's opinion would be preempted for, I will say, a minimum of six years and a maximum of probably at least twice that. So that should be considered in setting energy, estimating energy savings for coverage and I think will affect, very much affect, our opinion about the relative priority of these products.

FACILITATOR BROOKMAN: Thank you. Yes, Don? MR. BRUNDAGE: Don Brundage, Southern Company. This is a clarifying question asked to Mr. Nadel. Isn't it somewhat speculative on what state NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 61 1 the freerversionaspassedbythe Senatebothinclude 2 specific standards for CFL lamps. 3 FACILITATOR BROOKMAN: Yes, Steve Nadel? 4 MR. NADEL: Sincewe seemtohave finished 5 the other issues, I wanted to get to Mike's question 6 about as a cross -cut ting issue, are there any factors, 7 comments on page 6? 8 FACILITATOR BROOKMAN: Thank you for 9 referring to the page. 10 MR. NADEL: In light of the earlier 11 conversation, I believe that a keypartof considering 12 potential energy savings is factoring in potential 13 lost energy savings if state standards are and the 14 department's opinion would be preempted for, I will 15 say, a minimum of sixyears and a maximum of probably 16 at least twice that. So that shouldbe considered in 17 settingenergy, estimatingenergysavingsforcoverage 18 and I thinkwill affect, verymuchaffect, ouropinion 19 about the relative priority of these products. 20 FACILITATOR BROOKMAN: Thank you. 21 Yes, Don? 22 MR. BRUNDAGE: Don Brundage, Southern 23 Company. 24 This isa clarifyingquestionaskedtoMr. 25 Nadel.

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standards would be or which states would adopt them? Wouldn't that be difficult for the department to estimate the lost energy savings?

MR. NADEL: Steve Nadel responding. I agree for products that there has been no standard state activity, it would be very difficult. However, for many of these products, there are actually state standards already enacted being enforced today and so forth. So for those products, it is much easier to know what the states have actually enacted.

What those are saving also makes some impact because as you have more state standards, often manufacturers say it's easier just to meet this in other states as well. Because we know the standards from which states, it is much easier to estimate those things. FACILITATOR BROOKMAN: I think we are starting to bridge towards the limits of this workshop. So if you have some comments, let's make them brief. Steve, do you want to weigh in here, please?

(202) 234-4433 MR. ROSENSTOCK : Steve Rosenstock, EEI.

Yes. Just for the record, out of like 15



### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 62 1 standards would be or which states would adopt them? 2 Wouldn't that be difficult for the department to 3 estimate the lost energy savings? 4 MR. NADEL: Steve Nadel responding. 5 I agree for products that there has been 6 no standard state activity, it would be very 7 difficult. However, formanyof theseproducts, there 8 are actually state standards already enacted being 9 enforced today and so forth. So for those products, 10 it is much easier to know what the states have 11 actually enacted. 12 What those are saving also makes some 13 impactbecause asyouhavemore state standards, often 14 manufacturers say it's easier just to meet this in 15 other states as well. Because we know the standards 16 fromwhich states, it ismucheasierto estimate those 17 things. 18 FACILITATOR BROOKMAN: I think we are 19 starting to bridge towards the limits of this 20 workshop. 21 them brief. 22 23 please? 24 25

(202)234-4433 So if you have some comments, let's make

Steve, do you want to weigh in here,

MR. ROSENSTOCK: Steve Rosenstock, EEl. Yes. Just for the record, out of like 15 NEALR. GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODEISLANDAVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com63 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 or 16 states that were considering their own

standards, only 3 have done so to date: Maryland, Connecticut, and California. And of those states, as far as I know, centers are in effect in the State of California. It started last year.

Thank you. FACILITATOR BROOKMAN: Thank you. Additional cross-cutting issues that can easily be raised before we go toward the product list and also these factors that are considered on page 6?

(No response.) FACILITATOR BROOKMAN: No? Not at this point? We are in kind of a logical break point. It is 10:25. I am going to suggest we take a break right now. Before you go anywhere, please make certain you give a business card to Brenda so she can compile the attendee list and check to make sure so that we know you are here.

The small cafeteria which is one floor below us is being renovated, which is what that noise was all about you were hearing. There is a coffee kiosk at the bottom of the escalators, which is going back toward the lobby. Straight down the escalator, you will see a kiosk there for coffee. The main cafeteria is also open, which is a little bit of a

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 63 1 or 16 states that were considering their own 2 standards/ only 3 have done so to date: Maryland/ 3 Connecticut/ and California. And of those states/ as 4 far as I know/ centers are in effect in the State of 5 California. It started last year. 6 Thank you. 7 FACILITATOR BROOKMAN: Thank you. 8 Additional cross-cutting issues that can 9 easilybe raised before we go toward the product list 10 and also these factors that are considered onpage 6? 11 (No respons.e.) 12 FACILITATOR BROOKMAN: No? Not at this 13 point? We are in kind of a logical break point. It 14 is 10:25. I am going to suggest we take a breakright 15 now. Before you go anywhere/ please make certainyou 16 give a business card to Brenda so she can compile the 17 attendee list and check to make sure so that we know 18 you are here. 19 The small cafeteria which is one floor 20 belowus is being renovated/ which is what that noise 21 was all about you were hearing. There is a coffee 22 kiosk at the bottom of the escalators/ which is going 23 back toward the lobby. Straight down the escalator/ 24 you will see a kiosk there for coffee. The main 25 cafeteria is also open/ which is a little bit of a

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hike seeing as how we are going to start back at 10:40. At 10:40, we will return to action here. Thanks for a good start on the day. We will resume at 10:40. (Whereupon, the foregoing matter went off

the record at 10:23 a.m. and went back on the record at 10:41 a.m.) FACILITATOR BROOKMAN: Here is where I think we are. We have had a discussion on a variety of cross-cutting issues. We have had a good presentation on the department's perspective and their overview. I wanted to see if we could move or any final cross-cutting issues before we start considering the actual product categories, the high, medium, and low priority level categories as we centered our discussion on those issues.

Other final cross-cutting issues before we commence with considering the high priority items and the other priority items?

(No response.) FACILITATOR BROOKMAN: Okay. I see none. Then shall we just start with that? Who wants to comment? You can see on page 14 of your handout the

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 64 1 hike seeing as how we are going to start back at 2 10:40. 3 At 10:40, we will return to action here. 4 Thanks for a good start on the day. We will resume at 5 10:40. 6 (Whereupon, the foregoing matter went off 7 the record at 10:23 a.m. and went back on 8 the record at 10:41 a.m.) 9 FACILITATOR BROOKMAN: Here is where I 10 think we are. We have had a discussion on a variety 11 of cross-cutting issues. We have had a good 12 presentationonthedepartment'sperspectiveandtheir 13 overview. 14 I wanted to see if we could move or any 15 final cross-cuttingissuesbeforewe startconsidering 16 the actual product categories, the high, medium, and 17 low priority level categories as we centered our 18 discussion on those issues. 19 Otherfinal cross-cuttingissuesbeforewe 20 commence with considering the highpriorityitems and 21 the other priority items? 22 (No response.) 23 FACILITATOR BROOKMAN: Okay. I see none. 24 Then shall we just start with that? Who wants to 25 comment? You can see on page 14 of your handout the

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final F.Y. '04 versus proposed F.Y. '05 priorities.

The bulk of that first page , that bulk of products, is listed as high priority. Suggestions on changes to the high priority list, comments on what's there? Charlie Stephens?

MR. STEPHENS: Charlie Stephens, Oregon Department of Energy.

I am sympathetic to a comment that was made just before we broke there that the test procedures are fairly important before one launches off into rulemakings or just completes them. Is there some chance we could look at test procedures first so that then our comments on the standards might be better informed?

FACILITATOR BROOKMAN: Does the department have a perspective on this?

MR. McCABE: Michael McCabe. The process improvement rule we have committed to completing the test procedures rulemakings before we complete the standards rulemaking. Memory does fail me at times, but I think we have committed to completing the rulemaking before we publish the proposed rule. We have to complete the test procedure rulemaking before we publish the proposed rule on standards.

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 65 1 final F.Y. '04 versus proposed F.Y. '05 priorities. 2 The bulk of that first page, that bulkof 3 products, is listed as highpriority. Suggestions on 4 changes to the highpriority list, comments onwhat's 5 there? Charlie Stephens? 6 MR. STEPHENS: Charlie Stephens, Oregon 7 Department of Energy. 8 I am sympathetic to a comment that was 9 made just before we broke there that the test 10 procedures are fairly important before one launches 11 off intorulemakings orjust completes them. Is there 12 some chance we could look at test procedures first so 13 that then our comments on the standards might be 14 better informed? 15 FACILITATORBROOKMAN: Doesthedepartment 16 have a perspective on this? 17 MR. McCABE: Michael McCabe. 18 The process improvement rule we have 19 committed to completing the test procedures 20 rulemakings before we complete the standards 21 rulemaking. Memorydoes fail me at times, but I think 22 we have committed to completing the rulemaking before 23 we publishthe proposedrule. We have to complete the 24 test procedure rulemaking before we publish the 25 proposed rule on standards.

(202)234-4433 NEALR. GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODEISLANDAVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 66 However, looking at these products, those products on page 14, we have one of which we are working on a test procedure at present. And that is the distribution transformer.

The distribution transformer supplemental notice of proposed rulemaking has completed the final reviews within the department. It is going to be sent to the Federal Register concurrent with the advanced notice of proposed rulemaking for transformers. And the reason for that is so that we can schedule the public meeting and comment period for the two for the convenience of those who are going to be involved with the rulemaking so as to have public meetings scheduled back to back for those two so as not to double the travel burden on folks.

That one test procedure rulemaking, it is ready to go out and be published. As I mentioned, the standards, ANOPRs we expect to publish very soon.

The others, I don't believe there are any test procedure issues that won't be addressed when we publish the final rules for the commercial test procedures, but you can't expect that to be very soon.

MR. MULLIN: Jim Mullin, Lennox. Michael, the test procedure changes for residential cooling equipment affect essentially this NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 66 1 However, looking at theseproducts, those 2 products on page 14, we have one of which we are 3 working on a test procedure at present. And that is 4 the distribution transformer. 5 Thedistributiontransformersupplemental 6 notice of proposedrulemaking has completed the final 7 reviews within the department. It is going tobe sent 8 to the Federal Register concurrent with the advanced 9 notice of proposed rulemaking for transformers. And 10 the reason for that is so that we can schedule the 11 public meeting and comment period for the two for the 12 convenienceof thosewho are goingtobe involvedwith 13 therulemaking soas tohavepublicmeetings scheduled 14 back to back for those two so as not to double the 15 travel burden on folks. 16 That one test procedure rulemaking, it is 17 ready to go out andbepublished. As I mentioned, the 18 standards, ANOPRs we expect to publish very soon. 19 The others, I don't believe there are any 20 test procedure issues that won't be addressedwhenwe 21 publish the final rules for the commercial test 22 procedures, butyoucan't expect that tobevery soon. 23 MR. MULLIN: Jim Mullin, Lennox. 24 Michael, the test procedure changes for 25 residential coolingequipment affect essentiallythis

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three-phase 165,000 Btu per hour. And I believe there are two sets of changes in the mill somewhere. Maybe Karim or Mike remembers. It would really be nice to get those set before we go too far in this thing.

And also, as a reminder, the small high velocity was a test procedure change.

MR. STEPHENS: Charles Stephens again. My question had to do with another earlier comment about very high priority versus high priority and trying to focus our comments on which things we think really need to be done sooner than other things, even though they are all high. So I am trying to understand where we are in all of these things so I can make some comments down the road.

FACILITATOR BROOKMAN: Michael McCabe? MR. McCABE: This is Michael McCabe. The three advanced notices of proposed rulemaking for standards, I would expect that those -- all of the staff work has been completed. Most of the reviews have been completed. So they should be published. The ANOPR should be published very soon.

The final rules on test procedures for commercial products are in a similar situation, very close to being published. And the distribution transformer supplemental notice of proposed rulemaking

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### 1 three-phase 165,000 Btuperhour. And I believethere 2 are two sets of changes in the mill somewhere. Maybe 3 

### Karim or Mike remembers. It would really be nice to 4 get those set before we go too far in this thing. 5 

### And also, as a reminder, the small high 6 velocity was a test procedure change. 7 

### MR. STEPHENS: Charles Stephens again. 8 My questionhadtodowithanotherearlier 9 comment about veryhighpriorityversus highpriority 10 and trying to focus our comments on which things we 11 thinkreallyneedtobe done soonerthanotherthings, 12 even though they are all high. So I am trying to 13 understand where we are in all of these things so I 14 can make some comments down the road. 15 FACILITATOR BROOKMAN: Michael McCabe? 16 MR. McCABE: This is Michael McCabe. 17 The three advanced notices of proposed 18 rulemakingfor standards, I wouldexpect that those

-- 19 all of the staff workhas beencompleted. Most of the 20 

### reviews have been completed. So they should be 21 published. The ANOPR should be published very soon. 22 The final rules on test procedures for 23 commercial products are in a similar situation, very 24 

### close to being published. And the distribution 25 transformersupplementalnoticeofproposedrulemaking

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 upon test procedures is ready to go to the Federal

Register. The one thing that is holding that up is the ANOPR standards.

FACILITATOR BROOKMAN: Steve Rosenstock? MR. ROSENSTOCK: Steve Rosenstock, EEI. Just a clarification on the test procedures. Those are at the NOPR stage or the ANOPR stage, to clarify?

MR. McCABE: Michael McCabe. The distribution transformer is a supplemental notice of proposed rulemaking. We had published a proposed rule a couple of years ago. We posted comments in a number of areas, that we have been working with industry to resolve those.

The four commercial test procedures are the final rules.

MS. PINTO: Michael, this is Francine Pinto. One of those commercial test procedures will be a direct final rule, which will mean that there will be 30 days' comment period available. And then it will become effective in 60 days if we don't get significant adverse comments.

MR. McCABE: Which ones? MS. PINTO: Let me think. I think it was

NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 68 1 upon test procedures is ready to go to the Federal 2 Register. The one thing that is holding that up is 3 the ANOPR standards. 4 FACILITATOR BROOKMAN: Steve Rosenstock? 5 MR. ROSENSTOCK: Steve Rosenstock, EEl. 6 Just a clarification on the test 7 procedures. Those are at the NOPR stage or the ANOPR 8 stage, to clarify? 9 MR. McCABE: Michael McCabe. 10 The distribution transformer is a 11 supplemental notice of proposed rulemaking. We had 12 published a proposed rule a couple of years ago. We 13 posted comments in a number of areas, that we have 14 been working with industry to resolve those. 15 The four commercial test procedures are 16 the final rules. 17 MS. PINTO: Michael, this is Francine 18 Pinto. 19 One of those commercial test procedures 20 will be a direct final rule, which will mean that 21 there will be 30 days' comment period available. And 22 then it will become effective in 60 days if we don't 23 get significant adverse comments. 24 25

(202)234-4433 MR. McCABE: Which ones? MS. PINTO: Let me think. I think it was NEALR. GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com69 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 air conditioners commercial, air conditioners. FACILITATOR BROOKMAN: And you can confirm that if you find otherwise, correct?

MS. PINTO: Correct. FACILITATOR BROOKMAN: Thank you. Steve Nadel? MR. NADEL: Yes. I think this is useful to clarify where some of these products are now and what is likely to take place in 2005 assuming the priorities that DOE is proposing.

You have mentioned many of the products. I was curious if you could update us on the ASHRAE products and on commercial AC&D pumps, the three-phase less than five tons.

MR. McCABE: Michael McCabe. The ASHRAE products and the commercial air conditioner, I have one individual on the staff who is working them as a package. There are some analyses which have been recently completed on those all except for the commercial three-phase.

There are issues that had been identified in the last 12 months or so that needed to be resolved with respect to the ASHRAE standard for ASHRAE 90.1 and some of the referenced test procedures had some inconsistencies overlap, for example, with product NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 69 1 air conditioners commercial, air conditioners. 2 FACILITATORBROOKMAN: Andyoucanconfirm 3 that if you find otherwise, correct? 4 MS. PINTO: Correct. 5 FACILITATOR BROOKMAN: Thank you. 6 Steve Nadel? 7 MR. NADEL: Yes. I think this is useful 8 to clarify where some of these products are now and 9 what is likely to take place in 2005 assuming the 10 priorities that DOE is proposing. 11 You have mentioned many of the products. 12 I was curious if you could update us on the ASHRAE 13 products andoncommercialAC&D pumps, thethree-phase 14 less than five tons. 15 MR. McCABE: Michael McCabe. 16 TheASHRAEproductsandthecommercial air 17 conditioner, I have one individual onthe staffwho is 18 working them as a package. There are some analyses 19 whichhavebeenrecentlycompletedonthose all except 20 for the commercial three-phase. 21 There are issues that hadbeen identified 22 inthe last 12 months or so that neededtobe resolved 23 with respect to the ASHRAE standard for ASHRAE 90.1 24 and some of the referenced test procedures had some 25 inconsistencies overlap, for example, with product

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definition. Those needed to be resolved before we could proceed with the rulemaking phase.

As I understand it, a final resolution has been completed by ARI. And they are working with the ASHRAE subcommittees and that that will be an issue that will be discussed at length at this coming ASHRAE summer meeting.

I believe that there will be a ballot proposed and that we anticipate that those issues will be resolved as far as the ASHRAE process and coverage certainly by the end of this year, by the winter meeting January 2005.

MR. NADEL: Okay. Steve Nadel again. So for those products, you would anticipate to begin the rulemaking phase in calendar year 2005. I assume that starts with an ANOPR.

MR. McCABE: For these products, the commercial products -- I'm going to look to counsel to confirm, but I do not believe the commercial products require an advanced notice of proposed rulemaking, nor does the process rule apply to commercial products.

But we have and we will continue to try to apply the principles of the process rule to all of the products, all of the rulemakings, which we have work underway. So while a final decision has not been made NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 70 1 definition. Those needed to be resolved before we 2 could proceed with the rulemaking phase. 3 As I understandit, a final resolutionhas 4 been completed byARl. And they are working with the 5 ASHRAE subcommittees and that that will be an issue 6 that will be discussedat lengthat this comingASHRAE 7 summer meeting. 8 I believe that there will be a ballot 9 proposedandthatwe anticipatethat those issueswill 10 be resolved as far as the ASHRAE process and coverage 11 certainly by the end of this year, by the winter 12 meeting January 2005. 13 MR. NADEL: Okay. Steve Nadel again. 14 So for those products, you would 15 anticipate to begin the rulemaking phase in calendar 16 year 2005. I assume that starts with an ANOPR. 17 MR. McCABE: For these products, the 18 commercialproducts

- - I'mgoing to lookto counsel to 19 confirm, but I do not believe the commercial products 20 requireanadvancednoticeofproposedrulemaking, nor 21 does the process rule apply to commercial products. 22 Butwe have andwe will continue to tryto 23 applytheprinciples of theprocess rule to all of the 24 products, all of the rulemakings, which we have work 25 underway. Sowhile a final decisionhas not beenmade

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with respect to these commercial products, I would anticipate an ANOPR.

As I mentioned, we do have analysis work that is underway. And this work will continue; the analysis work, that is, in support of the next step of the process, which, again, I anticipate that will be an advanced notice of proposed rulemaking.

MR. NADEL: Okay. And then for the air conditioners less than five tons, I know ASHRAE passed a CR-12 standard. I don't know. Maybe ARI does this. Is ASHRAE planning on taking up an amendment to that? What is the status on that?

MR. McCABE: This is Michael McCabe. Our trigger has been already set by ASHRAE about CR-12. We are proceeding in response to that. If ASHRAE decides to adopt a different level, such as the 13, we will certainly have to take that into consideration. But that is a separate process at this point in time.

FACILITATOR BROOKMAN: Karim? MR. AMRANE: This is Karim Amrane with

ARI. There is nothing yet being triggered at ASHRAE to raise the level to 13. It is an issue that is being discussed within industry right now. I think NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 71 1 with respect to these commercial products, I would 2 anticipate an ANOPR. 3 As I mentioned, we do have analysis work 4 that is underway. And this work will continue; the 5 analysis work, that is, in support of the next stepof 6 the process, which, again, I anticipate that will be 7 an advanced notice of proposed rulemaking. 8 MR. NADEL: Okay. And then for the air 9 conditioners less thanfive tons, I knowASHRAE passed 10 a CR-12 standard. I don't know. MaybeARI does this. 11 Is ASHRAE planning on takingup an amendment to that? 12 What is the status on that? 13 MR. McCABE: This is Michael McCabe. 14 Ourtriggerhasbeenalready setbyASHRAE 15 about CR-12. We are proceeding in response to that. 16 If ASHRAE decides to adopt a different level, such as 17 the 13, we will certainly have to take that into 18 consideration. But that is a separateprocess at this 19 point in time. 20 FACILITATOR BROOKMAN: Karim? 21 MR. AMRANE: This is Karim Amrane with 22 ARI. 23 There is nothing yet being triggered at 24 ASHRAE to raise the level to 13. It is an issue that 25 isbeingdiscussedwithinindustryright now. I think

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there is a consensus to increase to 13. There is no discussion about the effective date that should be in effect. And we are discussing that.

FACILITATOR BROOKMAN: Karim, are you working with ASHRAE on this issue?

MR. AMRANE: We are right now discussing with our members. And the next step would be to look to ASHRAE. FACILITATOR BROOKMAN: Thank you.

Please? I saw this gentleman here. Did you wish to comment?

MR. GRAY: Yes. This is Ed Gray from

NEMA. I would just like to say I think the process that is proposed or underway on distribution transformers, with having some overlap between the test procedure and the standard is appropriate.

We sort of have on distribution transformers what we would characterize in NEMA as the reverse situation of section 323, which Barbara talked about, which is we have a test procedure which might impact standards, as opposed to an existing standard where a new test procedure might impose the standard or the DOE test procedure that is certain statistical assumptions which lead the average product being

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 72 1 there is a consensus to increase to 13. There is no 2 discussion about the effective date that shouldbe in 3 effect. And we are discussing that. 4 FACILITATOR BROOKMAN: Karim, are you 5 working with ASHRAE on this issue? 6 MR. AMRANE: We are right now discussing 7 with our members. And the next step would be to look 8 to ASHRAE. 9 FACILITATOR BROOKMAN: Thank you. 10 Please? I saw this gentleman here. Did 11 you wish to comment? 12 MR. GRAY: Yes. This is Ed Gray from 13 NEMA. 14 I would just like to say I think the 15 process that is proposed or underway on distribution 16 transformers, with having some overlap between the 17 test procedure and the standard is appropriate. 18 We sort of have on distribution 19 transformerswhat we wouldcharacterize inNEMA as the 20 reverse situationof section323, whichBarbaratalked 21 about, which is we have a test procedure which might 22 impact standards, as opposed to an existing standard 23 where a new test procedure might impose the standard 24 or the DOE test procedure that is certain statistical 25 assumptions which lead the average product being

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1 supplied with a standard efficiency that would be 2 above the standard, whatever it turns out to be later. 3 FACILITATOR BROOKMAN: Thank you. 4 MR. BERRINGER : Just to follow up on that 5 - Bryan Berringer. It's part of the process of proof, 6 and we also said that we would have a rule, test 7 procedure, final rule completed before we initiated or 8 published the notice, so that is our intent. 9 MR. DELAQUILA: Dave Delaquila with GAMA. 10 With respect to the residential furnace and boiler 11 standard proposal for high priority in fiscal year 12 2005, we'd like to see that lowered to low priority. 13 We don't see any real energy savings with the 14 incremental improvement that the standard is 15 considering right now, so I'm sure we'll be submitting 16 some written comments on this, as well, but we'd like 17 to see that put down to low priority. 18 FACILITATOR BROOKMAN: So now I think 19 we're commencing -- 20 MR. BERRINGER: May I follow-up? Bryan 21 Berringer. We are in the process - again, we have the 22 technical support documents. We feel they'll be 23 released shortly along with the ANOPR, so I mean, 24 again as Michael discussed earlier, we can then assess 25 that better as far as what the analysis is, and there 

### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 73 1 supplied with a standard efficiency that would be 2 above the standard, whatever it turns out tobe later. 3 FACILITATOR BROOKMAN: Thank you. 4 MR. BERRINGER: Just to follow up on that 5 - BryanBerringer. It'spart of theprocess ofproof, 6 and we also said that we would have a rule, test 7 procedure, final rule completedbeforewe initiatedor 8 published the notice, so that is our intent. 9 MR. DELAQUILA: Dave DelaquilawithGAMA. 10 with respect to the residential furnace and boiler 11 standard proposal for high priority in fiscal year 12 2005, we'd like to see that lowered to low priority. 13 We don't see any real energy savings with the 14 incremental improvement that the standard is 15 consideringright now, so I'msurewe'llbe submitting 16 some written comments on this, as well, but we'd like 17 to see that put down to low priority. 18 FACILITATOR BROOKMAN: So now I think 19 we're commencing

-- 20 MR. BERRINGER: May I follow-up? Bryan 21 Berringer. We are in the process - again, we have the 22 technical support documents. We feel they'll be 23 released shortly along with the ANOPR, so I mean, 24 againasMichael discussedearlier, we canthenassess 25 that better as far as what the analysis is, and there

(202)234-4433 NEALR.GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com74 1 will be a comment period and a public workshop for 2 that, so there will be definitely some analysis for

di i 3 more scuss on. 4 FACILITATOR BROOKMAN: Now I'm going to 5 ask people to refer to page 14, which is the list. 6 We've got a better plan. I was going to suggest that 7 we talk about these high priority products, what is 8 listed there, what individuals in the room would 9 suggest we change, and go in that direction for now. 1 Pl J h 0 o n.

ease, 11 MR. MANDIKE: John Mandike with Carrier 12 Corporation. I just wanted to offer our feedback on 13 the high priority list, and they're lumped into five 14 categories, some of which are on the list that we 15 think are appropriate, some we think are not on the 16 list that should be on the list. 17 The first two related to actually going 18 back to what we refer to as some cleanup for the 19 central air conditioning rule, and that is related to 20 ductless split air conditioners. And I know there 21 will be other forums for us to discuss this, but we 22 just wanted to state for the record that we think 23 Douglas air conditioners should be covered 24 expeditiously under the 13 SEER Rule effective in 25 2006.

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 74 1 will be a comment period and a public workshop for 2 that, so there will be definitely some analysis for 3 more discussion. 4 FACILITATOR BROOKMAN: Now I'm going to 5 ask people to refer to page 14, which is the list. 6 We've got a betterplan. I was going to suggest that 7 we talk about these high priority products, what is 8 listed there, what individuals in the room would 9 suggest we change, and go in that direction for now. 10 Please, John. 11 MR. MANDIKE: John Mandike with Carrier 12 Corporation. I just wanted to offer our feedback on 13 the high priority list, and they're lumped into five 14 categories, some of which are on the list that we 15 think are appropriate, some we think are not on the 16 list that should be on the list. 17 The first two related to actually going 18 back to what we refer to as some cleanup for the 19 central air conditioning rule, and that is related to 20 ductless split air conditioners. And I know there 21 will be other forums for us to discuss this, but we 22 just wanted to state for the record that we think 23 Douglas air conditioners should be covered 24 expeditiously under the 13 SEER Rule effective in 25 2006.

(202)234-4433 NEALR.GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODEISLANDAVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com75 1 We think they were incorrectly categorized 2 as space constrained in the original rule making, and 3 there is nothing space constrained about the product. 4 And we're concerned that a non-harmonized standard 5 could create product switching due to an economic 6 benefit that would be afforded to these units if they 7 weren't covered under 13 SEER. 8 Secondly, related to the central air 9 conditioning rule, is an issue that's neither a 10 standard nor a test procedure, but nonetheless, we 11 take this opportunity to raise it as one that should 12 be a high priority for the Department, and that has to 13 do with mixed coil ratings. 14 We believe the parameters of the current 15 various rating programs may be overstating 16 efficiencies today so, therefore, we urge DOE to 17 require that all manufacturers recertify all rating 18 programs prior to 2006 for the 13 SEER Rule, and 19 longer term require, or perhaps look at requiring a 20 single DOE generated mandatory mixed coil ratings 21 program. 22 The third issue is related to furnaces, 23 and two comments related to that. If the Department 24 proceeds with a rule making on furnaces, we just 25 caution again, as we've stated in the past, that non-

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 75 1 We thinktheywereincorrectlycategorized 2 as space constrained in the original rule making, and 3 there is nothing space constrained about the product. 4 And we're concerned that a non-harmonized standard 5 could create product switching due to an economic 6 benefit that would be afforded to these units if they 7 weren't covered under 13 SEER. 8 Secondly, related to the central air 9 conditioning rule, is an issue that's neither a 10 standard nor a test procedure, but nonetheless, we 11 take this opportunity to raise it as one that should 12 be a highpriorityfor theDepartment, and that has to 13 do with mixed coil ratings. 14 We believe the parameters of the current 15 various rating programs may be overstating 16 efficiencies today so, therefore, we urge DOE to 17 require that all manufacturers recertify all rating 18 programs prior to 2006 for the 13 SEER Rule, and 19 longer term require, or perhaps look at requiring a 20 single DOE generated mandatory mixed coil ratings 21 program. 22 The third issue is related to furnaces, 23 and two comments related to that. If the Department 24 proceeds with a rule making on furnaces, we just 25 caution again, as we've stated in the past, that non-

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condensing minimums above 80 percent can present significant safety and product erosion issues, so again we question whether there is enough energy to be saved by doing a rule making. But beyond that, our main concern today with the furnace rule making is that if the Department does proceed with a furnace rule making, we urge that whatever standard is applied, be also applied to the combination system, which is rated as a low priority today. We urge that that be considered in tandem as a high priority with furnaces. Again, we're concerned about product switching in the marketplace, and benefits that may be afforded to some and not others due to standards making. And issue, fourthly, commercial refrigeration. We urge the Department to cover both remote and reach-in products expeditiously as high priorities. We believe, certainly, that DOE has the authority to regulate both product classes, and would urge you to do so quickly to avoid a patchwork of state-by-state standards, and to capture valuable energy savings for the nation.

Finally, under 20 plus ton package unit, large package commercial air conditioners, we urge this be a high priority for the Department of Energy. NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 76 1 condensing minimums above 80 percent can present 2 significant safety and product erosion issues, so 3 againwe questionwhetherthere is enoughenergytobe 4 saved by doing a rule making. But beyond that, our 5 main concern today with the furnace rule making is 6 that if the Department does proceed with a furnace 7 rule making, we urge that whatever standard is 8 applied, be also applied to the combination system, 9 which is rated as a lowpriority today. We urge that 10 that be considered in tandem as a high priority with 11 furnaces. Again, we're concerned about product 12 switchinginthemarketplace, andbenefits thatmaybe 13 afforded to some and not others due to standards 14 making. 15 And issue, fourthly, commercial 16 refrigeration. We urge the Department to cover both 17 remote and reach-in products expeditiously as high 18 priorities. We believe, certainly, that DOE has the 19 authority to regulate bothproduct classes, andwould 20 urge you to do so quickly to avoid a patchwork of 21 state-by-state standards, and to capture valuable 22 energy savings for the nation. 23 Finally, under 20 plus ton package unit, 24 large package commercial air conditioners, we urge 25 this be a high priority for the Department of Energy.

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We disagree with the Department's conclusion that you do not have the legislative authority to regulate these products, and we believe you do under Sections 6311(g), and 6312(b), gives the Department the authority to regulate these products as national standards. And we urge you to do that as a high priority, again to avoid a patchwork of state standards and to capture valuable energy savings for the nation. Thank you very much.

MR. NADEL: Yes. I believe you're looking for comments at this point on page 14, and then we'll do them page by page. Is that how you'd like to proceed? FACILITATOR BROOKMAN: I thought that would be a sensible way to proceed.

MR. NADEL: Okay. To give a few comments on page 14, in light of my previous comment, I would recommend that three of these be declared very high priority, the commercial AC between 65 and 240 BTUs per hour, particularly for those products we have a change-out of refrigerant happening 2010. And the sooner the manufacturers know what the standard will be, the more time they have to prepare to change our refrigerant and meet efficiency standards, so that one should definitely be a very high priority.

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 77 1 We disagree with the Department's conclusion that you 2 do not have the legislative authority to regulate 3 these products I and we believe you do under Sections 4 6311(g), and 6312(b), gives the Department the 5 authority to regulate these products as national 6 standards. And we urge you to do that as a high 7 priority, again to avoid a patchwork of state 8 standards and to capture valuable energy savings for 9 the nation. Thank you very much. 10 MR. NADEL: Yes. I believeyou're looking 11 for comments at this point onpage 14, and then we'll 12 do them page by page. Is that how youfd like to 13 proceed? 14 FACILITATOR BROOKMAN: I thought that 15 would be a sensible way to proceed. 16 MR. NADEL: Okay. To give a few comments 17 on page 14, in light of my previous comment, I would 18 recommend that three of these be declared very high 19 priority, the commercial AC between 65 and 240 BTUs 20 per hour, particularly for those products we have a 21 change-out of refrigerant happening 2010. And the 22 sooner the manufacturers know what the standard will 23 be, the more time they have to prepare to change our 24 refrigerant andmeet efficiencystandards, so that one 25 should definitely be a very high priority.

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2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 78 Likewise, distribution transformers and residential furnaces and boilers should be very high priorities. These are the upcoming rule makings, according to the DOE analysis, our own analysis, there is very high potential for savings. We disagree with GAMA. They're looking, I believe, at only one of the three main mechanisms by which energy would be saved, go from 78 to 80 or 81 percent. The biggest opportunities are to go to condensing in cold climates and to look at the furnace fan, and all these issues will need to be considered in a full rule making, as opposed to stopping it short. Likewise, transformers. The federal legislation deals with certain products, but there are other products that have significant potential for savings.

The other comment I'd say is the Ashray products appear to be effectively medium priority in the way that they are being processed, and we'd recommend just calling them medium priority. Let's call a spade a spade, rather than going to the solution that more work is being done. We think DOE should proceed with these as they have time and resources because they are not as high priority as some of the other products.

Particularly, I was glad to hear -- it

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### 78 1 Likewise, distribution transformers and 2 residential furnaces and boilers should be very high 3 

### priorities. These are the upcoming rule makings, 4 accordingtotheDOE analysis, ourown analysis, there 5 is veryhighpotential for savings. We disagree with 6 GAMA. They're looking, I believe, at only one of the 7 three mainmechanisms bywhich energywouldbe saved, 8 

### go from 78 to 80 or 81 percent. The biggest 9 opportunitiesare togotocondensingincoldclimates 10 and to look at the furnace fan, and all these issues 11 will need to be considered in a full rule making, as 12 opposedto stoppingit short. Likewise, transformers. 13 The federal legislation deals with certain products, 14 but there are other products that have significant 15 potential for savings. 16 The other comment I'd say is the Ashray 17 products appear to be effectively medium priority in 18 the way that they are being processed, and we'd 19 

### recommend just calling them medium priority. Let's 20 call a spade a spade, rather than going to the 21 solution that more work is being done. We think DOE 22 should proceed with these as they have time and 23 resources because they are not as high priority as 24 some of the other products. 25

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sounds like there might be a way that Ashray would revise its standard, which would allow DOE to revise its standards for the less than 5 ton products, which would save everybody a lot of time and trouble.

MR. AMRANE: I'm Karim Amrane with ARI. I'd like to go on the record supporting DOE's priorities for commercial central AC between 65 and 40,000 BTUs. Central AC is three phased at 65,000 BTUs, to package general equipment, and to single package electrical air conditioning and heat pump. I think that DOE has set it right, and they should be moving forward.

FACILITATOR BROOKMAN: Other comments? I'll just cluster at this point. So let me ask again, other comments that people wish to make regarding these high priority products first listed on page 14. Okay. So I guess we're shifting over then to the next page, 15. MR. NADEL: I guess I 'll kick it off with a couple of suggestions. I think it's okay to maintain the small electric motor determination as a high priority. I believe that's mostly completed, and I believe there is a consensus largely on how to proceed. For the other products, though, I would recommend downgrading these to low priority. All of

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 79 1 sounds like there might be a way that Ashray would 2 revise its standard, which would allow DOE to revise 3 its standards for the less than 5 tonproducts, which 4 would save everybody a lot of time and trouble. 5 MR. AMRANE: I'm Karim Amrane with ARI. 6 I'd like to go on the record supporting DOE's 7 priorities for commercial central AC between 65 and 8 40,000 BTUs. Central AC is three phased at 65,000 9 BTUs, to package general equipment, and to single 10 package electrical air conditioning and heat pump. I 11 think that DOE has set it right, and they should be 12 moving forward. 13 FACILITATOR BROOKMAN: Other comments? 14 I'll just cluster at this point. So let me ask again, 15 other comments that people wish to make regarding 16 these highpriorityproducts first listed onpage 14. 17 Okay. So I guess we're shifting overthen to the next 18 page, 15. 19 MR. NADEL: I guess I'll kick it off with 20 a couple of suggestions. I think it's okay to 21 maintain the small electric motor determination as a 22 highpriority. I believe thatfs mostlycompleted, and 23 I believe there is a consensus largely on how to 24 proceed. For the other products, though, I would 25 recommend downgrading these to low priority. All of

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2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 these are products that states either have standards,

are actively working on standards. And if DOE has limited resources, they should concentrate on those products where they can save energy rather than get in the way of states that are already working on these products. FACILITATOR BROOKMAN: So everything but small electric motors.

MR. NADEL: Correct. MR. McCABE: Michael McCabe, for clarification. Would that include the high intensity discharge lamps?

MR. NADEL: Yes, that would. California has a proposal that they just had a workshop on a couple of weeks ago about that product.

MR. GRAY: Yes, but I think -- this is Ed Gray from NEMA again. I don't know that we're all speaking from the same page and what's going on there. I guess NEMA's perspective, and we have the first two products on this list, HID lamps and small electric motors. Our perspective is exactly the same as the counsel of DOE indicated earlier, that these are federally pre-empted products, and consequently, we should do whatever we need to do at the federal level to determine whether or not these products will have

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 80 1 these are products that states eitherhave standards, 2 are actively working on standards. And if DOE has 3 limited resources, they should concentrate on those 4 productswhere theycan save energyratherthanget in 5 the way of states that are already working on these 6 products. 7 FACILITATOR BROOKMAN: So everything but 8 small electric motors. 9 MR. NADEL: Correct. 10 MR. McCABE: Michael McCabe, for 11 clarification. Would that include the high intensity 12 discharge lamps? 13 MR. NADEL: Yes, that would. California 14 has a proposal that they just had a workshop on a 15 couple of weeks ago about that product. 16 MR. GRAY: Yes, but I think this is Ed 17 Gray from NEMA again. I don't know that we're all 18 speaking from the samepage andwhat's going onthere. 19 I guess NEMA's perspective, andwe have the first two 20 products on this list, HID lamps and small electric 21 motors. Our perspective is exactly the same as the 22 counsel of DOE indicated earlier, that these are 23 federally pre-empted products, and consequently, we 24 should do whatever we need to do at the federal level 25 to determine whether or not these products will have

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areas is we don't need product standards. But certainly through the DOE process we can at the end of the day decide whether NEMA's position prevails or another one does. Certainly we'll have some sort of track record where a determination is made, so we see these as staying in the federal process, and not having a proliferation of state standards which make it hard for manufacturers to manufacture products that are going to be sold nationwide.

MR. AMRANE: We disagree with Steve. We believe that there should be a federal standard for beverage merchandisers, as well as commercial beverage vending machines. We don't really like the lack of state standards that's going on right now. And we all feel that more energy will be saved by the minimum federal standard, so we really strongly urge DOE to maintain those products on high priority.

And we would like also to add to the commercial regime, refrigerators and freezers. We'd also like to add supermarket remote display cases as high priority too.

MR. MISURIELLO: Thank you. Harry Misuriello with the Alliance to Save Energy. We would

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 81 1 standards. 2 NEMA's position on both of these product 3 areas is we don't need product standards. But 4 certainlythrough theDOE processwe can at the endof 5 the day decide whether NEMA's position prevails or 6 another one does. Certainly we'll have some sort of 7 track recordwhere a determination is made, so we see 8 these as staying in the federal process, and not 9 having a proliferation of state standards which make 10 ithardformanufacturers tomanufactureproductsthat 11 are going to be sold nationwide. 12 MR. AMRANE: We disagree with Steve. We 13 believe that there should be a federal standard for 14 beveragemerchandisers, aswell ascommercialbeverage 15 vending machines. We don't really like the lack of 16 state standards that's going onright now. Andwe all 17 feel that more energy will be saved by the minimum 18 federal standard, so we really strongly urge DOE to 19 maintain those products on high priority. 20 And we would like also to add to the 21 commercial regime, refrigerators and freezers. We'd 22 also like to add supermarket remote display cases as 23 high priority too. 24 MR. MISURIELLO: Thank you. Harry 25 MisuriellowiththeAlliance to SaveEnergy. We would

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like to agree with ACEEE about DOE not pre-empting the state products. And as part of the investigation into this, DOE should look at the variants of requirements across the state standards. These are generally taken out of a model piece of legislation. There is verylittle variation in the requirements from state-tostate. They should be very similar, and that should not be a factor that encourages DOE to preclude these products. You're going to miss 10 years worth of energy savings if these products are precluded at this time. Thank you.

FACILITATOR BROOKMAN: I saw Deborah Miller, and then Steve Rosenstock.

MS. MILLER: Yes. I'd hate to get into a debate right now about state standards versus federal standards, but I want to make sure that DOE understands that ARI and our members are against state standards. And the model legislation that was referred to was put together in some cases from programs that were voluntary, not standards, voluntary specifications that have not had due diligence and appropriate analysis. So again, ARI does not support state standards, and believes that if there's enough energy saved from a product, it should become a federal standard where the most energy savings could

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 82 1 like to agreewithACEEE about DOE not pre-emptingthe 2 stateproducts. Andas part of the investigationinto 3 this, DOE should look at the variants of requirements 4 across the state standards. These aregenerallytaken 5 out of a model piece of legislation. There is very 6 little variation in the requirements from state-to7 state. They should be very similar, and that should 8 not be a factor that encourages DOE to preclude these 9 products. You're going to miss 10 years worth of 10 energysavings iftheseproducts areprecludedat this 11 time. Thank you. 12 FACILITATOR BROOKMAN: I saw Deborah 13 Miller, and then Steve Rosenstock. 14 MS. MILLER: Yes. I'd hate to get into a 15 debate right now about state standards versus federal 16 standards, but I want to make sure that DOE 17 understands thatARI andourmembers are against state 18 standards. And the model legislation that was 19 referred to was put together in some cases from 20 programsthatwerevoluntary, not standards, voluntary 21 specifications that have not had due diligence and 22 appropriate analysis. So again, ARI does not support 23 state standards, and believes that if there's enough 24 energy saved from a product, it should become a 25 federal standard where the most energy savings could

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MR. ROSENSTOCK: Steve Rosenstock, Edison Electric Institute. For the record, the state standards in California and Maryland, and Connecticut, there are different products in each state that are covered by the different states. There's also different time tables. Some of the California standards went into effect in 2003. For Maryland, I believe the standards take in 2005, and for Connecticut I believe the start year is 2007.

MS. MILLER: No, 8 and 9. MR. ROSENSTOCK: Oh, 2008 and 9, I'm sorry. I'm sorry. There's significant differences right there in terms of what's going on with the states. FACILITATOR BROOKMAN: John, why don't you follow on, and then we'll go to --

SPEAKER: Setting kind of -- really kind of getting back to again just a time line for the determinations, I'm just kind of curious about if the Department knows what kind of time line they think the - I'll say the determination report - will be estimated finished time. 

### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 83 1 occur. Thank you. 2 FACILITATOR BROOKMAN: Steve, why don't 3 you follow-up. 4 MR. ROSENSTOCK: Steve Rosenstock, Edison 5 Electric Institute. For the record, the state 6 standardsinCaliforniaandMaryland, andConnecticut, 7 there are different products in each state that are 8 covered by the different states. There's also 9 different time tables. Some of the California 10 standards went into effect in 2003. For Maryland, I 11 believe the standards take in 2005, and for 12 Connecticut I believe the start year is 2007. 13 MS. MILLER: No, 8 and 9. 14 MR. ROSENSTOCK: Oh, 2008 and 9 , I'm 15 sorry. I'm sorry. There's significant differences 16 right there in terms of what's going on with the 17 states. 18 FACILITATORBROOKMAN: John, whydon'tyou 19 follow on, and then we'll go to -- 20 SPEAKER: Setting kind of

-- really kind 21 of getting back to again just a time line for the 22 determinations, I'mjust kind of curious about if the 23 Department knows what kindof time line they thinkthe 24 I'll say the determination report 25 estimated finished time.

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www.nealrgross.com84 1 MR. MANDIKE: John Mandike with Carrier -- 2 FACILITATOR BROOKMAN: Let's let the 3 Department respond, John. 4 MR. McCABE: Michael McCabe. The analysis 5 respect to the time line for the two 6 determinations, the analyses in support of both 7 determinations have been completed, and are being 8 reviewed by the Office of Building Technology and the 9 staff at present to prepare a recommendation for 10 senior management. We do not have a schedule for when 11 this will be released, or the determination, the next 12 step. 13 FACILITATOR BROOKMAN: Thank you. 14 MR. MANDIKE: John Mandike with Carrier. 15 I guess we're just in an interesting role here, with 16 industry crying for faster federal standards so the 17 nation can save more energy. But be that as it may, 18 I guess the one response I have is to urge the 19 Department to consider that although this a "model 20 bill", I think it's been already pointed out that 21 there's less things that are model about it than 22 others. But the one thing that is for certain is, 23 even if all these "model standards" were enacted at 24 once today, you can be certain in the future as they 25 go to be changed, they will not all be done on the 

### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 84 1 MR. MANDIKE: JohnMandikewithCarrier 2 FACILITATOR BROOKMAN: Let's let the 3 Department respond, John. 4 MR. McCABE: MichaelMcCabe. The analysis 5 respect to the time line for the two 6 determinations, the analyses in support of both 7 determinations have been completed, and are being 8 reviewedby the Office of Building Technology and the 9 staff at present to prepare a recommendation for 10 seniormanagement. We do not have a schedule forwhen 11 this will be released, or the determination, the next 12 step. 13 FACILITATOR BROOKMAN: Thank you. 14 MR. MANDIKE: John Mandike with Carrier. 15 I guess we're just in an interesting role here, with 16 industry crying for faster federal standards so the 17 nation can save more energy. But be that as it may, 18 I guess the one response I have is to urge the 19 Department to consider that although this a "model 20 bill", I think it's been already pointed out that 21 there's less things that are model about it than 22 others. But the one thing that is for certain is, 23 even if all these "model standards" were enacted at 24 once today, you can be certain in the future as they 25 go to be changed, they will not all be done on the

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same day. And we can almost guarantee that this will result in patchwork of state standards that will not be beneficial to the nation.

MR. DELASKI: I want to urge the Department to move all the products that are listed here for coverage to a low priority, and to cease work on them. I appreciate what you're doing to prepare for possible passage of legislation that would give you authority, and also set pre-emption rules that would allow state standards to go forward. However, given the general counsel's current interpretation that coverage would pre-empt existing state standards, it would be a huge step backward for energy efficiency if the Department were to cover these products, both for the individual states that would be pre-empted, as well as for the nation as a whole.

As Steve pointed out, three states have already enacted standards for some or all of these products. Numerous other states are in the process of considering such standards. It's my opinion that within a very few short years, that we will have de facto national standards for these products, provided the Department does not cover them, because enough states will have acted. And for the Department to cover these products, as Harry pointed out, we're

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 85 1 same day. And we can almost guarantee that this will 2 result in patchwork of state standards that will not 3 be beneficial to the nation. 4 MR. DELASKI: I want to urge the 5 Department to move all the products that are listed 6 here for coverage to a lowpriority, and to ceasework 7 on them. I appreciate what you're doing to prepare 8 for possible passage of legislation that would give 9 you authority, and also set pre-emption rules that 10 would allow state standards to go forward. However, 11 given the general counsel's current interpretation 12 that coveragewouldpre-emptexistingstate standards, 13 itwouldbe a huge stepbackwardfor energyefficiency 14 if the Department were to cover these products, both 15 for the individual states thatwouldbepre-empted, as 16 well as for the nation as a whole. 17 As Steve pointed out, three states have 18 already enacted standards for some or all of these 19 products. Numerous other states are intheprocess of 20 considering such standards. It's my opinion that 21 within a very few short years, that we will have de 22 facto national standards for these products, provided 23 the Department does not cover them, because enough 24 states will have acted. And for the Department to 25 cover these products, as Harry pointed out, we're

(202)234-4433 NEALR. GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODEISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com86 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 looking at least 10 years of lost time. Under the process, it takes the Department two years for a test method, three years to develop the standard, and a three-year lead time, so a minimum of eight years. You've already got your current priorities. When you start covering these products, you're talking about pre-empting existing state energy efficiency standards and replacing them with zero action at the federal level. And that is a step backwards for energy efficiency, and I hope that you will take the recommendation to move these to a low priority. MR. McCABE: This is Michael McCabe. As a point of clarification, does your recommendation include small electric motors, as I understood? ACEEE's recommendation was to maintain it at a high priority, and all the others at low.

MR. DELASKI: Yes, I concur with that. MR. NADEL: Steve Nadel. Just to clarify here, we ultimately advocate national standards. We're not saying we should always have a patchwork of state standards. But we believe that the DOE process is so slow and cumbersome, DOE has much higher priorities elsewhere, particularly with this latest general counsel opinion, it's just going to, in our 

### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 86 1 looking at least 10 years of lost time. 2 Undertheprocess, ittakestheDepartment 3 two years for a test method, three years to develop 4 the standard, anda three-year leadtime, so a minimum 5 of eight years. You've already got your current 6 priorities. When you start covering these products, 7 you'retalkingaboutpre-emptingexistingstateenergy 8 efficiency standards and replacing them with zero 9 action at the federal level. And that is a step 10 backwards for energy efficiency, and I hope that you 11 will take the recommendation to move these to a low 12 priority. 13 MR. McCABE: This is Michael McCabe. As 14 a point of clarification, does your recommendation 15 include small electric motors, as I understood? 16 ACEEE's recommendation was to maintain it at a high 17 priority, and all the others at low. 18 MR. DELASKI: Yes, I concur with that. 19 MR. NADEL: Steve Nadel. Just to clarify 20 here, we ultimately advocate national standards. 21 We're not saying we should always have a patchwork of 22 state standards. But we believe that the DOE process 23 is so slow and cumbersome, DOE has much higher 24 priorities elsewhere, particularly with this latest 25 general counsel opinion, it's just going to, in our

(202)234-4433 NEALR.GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODEISLANDAVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com87 1 opinion, mess things up and distract them from much 2 higher priorities. 3 There are other mechanisms to establish 4 national standards. We in industry have negotiated 5 consensus standards on eight products now, six of 6 which are included in the Federal Energy Bill, two of 7 which are ready to be added to the bill as soon as 8 Congress picks it up. We are having discussions with 9 manufacturers on a number of other products, and are 10 cautiously optimistic we can reach agreement. So we 11 believe that the better route is to yes, let the 12 states proceed, but let these discussions proceed. 13 And we think that that will allow Congress to enact 14 these standards, and DOE should use its resources 15 where they're most needed on those rule makings that 16 will result in very large energy savings, where DOE is 17 already regulating products and it's time to upgrade 18 them. 19 MR. STEINER: David Steiner with Maytag 20 Corporation, which also includes our manufacturer of 21 vending machines, Victory Arco. I would like to say 22 that I support the DOE's prioritization at high for 23 beverage vending machines, as much as I support state 24 standards and states' rights. However, in this 25 category especially where we have a very small number

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 87 1 opinionl mess things up and distract them from much 2 higher priorities. 3 There are other mechanisms to establish 4 national standards. We in industry have negotiated 5 consensus standards on eight products nowI six of 6 which are included in the Federal EnergyBilll two of 7 which are ready to be added to the bill as soon as 8 Congress picks it up. We are having discussions with 9 manufacturers on a number of other products I and are 10 cautiously optimistic we can reach agreement. So we 11 believe that the better route is to yes l let the 12 states proceedl but let these discussions proceed. 13 And we think that that will allow Congress to enact 14 these standardsI and DOE should use its resources 15 where they/re most needed on those rule makings that 16 will result inverylarge energy savings I whereDOE is 17 already regulating products and it/s time to upgrade 18 them. 19 MR. STEINER: David Steiner with Maytag 20 Corporation l which also includes our manufacturer of 21 vending machines I Victory Arco. I would like to say 22 that I support the DOE/s prioritization at high for 23 beverage vendingmachinesl as much as I support state 24 standards and statesl rights. However, in this 25 category especiallywhere we have a very small number

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of manufacturers who are making a very small number of products, it makes so much more sense to have national standards that can apply across the country to the point Mr. Nadel just brought up. Despite the fact that we have state standards set today, and in fact if it is so important that we have these, then we should be working with the DOE to help streamline their process to speed along whatever we need to do meet the statutory requirements mentioned earlier by the NRDC representative, rather than trying to push the state standards, which are only going to Balkanize the marketplace here in the United States, cause compliance costs to increase substantially, and possibly drive out many of the manufacturers in producing these products in the United States.

FACILITATOR BROOKMAN: Additional comments on the products that are listed on 15, and maybe we can also go to 16.

MR. CALABRESE: Well, are we now on to page 16? FACILITATOR BROOKMAN: Yes.

MR. CALABRESE: Well, David Calabrese at AHAM. I do have some comments on the medium priority products, if we're again now moved onto that.

(202) 234-4433 Dishwashers, we support moving that from NEAP R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 88 1 ofmanufacturers who aremaking a very small numberof 2 products, itmakes somuchmore sense tohavenational 3 standards that can apply across the country to the 4 point Mr. Nadel just brought up. Despite the fact 5 that we have state standards set today, and in fact if 6 it is so important that we have these, then we should 7 be working with the DOE to help streamline their 8 process to speedalongwhateverwe need to domeet the 9 statutory requirements mentioned earlier by the NRDC 10 representative, rather than trying to push the state 11 standards, which are only going to Balkanize the 12 marketplace here in the United States, cause 13 compliance costs to increase substantially, and 14 possibly drive out many of the manufacturers in 15 producing these products in the United States. 16 FACILITATORBROOKMAN: Additionalcomments 17 on the products that are listed on 15, and maybe we 18 can also go to 16. 19 MR. CALABRESE: Well, are we now on to 20 page 16? 21 FACILITATOR BROOKMAN: Yes. 22 MR. CALABRESE: Well, David Calabrese at 23 AHAM. I do have some comments on the mediumpriority 24 products, if we're again now moved onto that. 25 Dishwashers, we support moving that from

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a medium priority to a low priority, and there are a number of reasons for that. First of all, as pointed out by Barbara in her introduction, there is a new test method in effect. As she has stated, there needs to be time for that to play out to see the type of data that will be generated by that, so from the Department's own mouth, there needs to be time for all this to play out.

On the other hand, and in addition and as Larry Wethje, my colleague, will describe, there would not be significant energy savings as a result of a rule making. Current voluntary programs, market pull programs as we like to call them, are working, working very effectively. They need more time to operate, and really an issue that was addressed in the DOE document provided for the meeting is that altering consumer's practices, for instance, pre-rinsing of dishes, et cetera, would actually save more energy than another rule making on these products, so I might ask Larry Wethje to comment further on some of those points.

MR. WETHJE: Larry Wethje with AHAM. The revised test procedure did carry along with it a significant reduction in the number of annual usage cycles associated with a typical household for dishwashers, which we feel like would be justification

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 89 1 a medium priority to a low priority, and there are a 2 number of reasons for that. First of all, as pointed 3 out by Barbara in her introduction, there is a new 4 test method ineffect. As shehas stated, thereneeds 5 to be time for that to play out to see the type of 6 data that will be generated by that, so from the 7 Department's ownmouth, thereneeds tobe time for all 8 this to play out. 9 On the other hand, and in addition and as 10 LarryWethje, my colleague, willdescribe, therewould 11 not be significant energy savings as a result of a 12 rule making. Current voluntaryprograms, market pull 13 programs as we like to call them, are working, working 14 veryeffectively. Theyneedmore time to operate, and 15 reallyan issue thatwas addressedintheDOE document 16 provided for the meeting is that altering consumer's 17 practices, for instance, pre-rinsing of dishes, et 18 cetera, would actually save more energy than another 19 rule making on these products, so I might ask Larry 20 wethje to comment further on some of those points. 21 MR. WETHJE: LarryWethje withAHAM. The 22 revised test procedure did carry along with it a 23 significant reduction in the number of annual usage 24 cycles associated with a typical household for 25 dishwashers, whichwe feel likewouldbejustification

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to move it from medium, where it had been residing, to a low priority, just because that provides less annual energy savings to be achieved as a result of the reduced annual cycles.

The Department's analysis only indicates about a half a quad of energy could be saved over a 25-year time period by moving to the Energy Star level, and we feel like those market initiatives are working satisfactorily. The Energy Star market transformation initiatives, there's other voluntary water savings initiatives that are being discussed, and we feel like these things are satisfactory and sufficient to achieve energy savings with dishwashers.

There's no cost benefit analysis that's been provided with the data sheets here on dishwashers to justify keeping this medium priority. And then additionally I would just add that the white goods industry has undergone some significant capital investment requirements as a result of previous rule makings, recent rule makings on refrigerator freezers in 2001, clothes washers which is just going into effect now in 2004, additionally in 2007, so the issue of cumulative regulatory burden will certainly be an issue in this case, as well.

FACILITATOR BROOKMAN: Thank you. Please,

NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 90 1 tomove it frommedium, where ithadbeenresiding, to 2 a lowpriority, justbecausethatprovides less annual 3 energy savings to be achieved as a result of the 4 reduced annual cycles. 5 The Department's analysis only indicates 6 about a half a quad of energy could be saved over a 7 25-year time period by moving to the Energy Star 8 level, and we feel like those market initiatives are 9 working satisfactorily. The Energy Star market 10 transformation initiatives, there's other voluntary 11 water savings initiatives that are being discussed, 12 and we feel like these things are satisfactory and 13 sufficienttoachieveenergysavingswithdishwashers. 14 There's no cost benefit analysis that's 15 beenprovidedwiththe data sheetshereondishwashers 16 to justify keeping this medium priority. And then 17 additionally I would just add that the white goods 18 industry has undergone some significant capital 19 investment requirements as a result of previous rule 20 makings, recent rulemakings on refrigerator freezers 21 in 2001, clothes washers which is just going into 22 effectnow in2004, additionallyin2007, so the issue 23 of cumulative regulatory burden will certainly be an 24 issue in this case, as well. 25

(202)234-4433 FACILITATORBROOKMAN: Thankyou. Please, NEALR.GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com91 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Kit. MS. KENNEDY: I'm sorry. My brain is

moving a little bit slowly. I want to go back to the last topic for a moment, because I have a comment on the pre-emption issues that were raised with the high priority products.

It seems to me, this an area where there is quite a bit of consensus that if we could have swift good national standards, and if the pre-emption issue could be resolved in a different way that what Office of General Counsel suggested this morning, then we'd have a different position on whether it should be high priority or low priority.

In other words, I think for many of these products, and correct me if I'm wrong, Steve, there's consensus on what the standards should be. And we would not -- if the pre-emption issue could be resolved in such a way that there was a mutual understanding that pre-emption would not occur until the regulation became effective, then I think we' d all be in the same place. So I guess I would encourage the industry folks who are interested in this issue, who are interested in having national standards rather than state standards and the Department of Energy to talk with us more on the issue of how you interpret NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 91 

### 1 Kit. 2 MS. KENNEDY: I'm sorry. My brain is 3 

### moving a little bit slowly. I want to go back to the 4 

### last topic for a moment, because I have a comment on 5 

### the pre-emption issues that were raisedwith the high 6 

### priority products. 7 

### It seems to me, this an area where there 8 

### is quite a bit of consensus that if we could have 9 

### swift goodnational standards, and if the pre-emption 10 

### issue could be resolved in a different way that what 11 

### OfficeofGeneral Counsel suggestedthismorning, then 12 

### we'dhave a differentpositiononwhether it shouldbe 13 

### high priority or low priority. 14 

### In otherwords, I think for many of these 15 

### products, and correct me if I'mwrong, Steve, there's 16 

### consensus on what the standards should be. And we 17 

### would not if the pre-emption issue could be 18 resolved in such a way that there was a mutual 19 

### understanding that pre-emption would not occur until 20 theregulationbecameeffective, thenI thinkwe'dall 21 

### be in the same place. So I guess I would encourage 22 the industry folks who are interested in this issue, 23 who are interestedinhavingnational standardsrather 24 than state standards and the Department of Energy to 25 talk with us more on the issue of how you interpret

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Department of Energy has reached a kind of a preliminary interpretation, at least.

I think at least one legal problem with it from our perspective is that that interpretation would allow the Department of Energy to call a product a covered product, and then do nothing for years and years, and decades and decades, and yet state regulation would be pre-empted, which is plainly not what Congress meant. So if we want to kind of move forward on standards for these products where there's no technical disagreement, but simply a disagreement about when pre-emption applies, that's something that perhaps the lawyers in the group could work together on and come up with an interpretation which sort of met everybody's needs. So I guess that's an open invitation. FACILITATOR BROOKMAN: Thank you. I didn't mean to close off additional discussion on 15 as we also consider 16 now.

MR. McCABE: This is Michael McCabe. I would like to ask a follow-up question to Larry Wethje. You had -- your last point was there was "no cost benefit analysis" done by DOE on dishwashers, which is correct. We did not do it in that present

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 92 1 the pre-emptionprovision. And I understand that the 2 Department of Energy has reached a kind of a 3 preliminary interpretation, at least. 4 I thinkat least one legalproblemwithit 5 fromourperspectiveis that that interpretationwould 6 allow the Department of Energy to call a product a 7 covered product, and then do nothing for years and 8 years, and decades and decades, and yet state 9 regulation would be pre-empted, which is plainly not 10 what Congress meant. So if we want to kind of move 11 forward on standards for these products where there's 12 no technical disagreement, but simply a disagreement 13 about whenpre-emption applies, that's something that 14 perhaps the lawyers in the group could work together 15 on and come up with an interpretation which sort of 16 met everybody's needs. So I guess that's an open 17 invitation. 18 FACILITATOR BROOKMAN: Thank you. I 19 didn't mean to close off additional discussion on 15 20 as we also consider 16 now. 21 MR. McCABE: This is Michael McCabe. I 22 would like to ask a follow-up question to Larry 23 Wethje. You had

-- your last point was there was "no 24 cost benefit analysis" done by DOE on dishwashers, 25 which is correct. We did not do it in that present

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value analysis. Is the analysis that we have for other products where we show them at present value, where we take an estimate of what the total cost would be, and subtract that from the total value of the energy savings. Is that the level of detail that you'd like to see?

MR. WETHJE: Well, that's typically one of the -- Larry Wethje with AHAM - one of the parameters you use to assess, so that's what I was referring to. Yes. MR. McCABE: Okay. This is Michael McCabe. I just wanted to see if there was any additional analysis that you're asking for, or if that which we had done, the sort which we had was sufficient. MR. WETHJE: Yes. No, that's what I was referring to.

MR. McCABE: Thank you. FACILITATOR BROOKMAN: Thank you. Steve Nadel. MR. NADEL: Steve Nadel, ACEEE. I guess to comment on dishwashers, we would support keeping these at the medium priority, using the new criteria we recommend, where medium priority are things that DOE does actively work on as time and resources allow.

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 93 1 value analysis. Is the analysis that we have for 2 other products where we show them at present value, 3 where we take anestimate of what the total cost would 4 be, and subtract that from the total value of the 5 energy savings. Is that the level of detail that 6 you'd like to see? 7 MR. WETHJE: Well, that's typicallyoneof 8 the LarryWethje withAHAM

- one of the parameters 9 you use to assess, so that's what I was referring to. 10 Yes. 11 MR. McCABE: Okay. This is Michael 12 McCabe. I just wanted to see if there was any 13 additional analysis thatyou're askingfor, orif that 14 which we had done, the sort which we had was 15 sufficient. 16 MR. WETHJE: Yes. No, that's what I was 17 referring to. 18 MR. McCABE: Thank you. 19 FACILITATOR BROOKMAN: Thank you. Steve 20 Nadel. 21 MR. NADEL: Steve Nadel, ACEEE. I guess 22 to comment on dishwashers, we would support keeping 23 these at the medium priority, using the new criteria 24 we recommend, where medium priority are things that 25 DOE does activelyworkon as time andresources allow.

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FACILITATOR BROOKMAN: Okay. Additional comments on this? Okay. I guess then we're moving on to page 17. That's a class of high priority products test procedures.

(202) 234-4433 MR. DELAQUILA: This is Dave Delaquila. NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 94 

### 1 It's not just kind of a non-deck circle. 2 These products

-- it is from what we see 3 in all our analyses, that it is highly cost effective 4 

### to go to at least the Energy Star level. There are 5 

### I'll call it medium levels of savings. It should be 6 relativelystraightforward. We canfigure outexactly 7 what the best effective date is. You know, it would 8 be after the 2007 clothes washer standard, for 9 example. So we think it's appropriate to continue to 10 work on these products. My understanding is there is 11 an excellent change, Steve, we will be revising the 12 Energy Star level so market share has gotten to be 13 quitehigh, andthe standards canthencome in, andwe 14 can mandate that, and Energy Star will promote on a 15 voluntarybasishigherefficiencylevels. Sowe would 16 support actively working on it as time and resources 17 allow, andthatmeans, inourview, a mediumpriority. 18 

### Although, in DOE's current classification where 19 anything theyworkon is a highpriority, I guess that 20 would mean calling it a high priority. 21 FACILITATOR BROOKMAN: Okay. Additional 22 comments onthis? Okay. I guess thenwe're moving on 23 to page 17. That's a class of highpriorityproducts 24 test procedures. 25

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With respect to the commercial water heaters and the commercial furnaces priority, we support maintaining a high priority, and hope that in the case of commercial furnaces, that the rule is published soon.

MR. AMRANE: Karim Amrane with ARI. With respect to the commercial air conditioners and residential central AC, and residential central for small velocity we also support DOE high priority.

FACILITATOR BROOKMAN: Steve Nadel. MR. NADEL: Steve Nadel. I guess we generally support -- we do support completion of the various commercial test procedures. That are well, well overdue, and need to be published very soon. They actually underscore the EPACT standards that took effect a number of years ago, so it's created difficulties for industry to have a standard without a test procedure.

I have two comments on these. One, you mentioned the five products in the coverage process, making those a high priority. Our recommendation would be if you're not even covering them -- you know, we'd like DOE to work on the test procedure, but as I understand legal counsel, DOE can't work on the test procedure until they're made covered products, and that's an unacceptable price to pay, so if that's NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 95 1 With respect to the commercial water heaters and the 2 commercial furnaces priority, we support maintaining 3 a high priority, and hope that in the case of 4 commercial furnaces, that the rule is published soon. 5 MR. AMRANE: KarimAmrane withARI. With 6 respect to the commercial air conditioners and 7 residential central AC, and residential central for 8 small velocity we also support DOE high priority. 9 FACILITATOR BROOKMAN: Steve Nadel. 10 MR. NADEL: Steve Nadel. I guess we 11 generally support -- we do support completion of the 12 various commercial test procedures. That are well, 13 well overdue, and need to be published very soon. 14 Theyactuallyunderscore theEPACT standardsthat took 15 effect a number of years ago, so it's created 16 difficulties for industry to have a standard without 17 a test procedure. 18 I have two comments on these. One, you 19 mentioned the five products in the coverage process, 20 making those a high priority. Our recommendation 21 wouldbe ifyou're not evencovering them

- - youknow, 22 we'd like DOE to work on the test procedure, but as I 23 understand legal counsel, DOE can't work on the test 24 procedure until they're made covered products, and 25 that's an unacceptable price to pay, so if that's

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DOE's interpretation, unfortunately these should be a low priority.

The other comment we have is with residential air conditioners. My understanding is now a rule making to deal with a couple of relatively small issues, and we're fine for that to proceed. Those issues can be resolved, although some of them may be a little controversial.

More broadly, though, we think DOE should begin a rule making soon to re-look at -- take a fresh look at the residential air conditioner test procedure. The current procedure will be used for the 2006 standard, that's clear, but there's a lot of problems with the current test procedure in terms of how it relates to field performance. John Mandike was talking about how it deals with third-party coils. There are many, many problems with this, where I think it's often being abused and not giving consumers the information that they need. And we'd recommend that DOE start a proceeding to consider a new test procedure that would take effect probably as of a new standard, just like DOE many years ago developed the clothes washer J-1 procedure that didn't take effect until a new standard took effect. I think the J-1 did significantly improve that test procedure, allowed to

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 96 1 

### DOEts interpretationt unfortunately these shouldbe a 2 low priority. 3 

### The other comment we have is with 4 residential airconditioners. Myunderstandingisnow 5 

### a rule making to deal with a couple of relatively 6 

### small issuest and wetre fine for that to proceed. 7 

### Those issues can be resolvedt although some of them 8 

### may be a little controversial. 9 

### More broadlYt thought we thinkDOE should 10 begina rule making soon to re-Iook at -- take a fresh 11 

### look at the residential air conditioner test 12 procedure. The currentprocedurewill beusedfor the 13 2006 standardt that t

### s cleart 

### but therets a lot of 14 problems with the current test procedure in terms of 15 how it relates to fieldperformance. JohnMandikewas 16 talking about how it deals with third-party coils. 17 There aremanyt 

### manyproblemswiththis t 

### where I think 18 itts often being abused and not giving consumers the 19 information that they need. And wetd recommend that 20 DOE start a proceeding to consider a new test 21 procedure that would take effect probably as of a new 22 standardt just like DOE many years ago developed the 23 clothes washer J-l procedure that didntt take effect 24 until a new standardtook effect. I thinkthe J-1 did 25 significantlyimprove that test proceduret allowed to

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consider issues that weren't in the old test procedure. We think it' s time for a fresh look at the air conditioner test procedure. And we'd recommend probably kicking that off with some more informal workshops before you start getting anywhere near to formal numbers or whatever.

I know I've talked with a number of people in industry, and I think there's been some acknowledgement that the current test procedure has problems, and a fresh look could be worthwhile; although, obviously no commitments yet about any particular direction.

MR. AMRANE: Karim Amrane with ARI. I don't fully believe that -- I don't fully agree with Steve when he says there are many, many issues with test procedures, but I do agree with him that there is a need to revisit the test procedure.

FACILITATOR BROOKMAN: So on page 17 still, test procedure comments. These are the high priority products as listed, as proposed by the Department. Larry Wethje.

MR. WETHJE: Larry Wethje with AHAM. Mike, by maybe a note when the -- we had asked for some additional follow-up work to be done on the test cloth for clothes washers, and I notice you're moving

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### consider issues that weren't in the old test 2 

### procedure. We think it's time for a fresh lookat the 3 

### air conditioner test procedure. And we'd recommend 4 probably kicking that off with some more informal 5 

### workshops before you start getting anywhere near to 6 

### formal numbers or whatever. 7 

### I know I'vetalkedwitha numberofpeople 8 

### in industry, and I 

### think there's been some 9 

### acknowledgement that the current test procedure has 10 

### problems, and a fresh look could be worthwhilei 11 

### although, obviously no commitments yet about any 12 

### particular direction. 13 

### MR. AMRANE: Karim Amrane with ARI. I 14 

### don't fully believe that

-- I don't fully agree with 15 

### steve when he says there are many, many issues with 16 

### test procedures, but I do agree withhimthat there is 17 

### a need to revisit the test procedure. 18 

### FACILITATOR BROOKMAN: So on page 17 19 

### still, test procedure comments. These are the high 20 

### priority products as listed, as proposed by the 21 

### Department. Larry Wethje. 22 

### MR. WETHJE: Larry Wethje with AHAM. 23 Mike, by maybe a note when the

-- we had asked for 24 some additional follow-up work to be done on the test 25 cloth for clothes washers, and I notice you're moving

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that from high to low. And I'm just wondering is there any ongoing activity to take a look at an alternative test cloth that., s given us so much problem in the past?MR. BERRINGER: Yes, there is. And I talked to Dick Topping, and maybe at the break or something we can talk to him a little bit more, but that's proceeding. They're looking at some new material they just got in. And they're looking at testing, and then they want to look at reliability. The reason this is low is basically we consider we completed the amendments to the test procedure, so that's low. But we are still doing ongoing work on the test cloth.

FACILITATOR BROOKMAN: Other comments or questions on this grouping, high priority products as proposed by the Department? Well, then let's look at page 18 then. Medium priority products test procedures. MR. BERRINGER: This is Bryan Berringer, DOE. I just wanted to sort of give an update on what the progress has been on the compact refrigerators. There has been two NIST Reports that were done, one in September 2000-2001, recommending improvements, so we'll make those available on our website for that.

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 98 1 that from high to low. And I'm just wondering is 2 there any ongoing activity to take a look at an 3 alternative test cloththat,'s givenus somuchproblem 4 in the past? 5 MR. BERRINGER: Yes, there is. And I 6 talked to Dick Topping, and maybe at the break or 7 something we can talk to him a little bit more, but 8 that's proceeding. They're looking at some new 9 material they just got in. And they're looking at 10 testing, and then they want to look at reliability. 11 The reason this is low is basically we consider we 12 completed the amendments to the test procedure, so 13 that's low. But we are still doing ongoing work on 14 the test cloth. 15 FACILITATOR BROOKMAN: Other comments or 16 questions on this grouping, highpriorityproducts as 17 proposedbythe Department? Well, then let's look at 18 page 18 then. Medium priority products test 19 procedures. 20 MR. BERRINGER: This is Bryan Berringer, 21 DOE. I just wanted to sort of give an update on what 22 the progress has been on the compact refrigerators. 23 Therehas beentwoNISTReports that were done, one in 24 September 2000-2001, recommending improvements, so 25 we'll make those available on our website for that.

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So we just think though, again as Barbara talked about this, if we did make -- implemented changes to these, it would also affect the standard, so that's our main concern with these two. So the question is, should these be something to maintain at medium, or moved to low. It will have potential impact on standards.

For the AC, the ductless, there was a kilometer test was considered. That change would again likely change the measured effect of the ductless air conditioner, so it would impact standards. So those are the main concerns about these two test procedures.

MR. WETHJE: Larry Wethje with AHAM. Bryan, I guess I'm a little surprised to hear you say that the possible changes to the compacts would affect the standard, because we've taken the initiative AHAM has to make some revisions to our AHAM standard, which is referenced by DOE for the performance testing of refrigerator freezers, specifically for compacts. And David Nasser from NIST has participated in those, and agreed with the changes that we've made. And to my knowledge, that doesn't affect the performance or the outcome with respect to its achieving any minimum efficiency standard level. So do you know specifically what you're referring to that NIST might

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 99 1 Sowe just thinkthough, again as Barbara talkedabout 2 this, if we did make

-- implemented changes to these, 3 it would also affect the standard, so that's our main 4 concern with these two. So the question is, should 5 these be something to maintain at medium, or moved to 6 low. It will have potential impact on standards. 7 For the AC, the ductless, there was a 8 kilometer test was considered. That change would 9 again likely change the measured effect of the 10 ductless air conditioner, so it would impact 11 standards. So those are themainconcerns about these 12 two test procedures. 13 MR. WETHJE: Larry Wethje with AHAM. 14 Bryan, I guess I'm a little surprised to hear you say 15 that thepossible changes to the compactswouldaffect 16 the standard, because we've taken the initiativeAHAM 17 has tomake some revisions to ourAHAM standard, which 18 is referenced by DOE for the performance testing of 19 refrigeratorfreezers, specificallyforcompacts. And 20 DavidNasser fromNIST has participated in those, and 21 agreed with the changes that we've made. And to my 22 knowledge, that doesn't affect the performance or the 23 outcome with respect to its achieving any minimum 24 efficiency standard level. So do you know 25 specificallywhat you're referring to that NISTmight

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FACILITATOR BROOKMAN: Do you want to follow-up, Larry?

MR. WETHJE: No. FACILITATOR BROOKMAN: Okay. Other comments on 18, page 18, medium priority products test procedures. Please.

MR. LEWIS: Dave Lewis of Lenox. WE're just a little bit unsure of an item here. It looks as though you're saying that there is the intent of having a test procedure change on a ductless product; and yet, it would seem like that would go in line with Karim's earlier comment about reviewing the test procedures, and Steve's earlier comment as far as reviewing the test procedures on air conditioning equipment in general. In particular, the reason why these need to be coordinated is that they both compete in the same marketplace. And basically, are going out to the same area. It seems like splitting them up and doing them separately would only cause more disruption in the marketplace, rather than helping.

And I guess the other thing, and I

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- - I'll have to do some further investigating 4 into that and get back to you. 5 FACILITATOR BROOKMAN: Do you want to 6 follow-up, Larry? 7 MR. WETHJE: No. 8 FACILITATOR BROOKMAN: Okay. Other 9 comments on 18, page 18, mediumpriorityproducts test 10 procedures. Please. 11 MR. LEWIS: Dave Lewis of Lenox. WE're 12 just a littlebit unsure of an itemhere. It looks as 13 though you're saying that there is the intent of 14 having a test procedure change on a ductless product; 15 andyet, it would seem like that would go in line with 16 Karim's earlier comment about reviewing the test 17 procedures, and Steve's earlier comment as far as 18 reviewing the test procedures on air conditioning 19 equipment in general. In particular, the reason why 20 these need tobe coordinated is that theybothcompete 21 inthe same marketplace. Andbasically, are going out 22 to the same area. It seems like splitting themup and 23 doingthem separatelywouldonlycausemore disruption 24 in the marketplace, rather than helping. 25

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recognize I missed my page 17, so I'm going to throw it in anyway. We do want to underscore the fact that we do need to have the test procedure on the small duct high velocity done as quickly as possible, because that really does resolve the issue on the true space constraint aspect of that equipment. So I guess our opinion is the small duct high velocity solution is something that can come quite quickly with the proper adjustment to the test procedure, and with eliminating further delay.

I guess the earlier comment that John Mandike made from Carrier would be consistent with our opinion, that the ductless product which currently, in our opinion, should be covered at the 13 SEER level, there really isn't any need or couldn't be any adjustment to that test procedure, since that's going into play. The test procedure that's seen on page 18 would be, in my assumption, part of that next cycle that we would be looking at for consistency in the product lines and within the marketplace.

FACILITATOR BROOKMAN: Steve Nadel. MR. NADEL: Yes, Steve Nadel. I just wanted to support Dave in terms of the small diameter high velocity. I know we've been talking to industry, and I think there's a consensus on how to proceed on

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 101 1 recognize I missed my page 17, so I'm going to throw 2 it in anyway. We do want to underscore the fact that 3 we do need to have the test procedure on the small 4 duct high velocity done as quickly as possible, 5 because that reallydoes resolve the issue on the true 6 space constraint aspect of that equipment. So I guess 7 our opinion is the small duct high velocity solution 8 is something that can come quite quickly with the 9 proper adjustment to the test procedure, and with 10 eliminating further delay. 11 I guess the earlier comment that John 12 Mandikemade fromCarrierwouldbe consistentwithour 13 opinion, that theductlessproductwhichcurrently, in 14 our opinion, should be covered at the 13 SEER level, 15 there really isn't any need or couldn't be any 16 adjustment to that test procedure, since that's going 17 into play. The test procedure that's seen on page 18 18 would be, in my assumption, part of that next cycle 19 that we would be looking at for consistency in the 20 product lines and within the marketplace. 21 FACILITATOR BROOKMAN: Steve Nadel. 22 MR. NADEL: Yes, Steve Nadel. I just 23 wanted to support Dave in terms of the small diameter 24 highvelocity. I knowwe'vebeentalking to industry, 25 and I think there's a consensus on how to proceed on

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that test procedure. That's going to be a critical issue for them resolving the standard for those products. There is a difference. They do have higher static pressure, and that needs to be reflected in both the test procedure and the standard. We have a problem with an inappropriate test procedure; therefore, how do you apply a standard to that.

FACILITATOR BROOKMAN: Thank you. Now I'm looking for summary comments on both 17 and 18 before we proceed. Please.

MR. DELAQUILA: Yes. This is Dave Delaquila again. I was waiting to see where commercial - I'm sorry - combination appliances appeared, but it wasn't on the list so I'm going to make the comment now. And I refer to, I guess this is a data sheet that was released. A number of them were released with the earlier publications, but one of the things on there says "recommendations by interested parties", and it mentions a larger manufacturer and energy advocate groups.

One of the things we wanted to encourage DOE to do is contact associations like GAMA, because when we see that, we think you are out soliciting comments on these priorities from others and we would like to be contacted to give our feedback, as well, as NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 102 1 that test procedure. That's going to be a critical 2 issue for them resolving the standard for those 3 products. There is a difference. Theydo have higher 4 static pressure, and that needs to be reflected in 5 both the test procedure and the standard. We have a 6 problem with an inappropriate test procedure; 7 therefore, how do you apply a standard to that. 8 FACILITATORBROOKMAN: Thankyou. Now I'm 9 looking for summary comments onboth 17 and 18 before 10 we proceed. please. 11 MR. DELAQUILA: Yes. This is Dave 12 Delaquila again. I was waiting to see where 13 commercial I'm sorry combination appliances 14 appeared, but it wasn't on the list so I'm going to 15 make the comment now. And I refer to, I guess this is 16 a data sheet that was released. Anumber of themwere 17 releasedwiththe earlierpublications, but oneof the 18 things on there says "recommendations by interested 19 parties", and it mentions a larger manufacturer and 20 energy advocate groups. 21 One of the things we wanted to encourage 22 DOE to do is contact associations like GAMA, because 23 when we see that, we think you are out soliciting 24 comments on these priorities from others and we would 25 like tobe contactedtogive our feedback, as well, as

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MR. CALABRESE: This is David Calabrese. There are two issues here that we want to talk about, and I'll start with maybe the somewhat easier one first. And that's the first issue on the list here, that is regulating commercial clothes washers. And I have a comment, and again a question. The first comment is that these are products that - commercial clothes washers that is - that are really identical to residential style and residential products, that DOEwould clearly have as we see it, the authority to preempt state activity. And we were disheartened and somewhat dismayed by the comments made, and was mentioned were made somewhat informally as to the Department feels they don't have the authority to regulate. So I guess I would like to ask Mike or whomever to really explain the rationale behind this

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 103 1 a point of the process. 2 FACILITATOR BROOKMAN: Some additional 3 comments or final comments onpage 17 and 18. So then 4 we're moving on. These would be considered new 5 products to consider for things that are not on the 6 list. Issues and products that people want to add at 7 this point for consideration. I think both of these 8 are referenced on 19. I think perhaps there are 9 others, as well. 10 MR. CALABRESE: This is David Calabrese. 11 There are two issues here that we want to talk about, 12 and I'll start with maybe the somewhat easier one 13 first. And that's the first issue on the list here, 14 that is regulating commercial clothes washers. And I 15 have a comment, and again a question. The first 16 comment is that these are products that

- commercial 17 clotheswashers that is

- that are really identical to 18 residential style and residential products, that DOE 19 wouldclearlyhave as we see it, the authoritytopre20 empt state activity. And we were disheartened and 21 somewhat dismayed by the comments made, and was 22 mentioned were made somewhat informally as to the 23 Department feels they don't have the authority to 24 regulate. So I guess I would like to ask Mike or 25 whomever to really explain the rationale behind this

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also rely on General Counsel staff, as well. This issue has been reviewed roughly the last 12 months within the Department. The residential style commercial clothes washers look a lot like the residential products. However, they are not identical to the residential products, so in their initial review we looked to see whether or not they would meet the definition of basic model, fall within the definition of basic model for residential products.

Since they are different, many, if not most of these products have a different energy factor if you were to test them to the residential test procedures, or different modified energy factors than the residential counterpart. They could not be considered the same basic model for our regulations and definitions.

Also, initiatives considered is that we look at the legislation. The residential portion of EPCA gives us the authority to add products that are not covered. The commercial part of the legislation does not give us that authority. It explicitly lists what products are covered, and the commercial -- residential style commercial washers are not one of

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 104 1 decision. 2 MR. McCABE: Michael McCabe, and I will 3 also rely on General Counsel staff, as well. This 4 issue has been reviewed roughly the last 12 months 5 within the Department. The residential style 6 commercial clothes washers look a lot like the 7 residentialproducts. However, theyarenot identical 8 to the residential products, so in their initial 9 reviewwe lookedto seewhether ornot theywouldmeet 10 the definition of basic model, fall within the 11 definition of basic model for residential products. 12 Since they are different, many, if not 13 most of these products have a different energy factor 14 if you were to test them to the residential test 15 procedures, or different modifiedenergy factors than 16 the residential counterpart. They could not be 17 considered the same basic model for our regulations 18 and definitions. 19 Also, initiatives considered is that we 20 look at the legislation. The residential portion of 21 EPCA gives us the authority to add products that are 22 not covered. The commercial part of the legislation 23 does not give us that authority. It explicitly lists 24 what products are covered, and the commercial 25 residential style commercial washers are not one of

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the products that are identified under the commercial products section. So we concluded that they are commercial products, and since they were not identified in the legislation as having the authority, we could not extend the program to include these products. MR. CALABRESE: I don't think I have a problem with that. I understand your rationale. It does get to a fundamental point that I had that you mentioned in the beginning, is the -- what we see as somewhat reluctance of the Department to extend their pre-emption authority. And we could differ, and reasonable individuals could differ on what is commercial and what is not. And we have discussed this in legal memorandum and otherwise on these products. And calling them commercial we think is a misnomer, and the fact that they are commercial going into residential units, and going into apartment complexes. So that in itself is not inherently a commercial product. But again, I guess pointing our concern overall is the reluctance of the Department not to extend federal pre-emption on such products as these and others, that I again I mentioned that are clearly, as we believe, under its purview.

(202) 234-4433 FACILITATOR BROOKMAN: Francine Pinto. NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 

### 105 1 theproducts that are identifiedunder the commercial 2 products section. So we concluded that they are 3 

### commercial products, and since they were not 4 

### identifiedinthelegislationashavingthe authority, 5 

### we could not extend the program to include these 6 

### products. 7 

### MR. CALABRESE: I don't think I have a 8 

### problem with that. I understand your rationale. It 9 does get to a fundamental point that I had that you 10 mentioned in the beginning, is the

-- what we see as 11 somewhat reluctance of the Department to extendtheir 12 pre-emption authority. And we could differ, and 13 reasonable individuals could differ on what is 14 

### commercial and what is not. And we have discussed 15 this in legal memorandum and otherwise on these 16 products. And calling them commercial we think is a 17 misnomer, and the fact that they are commercial going 18 into residential units, and going into apartment 19 

### complexes. So that in itself is not inherently a 20 commercial product. But again, I guess pointing our 21 concern overall is the reluctance of the Department 22 not to extend federal pre-emption on suchproducts as 23 these and others, that I again I mentioned that are 24 clearly, as we believe, under its purview. 25

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### FACILITATOR BROOKMAN: Francine Pinto. NEALR.GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODEISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 106 MS. PINTO: Yes.. This is Francine Pinto. I just want to add something, to say that we did give great attention to all the material that you sent to us. I want to assure you that we looked at it very carefully, and we determined that it does not fit the commercial style residential. It does not fit within the definition of consumer products, the statutory definition. MR. STEINER: David Steiner with Maytag. Just to get into -- add some comments to what David Calabrese has already mentioned on this issue of the residential style clothes washers for common laundry areas and so forth. It's interesting that you have thrown these underneath the commercial part of the legislation given that these are, as David has pointed out, used in residential settings. They are used by individuals, consumers. Therefore, they have every attribute of the residential style clothes washers. In fact, we are making these clothes washers on the same lines as the residential clothes washers that are complying with the standards that are set by DOE.

In addition to that, they are complying with the test procedure that is used to identify Energy Star qualifications. And I should have made that comment earlier about the beverage vending

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 106 1 MS. PINTO: Yes. This is Francine Pinto. 2 I just want to add something, to say that we did give 3 great attention to all the material that you sent to 4 us. I want to assure you that we looked at it very 5 carefully, and we determined that it does not fit the 6 commercial style residential. It does not fit within 7 the definition of consumer products, the statutory 8 definition. 9 MR. STEINER: David Steiner with Maytag. 10 Just to get into

-- add some comments to what David 11 Calabrese has already mentioned on this issue of the 12 residential style clothes washers for common laundry 13 areas and so forth. It's interesting that you have 14 thrown these underneath the commercial part of the 15 legislationgiventhat these are, asDavidhaspointed 16 out, used in residential settings. They are used by 17 individuals, consumers. Therefore, they have every 18 attribute of the residential style clothes washers. 19 In fact, we are making these clothes washers on the 20 same lines asthe residential clotheswashers that are 21 complying with the standards that are set by DOE. 22 In addition to that, they are complying 23 with the test procedure that is used to identify 24 Energy Star qualifications. And I should have made 25 that comment earlier about the beverage vending

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machines. Again, using an Energy Star level, which also makes sense for the DOE to set that standard, as well. But again to talk about this product, we're talking about only 2 percent of the marketplace. And these are units that, again, individuals are using, and we have a number of them qualifying for Energy Star levels using the DOE's test procedure. I think it makes every sense, even under the consumer definition that you mentioned. I think there's even room for argument there, as well.

MR. CANTANA: Tom Cantana from Whirlpool. Mike, should we then infer from the analysis that you applied to the commercial, that a state attempt toregulate residential clothes washers would be preempted? As you know, there is one such state regulation matriculating its way through the process

now. MR. McCABE: This is Michael McCabe. I believe you're referring to California with adding a water factor to their program?

MR. CANTANA: That could be, yes. MR. McCABE: I understand that California legislation requires the commission to submit a petition to DOE. We have not seen that petition yet. The issue as to whether or not the standards, our

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 107 1 machines. Again, using an Energy Star level, which 2 also makes sense for the DOE to set that standard, as 3 well. But again to talk about this product, we're 4 talking about only 2 percent of the marketplace. And 5 these are units that, again, individuals are using, 6 and we have a number of them qualifying for Energy 7 Star levels using the DOE's test procedure. I think 8 it makes every sense, even under the consumer 9 definition that you mentioned. I think there's even 10 room for argument there, as well. 11 MR. CANTANA: Tom Cantana fromWhirlpool. 12 Mike, shouldwe then infer from the analysis that you 13 applied to the commercial, that a state attempt to 14 regulate residential clothes washers would be pre15 empted? As you know, there is one such state 16 regulation matriculating its way through the process 17 now. 18 MR. McCABE: This is Michael McCabe. I 19 believe you're referring to California with adding a 20 water factor to their program? 21 MR. CANTANA: That could be, yes. 22 MR. McCABE: I understand that California 23 legislation requires the commission to submit a 24 petition to DOE. We have not seen that petitionyet. 25 The issue as to whether or not the standards, our

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efficiency standards pre-empt other regulations by states, such as water consumption has not been something, to my knowledge, that we have an opinion on, or addressed in any form at all.

FACILITATOR BROOKMAN: Steve Nadel. MR. NADEL: Yes. On this last question, it's my understanding that California is actually preparing a petition for exemption from pre-emption. There may be other legal arguments, as well. I haven't gotten into the details, but there will be further opportunities to decide on this. It's not -- I think there will be something from California to DOE that everybody else can comment on.

More broadly in this case, I think DOE General Counsel has made the correct decision. The key words here are the legislation doesn't refer to residential products, it refers to consumer products. There is a difference between products that are consumer products versus products that might be used in a residential setting.

One other thing I would note, the way the law -- consumers products are those that are purchased by consumers. Also, a lot of these products are used in laundromats which are clearly not a residential setting.

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 108 1 efficiency standards pre-empt other regulations by 2 states, such as water consumption has not been 3 something, to my knowledge, that we have an opinion 4 on, or addressed in any form at all. 5 FACILITATOR BROOKMAN: Steve Nadel. 6 MR. NADEL: Yes. On this last question, 7 it's my understanding that California is actually 8 preparing a petition for exemption from pre-emption. 9 There may be other legal arguments, as well. I 10 haven't gotten into the details, but there will be 11 further opportunities to decide on this. It's not 12 I think there will be something from California to 13 DOE that everybody else can comment on. 14 More broadly in this case, I think DOE 15 General Counsel has made the correct decision. The 16 key words here are the legislation doesn't refer to 17 residential products, it refers to consumerproducts. 18 There is a difference between products that are 19 consumer products versus products that might be used 20 in a residential setting. 21 One other thing I would note, the way the 22 law

- - consumersproducts arethose that arepurchased 23 by consumers. Also, a lot of these products are used 24 in laundromats which are clearly not a residential 25 setting.

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 The other thing I'd note is for a number

of products, the lines between residential and commercial are not entirely clear, that one gradates into another. It's not a black and white line. Just to give one example that we were talking about earlier, commercial air conditioners that are less than 5 tons. Those are basically the same products as residential, except they have a three phase compressor in them. But the same lines, and the manufacturers have always said we want the same standards for those products because they are the same lines.

Sometimes you have to draw a line somewhere between residential and commercial, and consumer and commercial, and some products fall on one side, some fall on the other.

MR. AMRANE: This is Karim Amrane with ARI. With respect to a lot of interior air conditioners that are at or above 3 tons are listed on the record as following the federal standard. We disagree with DOE's determination that it doesn't have to authority on this product, and we would like DOE to reconsider. We would like to understand the rationale behind this determination because we haven't seen anything in writing on that.

FACILITATOR BROOKMAN: Steve Rosenstock.

NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 109 1 The other thing I'd note is for a number 2 of products, the lines between residential and 3 commercial are not entirely clear, that one gradates 4 into another. It's not a black and white line. Just 5 to give one example that we were talking about 6 earlier, commercial air conditioners that are less 7 than 5 tons. Those arebasicallythe sameproducts as 8 residential, excepttheyhave a threephasecompressor 9 in them. But the same lines, and the manufacturers 10 have always saidwe want the same standards for those 11 products because they are the same lines. 12 Sometimes you have to draw a line 13 somewhere between residential and commercial, and 14 consumerandcommercial, and someproducts fallon one 15 side, some fallon the other. 16 MR. AMRANE: This is Karim Amrane with 17 ARI. With respect to a lot of interior air 18 conditioners that are at or above 3 tons are listedon 19 the record as following the federal standard. We 20 disagreewithDOE'sdeterminationthat itdoesn'thave 21 to authorityonthis product, andwe would likeDOE to 22 reconsider. We wouldlike tounderstandthe rationale 23 behind this determination because we haven't seen 24 anything in writing on that. 25

(202)234-4433 FACILITATOR BROOKMAN: Steve Rosenstock. NEALR. GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com1

2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 110 MR. ROSENSTOCK: Steve Rosenstock. I just want to get back to this California water rule. In a way, legalistically if they're doing a petition, if they're talking about water, is that really covered under DOE pre-emption? You know, is it a water versus an energy standard? If DOE has an energy standard that is "not a water standard", then do they have the authority to talk about it, versus if it isn't, then in a way this gives more states a way to basically go around the federal pre-emption. And then might the other products work the same way? There's a federal standard set with standards going into effect, not only once but twice, 2004 and 2007. But this type of possible loophole even further weakens national standards, even though people might be supporting the California rule were in support of those federal standards, so just kind of interesting possible side effect to what could happen.

FACILITATOR BROOKMAN: Other comments, please. MR. CALABRESE: I'll just follow-up quickly on that issue.

FACILITATOR BROOKMAN: The water issue? MR. CALABRESE: On the water issue, that DOE does have -- this is David Calabrese. DOE does NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 110 1 MR. ROSENSTOCK: SteveRosenstock. I just 2 want to get back to this California water rule. In a 3 way, legalistically if they're doing a petition, if 4 they're talking about water, is that really covered 5 underDOE pre-emption? Youknow, is it a waterversus 6 an energy standard? If DOE has an energy standard 7 that is "not a water standard", then do they have the 8 authority to talk about it, versus if it isn't, then 9 in a way this gives more states a way to basicallygo 10 around the federal pre-emption. And then might the 11 other products work the same way? There's a federal 12 standard set with standards going into effect, not 13 only once but twice, 2004 and 2007. But this type of 14 possible loophole even further weakens national 15 standards, even thoughpeople might be supporting the 16 California rule were in support of those federal 17 standards, so just kind of interesting possible side 18 effect to what could happen. 19 FACILITATOR BROOKMAN: Other comments f 20 please. 21 MR. CALABRESE: I'll just follow-up 22 quickly on that issue. 23 24 25 FACILITATOR BROOKMAN: The water issue? MR. CALABRESE: On the water issue, that DOE does have

-- this is David Calabrese. DOE does

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have the authority to cover that, in particular, and water in general because of the pre-emption authority is wide and deep, that it covers issues as that which are inextricably combined, linked with energy. So water and energy are one and the same thing, so that is our position.

FACILITATOR BROOKMAN: Other comments other than the water issue?

MR. GRAY: Yes. This is Ed Gray from NEMA. As I previously indicated, compact fluorescent lamps were something in the proposed legislation. Also, we have proposed to DOE that whether or not there's a Federal Energy Bill that we would like standards on compact fluorescent lamps. We're not doing this for any pre-emption reason. We think there needs to be standards to make sure the products out there are quality products. And these would be based upon Energy Star. And to my knowledge, we have gotten no written feedback, although there's been maybe some informal feedback to the effect that DOE doesn't feel that they have authority to regulate those.

I'd like to point out that CFLs are already regulated. The labeling is regulated. The test procedure is regulated. The only thing that isn't is the efficiency standard, so we would like to

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 111 1 have the authority to cover that, in particular, and 2 water ingeneral because of the pre-emption authority 3 is wide and deep, that it covers issues as that which 4 are inextricably combined, linked with energy. So 5 water and energy are one and the same thing, so that 6 is our position. 7 FACILITATOR BROOKMAN: Other comments 8 other than the water issue? 9 MR. GRAY: Yes. This is Ed Gray from 10 NEMA. As I previously indicated, compact fluorescent 11 lamps were something in the proposed legislation. 12 Also, we have proposed to DOE that whether or not 13 there's a Federal Energy Bill that we would like 14 standards on compact fluorescent lamps. We're not 15 doing this for anypre-emptionreason. We thinkthere 16 needs to be standards to make sure the products out 17 there are qualityproducts. And these would be based 18 uponEnergy Star. And tomy knowledge, we have gotten 19 no written feedback, although there's beenmaybe some 20 informal feedback to the effect that DOE doesn't feel 21 that they have authority to regulate those. 22 I'd like to point out that CFLs are 23 already regulated. The labeling is regulated. The 24 test procedure is regulated. The only thing that 25 isn't is the efficiency standard, so we would like to

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see some kind of formal opinion by DOE that they do have the authority to cover those products from an energy efficiency standpoint.

MR. McCABE: This is Michael McCabe, as a follow-up, if NEMA could take a look at some broader issues associated with that, CFLs typically have the Edison A socket. There are some pin-type designs. There is not currently a standard for pin-type -- pin designs and industry standards, but I understand there is one that is being worked on.

If you look at the program and the legislative history, we have what is referred to as product classes. And a product class is a subset of a product type differentiated by different energy sources, so a gas and oil furnace are two different product classes, for example. Side-by-side and top mount refrigerator freezers are two different classes. And those are different utility features, and we take a look at the utility of a product in order to further subdivide it.

Look at lighting. Could an argument be made that incandescent lamps with A sockets and CFLs with A socket should all be in the same class? And if so, where and how should a standard be set, if the Department were to pursue standard setting.

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 112 1 see some kind of formal opinion by DOE that they do 2 have the authority to cover those products from an 3 energy efficiency standpoint. 4 MR. McCABE: This is Michael McCabe, as a 5 follow-up, if NEMA could take a look at some broader 6 issues associated with that, CFLs typically have the 7 Edison A socket. There are some pin-type designs. 8 There is not currently a standard for pin-type

-- pin 9 designsandindustrystandards, but I understandthere 10 is one that is being worked on. 11 If you look at the program and the 12 legislative history, we have what is referred to as 13 product classes. And a product class is a subset of 14 a product type differentiated by different energy 15 sources, so a gas and oil furnace are two different 16 product classes, for example. Side-by-side and top 17 mountrefrigeratorfreezers aretwodifferentclasses. 18 And those are different utility features, andwe take 19 a look at the utilityof a product inorder to further 20 subdivide it. 21 Look at lighting. Could an argument be 22 made that incandescent lamps with A sockets and CFLs 23 withA socket should all be in the same class? And if 24 so, where and how should a standard be set, if the 25 Department were to pursue standard setting.

(202)234-4433 NEALR. GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODE ISLANDAVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 113 MR. GRAY: Obviously, that requires a lot of in-depth thought, and we'll get back to you on that. I would like to say that some of the applications that were listed, the exemptions as I recall it for certain applications, we chose to propose for CFLs, were the ones for incandescent general service lamps. In other words, we were saying that CFLs would be a replacement for a general service A line Edison socket lamp.

On the subject of pin-base, we did get into that to some extent in the Energy Star standards for ceiling fans and the current major energy saver there currently is the fact that CFLs are in the package or in the product. And we encouraged for that Energy Star guideline that they be pin-based so people couldn't unscrew the CFLs and put a regular A-line lamp in there. But we'll get back to you on this question of classes of products.

FACILITATOR BROOKMAN: Other comments on the issues that are listed on page 19, and other issues that were recently raised? Bryan Berringer.

MR. BERRINGER: Bryan Berringer. Just to follow-up on Karim's question about the units larger than 20 tons. I'm looking at 42 USC 63-11, when you look at the definitions for large commercial packaged

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 113 1 MR. GRAY: Obviously, that requires a lot 2 of in-depth thought, and we'll get back to you on 3 that. I would like to say that some of the 4 applications that were listed, the exemptions as I 5 recall it for certain applications, we chose to 6 propose for CFLs, were the ones for incandescent 7 general service lamps. In other words, we were saying 8 that CFLs wouldbe a replacement for a general service 9 A line Edison socket lamp. 10 On the subject of pin-base, we did get 11 into that to some extent in the Energy Star standards 12 for ceiling fans and the current major energy saver 13 there currently is the fact that CFLs are in the 14 package or intheproduct. Andwe encouraged for that 15 EnergyStarguidelinethat theybepin-basedsopeople 16 couldn't unscrew the CFLs and put a regular A-line 17 lamp in there. But we'll get back to you on this 18 question of classes of products. 19 FACILITATOR BROOKMAN: Other comments on 20 the issues that are listed on page 19, and other 21 issues that were recently raised? Bryan Berringer. 22 MR. BERRINGER: BryanBerringer. Just to 23 follow-up on Karim's question about the units larger 24 than 20 tons. I'm looking at 42 USC 63-11, when you 25 look at the definitions for large commercial packaged

(202)234-4433 NEALR.GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODEISLANDAVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com114 1 air conditioners, the upper limit is 240, so there's 2 nothing in the legislation that indicates that we 3 could do anything above 240. So that's where that 4 decision is based. 5 FACILITATOR BROOKMAN: Yes, please. 6 MR. MANDIKE: John Mandike with Carrier 7 Corporation. I guess my retort to that statement is 8 if you look at Section 6312 (b) , it indicates that "The 9 Department has the authority to regulate industrial 10 equipment, which means any article of equipment to any 11 significant extent is distributed in commerce for 12 industrial or commercial use." Clearly, large package 13 air conditioners over 20 tons meets that definition. 14 Then under Section 6312(b), it says, d " 15 Inclusion of industrial equipment as covere 16 equipment, the Secretary may be rule include a type of 17 industrial equipment as covered equipment if he 18 determines that to do so is necessary to carry out the 19 purposes of this part." So the argument that Carrier 20 Corporation makes, and I believe ARI, is that large 21 package air conditioners above 20 tons are industrial 22 equipment; therefore, by EPCA, the Department of 23 Energy has the authority to regulate them, and should 24 do so expeditiously. 25 FACILITATOR BROOKMAN: I think the 

### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 114 1 air conditioners, the upper limit is 240, so there's 2 nothing in the legislation that indicates that we 3 could do anything above 240. So that's where that 4 decision is based. 5 FACILITATOR BROOKMAN: Yes, please. 6 MR. MANDIKE: John Mandike with Carrier 7 Corporation. I guess my retort to that statement is 8 ifyou lookat Section 6312(b), it indicates that "The 9 Department has the authority to regulate industrial 10 equipment, whichmeans anyarticleof equipment to any 11 significant extent is distributed in commerce for 12 industrialorcommercialuse." Clearly, largepackage 13 air conditioners over 20 tons meets that definition. 14 Then under Section 6312(b), it says, 15 "Inclusion of industrial equipment as covered 16 equipment, the Secretarymaybe rule include a type of 17 industrial equipment as covered equipment if he 18 determines that to do so is necessaryto carryout the 19 purposes of this part." So the argument that Carrier 20 Corporation makes, and I believe ARI, is that large 21 package air conditioners above 20 tons are industrial 22 equipmenti therefore, by EPCA, the Department of 23 Energyhas the authority to regulate them, and should 24 do so expeditiously. 25

(202)234-4433 FACILITATOR BROOKMAN: NEAL

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Department would welcome those comments in writing. Steve Nadel. MR. NADEL: This is Steve Nadel. I would point out also, I agree with DOE's interpretation that in the legislation they do define covered equipment, and then Paragraph B of that does enumerate very specific equipment that can and can't be covered, so it's not the broad common dictionary definition of industrial equipment which might be anything that's used in industry. This is a more restrictive definition that's used in this portion of the law.

FACILITATOR BROOKMAN: There are other issues raised on page 19. Do people want to take them up now? MR. CALABRESE: David Calabrese with AHAM. WE would like to address the petition for residential refrigerators that has been presented here, and was submitted, I believe, last week. And we'd like to talk about that, and officially and formally register our opposition to the petition. And I'll explain in more detail here, as well as in more formal comments to the Department in the manner as appropriate why this petition and a rule making of these products are inappropriate at this time.

First of all, getting to the issue of its

NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 115 1 Department would welcome those comments in writing. 2 Steve Nadel. 3 MR. NADEL: This is Steve Nadel. I would 4 point out also l I agreewith DOEIs interpretationthat 5 in the legislation they do define covered equipment I 6 and then Paragraph B of that does enumerate very 7 specific equipment that can and can/t be coveredl so 8 it/s not the broad common dictionary definition of 9 industrial equipment which might be anything that/s 10 used in industry. This is a more restrictive 11 definition that/s used in this portion of the law. 12 FACILITATOR BROOKMAN: There are other 13 issues raisedonpage 19. Do peoplewant to take them 14 up now? 15 MR. CALABRESE: DavidCalabresewithAHAM. 16 WE would like to address the petition for residential 17 refrigerators that has been presented here l and was 18 submitted l I believe l last week. And weld like to 19 talk about that l and officially and formally register 20 our opposition to the petition. And 1/11 explain in 21 more detail here l as well as in more formal comments 22 to the Department in the manner as appropriate why 23 this petition and a rule making of these products are 24 inappropriate at this time. 25 First of all l getting to the issue of its

(202)234-4433 NEALR. GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODEISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com116 1 inappropriateness at this time, this is a product 2 category where there have been a number of rule 3 makings, at least three in a relatively short period 4 of time. And to ask for additional rule making on 5 these products, we see as unrealistic and very 6 inappropriate. 7 Already on the priority list for 105, 8 there are a number of other high priority products 9 that as we on the back of an envelope would tally them 10 up, I guess there are about 14 quads of energy savings 11 so adding on refrigerators at this time really, again, 12 is not an appropriate use of the Department's 13 resources, which were, again, pointed out in some of 14 the factors that should be taken into account when the 15 Department establishes those priorities for particular 16 years. 17 We also believe, and another critical 18 issue is that there are voluntary initiatives in place 19 right now on refrigerators. And these have not been 20 really given a chance, the Energy Star program, for 21 instance, to take effect. In fact, this year new 22 levels were set for refrigerators that have yet to

ll l t 23 rea y p ay ou . 24 In fact, there is a proposal in Congress 25 right now which our friends, Steve Nadel and the 

### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 116 1 inappropriateness at this time I this is a product 2 category where there have been a number of rule 3 makings I at least three in a relatively short period 4 of time. And to ask for additional rule making on 5 these products I we see as unrealistic and very 6 inappropriate. 7 Already on the priority list for \05 1 8 there are a number of other high priority products 9 that as we onthebackof an envelope would tally them 10 UPI I guess there are about 14 quads of energy savings 11 soaddingonrefrigerators at this time reallYI againl 12 is not an appropriate use of the Department/s 13**resources~** which wereI againl pointed out in some of 14 the factors that shouldbe takeninto account whenthe 15 Departmentestablishesthoseprioritiesforparticular 16 years. 17 We also believe l and another critical 18 issue is that there arevoluntaryinitiatives inplace 19 right now on refrigerators. And these have not been 20 really given a chancel the Energy Star programI for 21 instance l to take effect. In fact I this year new 22 levels were set for refrigerators that have yet to 23 really play out. 24 In facti there is a proposal in Congress 25 right now which our friends l Steve Nadel and the

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advocates support for a tax credit for super energy efficient refrigerators. We fully hope that that will be enacted into law. When it is, if it is enacted into law, we will see very, very significant energy savings result from that.

And there are other ideas too on the voluntary initiatives that should be considered. Our friends in Canada are considering an early retirement program type of initiative, replacing old as they call them beer fridges with more efficient products. That, of course, could be something that should be examined prior to engaging in a new rule making.

And our third point is the issue required under law and regulation that it be considered, is the cumulative regulatory impact. As I said, again we've had a number of rule makings already on these products, and our manufacturers don't just make refrigerators, they make clothes washers. And there's been rule makings in clothes washers, and so what we're talking about is a significant cumulative burden on our manufacturers that they are still at this time trying to recoup costs, R&D and the like from the previous refrigerator rule making. So that, of course, needs to be taken into account by the Department, as Barbara had mentioned earlier, in

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### 117 1 advocates support for a tax credit for super energy 2 efficientrefrigerators. We fullyhope that thatwill 3 

### be enacted into law. When it is, if it is enacted 4 into law, we will see very, very significant energy 5 savings result from that. 6 

### And there are other ideas too on the 7 voluntary initiatives that shouldbe considered. Our 8 friends in Canada are considering an earlyretirement 9 programtype of initiative, replacingoldas theycall 10 thembeerfridges withmore efficientproducts. That, 11 of course, couldbe something that shouldbe examined 12 prior to engaging in a new rule making. 13 And our thirdpoint is the issue required 14 underlawandregulationthat itbe considered, isthe 15 cumulative regulatory impact. As I said, againwe've 16 had a number of rule makings already on these 17 products, and our manufacturers don't just make 18 refrigerators, theymakeclotheswashers. Andthere's 19 been rule makings in clothes washers, and so what 20 we'retalkingabout isa significant cumulativeburden 21 on ourmanufacturers that they are still at this time 22 trying to recoup costs, R&D and the like from the 23 

### previous refrigerator rule making. So that, of 24 course, needs to be taken into account by the 25 Department, as Barbara had mentioned earlier, in

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10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 setting those priorities. And then more specifically to the petition itself, we see some very serious lapses or inaccuracies in the analysis. And the first of which is one that a statement made on the first page of the document, that looking at the current Energy Star list, that there are roughly 700 units that meet some of these new standards, these super efficient standards, or super efficient levels.

From our analysis of the list, and talking to our members, surveying our members, we see that number 687 as being probably closer to 50 or 150, really basic models that really are reflective of those levels. And when I say that, what I mean is on the Energy Star list, there are numerous -- well, 687 line items. Those don't represent distinct basic models. What those represent are derivations off of a basic model, so you could have a white model, and then you might have stainless steel, all of them having different model numbers, yet being the basic -- coming off of a derivation of a basic unit. So when you take that into account, and looking at the data presented, and the position they presented, we see very few products -- a fraction of what they say in the petition, or what the petition states are being NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 118 1 setting those priorities. 2 Andthenmore specificallytothepetition 3 itself, we see some very serious lapses or 4 inaccuracies in the analysis. And the first of which 5 is one that a statement made on the first page of the 6 document, that looking at the current Energy Star 7 list, that there are roughly 700 units that meet some 8 of these new standards, these super efficient 9 standards, or super efficient levels. 10 Fromouranalysis ofthe list, andtalking 11 to our members, surveying our members, we see that 12 number 687 as being probably closer to 50 or 150, 13 really basic models that really are reflective of 14 those levels. And when I say that, what I mean is on 15 the Energy Star list, there are numerous -- well, 687 16 line items. Those don't represent distinct basic 17 models. What those represent are derivations off of 18 a basic model, so you could have a white model, and 19 then you might have stainless steel, all of them 20 havingdifferentmodel numbers, yetbeingthebasic

-- 21 coming off of a derivation of a basic unit. So when 22 you take that into account, and looking at the data 23 presented, and the position they presented, we see 24 very few products

-- a fraction of what they say in 25 the petition, or what the petition states are being

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energy efficient, is down to a very small fraction. And, in fact, in the petition itself, the 15 percent efficiency level is pointed to as being a threshold, and it is, because when you move above 15 percent efficiency, the products that are above that level, and included in the CEE document which is CEE lists which are referenced, are either compact refrigerators or specialty units. So we're not talking about your standard run-of-the-mill refrigerators. You're talking about specific compact models, as well as specialty units.

So that is an important fact that needs to be pointed out, a deficiency in the petition that, again, we will be providing more in the way of analysis of that. I might ask Larry Wethje to comment a little bit more on the analysis that was done within the petition.

MR. WETHJE: Larry Wethje with AHAM. We think that the economic analysis that was provided with the petition is significantly flawed, extremely over-simplified, and just grossly overstated with respect to the next present value cost benefit analysis that was provided. There's assumptions made, numbers taken from census bureau shipments that just appear to have anomalies associated with them. A

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 119 1 energy efficient, is down to a very small fraction. 2 And, in fact, in the petition itself, the 15 percent 3 efficiency level is pointed to as being a threshold, 4 and it is, because when you move above 15 percent 5 efficiency, the products that are above that level, 6 and included in the CEE document which is CEE lists 7 whicharereferenced, areeithercompactrefrigerators 8 or specialty units. So we're not talking about your 9 standard run-of-the-mill refrigerators. You're 10 talking about specific compact models, as well as 11 specialty units. 12 Sothat isanimportant fact thatneeds to 13 be pointed out, a deficiency in the petition that, 14 again, we will be providing more in the way of 15 analysis of that. I might askLarryWethje to comment 16 a littlebitmore onthe analysis that was done within 17 the petition. 18 MR. WETHJE: Larry Wethje with AHAM. We 19 think that the economic analysis that was provided 20 with the petition is significantly flawed, extremely 21 over-simplified, and just grossly overstated with 22 respect to the next present value cost benefit 23 analysisthatwasprovided. There's assumptionsmade, 24 numbers taken from census bureau shipments that just 25 appear to have anomalies associated with them. A

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quantity of refrigerator shipments decreasing from 1997 until 2002, just isn't in line with industry shipment data that we have in-house at the Trade Association. The value of those shipments declining in the last five years just isn't in line, as well. And so the economic benefits that are stated in that analysis are significantly flawed.

A couple of other points I would want to maybe just add to what David had said on the cumulative regulatory burden. Not only looking at the burden from rule makings on other products for the white goods industry, but just the refrigerator manufacturers alone having undertaken already three rule makings. There's no other product that has had that kind of impact imposed upon them, and so the cumulative effect just on that one particular product line alone is enough to dissuade DOE, I think, from adding this to go through another rule making process.

You've identified the fact that they are in the midst of transition on the foam blowing agent that's used in the insulation for refrigerator freezers. That has added significant cost to the product, and will continue to require the need to recoup the capital investment that's gone along with that, associated with that. 

### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 120 1 quantity of refrigerator shipments decreasing from 2 1997 until 2002, just isn't in line with industry 3 shipment data that we have in-house at the Trade 4 Association. The value of those shipments declining 5 in the last five years just isn't in line, as well. 6 And so the economic benefits that are stated in that 7 analysis are significantly flawed. 8 A couple of other points I would want to 9 maybe just add to what David had said on the 10 cumulativeregulatoryburden. Not onlylookingat the 11 burden from rule makings on other products for the 12 white goods industry, but just the refrigerator 13 manufacturers alone having undertaken already three 14 rule makings. There's no other product that has had 15 that kind of impact imposed upon them, and so the 16 cumulative effect just on that one particularproduct 17 line alone is enough to dissuade DOE, I think, from 18 addingthis togo throughanotherrulemakingprocess. 19 You've identified the fact that they are 20 in the midst of transition on the foam blowing agent 21 that's used in the insulation for refrigerator 22 freezers. That has added significant cost to the 23 product, and will continue to require the need to 24 recoup the capital investment that's gone along with 25 that, associated with that.

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MR. CALABRESE: This is David Calabrese. Just to round this discussion up. As already mentioned, the cumulative regulatory impact is severe and very significant with these products. And we are reaching within our industry and many industries here in the U.S. in regards to the jobs issue, of keeping jobs, keeping good jobs here in the U.S. And it is really through this type of regulatory burden and efforts like this that manufacturers trying to keep up with these regulatory burdens, trying to meet these standards, and faced with issues like that have, in some cases, find alternative places for these jobs. And that is something we certainly do not want to do. We want to keep good jobs here in the U. S . , but as this ball keeps rolling, and efforts like this keep moving forward, it creates an atmosphere and environment that it becomes extremely difficult, and sometimes impossible for our manufacturers to do that. NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 121 1 

### The refrigerators now typically use less 2 than 75 watt lightbulb, and there's only so far you 3 

### can go in these products. And we just think that the 4 

### number of high priority products you've identified 5 

### already are more worthy of consideration, and should 6 

### be kept ahead of additional rule making on 7 

### refrigerators. 8 

### MR. CALABRESE: This is David Calabrese. 9 

### Just to round this discussion up. As already 10 

### mentioned, the cumulative regulatory impact is severe 11 

### and very significant with these products. Andwe are 12 

### reaching withinour industry andmany industries here 13 

### in the u.S. in regards to the jobs issue, of keeping 14 

### jobs, keeping good jobs here in the u.S. And it is 15 

### really through this type of regulatory burden and 16 

### efforts likethis thatmanufacturers tryingtokeepup 17 

### with these regulatory burdens, trying to meet these 18 

### standards, and faced with issues like that have, in 19 

### some cases, find alternative places for these jobs. 20 

### And that is something we certainlydo not want to do. 21 

### We want to keep good jobs here in the U.S., but as 22 this ball keeps rolling, and efforts like this keep 23 

### moving forward, it creates an atmosphere and 24 environment that it becomes extremely difficult, and 25 sometimesimpossible forourmanufacturerstodothat.

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So that's another issue for the Department to consider in raising this product to a high priority. So again in conclusion, we oppose the petition rule making, and importantly, we oppose any elevation of this from the low priority where it is now, to anything above low, of course to high, and not to medium.

FACILITATOR BROOKMAN: So let's hear from other persons that have comments on this issue at this time. Go ahead, Steve.

MR. ROSENSTOCK: This is Steve Rosenstock. Just as a quick aside, if this petition is successful, it will probably delay other products. And kind of interesting coming from a group that's complaining about delay in rule makings for other products.

MR. STEINER: Kind of stole my thunder, but this is David Steiner. Good job, Steve. I will just add a couple of things just to reiterate, there would be more benefit if we were to work on a program with the DOE through Energy Star and other programs, that would work on retirement and actually disposal of old refrigerators that are currently, as David has put it, in garages and basements, then we would get from increasing standards on the new refrigerators. So I would encourage that the DOE, in conjunction with the groups who have put this petition together, and the

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 122 1 Sothat's another issue for theDepartment to consider 2 in raising this product to a high priority. So again 3 inconclusion, we oppose thepetitionrulemaking, and 4 importantly, we oppose any elevation of this from the 5 low priority where it is now, to anything above low, 6 of course to high, and not to medium. 7 FACILITATOR BROOKMAN: So let's hear from 8 otherpersons that have comments onthis issue at this 9 time. Go ahead, Steve. 10 MR. ROSENSTOCK: This is SteveRosenstock. 11 Just as a quickaside, if thispetition is successful, 12 it will probably delay other products. And kind of 13 interesting coming from a group that's complaining 14 about delay in rule makings for other products. 15 MR. STEINER: Kind of stole my thunder, 16 but this is David Steiner. Good job, Steve. I will 17 just add a couple of things just to reiterate, there 18 would be more benefit if we were to work on a program 19 with the DOE through Energy Star and other programs, 20 thatwouldworkonretirement andactuallydisposal of 21 oldrefrigerators that are currently, asDavidhasput 22 it, in garages and basements, then we would get from 23 increasing standards on the new refrigerators. So I 24 would encourage that the DOE, in conjunctionwith the 25 groups who have put this petition together, and the

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manufacturers work together in developing such a program. Also, I'd like to share with you, just to reiterate the example of the jobs issue. For those of you who don't know, we are closing Maytag facility in Gaylesberg, Illinois, which at one time was featured as a great example of what happens when you get new regulations put in place. And that the investment that Maytag put in to Gaylesberg to keep it functioning as a refrigeration facility - well, folks, we can't afford it any more. And we're moving a lot of those jobs out of the country. Some of those are going to Iowa, that's not out of the country. In addition to out-sourcing some of those jobs from plants that we do not actually own ourselves.

We are following the industry trend, folks. We are the last ones to do this, and to encourage this type of additional rule making would further exacerbate this problem.

FACILITATOR BROOKMAN: Thank you. MR. CANTANA: Tom Cantana from Whirlpool. I guess I would add sort of a larger way to think about this issue. Because of the problems that have been raised many times here today about the cumbersomeness of the rule making process, whatever

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 123 1 manufacturers work together in developing such a 2 program. 3 Also, I'd like to share withyou, just to 4 reiterate the example of the jobs issue. Forthose of 5 you who don't know, we are closing Maytag facility in 6 Gaylesberg, Illinois, which at one time was featured 7 as a great example of what happens when you get new 8 regulations put in place. And that the investment 9 that Maytag put in to Gaylesberg to keep it 10 functioning as a refrigerationfacility

- well, folks, 11 we can't afford it any more. And we're moving a lot 12 of those jobs out of the country. Some of those are 13 going to Iowa, that's not out of the country. In 14 addition to out-sourcing some of those jobs from 15 plants that we do not actually own ourselves. 16 We are following the industry trend, 17 folks. We are the last ones to do this, and to 18 encourage this type of additional rule making would 19 further exacerbate this problem. 20 FACILITATOR BROOKMAN: Thank you. 21 MR. CANTANA: Tom Cantana fromWhirlpool. 22 I guess I would add sort of a larger way to think 23 about this issue. Because of the problems that have 24 been raised many times here today about the 25 cumbersomeness of the rule making process, whatever

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the reasons for that, there have been a number of occasions where this industry, the appliance industry has voluntarily agreed to accelerate that process, and have met with advocates and reached agreements, and those examples continue. The most recent one is dehumidifiers.

This petition, frankly, surprised me, and sort of falls into the category of no good deed goes unpunished. And I think those advocating cooperation between the advocacy community and the private sector to cut through the red tape that inevitably comes with the rule making process, should think twice about this kind of an effort, because I think others who have not moved at all in a cooperative way in these areas will look at examples like our industry and say why should we partner? Why should we act voluntarily? Becauseit will just mean folks will come back to you yearin/year-out. And it might not be a totally unreasonable conclusion to draw, and so this may not be a question for the Department, but it may be a question for the petitioners to ask themselves.

FACILITATOR BROOKMAN: Other comments related to the petition. Steve Nadel.

MR. NADEL: Okay. Steve Nadel, ACEEE. I was trying to take notes. I will try to be reasonably

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 124 1 the reasons for that, there have been a number of 2 occasions where this industry, the appliance industry 3 hasvoluntarilyagreedtoacceleratethatprocess, and 4 have met with advocates and reached agreements, and 5 those examples continue. The most recent one is 6 dehumidifiers. 7 This petition, frankly, surprisedme, and 8 sort of falls into the category of no good deed goes 9 unpunished. And I think those advocating cooperation 10 between the advocacy community and the private sector 11 to cut throughthe redtape that inevitablycomes with 12 therulemakingprocess, shouldthinktwice about this 13 kindof an effort, because I thinkothers who have not 14 moved at all in a cooperative way in these areas will 15 look at examples like our industry and saywhy should 16 we partner? Why should we act voluntarily? Because 17 it will just mean folks will come back to you year18 in/year-out. And it might not be a totally 19 unreasonable conclusion to draw, and so this may not 20 be a question for the Department, but it may be a 21 question for the petitioners to ask themselves. 22 FACILITATOR BROOKMAN: Other comments 23 related to the petition. Steve Nadel. 24 MR. NADEL: Okay. Steve Nadel, ACEEE. I 25 was tryingto take notes. I will trytobe reasonably

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brief here, and just respond to a few of the comments. Obviously, we supported the petition. We're one of the signatories. We worked on the petition. We believe that the federal statute puts out clear legal criteria for an additional rule making, and DOE's own analysis, which we extensively quoted, establish all those criteria.

Larry Wethje talked to some census data. That was additional data that goes beyond the basic criteria. We're just saying there's reason to question some of DOE's cost estimates. There's another paper, I think it was Lauren Greening, et al, an economist that's published, also indicating that DOE does tend to overstate the estimated cost on previous refrigerator standard rule makings. I won't say every single number the census has is right, but I'm just saying that was one example. There are other examples of how the prices are wrong.

But even if you ignore that and just use DOE' s prices, the case is made to at least open a rule making. A lot of the issues people are raising, you know, issues on jobs, cumulative burden, that would all be considered as part of a rule making. We're not saying that if the petition is granted, all that gets turned to the side. It's just saying okay, we are

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 125 1 briefhere, andjust respond to a few of the comments. 2 Obviously, we supported the petition. We're one of 3 the signatories. We worked on the petition. We 4 believe that the federal statute puts out clear legal 5 criteria for an additional rule making, andDOE's own 6 analysis, which we extensively quoted, establish all 7 those criteria. 8 Larry Wethje talked to some census data. 9 That was additional data that goes beyond the basic 10 criteria. We're just saying there's reason to 11 question some of DOE's cost estimates. There's 12 another paper, I think it was Lauren Greening, et aI, 13 an economist that's published, also indicating that 14 DOE does tend to overstate the estimated cost on 15 previous refrigerator standard rule makings. I won't 16 say every single number the census has is right, but 17 I'mjust sayingthat was one example. There are other 18 examples of how the prices are wrong. 19 But even if you ignore that and just use 20 DOE'sprices, the case ismade to at least opena rule 21 making. A lot of the issues people are raising, you 22 know, issues on jobs, cumulative burden, that would 23 all be considered as part of a rule making. We're not 24 saying that if the petition is granted, all that gets 25 turned to the side. It's just saying okay, we are

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beginning a process where all those things would be considered. And as I think Mike McCabe pointed, there would be a full rule making due process, and all the different criteria, all the different analyses.

The reason we picked this product is, as the Department said, while there are many criteria, the primary criteria is energy savings. And as we looked at from our own analyses, as well as with DOE, by far the largest energy savings of products that DOE could regulate, that they could add to the program would be refrigerators.

The only other three products that come, are in a similar ballpark are the three products we've recommended be very high priorities. Everything else, these other 14 or whatever that have been priorities are lower energy savings. So we said if the focus is on energy savings, let's focus on those big products.

The three that are now underway, that will soon get ANOPRs, this is the fourth one that's the really big one. Everything else is smaller. That's why we have keyed in on that.

A couple of little things. Larry said to you we've already gone through three rule makings already. I think you meant to say three rules already. The first rule was set by Congress. There NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 126 1 beginning a process where all those things would be 2 considered. Andas I thinkMikeMcCabepointedl there 3 would be a full rule making due processl and all the 4 different criteriaI all the different analyses. 5 The reason we picked this product iS I as 6 the Department saidl while there are many criteriaI 7 the primary criteria is energy savings. And as we 8 looked at from our own analyses l as well as with DOE I 9 byfar the largest energy savings ofproducts thatDOE 10 could regulate l that they could add to the program 11 would be refrigerators. 12 The only other three products that cornel 13 are ina similarballparkare the three productswe Ive 14 recommendedbeveryhighpriorities. Everythingelsel 15 these other 14 or whatever that have been priorities 16 are lower energy savings. So we said if the focus is 17 onenergy savings I let Is focus onthosebigproducts. 18 Thethreethat arenowunderwayI that will 19 soon get ANOPRs l this is the fourth one that/s the 20 really big one. Everything else is smaller. That/s 21 why we have keyed in on that. 22 A couple of little things. Larry said to 23 you we/ve already gone through three rule makings 24 already. I think you meant to say three rules 25 already. The first rule was set by Congress. There

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were two subsequent rule makings, not three rule makings. Minor correction.

We recognize that manufacturers did have to make significant investments. We very much appreciated the fact that manufacturers did work with us on negotiating that standard. It took a little while to ultimately get into a place, but we did work it through. What we're proposing if DOE were to grant this petition tomorrow the earliest, in our opinion, that a standard could take effect is 2011. Given DOE's track record, it's likely to be later, so there will be 10 years between standards.

The statute generally calls for five years between standards, so by 2011 they should have recovered any costs associated with 2001 standard. It's also four or more years after the 2007 clothes washer standard. We've had this one on our radar screen for a while. We've held off on it because we were mindful of the cumulative burden. We were also mindful of the fact that these other rule makings, the three that we consider the very high priorities are important, and we effectively want this new refrigerator one to come in after those.I mean, DOE is about to come out with ANOPRs. Under the process improvement rule -- for the three current ones, under

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 127 1 were two subsequent rule makings, not three rule 2 makings. Minor correction. 3 We recognize that manufacturers did have 4 to make significant investments. We very much 5 appreciated the fact that manufacturers didwork with 6 us on negotiating that standard. It took a little 7 while to ultimately get into a place, but we did work 8 it through. What we'reproposing ifDOE were togrant 9 this petition tomorrow the earliest, in our opinion, 10 that a standard could take effect is 2011. Given 11 DOE's track record, it's likely to be later, so there 12 will be 10 years between standards. 13 The statutegenerallycallsforfiveyears 14 between standards, so by 2011 they should have 15 recovered any costs associated with 2001 standard. 16 It's also four or more years after the 2007 clothes 17 washer standard. We've had this one on our radar 18 screen for a while. We've held off on it because we 19 were mindful of the cumulative burden. We were also 20 mindful of the fact that these otherrule makings, the 21 three that we consider the very high priorities are 22 important, and we effectively want this new 23 refrigerator one to come in after those.I mean, DOEis 24 about to come out with ANOPRs. Under the process 25 improvement rule

-- for the three current ones, under

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the process improvement rule it should be, I think it's 12 months or so, if I'm recalling correctly from -- no, it's 18 months from ANOPR to final rule. It's also 18 months from when it's made a high priority to an ANOPR, so you can have a final rule on those other ones in the period leading up to the ANOPR on refrigerators, so we don't think that this refrigerator petition needs to slow down at all the three that we consider to be the very high priorities. This would be next.

Yes, it would probably affect some of these other items that are not only high priority, that DOE hasn't really been working on, but the savings aren't nearly as great.

Dave Steiner from Maytag talked about accelerated programs for early retirement. We have been supportive particularly of programs to encourage people to get rid of second refrigerators, you know, what did someone call them, the beer coolers. We work with the utilities on programs. We're happy to work with the industrial on additional programs, so it doesn't have to be either/or. There may be opportunities to work on both of these.

Tom Cantana talked about working with industry, and we certainly have worked with industry. NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 128 1 the process improvement rule it should be, I think 2 it's 12 months or so, if I'm recalling correctly from 3

-- no, it's 18 months fromANOPR to final rule. It's 4 also 18 months from when it's made a highpriority to 5 anANOPR, so you can have a final rule on those other 6 ones in the period leading up to the ANOPR on 7 refrigerators, so we don't think that this 8 refrigerator petition needs to slow down at all the 9 three that we considertobe theveryhighpriorities. 10 This would be next. 11 Yes, it would probably affect some of 12 these other items that are not only high priority, 13 that DOE hasn't really been working on, but the 14 savings aren't nearly as great. 15 Dave Steiner from Maytag talked about 16 accelerated programs for early retirement. We have 17 been supportiveparticularlyof programs to encourage 18 people to get rid of second refrigerators, you know, 19 what did someone call them, thebeercoolers. We work 20 with the utilities on programs. We're happy to work 21 with the industrial on additional programs, so it 22 doesn't have to be either/or. There may be 23 opportunities to work on both of these. 24 Tom Cantana talked about working with 25 industry, andwe certainlyhave worked with industry.

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We appreciated working with industry. We often work together, not always. We actually did approach AHAM before we submitted the petition to ask if they wanted to work on this, and we got a polite no thank you, which is why we decided ramp up the pressure, but we did first try that. Ad hopefully, there will be opportunities.

Our read is the legislative criteria are pretty clear on whether this petition should be granted. We think that clearly they show it should be. That just begins the process, and we hope to work with industry on a way to set up a new standard in a way that saves energy but doesn't have large burdens on industry. I guess the final thing I wanted to mention is the whole jobs question. Yes, there has been a trend for industry to move overseas. I just saw in this month's Appliance Magazine yet another manufacturer, not Dave's company but another one is building another new factory in Mexico. This is happening now at a time that the standards haven't been changing. I mean, there are large competitive pressures on industry, irrespective of standards.

You have increased pressure from Asia. You have the power retailers who are driving an NEAP R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 129 1 We appreciated working with industry. We often work 2 together, not always. We actually did approach AHAM 3 beforewe submittedthepetitionto askif theywanted 4 to work on this, and we got a polite no thank you, 5 which is why we decided ramp up the pressure, but we 6 did first try that. Ad hopefully, there will be 7 opportunities. 8 Our read is the legislative criteria are 9 pretty clear on whether this petition should be 10 granted. We think that clearly they show it should 11 be. That justbegins theprocess, andwe hope to work 12 with industry on a way to set up a new standard in a 13 way that saves energy but doesn't have large burdens 14 on industry. 15 I guess the final thing I wanted to 16 mention is the whole jobs question. Yes, there has 17 been a trend for industry to move overseas. I just 18 saw in this month's Appliance Magazine yet another 19 manufacturer, not Dave's company but another one is 20 building another new factory in Mexico. This is 21 happening now at a time that the standards haven't 22 been changing. I mean, there are large competitive 23 pressures on industry, irrespective of standards. 24 You have increased pressure from Asia. 25 You have the power retailers who are driving an

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exceedingly hard bargain with these manufacturers, and driving down the price. That's going to happen regardless of what we do with standards. Standards is somewhat of a side show to that. Yes, there's major burdens associated with these larger international pressures, but that's irrespective of standards. And we'd be happy to work with the industry to figure out ways to minimize the impacts of a new standard on those problems, but it really is a larger issue than just standards.

FACILITATOR BROOKMAN: Additional comments on the petition.

MR. CALABRESE: I guess I would maybe just respond and rebut some of those comments. I don't want this to -- Dave Calabrese again, AHAM. I don't want this to become a back and forth, but there's a number of issues that Steve brought up that do need to be addressed.First of all, I think it's somewhat misleading and disingenuous to say this is just a rule making. Just a rule making is inaccurate. This is a process whereby effort on the Department's behalf has to be put forward, and on these products significant effort. And again as I said before, the factors to establish priorities, one of those is incremental

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 130 1 exceedinglyhardbargainwiththesemanufacturers, and 2 driving down the price. That's going to happen 3 regardless of what we dowith standards. Standards is 4 somewhat of a side show to that. Yes, there's major 5 burdens associated with these larger international 6 pressures, but that's irrespective of standards. And 7 we'd be happy to work with the industry to figure out 8 ways to minimize the impacts of a new standard on 9 those problems, but it really is a larger issue than 10 just standards. 11 FACILITATORBROOKMAN: Additionalcomments 12 on the petition. 13 MR. CALABRESE: I guess I wouldmaybejust 14 respond and rebut some of those comments. I don't 15 want this to -- Dave Calabrese again, AHAM. I don't 16 want this to become a back and forth, but there's a 17 number of issues that Stevebrought up that doneedto 18 be addressed. 19 First of all, I think it's somewhat 20 misleading anddisingenuous to saythis isjust a rule 21 making. Just a rule making is inaccurate. This is a 22 process whereby effort on the Department's behalf has 23 to be put forward, and on these products significant 24 effort. And again as I said before, the factors to 25 establish priorities, one of those is incremental

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resources by DOE to complete a rule making process. So clearly there, that factor would be implicated by this. Second of all, from a company standpoint, to just say well we'll engage in a rule making means that the companies have to then make plans based upon presumptions of how that rule making may end up. And again, this jobs issue which Steve insinuates is larger than just standards, which we vehemently disagree, would come into play very much so.

If, in fact, this rule making or this petition is just a stalking horse for more negotiations and asking for other voluntary initiatives, we would be very disturbed if that was, in fact, the point. It was somewhat implicated there that other efforts could come off of this, because in fact, we are always interested and welcome opportunities to talk about voluntary initiatives. So if this again is just a means to generate a discussion, it's an inappropriate way both time-wise for the Department, and for us.

Again, on the jobs issue, we cannot emphasize enough, and I would think that our friends in the advocacy community should be careful when advocating proposals like this that could have a

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 131 1 

### resources by DOE to complete a rule making process. 2 So clearly there, that factor would be implicated by 3 this. 4 

### Secondof all, from a company standpoint, 5 

### to just say well we'll engage in a rule making means 6 

### that the companies have to thenmake plans based upon 7 

### presumptions of how that rule making may endup. And 8 

### again, this jobs issue which Steve insinuates is 9 

### larger than just standards, which we vehemently 10 

### disagree, would come into play very much so. 11 

### If, in fact, this rule making or this 12 

### petition is just a 

### stalking horse for more 13 

### negotiations and asking for other voluntary 14 

### initiatives, we would be very disturbed if that was, 15 

### in fact, the point. It was somewhat implicated there 16 

### that other efforts could come off of this, because in 17 

### fact, we are always interested and welcome 18 opportunitiestotalkaboutvoluntaryinitiatives. So 19 if this again is just a means to generate a 20 discussion, it's an inappropriate way both time-wise 21 

### for the Department, and for us. 22 Again, on the jobs issue, we cannot 23 emphasize enough, and I would think that our friends 24 in the advocacy community should be careful when 25 advocating proposals like this that could have a

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dramatic effect on jobs because from our standpoint, we don't want to be pushing more jobs off-shore. But from their standpoint, to have their efforts seen as causing that could have a detrimental effect on everyone, so we really want and urge the Department and others to see this for what it is. It is a regulatory burden that has the implication to dramatically affect our industry and, in fact, those efforts by the advocacy community.

FACILITATOR BROOKMAN: Let's hear any additional perspectives on the petition. Perhaps we don't need to recommend about this argument. It's already been gone over. Harvey, just state your name for the record.

MR. SACHS: Harvey Sachs, ACEEE. David, I'm old enough to remember AHAM's bragging on productivity improvements in refrigerator manufacturing about the time of the transition from fiberglass to foam insulation, roughly 20 years ago, so I really am very much concerned about the jobs issue myself.

One question I would like to ask is the number of direct manufacturing jobs in the refrigerator industry in this country and I'm concerned about each one of these, but I think that we

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### NEALR. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 132 1 dramatic effect on jobs because from our standpoint, 2 we don't want to be pushing more jobs off-shore. But 3 from their standpoint, to have their efforts seen as 4 causing that could have a detrimental effect on 5 everyone, so we really want and urge the Department 6 and others to see this for what it is. It is a 7 regulatory burden that has the implication to 8 dramatically affect our industry and, in fact, those 9 efforts by the advocacy community. 10 FACILITATOR BROOKMAN: Let's hear any 11 additional perspectives on the petition. Perhaps we 12 don't need to recommend about this argument. It's 13 already beengone over. Harvey, just state your name 14 for the record. 15 MR. SACHS: Harvey Sachs, ACEEE. David, 16 I'm old enough to remember AHAM's bragging on 17 productivity improvements in refrigerator 18 manufacturing about the time of the transition from 19 fiberglass to foam insulation, roughly 20 years ago, 20 so I really am very much concerned about the jobs 21 issue myself. 22 One question I would like to ask is the 23 number of direct manufacturing jobs in the 24 refrigerator industry in this country and I'm 25 concernedabout eachone of these, but I thinkthat we

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ought to have a sense in this room whether we're talking 10,000 jobs, 100,000 jobs, or a million jobs.

FACILITATOR BROOKMAN: I want to make sure we stay pretty close to the focal point of this workshop here. Maybe that's a conversation you can have off-line.

MR. SACHS: The point has been introduced for the record that this is about jobs in a major way. I'm merely asking for a factual basis to be added to that conversation.

MR. CALABRESE: This is David Calabrese, and I'll keep this brief. Of course, I don't have those exact job figures, but if the implication is that if it's a small number, that these individuals who might lose their job is inconsequential to the overall picture, then I think that's a very unpleasant thing to say.

FACILITATOR BROOKMAN: Let's see if there are any additional comments.

MR. McCABE: Michael McCabe. The legislation does provide for petitions of this sort. This is the first one that we have received. We have not established the procedures, the process for responding to it. We're in a learning mode at present. But given that the petition was submitted so close to NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 133 1 ought to have a sense in this room whether weIre 2 talking 10 1000 jobs l 100/000 jobs l or a millionjobs. 3 FACILITATORBROOKMAN: I want tomake sure 4 we stay pretty close to the focal point of this 5 workshop here. Maybe that/s a conversation you can 6 have off-line. 7 MR. SACHS: The point has been introduced 8 for the record that this is about jobs in a majorway. 9 11m merely asking for a factual basis to be added to 10 that conversation. 11 MR. CALABRESE: This is David Calabrese l 12 and 1/11 keep this brief. Of course I I don/t have 13 those exact job figures l but if the implication is 14 that if it/s a small numberI that these individuals 15 who might lose their job is inconsequential to the 16 overallpicture l thenI thinkthat ls a veryunpleasant 17 thing to say. 18 FACILITATOR BROOKMAN: Let/s see if there 19 are any additional comments. 20 MR. McCABE: Michael McCabe. The 21 legislation does provide for petitions of this sort. 22 This is the first one that we have received. We have 23 not established the procedures I the process for 24 responding to it. wetre in a learningmode atpresent. 25 But given that the petitionwas submitted so close to

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today's meeting, we felt that it was the right thing to do to make sure that all who were interested in these proceedings have a copy of it, and are aware of it, and are able to provide us with comments regarding the petition, the issue as to whether or not a product - in this case refrigerators - should be added to the priority list, and at what priority it should be.

The comments that have been received this morning as to the cumulative regulatory burden, the energy savings are particularly valuable, and I would encourage one and all who have an interest in this product to expound upon those comments in their written comments. We will be, over the next month, determining what is the procedures which we will follow to handle this petition. We do not have any in-hand to establish at the present.

FACILITATOR BROOKMAN: Kit. MS. KENNEDY: Kit Kennedy from NRGC. In terms of the process and the petition, and the distinction between commenting on petition and commenting on what the standard should be through the rule making process, the provision we're talking about is 6295 (n) . And 6295 (n) (2) says, "The Secretary shall grant the petition if he finds that it contains evidence, which assuming no other evidence were

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 134 1 today's meeting, we felt that it was the right thing 2 to do to make sure that all who were interested in 3 these proceedings have a copy of it, and are aware of 4 it, and are able toprovideuswithcomments regarding 5 thepetition, the issue as towhetherornot a product 6 inthis case refrigerators

- shouldbe addedto the 7 priority list, and at what priority it should be. 8 The comments that have beenreceived this 9 morning as to the cumulative regulatory burden, the 10 energy savings are particularlyvaluable, and I would 11 encourage one and all who have an interest in this 12 product to expound upon those comments in their 13 written comments. We will be, over the next month, 14 determining what is the procedures which we will 15 follow to handle this petition. We do not have any 16 in-hand to establish at the present. 17 FACILITATOR BROOKMAN: Kit. 18 MS. KENNEDY: Kit Kennedy from NRGC. In 19 terms of the process and the petition, and the 20 distinction between commenting on petition and 21 commenting onwhat the standard shouldbe through the 22 rulemakingprocess, theprovisionwe're talkingabout 23 is 6295(n). And 6295(n) (2) says, "The Secretaryshall 24 grant the petition if he finds that it contains 25 evidence, which assuming no other evidence were

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considered provides an adequate basis for amending the standard." So it is -- the Secretary has very little discretion to deny a petition which makes a facial showing that there's a basis for amending the standards. The statute doesn't call for considering responses to petitions, and I simply want to point that out.

Rosenstock. FACILITATOR BROOKMAN: Thank you. Steve

MR. ROSENSTOCK: Steve Rosenstock at EI. It wasn't shown on the slide show, but as I recall from the website, in terms of low priority products in terms of standards, and I think as well as test procedures, that refrigerators and refrigerator freezers are -- in this proposal are considered low priority, since they are a covered product. Is that correct, just for everyone's notice, that they are in there already as a low priority product for both standards and test procedures? Is that correct? That's what I recall from the website.

MR. BERRINGER: Bryan Berringer. Yes, you are correct, Steve. They're low priority.

MR. ROSENSTOCK: And as a follow-up, I would suggest they stay as low priorities. Thank you.

(202) 234-4433 MR. CALABRESE: Dave Calabrese, one last NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 135 1 consideredprovides anadequatebasis for amendingthe 2 standard." So it is

-- the Secretaryhas very little 3 discretion to deny a petition which makes a facial 4 showing that there's a basis for amending the 5 standards. The statute doesn't call for considering 6 responses to petitions, and I simply want to point 7 that out. 8 FACILITATOR BROOKMAN: Thank you. Steve 9 Rosenstock. 10 MR. ROSENSTOCK: Steve Rosenstock at EI. 11 It wasn't shown on the slide show, but as I recall 12 fromthe website, interms of lowpriorityproducts in 13 terms of standards, and I think as well as test 14 procedures, that refrigerators and refrigerator 15 freezers are in this proposal are considered low 16 priority, since they are a covered product. Is that 17 correct, just for everyone's notice, that they are in 18 there already as a low priority product for both 19 standards and test procedures? Is that correct? 20 That's what I recall from the website. 21 MR. BERRINGER: BryanBerringer. Yes, you 22 are correct, Steve. They're low priority. 23 MR. ROSENSTOCK: And as a follow-up, I 24 would suggest they stayas lowpriorities. Thankyou. 25

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comment and I will not talk again. The reference was to the statute and to the standard by which DOE would or could grant the petition. The comment was made that there is no discretion given to the Secretary to in fact limit discretion to deny. We would see it exactly the opposite, that as was read, the Secretary shall grant the petition considering evidence assuming no other evidence were considered.

Well, of course, we have presented here ample evidence and more is forthcoming, so I see the Secretary having ample discretion. And, in fact, from this reading of the statute, it would seem to provide that as long as other evidence is provided, and it is sufficient and is substantial, that the decision would be to our position in opposition of the petition.

FACILITATOR BROOKMAN: David, I'm sure that you and all the parties involved in this, the Secretary would welcome your written comments about his discretion.

MR. CANTANA: Tom Cantana from Whirlpool. I guess the only thing I would add to that is I think that initial submission of petitions that are advocated to be sort of triggering an automatic process have to meet a minimal standard of credibility, as well. And the Secretary is clearly

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 136 1 comment and I will not talk again. The reference was 2 to the statute and to the standard bywhich DOE would 3 or could grant the petition. The comment was made 4 that there is no discretion given to the Secretary to 5 in fact limit discretion to deny. We would see it 6 exactly the opposite, that as was read, the Secretary 7 shallgrantthepetitionconsideringevidenceassuming 8 no other evidence were considered. 9 Well, of course, we have presented here 10 ample evidence and more is forthcoming, so I see the 11 Secretaryhaving ample discretion. And, infact, from 12 this reading of the statute, it would seem to provide 13 that as long as other evidence is provided, and it is 14 sufficient andis substantial, that thedecisionwould 15 be to our position in opposition of the petition. 16 FACILITATOR BROOKMAN: David, I'm sure 17 that you and all the parties involved in this, the 18 Secretary would welcome your written comments about 19 his discretion. 20 MR. CANTANA: Tom Cantana fromWhirlpool. 21 I guess the only thing I would add to that is I think 22 that initial submission of petitions that are 23 advocated to be sort of triggering an automatic 24 25 process have to meet a minimal standard of credibility, as well. And the Secretary is clearly

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going to have to evaluate that. And I raise that issue because I want to comment a bit on this whole question of dialogue between the advocacy community and industry, because it is always helpful that when we debate a public policy issue, we at least agree on the facts. And it's my understanding of the process thus far, and I think David participated. I didn't participate in some of these direct discussions, that initial discussions were over factual questions about how much energy might be saved if we looked at refrigerators. And the DOE's initial assessment that put it at a low priority saw a savings in the order of one quad or so. And then there was an initial discussion that maybe the advocacy community's view was that the real savings would be morel like three quads. And then there was more discussion about whether that was sufficient to justify raising it on the priority level. And then by the time the petition is filed a relatively short number of days later, the number begins to get to five quads.

Now maybe the best thing we can do to save energy in this country is figure out a process where we can capture how many quads of energy can be instantly identified as saved. But somebody is actually going to have build these products, so I

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 137 1 going to have to evaluate that. And I raise that 2 issue because I want to comment a bit on this whole 3 question of dialogue between the advocacy community 4 and industry, because it is always helpful that when 5 we debate a public policy issue, we at least agree on 6 the facts. And it's my understanding of the process 7 thus far, and I think David participated. I didn't 8 participate in some of these direct discussions, that 9 initial discussions were over factual questions about 10 how much energy might be saved if we looked at 11 refrigerators. And the DOE's initial assessment that 12 put it at a lowpriority saw a savings inthe orderof 13 one quad or so. And then there was an initial 14 discussion that maybe the advocacy community's view 15 was that the real savings would be morel like three 16 quads. And then there was more discussion about 17 whether that was sufficient to justify raising it on 18 theprioritylevel. And thenbythe time thepetition 19 is filed a relatively short number of days later, the 20 number begins to get to five quads. 21 Nowmaybe thebest thingwe cando to save 22 energy in this country is figure out a process where 23 we can capture how many quads of energy can be 24 instantly identified as saved. But somebody is 25 actually going to have build these products, so I

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would submit that it's very important that these numbers be looked at very carefully, and that we all reach some consensus on the facts. Because for us to move from a Department initial assessment of one quad to a few weeks later, a clear showing that there are five quads of opportunity suggests to me that there's more work to be done before this thing moves up higher on the priority list.

MR. BERRINGER: Thank you. Other comments, and perhaps final comments on the petition as we are moving on towards other issues. Steve Nadel. MR. NADEL: Keep it brief, I just want to respond to one or two things. One, I wanted to make it clear this is not a stalking horse. We believe that there are very significant energy savings from updating the standard. I said we are openly discussing other things, because we're always looking for multiple ways to save energy, particularly things that are win-win. We're not looking at either/or. If the industry doesn't want to discuss other things, fine. We have a petition. We're open to working on this and on other things, but it's not like it's bait and switch or anything like that. That's not at

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 138 1 would submit that it's very important that these 2 numbers be looked at very carefully, and that we all 3 reach some consensus on the facts. Because for us to 4 move from a Department initial assessment of one quad 5 to a few weeks later, a clear showing that there are 6 five quads of opportunity suggests to me that there's 7 moreworktobe donebefore this thingmoves up higher 8 on the priority list. 9 MR. BERRINGER: Thank you. Other 10 comments, and perhaps final comments on the petition 11 as we are moving on towards other issues. Steve 12 Nadel. 13 MR. NADEL: Keep it brief, I just want to 14 respond to one or two things. One, I wanted to make 15 it clear this is not a stalking horse. We believe 16 that there are very significant energy savings from 17 updating the standard. I said we are openly 18 discussing other things, becausewe're always looking 19 for multiple ways to save energy, particularlythings 20 that are win-win. We're not looking at either/or. If 21 the industry doesn't want to discuss other things, 22 fine. 23 We have a petition. We're opentoworking 24 on this and on other things, but it's not like it's 25 bait and switch or anything like that. That's not at

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One final point, Dave made a point about well, 687 models; there is only 50 to 100 basic models. Yes, there's a lot of boiling down. I don't think basic models -- those numbers -- Energy Star keeps track of different colors, but yes, there often are small little differences. That also affects the total number of models that are available also, so instead of thousands of models, I would imagine we're only talking hundreds of basic models available, so you need to keep whether you're looking at total models or basic models, you need to be clear that one is much smaller than the other. But if you're looking just at basic models, you need to look at what is the total universe of basic models. There's an awful lot of those skews as stocking units go away.

FACILITATOR BROOKMAN: So let's then refer to page 19, and talk about any other thing anyone wishes to raise other than the petition. I think we've

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 139 1 all going on. 2 In terms of the numbers, whenwe met with 3 AHAM, we presented the numbers that DOE had, as well 4 as some of our own. DOE subsequently came out with 5 some new numbers. I haven't looked in detail at the 6 DOE numbers how they revised their numbers, but that 7 could be clarified. 8 One final point, Dave made a point about 9 well, 687 models; there is only 50 to 100 basic 10 models. Yes, there's a lot of boiling down. I don't 11 think basic models

-- those numbers

-- Energy Star 12 keeps track of different colors, but yes, there often 13 are small little differences. That also affects the 14 total number of models that are available also, so 15 instead of thousands of models, I would imagine we're 16 only talking hundreds of basic models available, so 17 you need to keep whether you're looking at total 18 models orbasic models, you need to be clear that one 19 ismuch smallerthanthe other. But if you're looking 20 just at basic models, you need to look at what is the 21 total universe of basic models. There's an awful lot 22 of those skews as stocking units go away. 23 FACILITATORBROOKMAN: Solet's thenrefer 24 to page 19, and talk about any other thing anyone 25 wishes to raise otherthan thepetition. I thinkwetve

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covered these. The question is whether we've covered them adequately from your perspective before we move to page 20. Nothing additional, then we're moving to page 20. We've also -- many of you independently have already addressed a lot of the issues that are here on page 20. Those issues in the coverage and for which the Department suggests no action. Yes, please.

MR. AMRANE: Karim Amrane. I just would like to reiterate all comments, Peter's comments about the supermarket display cases. We would like them to put into -- lumped in with the other for refrigerators.

FACILITATOR BROOKMAN: Thank you. FACILITATOR BROOKMAN: Other comments on these. They're listed as in coverage and no action. I think we're nearing the end of the segment. I want to open it at this point to other issues that other people would like to raise if they think it's relevant to this particular meeting.

MR. GRAY: This is Ed Gray from NEMA. I think one thing that didn't come up and needs to be I think reflected in all the cost benefit calculations that are done, are the sea changes and the cost of materials that we're seeing. A lot of the materials that go into electrical products cost a whole lot more NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 140 1 covered these. The question is whether we've covered 2 them adequately from your perspective before we move 3 to page 20. Nothing additional, then we're moving to 4 page 20. We've also

-- many ofyou independentlyhave 5 already addressed a lot of the issues that arehere on 6 page 20. Those issues in the coverage and for which 7 the Department suggests no action. Yes, please. 8 MR. AMRANE: Karim Amrane. I just would 9 liketoreiterateall comments, Peter'scomments about 10 the supermarket display cases. We would like them to 11 put into lumped in with the other for 12 refrigerators. 13 FACILITATOR BROOKMAN: Thank you. 14 FACILITATOR BROOKMAN: Other comments on 15 these. They're listed as in coverage and no action. 16 I think we're nearing the end of the segment. I want 17 to open it at this point to other issues that other 18 peoplewould like toraise if theythink it'srelevant 19 to this particular meeting. 20 MR. GRAY: This is Ed Gray from NEMA. I 21 think one thing that didn't corne up and needs to be I 22 think reflected in all the cost benefit calculations 23 that are done, are the sea changes and the cost of 24 materials that we're seeing. A lot of the materials 25 that go intoelectricalproducts cost a whole lot more

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than they did a couple of years ago. And I'd just like to make sure that those new costs are reflected in the calculations.

I think someone indicated well, they just see this as a typical cyclical factor that occurs in raw materials, and I would beg to differ with that. I think we have emerging significant demand on these materials, whether they're steels, copper, aluminum or whatever, for example, in China; that not being the only one, but certainly an important one. So I think we'll need to get better numbers for the cost of magnetic steels, and lining materials and things like that for a number of electrical products.

FACILITATOR BROOKMAN: Please, Harvey. MR. SACHS : I certainly take this as being very important. I agree with NEMA on it. And, in fact, would go beyond that and say that we sometimes look at these materials as being embodied energy. And while we're revising the costs of the materials, we need to make sure that the ratio of energy utilized cost to materials cost is also looked at, if we are updating our energy cost forecast with the same rigor that we're looking at our materials costs.

(202) 234-4433 FACILITATOR BROOKMAN: Charlie Stephens.

MR. STEPHENS: Charlie Stephens, Oregon

NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 141 1 than they did a couple of years ago. And I'd just 2 like to make sure that those new costs are reflected 3 in the calculations. 4 I think someone indicatedwell, theyjust 5 see this as a typical cyclical factor that occurs in 6 raw materials, and I would beg to differ with that. I 7 think we have emerging significant demand on these 8 materials, whetherthey're steels, copper, aluminumor 9 whatever, for example, in China; that not being the 10 only one, but certainly an important one. So I think 11 we'll need to get better numbers for the cost of 12 magnetic steels, and lining materials and things like 13 that for a number of electrical products. 14 FACILITATOR BROOKMAN: Please, Harvey. 15 MR. SACHS: I certainlytake this asbeing 16 very important. I agree with NEMA on it. And, in 17 fact, would go beyond that and say that we sometimes 18 look at thesematerials as beingembodiedenergy. And 19 while we're revising the costs of the materials, we 20 need to make sure that the ratio of energy utilized 21 cost to materials cost is also looked at, if we are 22 updating our energy cost forecast with the same rigor 23 that we're looking at our materials costs. 24 25

(202)234-4433 FACILITATOR BROOKMAN: Charlie Stephens. MR. STEPHENS: Charlie Stephens, Oregon NEAL

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Department of Energy. I'd just like to second that as I look back at some of the energy prices and forecasts that are embedded in some of the analyses that we've been waiting for so long to see. I could only politely call them fiction at this point, and they really do need to be updated.

MR. MULLIN: Jim Mullin, Lenox. I want to talk about Appendix A and it's actually number 17, which is the furnace fan efficiency. I was a little surprised to find out the numbers were being quoted from the Wisconsin field survey and extrapolated to the rest of the U.S. to claim the amount of energy used by furnace fans. In 1,000 or 1,100 kilowatt hours per year, a typical fan would have to run probably two to three thousand hours, which I believe is about 1,000 to 2,000 hours above what DOE's test procedure predicts. So I'm sure there's a significant overstatement in those numbers of the potential energy savings and we'll certainly comment on that later.

FACILITATOR BROOKMAN: Thank you. Charlie. MR. STEPHENS: Charlie Stephens. I would second that. I think I can find those same levels of overstatements in a number of manufacturer brochures.

FACILITATOR BROOKMAN: Harvey Sachs.



### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 142 1 Department of Energy. I'djust like to secondthat as 2 I lookbackat some of the energyprices and forecasts 3 that are embedded in some of the analyses that we've 4 been waiting for so long to see. I could only 5 politely call them fiction at this point, and they 6 really do need to be updated. 7 MR. MULLIN: JimMullin, Lenox. I want to 8 talk about Appendix A and it's actually number 17, 9 which is the furnace fan efficiency. I was a little 10 surprised to find out the numbers were being quoted 11 from the Wisconsin field survey and extrapolated to 12 the rest of the U.S. to claim the amount of energy 13 used by furnace fans. In 1,000 or 1,100 kilowatt 14 hours per year, a typical fan would have to run 15 probably two to three thousand hours, which I believe 16 is about 1,000 to 2,000 hours above what DOE's test 17 procedurepredicts. So I'msure there Is a significant 18 overstatementinthosenumbers ofthepotential energy 19 savings and we'll certainly comment on that later. 20 FACILITATOR BROOKMAN: Thank you. 21 Charlie. 22 MR. STEPHENS: Charlie Stephens. I would 23 second that. I think I can find those same levels of 24 overstatements in a number of manufacturerbrochures. 25

(202)234-4433 FACILITATOR BROOKMAN: Harvey Sachs. NEALR. GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODEISLANDAVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 143 MR. SACHS: Jim, thanks for bringing that up. I'd just like to say that I believe from the struggles I've had to understand that particular issue and the work we've done with some spreadsheets, that part of this is based on the difference between the external static pressures found in the field, and those which are assumed in the analysis, directly in the air conditioner analysis, and indirectly perhaps trekking back into the AFUE. So I think as part of the lookbacks and look-sees that the rule making procedures that have been proposed, that we certainly would be hopeful that this would lead to some consideration of how all these issues interplay.

FACILITATOR BROOKMAN: And I'm certain the Department would welcome any additional and very specific comments of this sort.

MR. SACHS: The point I'm trying to make is that in the field at the higher static pressures the field installed equipment seems to see, we are not surprised to see higher electricity use for the fans, particularly since that particular study emphasized ECMs which respond by pumping volt.

FACILITATOR BROOKMAN: I think those topics would be helpful in writing, Harvey.

MR. NADEL: The one thing I'd note on this

NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 143 1 MR. SACHS: Jim, thanks for bringing that 2 up. I'd just like to say that I believe from the 3 struggles I'vehadtounderstandthatparticularissue 4 and the work we've done with some spreadsheets, that 5 part of this is based on the difference between the 6 external static pressures found in the field, and 7 those which are assumed in the analysis, directly in 8 the air conditioner analysis, and indirectly perhaps 9 trekking back into the AFUE. So I think as part of 10 the lookbacks and look-sees that the rule making 11 procedures that have beenproposed, that we certainly 12 would be hopeful that this would lead to some 13 consideration of how all these issues interplay. 14 FACILITATORBROOKMAN: AndI'mcertainthe 15 Department would welcome any additional and very 16 specific comments of this sort. 17 MR. SACHS: The point I'm trying to make 18 is that in the field at the higher static pressures 19 the field installedequipment seems to see, we arenot 20 surprised to see higher electricityuse for the fans, 21 particularly since that particular study emphasized 22 ECMs which respond by pumping volt. 23 FACILITATOR BROOKMAN: I think those 24 topics would be helpful in writing, Harvey. 25

(202)234-4433 MR. NADEL: The one thing I'dnote onthis NEALR. GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODEISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 144

is that was constant as the cold was the normal climate, so Wisconsin probably will have higher operating hours than other locations, and that probably needs to be factored in.

I guess with that, I have one other question since we seem to be wrapping up. Where do you recommend we go for lunch?

FACILITATOR BROOKMAN: I'll address that at the end. We're not there yet. Other issues? I want to make certain we have a chance to cover what needs to be covered in this meeting right now, so any additional issues . Not talking about the petition.

MR. CALABRESE: That' right. I'm not talking about the petition. I think another wrap-up issue, and I think the discussion here has been very good. And before my time, I understand there used to be an advisory committee that DOE had of industry, stakeholders and the like. And I guess my parting comment here would be is that that type of advisory committee - in my previous life I worked on international trade issues, and there were a number of these committees in the government, and they were very helpful getting groups together and dialoguing and the rest.

(202) 234-4433 I guess my recommendation, my last 

### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 144 1 is that was constant as the cold was the normal 2 climate, so Wisconsin probably will have higher 3 operating hours than other locations, and that 4 probably needs to be factored in. 5 I guess with that, I have one other 6 question since we seem to be wrapping up. Where do 7 you recommend we go for lunch? 8 FACILITATOR BROOKMAN: I'll address that 9 at the end. We're not there yet. Other issues? I 10 want to make certain we have a chance to cover what 11 needs to be covered in this meeting right now, so any 12 additional issues. Not talking about the petition. 13 MR. CALABRESE: That' right. I'm not 14 talking about the petition. I think another wrap-up 15 issue, and I think the discussion here has been very 16 good. And before my time, I understand there used to 17 be an advisory committee that DOE had of industry, 18 stakeholders and the like. And I guess my parting 19 comment here would be is that that type of advisory 20 committee in my previous life I worked on 21 international trade issues, andtherewere a numberof 22 thesecommittees inthegovernment, andtheywerevery 23 helpful gettinggroupstogetheranddialoguingandthe 24 rest. 25

(202)234-4433 I guess my recommendation, NEALR. GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODEISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 my last

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recommendation would be that the Department consider within the law as it can be done to reinstitute that advisory committee.

FACILITATOR BROOKMAN: Thank you. Final comments. I think we're just about to describe a few next steps, barring anything else that anybody has to say. This was in the slide that Barbara described already. The next slide. The comment period concludes July 9th. Please submit your electronic comments. You can see the email address there, and written comments to the Department of Energy as located in your packet. And any specific questions could be directed to Barbara Twigg. And are there other next steps we would list at this point. We've already described that at some point in the future we would expect the Secretary to comment on the petition. And that beyond that, Michael or Bryan.

MR. McCABE: Michael McCabe. There have been a number of issues raised today that are very different than the sorts of issues raised in the previous prior setting agendas. And when we had developed the process improvement rule, we had envisioned the next step as being publishing the priorities and the rule making schedules and the regulatory agenda.

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 145 1 recommendation would be that the Department consider 2 within the law as it can be done to reinstitute that 3 advisory committee. 4 FACILITATOR BROOKMAN: Thank you. Final 5 comments. I think we're just about to describe a few 6 next steps, barring anything else that anybody has to 7 say. This was in the slide that Barbara described 8 already. The next slide. The comment period 9 concludes July 9th • Please submit your electronic 10 comments. You can see the email address there, and 11 written comments to the Department of Energy as 12 located in your packet. And any specific questions 13 could be directed to Barbara Twigg. And are there 14 other next steps we would list at this point. We've 15 already described that at some point in the future we 16 wouldexpect the Secretarytocomment onthepetition. 17 And that beyond that, Michael or Bryan. 18 MR. McCABE: Michael McCabe. There have 19 been a number of issues raised today that are very 20 different than the sorts of issues raised in the 21 previous prior setting agendas. And when we had 22 developed the process improvement rule, we had 23 envisioned the next step as being publishing the 24 priorities and the rule making schedules and the 25 regulatory agenda.

(202)234-4433 NEALR. GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODEISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 146 There are issues here that likely may not be answered in the regulatory agenda, and we will be looking at those, and looking at ways to respond. Some issues I think we've already responded. I'm not certain if there will be any further, for example, the commercial clothes washers, or the large central air conditioners. We will make available the letters that have gone out on the commercial clothes washer, but beyond that, I'm not certain that there's anything else that we'll do responding to the petition for refrigerators. We will be processing that. Exactly how it's going to be processed, I don't have an answer, so there are a number of things that I wish I had answers to exactly how they'll be addressed, but I anticipate that some of them will be addressed outside of the publication of the regulatory agenda.

FACILITATOR BROOKMAN: Thank you. Yes. MR. WETHJE: Larry Wethje. Just to confirm then, Michael, I assume we have at least until July 9th to submit comments on the petition before the Secretary will take any action on it. Can you confirm that? MR. McCABE: No, I cannot.

MR. WETHJE: So there's a possibility that he might act upon it before we have a chance to submit NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com 146 1 There are issues here that likelymaynot 2 be answered in the regulatory agenda, and we will be 3 looking at those, and looking at ways to respond. 4 Some issues I think we've already responded. I'mnot 5 certainif therewill be any further, for example, the 6 commercial clothes washers, or the large central air 7 conditioners. We will make available the letters that 8 have gone out on the commercial clothes washer, but 9 beyond that, I'm not certain that there's anything 10 else that we'll do responding to the petition for 11 refrigerators. We will be processing that. Exactly 12 how it's going to be processed, I don't have an 13 answer, so there are a number of things that I wish I 14 had answers to exactly how they'll be addressed, but 15 I anticipate that some of them will be addressed 16 outside of the publication of the regulatory agenda. 17 FACILITATOR BROOKMAN: Thank you. Yes. 18 MR. WETHJE: Larry Wethje. Just to 19 confirmthen, Michael, I assumewe have at leastuntil 20 July 9th to submit comments on the petitionbefore the 21 Secretarywill take any actionon it. Canyou confirm 22 that? 23 MR. McCABE: No, I cannot. 24 MR. WETHJE: Sothere's a possibilitythat 25 he might act upon it beforewe have a chance to submit

(202)234-4433 NEALR. GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODEISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com147 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 comments? MR. McCABE: This petition that -- we have

the requirement in the legislation to respond to the petition. It is -- the Department will have to determine what is the right way, what the legislation expects us to respond. And there are -- with an engineering background, and I answered the question, the specific question such as that there's always that possibility. As to how real that possibility is, I don't know. MR. CALABRESE: I guess knowing as they tell me that there is an interest in our behalf to comment substantively on this, we will. And if we're given the time frame, of course provide that. And we'll provide it, so our concern is missing some deadline that the Secretary makes the decision and we weren't able to -- weren't aware that it was moving forward. MR. McCABE: Michael McCabe. There are at least two separate issues on the refrigerator petition. One is the response to it, and the second is the priority, and so certainly in commenting on the priority and where it will be in the priority if it is accepted is a question which I would encourage comments on. The responding to it and accepting it,

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 147 1 comments? 2 MR. McCABE: Thispetitionthat

-- we have 3 the requirement in the legislation to respond to the 4 petition. It is the Department will have to 5 determine what is the right way, what the legislation 6 expects us to respond. And there are with an 7 engineering background, and I answered the question, 8 the specificquestion suchasthat there's always that 9 possibility. As to how real that possibility is, I 10 don't know. 11 MR. CALABRESE: I guess knowing as they 12 tell me that there is an interest in our behalf to 13 comment substantively on this, we will. And if we're 14 given the time frame, of course provide that. And 15 we'll provide it, so our concern is missing some 16 deadline that the Secretarymakes the decision andwe 17 weren't able to -- weren't aware that it was moving 18 forward. 19 MR. McCABE: Michael McCabe. There are at 20 least two separate issues on the refrigerator 21 petition. One is the response to it, and the second 22 is thepriority, and so certainlyincommentingonthe 23 priorityandwhere it will be inthe priorityif it is 24 accepted is a question which I would encourage 25 comments on. The responding to it and accepting it,

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I view that as a separate question, and that may -- I don't know what the schedule is for that. I would offer that that may happen before the 9th. I think it's quite unlikely, but there is always that possibility. MR. ROSENSTOCK: So just for all the stakeholders here, in terms of the petition, if we're going to comment on what the priority level is, we can send them in with our July 9th comments, or the comments that are due by July 9th. But if we want to respond to the petition itself, or have other comments just on the petition, not necessarily the -- well, with issues beyond the prioritization, that a stakeholder should write the Secretary of Energy directly at the earliest possible time, since there's no real time line for considering the issue. It didn't sound like there's any sort of process outlined. MR. DePRIEST: I think we mentioned -- this is Tom DePriest, General Counsel, again. I think we mentioned earlier on that the statute really makes no provision for public input to the Secretary's decision to accept or deny the petition. There would be public input, of course, in the event that the petition is accepted, and then we proceed to review a

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 148 1 I view that as a separate question, and that may -- I 2 don't know what the schedule is for that. I would 3 offer that that may happen before the 9th • I think 4 it's quite unlikely, but there is always that 5 possibility. 6 MR. ROSENSTOCK: So just for all the 7 stakeholders here, in terms of the petition, if we're 8 going to comment onwhat the prioritylevel is, we can 9 send them in with our July 9th comments, or the 10 comments that are due by July 9th • But if we want to 11 respondto thepetitionitself, orhaveothercomments 12 just on the petition, not necessarily the

-- well, 13 with issues beyond the prioritization, that a 14 stakeholder should write the Secretary of Energy 15 directly at the earliest possible time, since there's 16 no real time line for considering the issue. It 17 didn't sound like there's any sort of process 18 outlined. 19 MR. DePRIEST: I think we mentioned

-- 20 this is Tom DePriest, General Counsel, again. I think 21 we mentioned earlieron that the statute reallymakes 22 no provision for public input to the Secretary's 23 decision to accept or deny the petition. There would 24 be public input, of course, in the event that the 25 petition is accepted, and thenwe proceed to review a

(202)234-4433 NEALR.GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODEISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 149

number in terms of whether to set higher standards. So Michael is correct also when he mentioned earlier that this is the first one we've ever gotten. We have all read the statute, and we will proceed based on the statute. The deadline for commenting on the priority is the same for the petition as it would be for any of the prior settings we've discussed here today. As far as the Secretary's action on accepting or denying the petition, if you have something that you want to say, then I think the sooner you say it, the happier you'll be.

We have no idea, and I don' t think this is going to be a decision in terms of accepting or denying the petition. I personally, and I'm only speaking for myself only here, I don't see that as being a particularly protracted drawn out affair. I think we can make a decision, that the program can make a decision with legal advice on whether to accept or deny the petition. It's not going to take months and months to make that decision.

MR. CALABRESE: Dave Calabrese. Clarification - the statute does provide for other evidence to be presented. That's what I was reading in the --

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 149 1 number in terms of whether to set higher standards. 2 So Michael is correct also when he mentioned earlier 3 that this is the first one we've evergotten. We have 4 all readthe statute, andwe will proceedbasedonthe 5 statute. 6 The deadline for commenting on the 7 priority is the same for the petition as it would be 8 for any of the prior settings we've discussed here 9 today. As far as the Secretary's action on accepting 10 or denying the petition, if you have something that 11 you want to say, then I think the sooner you say it, 12 the happier you'll be. 13 We have no idea, and I don't think this is 14 going to be a decision in terms of accepting or 15 denying the petition. I personally, and I'm only 16 speaking for myself only here, I don't see that as 17 being a particularly protracted drawn out affair. I 18 think we can make a decision, that the program can 19 make a decisionwithlegal advice onwhetherto accept 20 or deny the petition. It's not going to take months 21 and months to make that decision. 22 MR. CALABRESE: Dave Calabrese. 23 Clarification

- the statute does provide for other 24 evidence to be presented. That's what I was reading 25 in the

--

(202)234-4433 NEAL

### R. GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODEISLANDAVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 150 MR. DePRIEST: I think we respectfully disagree on that, David.

FACILITATOR BROOKMAN: So the two of you can take that off-line. Yes, Jim.

MR. CRAWFORD: Jim Crawford. The subject of what is covered seems to have come up several times today, and I expect to leave this room not knowing the answer, and that concerns me, certainly at least for the products that we manufacture that concerns me. And I would think that that should be the number one priority of this whole process, is to resolve any questions as to what products are covered, and by what laws they come under coverage, because if we don't have that, then we're off kind of in never-never land on everything. And I don't see this as some negotiated thing. I think this is a matter of reasoned interpretation of law by counsel.

FACILITATOR BROOKMAN: Other final comments? So from my perspective, I'll just thank you all for what I thought was a very constructive meeting, and particularly thank all of you for what was well done, good conduct. And so I'll turn it back to the Department of Energy to see if any of them wish to make closing remarks. Thanks. Travel safe. Thank you. If that answered -- Deborah.

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 150 1 MR. DePRIEST: I think we respectfully 2 disagree on that, David. 3 FACILITATOR BROOKMAN: So the two of you 4 can take that off-line. Yes, Jim. 5 MR. CRAWFORD: Jim Crawford. The subject 6 ofwhat is covered seems tohave comeup several times 7 today, and I expect to leave this roomnot knowing the 8 answer, and that concerns me, certainly at least for 9 the products that we manufacture that concerns me. 10 And I would think that that should be the number one 11 priority of this whole process, is to resolve any 12 questions as towhatproducts are covered, andbywhat 13 laws they come under coverage, because if we don't 14 have that, then we're off kind of in never-never land 15 on everything. And I don't see this as some 16 negotiated thing. I think this is a matter of 17 reasoned interpretation of law by counsel. 18 FACILITATOR BROOKMAN: Other final 19 comments? So frommyperspective, I'lljust thankyou 20 all for what I thought was a very constructive 21 meeting, and particularly thank all of you for what 22 was well done, good conduct. And so I'll turn itback 23 to the Department of Energyto see if anyof themwish 24 tomake closingremarks. Thanks. Travel safe. Thank 25 you. If that answered

-- Deborah.

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stand. MS. MILLER: No, we know where to go.

FACILITATOR BROOKMAN: The hotdog stand

MS. MILLER: The cafeteria or the hotdog

FACILITATOR BROOKMAN: The DOE cafeteria is open, as I understand it, the main cafeteria if you want to go there. Safe travel to everyone.

(Whereupon, the proceedings in the aboveentitled matter went off the record at 12:43 p.m.)

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### NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. WASHINGTON, D.C. 20005-3701 www.nealrgross.com 151 1 MS. MILLER: No, we know where to go. 2 FACILITATOR BROOKMAN: The hotdog stand 3 out -- 4 MS. MILLER: The cafeteria or the hotdog 5 stand. 6 FACILITATOR BROOKMAN: The DOE cafeteria 7 is open, as I understand it, the main cafeteria ifyou 8 want to go there. Safe travel to everyone. 9 (Whereupon, the proceedings inthe above10 entitled matter went off the record at 12:43 p.m.) 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

(202)234-4433 NEALR.GROSS COURTREPORTERSANDTRANSCRIBERS 1323 RHODEISLANDAVE., N.w. WASHINGTON, D.C. 20005-3701 www.nealrgross.com152 CERTIFICATE

This is to certify that the foregoing transcript in the matter of: Public Meeting on Proposed FY 2005 Prioritization

Before: Dept. of Energy

Date: June 9, 2004

Place: Washington, DC

represents the full and complete proceedings of the aforementioned matter, as reported and reduced to typewriting. 152 CERTIFICATE

This is to certify that the foregoing transcript in the matter of: Public Meeting on Proposed FY 2005 Prioritization

Before: Dept. of Energy

Date: June 9, 2004

Place: Washington, DC

represents the full and complete proceedings of the aforementioned matter, as reported and reduced to typewriting.