Energy Con servation St anda rds Ru lemaking Framework Do cume nt fo r Co mmercial Packaged Boilers RI N: 1904-AD01

U.S. De pa rtme nt of Energy Off ice of Energy Eff ici ency and Renewable Energy B ui l di ng T ec hno logies Office

Aug ust 28, 2013TABL E OF CON TENTS

1. INTRODUC TI ON

................................ ................................ ...................................................... 1

1.1 Statu to ry Authorit y

................................ ................................ ...................................... 2 1.2 History of Co mm ercial P ac kaged Bo il er Standards

..................................................... 3 1.3 Overview of the Rulemaking Pro ce s s

................................ .......................................... 5 1.3.1 Pre li minary Analysi s

................................ ......................................................... 7 1.3.2 No tice of Proposed Rulemaki ng

................................ ........................................ 8 1.3.3 Final Rul e

................................ ................................ ........................................ 10

2. SC OPE OF COVERA GE

................................ ................................ ........................................ 10

2.1 Cu rr ent Scope of Covera ge

................................ ........................................................ 10 2.2 Proposed Scope of Covera ge

................................ ..................................................... 11

3. T EST PROCEDURE S

................................ ................................ ............................................. 12

3.1 Discu ss ion of Alternat iv e Test Pro ce dure Approache s

.............................................. 13

4. OVERVIEW OF ANAL YS IS F OR ENER GY CONSERVA TI ON STANDARDS RULEMAKI NG

................................ ................................ .......................................... 15

5. MARKET A ND TE CHNOLOGY A SS E SS MENT

................................ ................................ 17

5.1 Market A ss essmen t

................................ ................................ .................................... 17 5.2 Tr a de A ss ociations and Manuf ac turer s

................................ ...................................... 18 5.2.1 Air-Conditioni ng, Heat in g, and Refrigeration Institut e

................................ ... 18 5.2.2 American Bo il er Manuf ac turer s A ss ociation

.................................................. 19 5.3 Equipment Cla ss e s

................................ ................................ ..................................... 19 5.4 T ec hnol og y A ss essmen t

................................ ............................................................. 20 5.4.1 Bo il er Equipmen t

................................ ............................................................. 20 5.4.2 T ec hnol og y Op tions to Improve Co mb ustion and/or Thermal Bo il er Efficienc y

................................ ................................ ......................................... 24 5.4.3 T ec hnol og y Op tions to Reduce Standby Mode and Off Mode Energy Consumption

................................ ................................ .................................... 27 5.4.4 T ec hnol og y Op tions to Reduce S ea sonal Bo il er Energy Consumption

.......... 28

6. S CREE NI NG ANALYS I S

................................ ................................ ...................................... 30

7. ENGIN EE RI NG ANAL YS I S

................................ ................................ ................................ .. 31

7.1 Engin ee r in g Analysi s Overvie w

................................ ................................................ 31 7.2 Engin ee r in g Analysis A pp ro ac h

................................ ................................................ 32 7.2.1 Baseline Model s

................................ .............................................................. 32 7.2.2 Efficiency Level s

................................ ............................................................. 33 7.2.3 Methodology for Devel op ing the Cost-E ff iciency Relationship

..................... 34 7.2.4 Proprietary Design s

................................ ......................................................... 35

8. MARK UPS ANALYS I S

................................ ................................ .......................................... 35

9. ENER GY USE ANAL YS I S

................................ ................................ .................................... 38

9.1 Est im at in g An nual Energy Consumption of Bo il er s

.................................................. 39

i10. LIFE-CY CL E C OST A ND PAYBACK PERI OD ANALYS I S

............................................ 42

10.1 Overvie w

................................ ................................ .................................................... 42 10.2 Appro ac h

................................ ................................ .................................................... 42 10.3 Energy Price s

................................ ................................ ............................................. 44 10.4 Ma in tenance and Repair Cost s

................................ ................................................... 44 10.5 Insta ll ation Cost s

................................ ................................ ........................................ 45 10.6 Equipment Lifet im e

................................ ................................ ................................ ... 46 10.7 Discount Rate s

................................ ................................ ........................................... 46 10.8 Energy Efficiency in the Base Cas e

................................ ........................................... 46

11. SH IPMENTS ANAL YS I S

................................ ................................ ..................................... 47

11.1 Imp ac t of Amended Standards on Equipment Sh ipment s

.......................................... 48

12. NA TI ONAL IMPACT ANALYS I S

................................ ...................................................... 49

12.1 Proj ec ted E ff iciency Tr end s

................................ ....................................................... 49 12.2 National Energy Saving s

................................ ............................................................ 50 12.3 Net Present Value of Consumer Saving s

................................ ................................ ... 50

13. CON SU ME R SU BGROUP ANAL YS I S

................................ .............................................. 51

14. MANUFACTURE R IM PA CT ANALYS I S

................................ .......................................... 52

14.1 Sour ce s of Information for the Manuf ac turer Impact Analysi s

................................ . 52 14.2 Industry Cash-Flow Analysi s

................................ ..................................................... 53 14.3 Manufacturer Subgroup Analysi s

................................ .............................................. 53 14.4 Competit iv e Impact s Asse ss men t

................................ .............................................. 54 14.5 Cumulat iv e Regulatory Burden

................................ .................................................. 54

15. EMI SS IONS ANAL YS I S

................................ ................................ ...................................... 54

16. MONETIZI NG CO 2 A ND OTHER EMI SS IONS REDUC TI ON S

...................................... 57

17. UTIL IT Y IMPACT ANAL YS I S

................................ ........................................................... 58

18. EMPLOYME NT IMPACT ANALYS I S

................................ ............................................... 58

19. REGULATORY IM PA CT ANALYS I S

................................ ................................................ 59

A

PP ENDIX A – LI ST OF I TE MS F OR CO MM E NT

................................ ................................ 61

LI ST OF TAB LE S

Table 1.1 Energy Conservation Standards for C om mercial P ac kaged Bo il er s Manuf ac tured on or after March 2, 2012

................................ ................................ ....................................... 4 Table 1.2 Energy Conservation Standards for C om mercial P ac kaged Bo il er s Manuf ac tured on or after March 2, 2022

................................ ................................ ....................................... 4 Table 5.1 Considered Co mm ercial P ac kaged Boi ler Equipment Classes

.................................... 20LI ST OF FI GU RES

Fi gu re 4.1 Flow Diagram of Analyse s Conducted for an Energy Conservation Standards Rulemaki ng

................................ ................................ ................................................ 16 Fi gu re 8.1 Repl ac ement Distr ib ution Channe l

................................ ............................................ 36 Fi gu re 8.2 New Construction Distr ib ution Channe l

................................ .................................... 36 Fi gu re 8.3 National Account Distr ib ution Channe l

................................ .................................... 36 Fi gu re 8.4 Wholesaler Distribution Channe l

................................ ............................................... 36

iiiLI ST OF AC RON YMS

A

BM A American Bo il er Manuf ac turer s A ss ociation A CC A Air-conditioning Contr ac to rs of America AEMTCA American Energy Manuf ac tur in g T ec hnical Co rr ec tions Ac t AEO An nual Energy Ou tl oo k AHRI Air-conditioni ng, Heat in g, and Refrigeration Institut e A

NSI American National Standards Institute A SH RAE American Society of Heat in g, Refrigerat in g and Ai r-Conditioning Engin ee r s ASME American Society of Mechanical Engineers BLS Bur ea u of Labor Statistics BMG basic model group B OH burner operat in g hours B OM bill of materials B PM brushles s p ermanent magnet BT Bu il ding T ec hnol og ies Office Btu British thermal unit CAIR Cl ea n Air Interstate Rule CB ECS Co mm ercial Building Energy Consumption Surve y CB LR Certification Program for Co mm ercial Bo il ers CB L R OM Certification Program for Co mm ercial Bo il er s Op eration s Manua l CFR Code of Federal Regulations CO 2 carbon dioxide C PVC chlorinated po ly vin yl chloride CSA PR Cross-State Air Po llution Rul e C SL candidate standard level D.C. District of Columbia DO E U. S. Department of Energy DO J U. S. Department of Justice DSI dir ec t spark ignition E C co mb ustion efficiency E T thermal e ff iciency EE RE O ff ice of Energy Efficiency and Renewable Energy E GU el ec tric generat in g unit EI A Energy Information Administration EI SA 2007 Energy Independence and S ec urity Act of 2007 E PA U. S. E nvironmental Prot ec tion Agenc y EPACT 1992 Energy Po li cy Act of 1992 EPCA Energy Po li cy and Conservation Ac t EPRI El ec tric Power Res earch Institute FFC full fuel-cycle

4F R Federal Regist er GAM A Ga s Appliance Manuf ac turer s A ss ociation GD P gros s domestic product GHG gr ee nhouse gas GREE T Gr ee nhouse Gases, Regulated E mi ss ions, and Energy Use in Tr ansportation GRIM Government Regulatory Imp ac t Model GT I Ga s T ec hnol og y Institute HA P hazardous air po llutant HARDI Heat in g, Air-conditioni ng & Refrigeration Distributors Internationa l HD D h ea t in g degree-day H g mercury H I Hydronic s Institute h

r hour HVA C h ea t in g, vent il ation, and air-conditioning HVACR h ea t in g, vent il ation, air-conditioni ng, and refrigeration ImSET Imp ac t of S ec tor Energy T ec hnol og ies I-O U. S. Benchmark National Input-Outpu t LBNL Lawr ence Berkeley National Labora to ry LC C l if e-cycle cost L PG liquefied petroleum gas MATS Mercury and Air Toxic s S tandards MIA manuf ac turer im p ac t analysis M PC manuf ac turer production cost M SP manuf ac turer selli ng price NC I Navigant Consult in g, Inc. NEM S National Energy Mode li ng System NE S national energy savi ngs NIA national im pact ana ly sis NO PD notice of proposed deter mi nation NO PR notice of proposed rulemaki ng NO X oxide s of nitrogen NPV net present value NRE L National Renewable Energy Labora to r y OM B U. S. Office of Management and Budge t PB P pa yb ack period PM particulate matter PNNL Pacific Northwest National Laborator y PSC permanent split ca pacitor psi g pounds per square in ch ga uge R& D res ea rch and devel op ment RIM S Regional Input-Output Mode li ng Syste m REC S Residential Energy Consumption Surve y SC C social cost of carbon SE C S ec uritie s and Exchan ge Commi ss ion SG&A selli ng, general, and ad mi nistrat iv e cost s SM PS switch in g mode power supply

5SO 2 sulfur dioxide TFI trail-for-ignition period T SD t ec hni ca l support document T SL trial standard level U. S. Un ited States U.S.C. Un ited State s Code WH water h ea t in g

6RU LE MAKI NG FRAMEWORK DOC UMEN T F OR CO MMERCI AL PACK AG ED BO ILE RS

1. INT ROD UC TI ON

The U. S. Department of Energy (DOE) Appliance s and Equipment Standards Program, within the Office of Energy Efficiency and Renewable Energy’s (EE RE’s) Bu il di ng T ec hnol og ies Office (B T) , develops and promulgate s energy conservation standards for ce rtain
consumer app li ances and co mm ercial and in dustrial equipment. The pro ce s s for devel op in g standards invo lv e s ana lysis, public notice and co mm ent, and consultation with in terested parties. Interested parties in c lude manuf ac turers, trade a ss ociations, consumers/users, energ y conservation and environmental advo ca tes, State and Federal agencies, and a ny other groups o r individual s with an in terest in these standards. The DO E App li ance Standa rds Pro gr am Report to Con gr e ss , 1 initially submitted on January 31, 2006, and upd ate d twice a year since first publication, identif ie s the nu me rous rule ma kin gs for a vari et y of produ ct s that DO E has schedu le d for compl e t ion and explains many of the te chniques DO E w il l apply durin g the rule ma kin g p ro ce ss to me et thi s schedu le

. The purpose of this Framework Document i s to descr ib e the pro ce dural and analytica l
appro ac he s D OE anticipate s u s in g to ev aluate potentia l amended energy conservation standard s for co mm ercial packaged bo il er s (see s ec tion 1.1 for a discussion of the statu to ry authority fo r thi s rulemak in g). This Framework Document also in trodu ce s the upco mi ng co mm ercia l
p ac kaged bo il er s test pro ce dure rulemaki ng, and serve s to so li cit f ee db ac k from stakeholder s on the cu rr ent test pro ce dure (see s ec tion 3 for a discussion of the test pro ce dure). Co mm ercia l
p ac kaged bo il ers include el ec tric, gas-fired and oil-fired, hot water and st eam bo il er s with input
rat in gs of 300,000 British thermal units/hour (Bt u/h r) or more.

Thi s d ocument is in tended to inform in terested parties about the pro ce s s D OE w il l follo w and to encoura ge and f ac ilitate the in put of in teres ted parties dur in g the rulemaking. Thi s document serve s a s the start in g po in t to develop potential amended energy conservation standards, and a potentia lly amended test proc edure, and is not a definitive statement on any issue to be deter mi ned in the rulemaki ng.

Thi s Framework Document i s comprised of 19 section s related to the rulemaking. Section 1 of thi s d ocument provide s an overview of DO E’ s rulemaking pro ce ss and of the history and authority for re gu lation of co mm ercial p ac kaged bo il ers. S ec tion s 2 and 3 discus s s cope o f coverage and test pro ce du res, resp ec t iv ely. S ec tion s 5 thro ugh19 discus s analyse s D OE in tends
to conduct to fulfi ll the statu to ry requirements for th i s energy conservation standards rulemaking. DOE wi ll analyze potential amended energy conservation standards for co mm ercial p ac kaged bo il er s to deter mi ne wh ether such standards are technol og ica lly feasible and ec ono mi ca l ly justified and would result in signifi ca nt energy savings. DOE wi ll ma in tain information about

1 U.S. Depar tm ent of Energy. Ener gy Conserva ti on St anda r ds A ct ivities; Submi tt ed pursuant to S ec ti on 141 of th e Ene rgy Po lic y Act of 2005 (E PA CT 200 5 ), Pub. L . 10 9- 58, and in response to s ec ti on 305 of the Ener gy Independence and S ec urity Act of 2007 (EISA 2 007 ), Pub. L. 110- 14 0; U.S

. Department of Ener gy (Av ailable at : h tt p :// www1. ee re.energy. go v/bu il di ng s /appl ia n ce _standards/reports_and _pu b li cations.htm l ).

1thi s rulemak in g on it s w ebsite at: h

tt p:/ /ww w1. ee re.energy.gov/buildings/app li an ce _standards /p roduct.aspx/p roductid/74

While DOE invites com me nt on all asp ec ts of the mat erial prese nted in this document,

s eve ral sp ec if ic issues on w hich DOE s eek s comment are set out in com me nt boxe s li ke this

one. DO E uses these com me nt boxe s to highlight issues and to ask sp ec if ic questions on the approache s D OE plans to follow to conduct the analyse s required for th is ener gy conservation standards rulemaking. Such reques ts for f ee dback are numbered seque ntially th roughout the document and are compiled in Appendix A.

1.1 Statutory Au t ho rity

Titl e II I, Part C 2 of the Energy Po li cy and Conservation Act of 1975 (E PCA), Pub. L. 94- 163 (42 U.S.C. 6311-6317, a s codified), added by Pub. L. 95-619, Title I V, §441(a), set s forth a variety of provisions designed to im prove energy efficiency, and it estab li shed the "Energ y Conservation Program for Certain Industrial Equipment, " a program covering ce rtain

co mm ercial and in dustrial equipment (her ea fter refe rr ed to a s "covered equipment"), wh ich includes the co mm ercial p ac kaged bo il ers that are the subj ec t of thi s rulemaking. 3 Part A-1 specifi ca l ly include s d efinitions (42 U.S.C. 6311), energy conservation standards (42 U.S.C. 6313), test pro ce dure s ( 42 U.S.C. 6314), labe li ng provision s (42 U.S.C. 6315), and the authorit y to require comp li ance information and ce rtifi ca tion report s from manufacturers of covered equipment (42 U.S.C. 6316). T hi s p rogram authorize s D OE to estab li sh technol og ical ly f

ea sible,

ec ono mi ca l ly justified energy conservation regulations for ce rtain product s and equipment tha t woul d be li ke ly to result in substantial national energy savi ng s. (42 U.S.C. 6295(o )( 2)(B )( i )(I )- ( VI I))

EPCA established mandatory Federal energy conservation standards for co mm ercia l h ea t in g, air-conditioni ng, and water-h ea t in g equipment that general ly co rr espond to the levels se t in the American Society of Heat in g, Refrigeration, and Air-Conditioning Engineer s (A SH RAE ) Standard 90.1, “Energy Standard for Bu il di ngs Ex ce pt Low-Rise Residential Buildi ngs ,” which were subsequently c od ified under subpart E of Title 10 of the Code of Federal Regulation s (CFR), Part 431 (10 CF R P art 431). 4 (42 U.S.C. 6313(a) ) In particular, the statute set s standards for small, large, and very large co mm ercial p ac kage air-conditioning and h ea t in g equipment,
p ac kaged ter mi nal air conditioners, p ac kaged ter mi nal h ea t pumps, warm air furn ace s, p ac kaged bo il ers, stora ge water h ea ters, in stantaneous water h ea ters, and unfired hot water stora ge tanks (co ll ec t iv e ly “ASHRAE equipment”). (42 U.S.C. 6313(a))

EPCA dir ec t s D OE to consider amending the existing Federal energy conservation standard for eac h ty pe of covered A SH RAE equipment whenever ASHRAE amends th e

e ff iciency levels in Standard 90.1. (42 U.S.C. 6313(a )( 6)(A) ) For eac h ty pe of li sted equipment, EPCA dir ec t s that if A SH RAE amend s S tandard 90.1, DOE must adopt amended standards at the

2 For ed it orial reasons , up on codific ati on in the United St at es Co de (U.S.C.), Part C was redesi gn at ed Part A- 1.
3 All referen ce s to EP CAin this document refer to the statute as amended through the Ameri ca n Ene rgy Manufacturing and T ec hn ical Corr ec ti ons Act

, Pub. L. 112-2 10 (D ec . 18 , 2012 ).
4 For more in fo rmati on , see www.as hr ae.org

. 2new A SH RAE efficiency level, unles s clear and convincing evidence support s a deter mi nation that adoption of a more-str in gent level w ou ld produce significant additional energy savi ngs and would be t ec hn ol og i ca l ly f

ea sible and ec ono mi ca lly justified. (42 U.S.C. 6313(a)(6)(A )( ii) ) I f DOE decide s to adopt a s a national standard the efficiency level s specified in the amended A SH RAE Standard 90.1, DOE must estab li sh such standard not later than 18 month s a fte r publi ca tion of the amended in dustry standard. (42 U.S.C. 6313(a)(6 )( A )( ii)( I) ) However, i f DOE deter mi ne s that a more-stringent standard is ju stified, then it must estab li sh such morestr in gent standard not later than 30 month s after publi ca tion of the amended A SH RAE Standard 90.1. (42 U.S.C. 6313(a)(6 )( B))

OnDecember 19, 2007, the Energy Independence and S ec urity Act of 2007 (EI SA 2007), Pub. L. 110-140, wa s signed in to law, wh ich further revised the energy conservation standards for co mm ercial and industrial equipment. EI SA 2007 amended EPCA, in relevant par t, to require that not later than six y ea r s after i ss uance of a ny final rule establishing or amendi ng a standard, the S ec retary of Energy publish either a notice of deter mi nation that the standards for a g iv en type of equipment do not n ee d to be amended, or a notice of proposed rulemaking (NOPR) including new proposed standards. Thi s amendment wa s further mod ified by the American Energy Manufactur in g T ec hni ca l Co rr ec tions Act (AEMTCA), Pub. L. 112-210, wh ich wa s signed in to law on December 18, 2012. AEMTC A, amended EPCA to require that every si x yea rs, the S ec retary of Energy sha ll take ac tion regard in g wh ether or not more-stringen t standards are n ee ded. ( 42 U.S.C. 6313(a)(6)(C) ) In addition, AEMTCA also amended EPCA so

a s to trigger DOE to review of the energy savings potential of a ny ASHRAE/ IE S Standard 90.1 amendment that changes the standard level s or design requirement s app li cable to a g iv en produc t or ty pe of equipment. ( 42 U.S.C. 6313(a )( 6)(A))

1.2 Hi story of Co mm e rc ial Packaged Boiler St anda rds

The Energy Po li cy Act of 1992 (E PACT 1992), Public Law 102−486, amended EPCA to add co mm ercial packaged bo il ers a s a ty pe of covered equipment. EPACT 1992 also amended EPCA with resp ec t to p ac kaged bo il ers by providing a definition, a s w ell a s p rovisions se tt in g forth app li cable requirements for energy conservation standards, test pro ce dures, labe li ng, and compliance ce rtification. (42 U.S.C. 6311(11)(B); 6313(a )( 4); 6314(a )( 4); 6315(e); 6316(a)-(b) ) Most r ece nt ly , DOE amended it s e nergy conservation standards for co mm ercial p ac kaged bo il er s thro ugha f in al rule published in the Federal Regis ter (FR) on July 22, 2009 (hereafter refe rr ed to

a s the “Ju ly 2009 final rul e” ). 74 FR 36312. More specifica ll y, the Ju ly 2009 final rule updated the energy conservation standards for co mm ercial p ac kaged bo il ers to co rr espond to the levels in the 2007 revision of A SH RAE Standard 90.1 ( i.e. , A SH RAE Standard 90.1-2007). Id . at 36355- 56. Comp li a nce with the amended standards wa s required beginning on March 2, 2012. These levels are sho wnin Table 1.1 belo w. Also in the July 2009 final rule, DOE again followed A SH RAE’ s appro ac h in Standard 90.1-2007 and adopted a s ec ond tier of energy conservation standards for two classe s of co mm ercial p ac kaged bo il ers, wh ich are sho wnin Table 1.2 belo w. Compliance with the la tt er standards w il l be required beginning on March 2, 2022. Id.

3Table 1.1 Energy Con servation St anda rds for Co mmercial Packaged Boiler s Manufactured on or afte r March 2, 2012

E qui pme nt type Sub category Si ze category (in pu t) E f f ici e n c y level—Effect ive da te: March 2, 2012* Hot W a t e r C o mm e r c i a l P ac k a g e d B o il e r s G as -fired >= 300

, 000 B t u /h

r an d

<= 2

, 500

, 000 B t u/hr 80.0% E T

Hot W a t e r C o mm e r c i a l P ac k a g e d B o il e r s G as -fired >2,500,000 Btu/hr 82.0% E C

Hot W a t e r C o mm e r c i a l P ac k a g e d B o il e r s Oil-fired >= 300

, 000 B t u /h

r an d

<= 2

, 500

, 000 B t u/hr 82.0% E T

Hot W a t e r C o mm e r c i a l P ac k a g e d B o il e r s Oil-fired >2,500,000 Btu/hr 84.0% E C
S t eam C o mm e r c i a l P ac k a g e d B o il e r s G as

- f i r e d

— a l l

, e x c e pt n a t u r a l dr a f t >= 300

, 000 B t u /h

r an d

<= 2

, 500

, 000 B t u/hr 79.0% E T
S t eam C o mm e r c i a l P ac k a g e d B o il e r s G as

- f i r e d

— a l l

, e x c e pt n a t u r a l dr a f t >2,500,000 Btu/hr 79.0% E T
S t eam C o mm e r c i a l P ac k a g e d B o il e r s G as

- f i r e d

— n a t ur a l dr a f t >= 300

, 000 B t u /h

r an d

<= 2

, 500

, 000 B t u/hr 77.0% E T
S t eam C o mm e r c i a l P ac k a g e d B o il e r s G as

- f i r e d

— n a t ur a l dr a f t >2,500,000 Btu/hr 77.0% E T
S t eam C o mm e r c i a l P ac k a g e d B o il e r s Oil-fired >= 300

, 000 B t u /h

r an d

<= 2

, 500

, 000 B t u/hr 81.0% E T
S t eam C o mm e r c i a l P ac k a g e d B o il e r s Oil-fired >2,500,000 Btu/hr 81.0% E T

* E T m ea ns “t hermal e ff iciency. ” E C m ea ns “c ombus ti on efficiency.”

Table 1.2 Energy Con servation St anda rds for Co mmercial Packaged Boiler s Manufactured on or afte r March 2, 2022

E qui pme nt type Sub category Si ze category (in pu t) E f f ici e n c y level—Eff ec tive da te: March 2, 2022 S t eam C o mm e r c i a l P a c k a g e d B o il e r s G as

- f i r e d

— n a t ur a l dr a f t >= 300

, 000 B t u /h

r an d

<= 2

, 500

, 000 B t u/hr 79.0% E T
S t eam C o mm e r c i a l P ac k a g e d B o il e r s G as

- f i r e d

— n a t ur a l dr a f t >2,500,000 Btu/hr 79.0% E T

DOE is initiat in g thi s rulemak in g pursuant to 42 U.S.C. 6313(a)(6 )( C), wh ich require s that every six y ea r s D OE must publish either a notice of the deter min ation that standards for th e equipment do not n ee d to be amended, or a NO PR including new proposed energy conservation standards. A s noted above, DOE’s last final rule for co mm ercial p ac kaged bo il er s w as i ss ued on

4July 22, 2009, so a s a result, DOE i s required to ac t by Ju ly 22, 2015. Thi s rulemaking wil l satisfy this statutory ob li gation. 5

1.3 Ov er view of t he Rulemaking Process

Under EPCA, any new or amended standards must ac hieve the ma xi mum level of energ y

e ff iciency that i s t ec hnol og ica lly feasible and ec ono mi ca lly justified. (42 U.S.C. 6313(a)(6)(A)- (C) ) In deter mi ning whether any new or amended standards are ec ono mi ca lly justified, DO E
must a ss es s whether the benefit s of the proposed standard ex cee d it s burdens by, to th e

ma xi mum extent pr ac ticable, consider in g the follow in g seven f ac tors:

(1) The ec ono mi c imp ac t of the standard on the manuf ac turer s and on the consumer s o f the products subj ec t to such standard;

(2) The savi ngs in operat in g costs throughout the est im ated avera ge l if e of the product in the type ( or cla ss ) compared to any incr ea se in the price of, or in initial charges for, o r

ma in tenance expense s of the covered product s wh ich are li ke ly to result from th e standard;

(3) The to tal proj ec ted amount of energy (or as applicable, water ) savi ngs like ly to resul t dir ec tly from the standard;

(4) A ny lessen in g of the ut il ity or the performance of the covered product s li ke ly to resul t from the standard;

(5) The im p ac t of any lessen in g of competition, a s d eter mi ned in writ in g by the At to rne y General, that is li ke ly to result from the standard;

(6) The n ee d for national energy and water conservation; and

(7) Other f ac tors the S ec retary consider s relevant.

(42 U.S.C. 6313(a)(6 )( B) ( ii ))

Additional statu to ry requirement s of general applicability for prescribing new o r amended standards are set forth in 42 U.S.C. 6295(o)(2 )( A), (2)(B )( ii)-(iii), and (3)–(5), a s w el l as 42 U.S.C. 6313(a)( 6)(B).

As discussed in further detail belo w, the standards rulemaking pro ce s s for a g iv en consumer product or co mm ercial and/or in dustrial equipment type typica lly invo lv es a four-step
pro ce s s w ith the foll ow i ng public noti ce s p ublished in the Federal Regis te r : (1) ann oun ce ment o f the availability of the Framework Document in which DOE descr ib e s the overall appro ac h it i s consider in g; (2) announcement of the ava il ability of the prel im inary analysis, which focuse s o n

5 DOE notes that since its la st final rule in 20 09, AS HRAE has not acted to am end its s ta nda rds fo r co mm ercia l packaged bo ilers

, as would tri gg er DO E rule ma king a ct ion under 42 U.S. C. 631 3(a)( 6)( A ).

5the analytical methodol og y DOE i s considering in sett in g potential standards; (3) the NOPR; and (4) the final rule. At eac h of the first three steps, DOE hold s a public mee t in g and so li cits

co mm e nts from the in terested parties on a variety of relevant i ss ue s under consideration in devel op ing potential standards. Interested parties genera lly include manuf ac turers, tra de

a ss ociations, consumers, environmental and energy-efficiency advo ca tes, State and Federa l agencies, and other groups and in dividual s with an in terest in energy conservation standards and test pro ce dures. DOE consider s the participation of in terested partie s t o be a vital part of th e rulemaking pro ce s s for sett in g new and amended energy conservation standards. The broad

arr ay of in terested partie s who rout in e ly provide co mm ent s p romote s a balanced discu ss ion o f critical information required to conduct a standar ds or test pro ce dure rulemaki ng, beginning with public co mm ents on the Framework Document. A cc ord in gly, DOE encourage s the participation of all in terested partie s du r in g the co mm e nt period s p rovided at eac h sta ge of the rulemak in g.

The foll ow ing out li nes next steps for the commercial p ac kaged bo il er s energ y conservation standards rulemaki ng:

Pre li minary Analysi s (s ec tion 1.3.1 ). DOE pla ns to pub li sh pre lim inary analyse s to public ly vet the data, models, and tool s that DOE expect s to use in the rulemaki ng, and to fac il itate pub li c participation in devel op in g the pr op osed rule. These data wi ll include planned equipment classe s and candidate standard level s (CSLs), wh ich span the ran ge o f

e ff iciencies from baseline equipment to equipment utilizing the most e ff icien t
t ec hn ol og y. DOE wi ll hold a public m ee t in g and webinar related to the pre li minar y analyse s and wi ll seek public co mm ent.

No tice of Proposed Rulemaking (s ec tion 1.3.2 ). The NO PR w il l present: ( 1) a discussion of co mm ent s r ec e iv ed in response to the prel im inary ana lyses; (2) DOE’ s analysi s of th e imp ac t s of potential standards on consumers, manuf ac turers, and the Na tion; (3) DOE’ s weight in g of those im p ac ts; and (4) any proposed standard levels for pub li c co mm ent. DOE wi ll hold a pub li c m ee t in g and webinar related to the NO PR and wi ll again s ee k public co mm ent.

Final Rule (s ec tion 1.3.3 ). The final rule wi ll present: (1) a discussion of and response to

co mm ent s r ec e iv ed on the NOPR; ( 2) the revised analysis (a s appropriate) of the imp ac t s of any amendment s to the standards; (3) DOE’ s weight in g of the im p ac ts; and (4) th e new or amended standard levels (if any) that DOE i s adopt in g. The final rule also wi ll estab li sh the compliance date of any adopted standards.

In para ll el with the energy conservation standards rulemaki ng, DOE wi ll be conduct in g a test pro ce dure rulemaking for co mm ercial p ac kaged bo il ers. Test pro ce dure rulemakings follo w a si mi lar pro ce ss a s standards rulemakings; however, test pro ce dure rulemaking s typica lly o nly include the publi ca tion of a notice of proposed rule and a final rule in the Federal Regis te r

. After the NO PR is published, DOE holds a public m ee t in g and so li cit s co mm ents from in terested partie s o n a variety of relevant issue s under consideration in devel op ing a potential ly amended test pro ce dure.

6DOE encourage s in terested partie s to develop and submit jo in t r ec o mm endation s and wi ll

carefu lly consider any such r ec o mm endations in it s d ecision maki ng.

1.3.1 Preliminary An alys is

DOE’ s p rel im inary analysi s ac tivities include identif yi ng available equipment t ec hnolog y options and deter mi ning whether they warr ant detailed analysi s or can be e li mi nated from furthe r consideration. Thi s p ro ce ss include s a market and t ec hn ol og y asse ss ment (s ec tion 5 ) and a

s creeni ng analysi s (s ec tion 6). DOE app li es four criteria in the screening analy si s to deter mi ne whether a g iv en t ec hnology option sh ou ld be el imi nated from further consideration: ( 1)
t ec hn ol og ical f ea sib il ity; (2) pr ac ticability to manuf ac ture, in stall, and service; (3) advers e imp ac t s on equipment utility or ava il ability; and ( 4) adverse im p ac ts on health or safety. T ec hnol og ie s that pas s the scr ee ning analysi s are considered in the engin ee ring analysis (s ec tion 7) a s methods of im proving the e ff iciency of the covered equipment (design options).

DOE consult s with in terested partie s and in dependent t ec hnical expert s and res earche s industry literature to identify the key issue s and design option s or e ff iciency level s that DOE wi ll consider in the rulemak in g. Also at thi s sta ge of the analysis, DOE co ll ec ts manuf ac turer cos t data, historical shipment s d ata, shipments-weighted average efficiency data, and prel im inar y manuf ac turer im p ac t data ( e.g. , ca pital conversion expenditures, market in g costs, and res earch and devel op ment (R& D) costs). A s p art of the pre lim inary analysis, DOE also conducts othe r pr in cipal ana ly ses wh ich are explained in subsequent s ec tion s of this Framework Document, including:

1. Engin ee r in g analysi s (s ec tion 7); 2. Markups ana lysi s (s ec tio n 8 ); 3. Energy use analysis (s ec tion 9 ); 4. Consumer li fe-cycle cost (L CC ) and pa yb ack period (PB P) ana ly si s (s ec tion 10); 5. Sh ipment s analysis (section 11 ); 6. Na tional im p ac t ana lysis, wh ich consider s national energy savi ngs (NE S) and national consumer net present value (NPV) (s ec tion 12); and 7. Pre li minary manufacturer im pact ana ly sis (MIA) (s ec tion 14).

DOE wi ll present the result s of these analyses in the prel im inary analysis t ec hnica l support document (T SD ), wh ich wi ll be made ava il able at the t im e of publi ca tion of th e pre li minary analysis.

DOE sel ec ts CSLs from the energy efficiency or energy use level s considered in th e pre li minary analysis. Discu ss ion of various CSLs in the preliminary analysi s w ill f ac ilitat e review by in terested partie s of the spr ea dsheet model s that under pi n the analyses. DOE wi ll us e

co mm ents from in terested partie s to refine the models for the rulemaking analysi s at the NO PR stage, where DOE w il l propose specific energy conservation standard levels for adoption. Based

o n the results, DOE sel ec t s CSLs from the energy e ff iciency or energy use level s considered in the prel im inary analyses. In addition to the efficiency level s co rr espond in g to the ma xi mum

7t ec hnol og ica lly f

ea sible (“max-t ec h” 6 ) design, DOE general ly sel ec ts level s or design options fo r consideration that span the full ran ge of t ec hnol og ical ly achievable efficiencies. DOE typica lly analyze s the foll ow ing ran ge of efficiency levels:

The baseline efficiency level ( i.e. , the mi nimum level) typica lly represent s equipmen t with the lowest energy efficiency level curr ently sold on the market for a g iv en equipment class. For classe s where mi nimum energy efficiency standards alr ea dy exist, the baseline efficiency level i s typica lly defined by the exist in g energy conservation standard;

The highest energy efficiency level or lowest energy consumption level that i s tec hn ol og ica lly f

ea sible ( i.e. , the “max-t ec h” level); and

Level s that in corporate note wo rt hy t ec hnol og ie s or f ill in lar ge gaps between othe r

e ff iciency level s b e in g considered.

The prel im inary analyse s re ly on analytical models and to ol s to a ss es s the differen t equipment classe s at eac h efficiency or energy use level analy ze d. Many of these analyti ca l model s and to ol s are in the form of spr ea dsh ee ts, some of which DOE use s to conduct the LC C and PBP ana ly se s and to deter mi ne the NES and NPV of prospect iv e standards. Prel im inar y results may f ac ilitate discussions among in terested partie s on potential jo in t r ec o mm endations f or standard levels.

DOE wi ll make the spr ea dsh ee t to ols and result s of the prel im inary analyse s ava il able on its website for review. 7 When it pub li she s the prel im inary analysis, DOE wi ll also make th e pre li minary T SD available, wh ich w ill contain deta il s of all the analyse s p erformed to date. After publi ca tion of the preliminary analysis, DOE provide s a public co mm ent period and holds a pub li c m ee t in g to discus s these ana lyses.

1.3.2 Notice of Proposed Ru lemaking

In devel op in g the NO PR for potential energy conservation standards for co mm ercia l
p ac kaged bo il ers, DOE w il l first review and cons ider all the co mm ents it r ec e iv es dur in g th e pre li minary analysi s p ublic m ee t in g and in wri tt en co mm ents dur in g the 60-day co mm ent period follow in g publi ca tion of the preliminary analysis. Thi s p ro ce ss may result in revisions o r refinement s to the planned methodol og y for eac h analysi s related to the energy conservation standards rulemaking, in c luding the engin ee ring and LC C ana ly ses. DOE wi ll also conduc t additional in-depth ec ono mi c and environmental im p ac t analyse s at this sta ge of the rulemak in g. These analyse s g enera lly include:

6 The “m ax -tech” level represents the most e ff icient design that is co mm ercialized or has b ee n demonstrated in a prototype w it h m at eri al s or t ec hnologies av ai lable today

. “Max-t ec h” is not constr ai ned by ec ono mi c jus ti fic ati on , and typic all y is the most e xp ensive efficiency le vel considered in the an al ysis.

7 M at er ial s a ss oc iat ed with the co mm ercial packaged bo il er rule ma kin gs will b e av ai lable on DO E ’s webs it e at h tt p :// www1. ee re.energy. go v/bu il di ng s /appl ia n ce _standards/pro du ct.as px /pro du c ti d/74

. 81. Consumer subgroup analysi s (section 13 ); 2. Complete MIA (s ec tio n 14 ); 3. E mi ss ions analysi s (s ec tion 15 ); 4. Moneti za tion of carbon dioxide and other e mi ss ions reduction s (s ec tion 16 ); 5. Utility imp ac t analysi s (section 17 ); 6. Employment im p ac t analysi s (s ec tion 18); and 7. Regulatory im p ac t ana lysi s (RIA) (s ec tion 19 ).

DOE wi ll describe the methodolog y it used and post the results of a ll the analyse s on it s website for review and co mm ent. DOE wi ll present a su mm ary of the analytical results in th e NOPR, with the deta il s of the analysi s p rovided in an acc ompa nyi ng T SD. The NO PR analytica l
pro ce ss cu lmi nates in the sel ec tion of proposed standard level s (if any), wh ich DOE wi ll presen t in the NOPR. DOE sel ec t s these proposed standard levels from the trial standard level s (T S Ls ) 8 analyzed prior to pub li ca tion of the NOPR. The N OP R, pub li shed in the Federal Regis te r , wi ll document the evaluation and selection of a ny proposed standard levels, along with a discu ss ion of other TSL s c onsidered but not sel ec ted (and the r ea sons for not select in g them). Based on

co mm ent s by in terested parties, further revisions to the analysis and proposed standard levels may be undertaken dur ing the final rule stage.

For eac h equipment class, DOE wi ll identify the maxi mum improvement in energ y

e ff iciency or max im um reduction in energy use that i s t ec hn ol og i ca l ly f

ea sible. Beginning with the max-t ec h level, DOE wi ll weigh the benefit s and burdens of ea ch level to deter mi ne whethe r that level m ee t s the criteria out li ned in EPCA discu ss ed above (s ec tion 1.3 ) . If DOE propose s a level that is below the max-t ec h level, it wi ll explain the r ea sons for el im inat in g higher levels, beginning with the highest level considered.

DOE considers ma ny f

ac tor s in sel ec t in g proposed standards, a s d escr ib ed in s ec tion 1.3. These f ac tor s are estab li shed by EPCA and consider the ma ny benefits, costs, and other im p ac t s of energy conservation standards. DOE encourages in terested partie s to develop jo in t

r ec o mm endations for standard levels. DOE wi ll consider such r ec o mm endation s careful ly in it s decision pro ce ss

.
When DOE publishe s the NO PR propos in g energy conservation standards fo r

co mm ercial p ac kaged bo il er s, it wi ll provide the U. S. Department of Justice (DOJ) with copie s of the NO PR and T SD to so li cit f ee dback on the competit iv e im p ac t of the proposed standard levels on the co mm ercial p ac kaged bo il er in dustry

. DO J w i ll review these proposed standard levels to help a ss es s the im pacts from a ny lessening of competition that is like ly to result fro m the im position of standards. (42 U.S.C. 6313(a )( 6)(B )( ii )( V) ) DOE wi ll consider DOJ’ s deter mi nation regard in g the im p ac t s of the proposed standard(s) on competition in preparing th e final rule. The NO PR is followed by a 60-day public co mm ent period that in cludes a publi c

m ee t in g.

8 TSLs are a ss embled from the ca ndidate s ta ndard levels analyzed for the indivi du al equipment c la ss es based on a set of cr it eria from the analy ti cal resu lt s.

91.3.3 Final Rule

After publi ca tion of the NOPR, DOE w il l consider pub li c co mm ents it r ece ive s on th e proposal ( in cluding TS Ls ) and acc ompa ny i ng analyses. Onthe basi s of the public co mm ents, DOE wi ll review the engin ee ring and ec ono mi c i mpa ct ana ly se s and proposed standards, maki ng

mod ifications as n ec e ss ary

. Before it issue s the final rule, DOE w il l consider DOJ’ s co mm ent s on the NO PR relat in g to the im p ac t s of the proposed standard level s on competition to deter mi ne whether change s to these standard levels are n ee ded. DOE pub li she s DO J’ s co mm ent s and DOE’ s response a s p art of the final rule.

The standards rulemaking will conclude with publi ca tion of the final rule. DOE wi ll deter mi ne wh ether to amend exist in g standards, and if such deter mi nation i s p ositive, sel ec t th e final energy conservation standard levels based on the complete record of the standards rulemaking. The final rule will promulgate the final standard level s and the compliance date (o r dates), and wi ll explain the basis for their sel ec tion. The final rule wi ll be accompanied by a final rule T SD.

2. SCO PE OF COV ERA GE

2.1 Cur re nt S cope of Cov erage

“P ac kaged bo il er” i s d efined in EPCA as “a bo il er that i s shipped complete with h ea t in g equipment, mechani ca l draft equipment, and automatic controls; usual ly shipped in one or mor e

s ec tions. ” (42 U.S.C. 6311(11 )( B)) In it s re gu lation s at 10 CFR 431.102, DOE further refined the “p ac kaged bo il er” definition to exclude a bo il er that i s custom designed and field constructed. Additiona ll y, 10 CFR 431.102 provide s that if the bo il er i s shipped in more than

one s ec t ion, the s ec tio ns may be produ ce d by more than one manuf ac turer, and may be originated or shipped at di ff erent t im e s and from more than one lo ca tion. In it s regulations at 10 CFR 431.82, DOE also define s a “c ommercial packaged bo il er” as “a type of p ac kaged lo w pre ss ure bo il er that is in dustrial equipment with a ca pacity, (r ated max im um input) of 300,000 Btu/hr or more wh ich, to any significant extent, i s distr ib uted in commer ce : (1) For h ea t in g o r sp ac e conditioning appli ca tions in buildings; or (2) For service water h ea t in g in buildi ngs but doe s not mee t the definition of ‘hot water supply bo il er’ in [part 431].” A “p ac kaged low
pre ss ur e bo il er” i s defined as “a p ac kaged bo il er that is: (1) A st eam bo il er designed to operate a t or below a st eam pre ss ure of 15 psig [pounds per square inch ga ug e]; or (2) A hot water bo il e r designed to operate at or below a water pre ss ure of 160 psig and a temperature of 250 °F; or ( 3) A bo il er that i s d esigned to be ca pable of supp ly ing either st eam or hot water, and designed to operate under the conditions in paragraph s ( 1) and (2) of thi s d efinition. ” 10 CFR 431.82.

DOE’ s regulations for co mm ercial packaged bo il er s that are currently in eff ec t cove r small and large, gas-fired and oil-fired, hot water and steam co mm ercial p ac kaged bo il er s tha t

m ee t the definition s out lined above, a s app li cable. 9 DOE notes that altho ughthere are not

9 DO E ’s regulati ons fo r co mm er ci al packaged bo il ers divi de this e qu ipment into e qu ipme nt cla ss e s based on i nput
capac it y ( i.e. , size c at egory ). Througho ut this Framework Document

, DOE refers to units with an input capac it y of

10cu rr ently Federal energy conservation standards for electric co mm ercial packaged bo il ers, th e definitions set forth above do not preclude DOE from adopt in g standards for such equipment i f justified. In other word s, el ec tric co mm ercial p ac kaged bo il er s are within the scope of DOE’ s authority under EPCA.

In addition, DOE r ece ntly pub li shed a notice of proposed deter mi nation (NO PD) regard in g covera ge of natural draft co mm ercial packaged bo il ers. 78 FR 49202 (A ugu st 13, 2013). A s explained in the NO PD, under DOE’s in terpretation of the relevant statu to ry provisions, natural draft co mm ercial p ac kaged boi lers are cu rr ently included a s covered equipment with standards at 10 CF R p art 431, subpart E. DOE i s p erfor ming a covera ge deter mi nation to exp li citly clarify its statu to r y authority under EPCA to cover natural draf t

co mm ercial p ac kaged bo il er s, b eca use exp li cit covera ge of thi s equipment is necessary to carr y out the purposes of part A-1 of EPCA. Covera ge wi ll promote conservation of energy and provide a more level playing field to the variety of co mm ercial p ac kaged bo il er s on the market, there by discourag in g potential substitution e ff ec ts

. Id. at 78 FR 49204.

2.2 Proposed Scope of Cov erage
DOE plans to ma in tain the scope of covera ge a s d efined by its cu rr ent re gu lations fo r thi s analysi s of amended thermal and co mb ustion effic ie ncy standards for co mm ercial p ac kaged bo il ers. DOE is not consider in g standards for el ec tric co mm ercial p ac kaged bo il ers at thi s t im e, because DOE may have difficulty in justifyi ng that standard levels for el ec tric co mm ercia l
p ac kaged bo il er s w ou ld save a significant amount of energy and be t ec hn ol og ica lly f ea sible. A
pre li minary review of the market revealed that electric co mm ercial p ac kaged bo il er s acc ount fo r a relatively sma ll number of annual shipment s (a pp rox im ately 1,500-2,100 units), and th e

e ff iciency of thi s equipmen t alr ea dy appro ac hes 100 per ce nt under the cu rr ent metric ( i.e.
, thermal e ff iciency). Thus, there is little to no room for im provement in efficiency, unles s D O E

were to consider adopt ing level s requiring insta ll ation of h ea tpump t ec hnol og y (a t ec hn ol og ica l l ea p when se tt in g initial standards). However, h ea t pump t ec hnolog y has not b ee n used o r demonstrated f ea sible for use in electric co mm ercial p ac kaged bo il ers, so it i s uncl ear whethe r such a level would be a viable opportunity for energy savi ngs at thi s t im e.

DOE plans to in clude natural draft co mm ercial packaged bo il er s within the scope of t hi s rulemaking if the outcome of the A ug ust 2013 NO PD i s ult im ately to confirm DOE’ s authorit y to cover natural draft co mm ercial p ac kaged bo il ers.

Cu rr ently, there is no upper li mit to the in put ca pacity of co mm ercial p ac kaged bo il er s that are covered by DOE’ s energy conservation standards. In thi s rulemaking, DO E s ee ks

co mm ent a s to whether there are any size-related i ss ue s with conduct in g test in g under the DO E test pro ce dure wh ich the agency sh ou ld consider addressing in it s test pro ce dure rulemaking. DOE i s also in terested in a ny co mm ent s regard in g whether there i s a ca pacity lim it beyond wh ich amended energy conservation standar d s wo uld not be t ec hnologica lly feasible and

ec ono mi ca l ly justified.

≥ 30 0, 000 Btu/h a nd ≤ 2, 500

, 000 Btu/h as “small” a ndun it s w it h an i nput capa ci ty ≥ 2,500,000 Btu/h as “la rge. ” See 10 CFR 431 .8 7.

11S in ce ma ny co mm ercial packaged bo il ers do not operate cont in uously, DOE also plans to consider estab li shing energy conservation standards for energy con su mption of bo il ers operat in g in stand by mode and off mode a s p art of thi s rule mak in g. DOE wi ll consider whether an energ y

e ff iciency metric with stand by mode and off mode energy consumption in tegrated in to the metri c i s t ec hnica lly feasible a s p art of the test pro ce dure rulemaking for co mm ercial p ac ka ged bo il ers.

I

tem 2- 1 DOE we lco me s com me nt on the proposed scope of co ve r age and on whe ther there are any additional typ e s of com me rcial pa ck aged boilers that should or should not be included in the scope of this rulemaking.

I

tem 2-2 DOE we lco me s com me nts regarding the n ee d to include e le ctr ic com me rc ial

pa ck aged boiler s in this rulemaking.

I

tem 2-3 DOE reques ts com me nt on pu rs uing standby mode and o ff

mode ener gy conservation standards for com me rcial pa ck aged boile rs

.

I

tem 2-4 DOE we lco mes com me nt as to whe ther there are any size-related issues w ith conduc ting te s ting unde r the DOE te st pro ce dure w hich the agency should cons ide r addressing in its te st pro ce dure rulemaking. DOE is also interes ted in any com me nts regarding whe th e r the re is a capac ity limit b ey ond w hich amended energy conservation standards would not be te chnologic ally feas ible and ec onomic ally ju s tifi ed.

3. TE ST P ROC EDURES

DOE’ s cu rr ent energy conservation standards for co mm ercial packaged bo il er s ar e expressed in term s of thermal efficiency for all equipment classe s ex ce pt for oil-fired and g as fired hot water co mm ercial packaged bo il er s with in put ca pacitie s above 2,500,000 Btu/hr. Fo r these two equipment classes, co mb ustion efficiency i s used a s the metric for energy conservation standards rather than thermal efficiency. The existing DOE test procedure for deter mi ning th e

e ff iciency of co mm ercial p ac kaged bo il ers is loc at ed in 10 CFR 431.86. The cu rr ent DOE tes t
pro ce dure for co mm ercial p ac kaged bo il er s referen ce s the Hydronic s Institute (HI) division o f the Air Conditioni ng, Heat in g, and Refrigeration Institute (AHRI) standard HI BTS-2000, Method to De te r mine E ffici ency of Com me rcial Space Heating Boile rs , Second Edition (Rev 06.07), 2007.

In 2007, the Hydronic s Institute made several change s to BTS–2000 and r ea ffirmed th e cont in ued use of BTS–2000 a s the r ec o mm ended te st in g standard. Therefore, in the July 22, 2009 final rule, DOE amended the uniform test pro ce dure for co mm ercial p ac kaged bo il er s to incorporate by reference HI BTS–2000 (Rev 06. 07 ). 74 FR 36312, 36323. In addition, DO E removed the in corporation by reference of, and any reference s t o, the American Society o f Mechanical Engin ee r s (ASME) Power Test Code s for Steam Generat in g Units, ASME PT C 4.1–

121964, r ea ff irmed 1991 (including 1968 and 1969 addenda) (ASME PT C 4.1) a s an alternate tes t method for rat in g the e ff iciency of steel co mm ercial p ac kaged bo il ers. Id.

Prior to the July 2009 final rule, the uniform test method for the measurement of energ y

e ff iciency of co mm ercial p ac kaged bo il er s required that only the co mb ustion efficiency be tested and calculated in acc ordance with the HI BTS–2000. 10 CFR 431.86(c )( 1 )( ii)(A). However, in the July 2009 final rule, DOE adopted a s Federal energy conservation standards several therma l

e ff iciency level s d escribed in A SH RAE Standard 90.1–2007. In addition, DOE amended th e de finitions in 10 C FR 431 .82 to incorporate the definition of ‘‘thermal efficiency’’ a s w ritten in

s ec tion 3.0 of the HI BTS–2000 (Rev 06.07). 74 FR 36312, 36354. DOE also amended 10 CFR 431.86 to specify that thermal efficiency sh ou ld be m ea sured and rated for the co mm ercia l
p ac kaged bo il er equipment cla ss e s wh ich use thermal efficiency a s the metric for energ y conservation standards, and co mb ustion efficiency sh ou ld be measured and rated for the two

co mm ercial p ac kaged bo il er equipment classe s which use the co mb ustion e ff iciency a s th e metric for energy conservation standards ( i.e. , lar ge ga s hot water and large oil hot water

c o mm ercial p ac kaged bo il ers). Id. at 36355.

In addition to requiring DOE to update it s test method eac h t im e the relevant in dustry tes t
pro ce dure is mod ified (42 U.S.C. 6314(a )( 4 )( B)), EPCA require s that DOE conduct an evaluation of it s test pro ce dure for eac h covered clas s of equipment at least once every seven
yea rs. (42 U.S.C. 6314(a)(1 )( A) ) A s noted, DOE last reviewed it s test pro ce dure s fo r

co mm ercial p ac kaged bo il ers in 2009, so DOE must evaluate the test pro ce dure s for thi s equipment not later than 2016. DOE i s c onsidering updating the test pro ce dure s for co mm ercia l
p ac kaged bo il ers in a separate pro cee d in g that wo ul d o cc ur in para ll el with the energ y conservation standards ana ly si s out li ned in thi s Framework Document. DOE a im s to pu bli sh a final rule for the test pro ce dure rulemaki ng prior to complet in g the energy conservation standards rulemaki ng.

I

tem 3-1 DOE we lco me s com me nt on all asp ec ts of the current DOE te st pro ce dure for

com me rcial pa ck aged boil ers and on whe th er the te st pro ce dure is in n ee d of updates or

r

ev is io ns.

3.1 Di scu ss ion of Alter na tive Test Pro ce dure Approaches

In the test pro ce dure rulemaki ng, DOE wi ll consider alternat iv e methods for m ea suri ng the energy efficiency, energy use, or average annual operat in g cost of co mm ercial p ac kaged bo il ers dur in g a representative average-use cycle or period of use that is not unduly burdensome to conduct. (42 U.S.C. 6314(a )( 2) ) In prescribing new or amended test pro ce dures, DOE take s in

to acc ount relevant information in cluding t ec hnol og ical devel op ment s relat in g to energy use o r

e nergy efficiency of co mm ercial pa ckaged bo il ers.

DOE be li eve s that ce rtain requirements of the current test pro ce dure may ca use test in g t o be either difficult or infeasible to conduct for ce rtain co mm ercial p ac kaged bo il er models. Some of the issue s that DOE i s aware of in clude:

13The requirement to conduc t test in g at atmospheric pre ss ure or a steam pre ss ure no t
to ex cee d 2 psi ga uge which may not be possible for all equipment; Perfor mi ng a st eam quality test when the unit may not be operable below 2 psi ; Us in g a thermocouple grid to measure the temperature of flue gases; and Conduct in g test in g on equipment that may be assembled at the site of use.

DOE i s also aware of several asp ec t s of the cu rr ent test pro ce dure tha t, due to the lack o f specificity, may influence the test in g of commercial p ac kaged bo il er s and produce mi sl ea di ng

e ff iciency results. These asp ec ts in clude:

The l ac k of an exces s air requirement; The l ac k of a defined temperature ran ge for room air; and The wide temperature ran ge of allowable inlet wa ter temperatures.

B TS -2000 wa s adopted as the test method for co mm ercial p ac kaged bo il ers in th e October 21, 2004 final rule. 69 FR 61949, 61961-62. In the rulemaki ng pro ce s s p r ece d in g th e October 21, 2004 final rule, DOE ana ly zed five industry-r ec o gn i ze d test methods for rat in g th e performance of co mm ercial p ac kaged bo il ers, a s r ec o mm ended by industry stakeholders. Thes e standards in cluded:

American National Standards Institute (A NS I) Standard Z21.13–1987, “G as -fire d Low Pre ss ure St eam and HotWater Bo il ers,” (r evised a s A NSIZ21.13–1991 wit h Addendum A NSIZ21.13a –1993). HI-1989 “Test in g and Rat in g Standard for Heat in g Bo il ers,” s ix th edition, 198 9. ASME Power Test Codes (PTC) 4.1–1964 (r ea ffirmed R1991) “Power Test Code s for Steam Generat in g Units,” (r evised in 1998 as ASME PT C 4–1998, Fired Stea m Generators, i ss ued on December 31, 1999). Underwriter s Labora to ry Standard 795–1973, “Commercial-Industrial Ga s H eat in g Equipment” ( UL 795, revised in 1994 a s UL795–94). Underwriter s Labora to ry Standard 726–1990, “Oil-fired Bo il er A ss emblies,” ( UL 726).

65 FR 48838, 48841 (A ugu st 9, 2000 ).

In the October 21, 2004 f in al rule, DOE concluded that BTS-2000 was the most suitabl e standard to referen ce . 69 F R 61949, 61956. However, a s noted above, several con ce rns with th e B TS -2000 standard have come to light, and in particular, DOE i s con ce rned about the standard’ s app li cability to all type s of co mm ercial p ac kaged bo il ers. Thus, in a separate test pro ce dur e rulemaki ng, DOE plan s to analyze the alternat iv e te st pro ce dures that are ava il able and widel y

acce pted within the in dustry. In conduct in g thi s ana ly sis, DOE wi ll work closely with manuf ac turers, in dustry experts, and stakeholder s to deter mi ne the test pro ce dure (or pro ce dures ) that i s best suited to mee t the n ee ds of the co mm ercial p ac kaged bo il er in dustry and the statutor y requirements of EPCA ( 42 U.S.C. 6314(a)).

14I tem 3-2 DOE reques ts f ee dback on issue s or p roblems w ith the cu rr ent te st pro ce dur e that may ma ke it burdensome or in feas ible f or ma nufac tu rer s to conduct testing on s ome or all mode ls of com me rcial pa ck aged boile rs . Sp ec if ically, DOE reques ts com me nt whe ther the operating pressure s required by BTS-2000 are not achievable for any

com me rcial pa ck aged boil ers w ithin the scope of this rulemaking.

I

tem 3-3 DOE reques ts feedback on te s ting conditions w ith in the cu rr ent te st pro ce du r e that may nee d to be re fin ed to ensure fair comparison of eff ici enc ies acros s commerc ial

pa ck aged boile r models.

I

tem 3-4 DOE we lco me s com me nt on alternative industry te st methods for de te rmining the e ffici ency for com me rcial pa ck aged boile rs , parti cular ly w ith regards to how an alternative standard w ould imp rove or not imp rove upon the cu rr ent te st procedure based on BTS-2000, and on the compar ability of eff ici ency ratings de te r min ed us ing the alternative standards to tho se from a BTS-2000 te s t.

4. OV ERVIEW OF A NAL YS IS F ORENE RGY CONS ERVATI ON STANDAR DS RU LEMAKI NG

The purpose of the analyse s conducted in support of the standards rulemaking i s to ensur e that DOE select s energy conservation standards that ac hieve the ma xi mum im provement in energy efficiency that i s t ec hn ol og i ca l ly f

ea sible and ec ono mi ca lly justified, and w ill result in significant energy savi ng s, a s required by EP CA . Econo mi c justifi ca tion include s th e consideration of ec ono mi c f ac tor s s etforth in EPCA (see s ec tion 1.3 )

, wh ich encompas s th e

ec ono mi c imp ac t s on domestic manuf ac turer s and consumers, national benefits ( in cludi ng environmental im p ac ts), i ss ue s of consumer utility, and im p ac ts from a ny lessening o f competition. DOE exp ec ts the sel ec tion of such standards to ac hieve the ma xi mum energ y savi ngs that are t ec hnologica lly feasible and ec onomica lly justified witho ut im pos in g an excessive financial burden on any particular party.

Fi gu re 4.1 su mm ari ze s the analytical component s of the DOE standards-se tt in g pro ce ss

. The ana ly se s are presented in the ce nter column. E ac h analysis ha s a set of key inputs, wh ich ar e data and information required for the analysis. The identified appro ac he s are the methods tha t DOE wi ll use to obtain key inputs, wh ich may vary depending on the information in question. For example, some key inputs can be found in public databas es . In support of thi s r ulemaking, DOE wi ll also develop relevant information or co ll ec t such information from in terested partie s o r expert s with special kn ow ledge. Key output s from eac h analysis f ee d directly in to th e rulemaki ng. A rr o ws in di ca te the flow of information among the various analyses. DOE ensure s a consistent appro ac h to it s analyse s thro ug hout the rulemaking by considering ea ch ana ly si s a s a part of the overall standards-se tt in g framework.

15F ig ure 4.1 Flow Diag ram of Ana lyses Con ducted for an Energy Con servation St anda rds Ru lemaking

165. MARKE T A ND TE CHNO LOGY AS SESSME NT

The market and t ec hn ol og y assessment wi ll provide information about the commercia l
p ac kaged bo il er in dustry and performance attr ib ute s of various type s of co mm ercial p ac kaged bo il ers. DOE uses this information throughout the rulemaking. Thi s a ss essment i s p articular ly important at the outset of the rulemaking for develop in g equipment classe s and for identifyi ng t ec hn ol og ies that improve efficiency for eac h of the bo il er types bei ng considered in thi s

r ulemaking.

5.1 Market A ss essme nt

In the market a ss essment, DOE wi ll qualitative ly and quantitat iv e ly char ac terize th e structure of the market for co mm ercial p ac kaged bo il ers. DOE wi ll identify and char ac terize th e manuf ac turers of this equipment, est im ate market share s and trends, addres s regulatory and nonregulatory initiatives in tended to improve the effic ie ncy or reduce the energy use of covered bo il ers, and explore the po tential for t ec hn ol og ical improvement s i n the design and manuf ac tur in g of such equipment.

The market a ss e ss ment estab li she s the context for the rulemaking and serve s a s a

resource to gu ide the analyse s that follo w. The market a ss essment allo ws DOE to gather dat a that can help identify important issue s ( e.g. , potential sma ll business im p ac ts, t ec hn ol og y options, competit iv e disruptions, manuf ac turers’ market shares, and other f ac tors that may aris e from en ac t in g standards)

. For example, DOE may use historical shipment s and pri ce s a s indi ca tors of future shipment s and prices. Si mi larly, DOE plans to use market structure data fo r the MIA, wh ich wi ll be particular ly useful for a ss essing competit iv e imp ac ts. Thi s a ss essmen t also enable s D OE to start updat in g design options by review in g product literature, industry publi ca tions, and compa ny websites.

DOE i s consider in g examining national market reports; however, DOE r ec o gn ize s tha t there may be l im ited pu bl icly-ava il able information on national shipments, manuf ac tur in g costs, distr ib ution channels, product literature, and manuf ac turer market share s of co mm ercia l
p ac kaged bo il ers. Thi s ty pe of data i s an im portant in put for analyse s that deter mi ne whethe r amended energy conservation standards w ou ld be ec ono mi ca l ly justified and ca pable o f

ac hi eving significant energy sav in gs. Therefore, DOE encourage s in terested partie s to submi t data that wi ll improve DOE’ s understanding of the co mm ercial p ac kaged bo il ers market.

Da ta may be provided under a confidentiality agreement with DOE’ s contractor s responsible for the rulemaking analyses, Lawr ence Berkeley National Labora to ry (LBNL) and/o r Navigant Consult in g, Inc. (NCI). In other rulemakings, LBN L and NCI rout in e ly work with confidential data provided by manuf ac turer s and ot her organiza tions in prepar in g aggregated results for DOE’ s ana ly ses. These aggregated results do not divulge the sensitive, in dividual raw da ta, but enable other in terested partie s to co mm ent on the aggregated dataset.

17Alternat iv ely, in terested parties may submit confidential data to DOE, in dicat in g in writ in g which data sh ou ld remain confidential. Inter ested parties must s ubm it confidentia l information to DOE acc ord in g to the pro ce dures ou t li ned in 10 CFR 1004.11. Pursuant to 10 CFR 1004.11, any person submitt in g information that he or she be li eve s to be confidential and exempt by law from public disclosure should su bm it two copies. One c op y of the documen t shall include a ll the information believed to be confidential, and the other co py sha ll have th e information be li eved to be confidential deleted. D OE wi ll make it s o wndeter mi nation about the confidential status of the information and treat it a cc ord in gly. 10

I

tem 5- 1 DOE we lco me s data that would c ont ribute to the ma r ke t a ss e ss ment, including but not lim i ted to information on national his to r ic al shipments, distribution channels, and manufac tu re r ma r ke t shares of com me rcial pa ck ag ed boile rs

.

5.2 Trade A ss oc ia t io ns and Ma nu facturers

DOE reco gn ize s the im portance of manufacturers and their representat iv e trade groups in disseminat in g information and promot in g the in terests of the in dustry that they support. The two main trade groups for co mm ercial p ac kaged bo il er s are discussed immediately belo w. In addition, DOE notes that there are several co mm ercial p acakaged bo il er manuf ac turers that ar e not member s of either of the tra de a ss ociation s discu ss ed belo w. DOE welcome s information to inform the rulemaking from a ll manufacturers, in c lu ding both member s and non-member s o f trade a ss ociation s, and will s ee k to inform and include all in terested parties.

5.2.1 Air- Con dit io ning, Heati ng, and Refr ig eration Institute

The Air-Condition in g, Heat in g, and Refrigeration Institute (AHRI) i s a national tra de

a ss ociation for manufacturers of h ea t in g, vent il ation, air-conditioni ng, and refrigeration (HVACR) and water-h ea t in g equipment, in cludi ng co mm ercial p ac kaged bo il ers. DOE exp ec t s that AHRI wi ll play an im portant role in providi ng market information, in cluding information on manuf ac turers, market shares, and trends in the market. AHRI ma in tains the Gas App li anc e Manufacturer s A ss ociation (GAMA) Efficiency Certification Program, wh ich i s a database of equipment rat in g s for all manuf ac turer s w ho el ec t to participate in the program. 1 1 DOE plans to use the data in thi s dir ec tory in its market a ss essment. DOE also plan s to exa mi ne other dat a

sour ce s such as manuf ac turer literature, t ec hni ca l reports, and any other relevant information to provide a broad insight in to the co mm ercial p ac kaged bo il ers market.

10 Factors that DO E considers when ev al uati ng re qu ests to tr ea t submi tt ed in fo rmati on as confidential include: (1) a description of the items; (2) wh et her and why such items are custo ma r il y tr eated as confidential within the in du stry; (3) wh et her the in fo rma ti on is generally known by or av ai lable from other pu b li c sour ce s; (4) wh et her th e in fo rmati on has previously b ee n ma de available to others witho ut ob li g ati on con ce rn ing its confidenti al ity; (5) a n

e xp lanati on of the compe titi ve injury to the sub mi tting person which would result from pu b li c disclosure; (6) a d ate after which such in fo rma ti on mi ght lose it s confidential characte r; and (7) why disclosure of the in fo rmation w oul d be contrary to the pu b li c interest.

11 Se e h tt p :// www.a hr idir ec tory.org /a hridir ec tory/pages/home.aspx

.
185.2.2 Amer ican Boiler Manufacturer s A ss oc ia tion

The American Bo il er Manuf ac turer s A ss ociation (A BM A) is a national, nonprofit tra de

a ss ociation of co mm ercial, institutional, in dustrial, and electricity-generat in g bo il er syste m manuf ac tur in g companie s (> 400,000 Btu/hr h ea t in put), dedi ca ted to the advancement and growth of the bo il er and co mb ustion equipment i ndu stry. 12

I

tem 5-2 DOE we lco me s com me nt on the li s ted national trade a ss oc iatio n s for

com me rcial pa ck aged boil e rs . Sp ec if ically, are th ere trade a ss ociations not li s ted her e that should be included?

5.3 E qui pme nt Class es
DOE may divide covered equipment in to equipment classes by: (a) the type of energ y used; (b) the ca pacity of the equipment; and/or (c) any other performance-related feature tha t justifie s different standard levels. In deter mi ning whether a f ea ture justifie s a di ff erent standard level, DOE consider s the utility of the f ea ture to the consumer and other f ac tor s D OE consider s appropriate. DOE use s the market a ss essment to deter mi ne the appropriate equipment classe s

and their resp ec t iv e operat in g ranges. DOE wi ll conduct it s analysi s to estab li sh separat e standard levels for eac h equipment class.

The considered co mm ercial p ac kaged bo il er equipment classes for thi s rulemaking ar e based on the cu rr ent set a s d escr ib ed in 10 CF R 4 31.87(a). The considered equipment classes ar e divided by fuel type ( i.e., gas or oil), heat in g med ia ( i.e., st eam or hot water), and size ( i.e., sma ll (300,000-2,500,000 Btu/hr) or large (>2,500,000 Btu/h r) ) (see Table 5.1 ). The type of energ y

us ed and ca p ac ity of the equipment are explicitly ca ll ed out a s criteria for creat in g separat e equipment classes in EPCA. DOE wi ll ma in tain equipment classes for gas-fired and oil-fired bo il er s and develop a new equipment class for electric bo il ers. Further, in cr ea t in g separat e standards for steam and hot water residential bo il ers in EI SA 2007, Congres s d eemed h ea t transfer medium a performance-related f ea ture that merit s a separate equipment class. St ea m offer s a few benefits over hot water a s a h ea t transfer medium, such a s h igher operatin g temperature s and fewer moving parts. B eca use steam bo il ers general ly cannot r eac h the same

e ff iciency levels as hot water bo il er s, combining steam bo il er s and hot water bo il ers in to a s in gl e equipment class could result in standard s that would potential ly e lim inate st eam bo il ers from th e market. EPCA doe s n ot allow DOE to promulgate efficiency standards that would result in th e unavailability in the Un ited State s (U.S.) in a ny covered equipment type (or class) o f performance char ac teristic s ( in cluding re li ability), f ea tures, size s, ca pacities, and volume s tha t are substantia lly the same a s those cu rr ently on the market (42 U.S.C. 6295(o )( 4)), and thus,

us in g thi s same l og ic, DOE be li eve s that the com mer cial p ac kaged bo il er equipment clas se s fo r h ea t in g media (steam and hot water) should be ma in tained.

As discussed in s ec tio n 2, DOE r ece ntly published a notice of proposed deter mi nation (NO PD) regarding covera ge of natural draft commer cial p ac kaged bo il ers. 78 FR 49202 (A ugu st

12 Se e h tt p :// www.ab ma .com/

.
1913, 2013). If the outcome of the A ugu st 2013 NO PD confirm s D OE’ s authority to cover natura l draft co mm ercial p ac kaged bo il ers, DOE would cr ea te a separate equipment category for natura l draft co mm ercial p ac kaged bo il ers wh ich w ou ld include it s o wnset of equipment cla ss es.

Table 5.1 Con sidered Com mercial Packaged Boile r E qui pme nt Class es Co m m e rc i a l P a c k ag e d B oi l e r E qui p m e nt C l a s s S ma ll ( 300

, 000

- 2

, 500

, 000 B t u/h r ) G a s

- F i r e d H o t W a t e r
S ma ll ( 300

, 000

- 2

, 500

, 000 B t u/h r ) G a s

- F ir e d S t eam S ma ll ( 300

, 000

- 2

, 500

, 000 B t u/h r ) O il

- F i r e d H o t W a t e r
S ma ll ( 300

, 000

- 2

, 500

, 000 B t u/h r ) O il

- F i r e d S t e a m
L a r ge ( > 2

, 500

, 000 B t u /hr ) G as

- F i r e d H o t W a t e r
L a r ge ( > 2

, 500

, 000 B t u /h

r ) G as

- F ir e d S t e a m
L a r ge ( > 2

, 500

, 000 B t u /h

r ) O i l

- F i r e d H o t W a t e r
L a r ge ( > 2

, 500

, 000 B t u /h

r ) O i l

- F i r e d S t e a m
E l ec t r i c ( a l l)

I

tem 5-3 DOE we lco me s com me nts on its considered equipment c la sses. Are there any other perfor man ce-related features that should be considered for com me rc ialpa ck aged boiler s equipment c la sses?

5.4 T ec hno logy A ss essme nt

The t ec hn ol og y assessment focuse s on understanding how co mm ercial p ac kaged bo il er s use energy and on identifyi ng potential t ec hnol og y changes that would im prove the efficiency o f thi s equipment. M ea sure s that im prove the rated equipment efficiency are ca ll ed t ec hn ol og y options, and they are based on exist in g t ec hnolog ies, a s w ell a s w ork in g prototypes. In consultation with in terested parties, DOE w il l create a li st of t ec hn ol og y options fo r conside ration in thi s rulemaking. Foll ow ing res earch in to this li st of t ec hnol og y options, DO E wi ll consider ea ch option in light of the four scr ee ning criteria discussed in s ec tion 6. Thos e t ec hn ol og y option s that pass the screeni ng criteria wi ll be considered suitable options fo r improv in g the efficiency of the equipment in the engin ee ring analysis, and wi ll assist DOE in deter mi ning the max-t ec h design.

5.4.1 Boiler E qui pme nt

Co mm ercial p ac kaged bo il er s are pre ss ure ve ss els designed to transfer h ea t vi a

co mb ustion to water or st eam, used for sp ac e h ea t in g, and in some app li ca tions domestic ho t
water a s w ell. Co mm ercial p ac kaged bo il er s can be condens in g or noncondensing in design. Condensing design bo il er s r ec over additional h ea t by condensing part of the water vapor

20produ ce d by the burning fuel. 13 A bo il er consist s of: (1) a tank/she ll (or other form of pre ss ur e

ve ss el to hold the water or st eam); (2) a burner; ( 3) a co mb ustion chamber (also somet im e s refe rr ed to a s a firebox); (4) a h ea t exchanger; ( 5) automatic controls; and (6) mechanical draf t equipment ( e.g ., for ce d or in du ce d draft blower) if the bo il er is not of the natural draft type. Th e follow in g provides further deta il s regarding the component s u sed in co mm ercial p ac kaged bo il ers.

Construc tion Mater ials

Tr aditional noncondensi ng bo il er s are often made of ca st iron, st ee l, copper, or copperclad steel, and are usual ly designed to prevent corrosion and thermal shoc k. Condensing bo il er s are usual ly ma de of stainles s steel or alu mi num construction, because the acidic condensat e would corrode copper, ca st iron, or carbon steel. Condensing bo il ers may include s ec ondary hea t exchangers wh ich, due to exposure to co rros iv e flue ga s condensate, must also be constructed o f

s tainles s steel and/or in corporate non-co rrod in g p la stic material s that wi ll withstand the flue temperatures, such a s chlor in ated po ly vinyl chlor ide (C PV C).

Tank/Pre ss ure Vessel

Bo il er tanks (also ca ll ed the pre ss ure vessel or boi ler shell) are frequently cylindrical in shape, but can also be of r ec tangular or other construction st yl es. The in si de wall s of the tank opposite co mb ustion regions are somet im es li ned with insulat in g materia ls to ma in tain sufficien t flame temperature for clean co mb ustion. The outside surf ace s of the tank are usual ly covered with insulation to reduce h ea t lo ss e s thro ughthe bo il er j ac ket.

Burner

Burner s combine the fuel and air and then ignite t he mix ture to start the co mb ustion
pro ce ss . The bo il er fuel type dictates the ty pe of bu rner that i s u sed.

Atmospheric burners typica lly use natural ga s or propane in natural draft app li ca tions. Anatmospheric burner use s the pre ss ure-indu ce d velocity of ga s exiting an orifice to mi x such ga s with pr im ary co mb ustion air. Anatmospheric burner then uses natural draft to mix s ec ondary air in to the flame dur in g co mb ustion.

A ga s p ower burner i s a type of burner that use s a blower to push co mb ustion air in to th e

co mb ustion zone. This may be an external ly mou nted gun-ty pe burner si mi lar to an oilpre ss ure ato mi zing burner, or an in corporated fan and ga s d elivery system within th e bo il er.

Anoil power burner may be a pre ss ure ato mi zing burner or an air ato mi zi ng burner. A
pre ss ure ato mi za tion oil burner use s oil pumped thro ugha no zz le to create a f in e mist

13 This requires tha t the w at er r et urni ng to the bo il er system be cold enough to su ff icien tl y carry o ut th e condensation pro ce ss of the w at er vapor in the exhaust.
21that is then mixed with the co mb ustion air and ignited at the front of the burner. An ai r ato mi zing burner use s compressed air to ato mi ze the oil in to a fine mi st before bei ng de li vered and ignited in the co mb ustion chamber.

Heat Exc hang ers

A h ea t exchanger i s a device used to transfer h ea t from one medium to another. Al l bo il er s come equipped with air-to-water h ea t exchangers. The pr im ary bo il er h ea t exchange r designs include: (1) water tub e; ( 2) fire tub e; (3) ca st iron; and (4) tubele ss

. 14

For water tube boilers, co mb ustion gase s circulate around water or steam-f il led tubes. Heat transfer i s achieved by radiation from the flame s a s w ell as by conv ec tion from the ho t

co mb ustion gases. There may be up to several thousand water tubes in a bo il er, depending on th e size of the unit. 1 5 The wate r tube s are often welded together to form the wa ll s of th e

co mb ustion chamber, ca ll ed a “waterwall. ” Water-tube design s are often used in steam bo il ers. Finned copper water tube bo il er s are designed with ro ws of horizontal finned tubes lo ca ted abov e the co mb ustion chamber

. Finned copper water tube bo il er s are general hot water bo il ers. The water-tube design can enable more rapid start-up due to lower thermal mas s plus can enhanc e thermal shock resistance due to greater structural f lex ib il ity relat in g to thermal expansion an d contraction.

For fire tube bo il ers, the bo il er tank is f il led with water and h ea t i s transfe rr ed 1 6 a s hot

co mb ustion gase s p as s thro ughone to several metal tube s or other pa ss ageways in the h ea t exchanger. Fire tube bo il er s are often char ac terized by their number of passe s ( i.e. , nu mb er o f
t im e s co mb ustion gases flow the length of the boi ler ). The co mb ustion gas flo ws thro ughth e length of a bundle of tube s and then i s turned aro un d and pa ss e s b ac k thro ughan additiona l b undl e of tubes. 1 7 Fir e tube bo il er co mb ustion cha mb ers may be dry-base, wet-base, or wet-le g. Dry-base chamber s are refr ac tory-lined chamber s that dir ec t the co mb ustion gases from the firebox to the h ea t transfer tubes; the chamber i s u sual ly lo ca ted ben ea th the fluid-b ac ked

s ec tions. Wet-base chamber s often utilize a water-cooled turn-around chamber to dir ec t the flue gases from the co mb ustion chamber to the tube banks, altho ughdry-backed turn-around chamber s are also somet im es used. A wet-b ac ked turn-around chamber is ful ly surr ounded by fluid-b ac ked s ec tion s ex ce pt for the necessary openi ngs – there by e li mi nat in g the n ee d for th e

r efractory li ning. Wet-leg co mb ustion chamber s h ave fluid-b ac ked s ec tion s on the top and side s of the chamber.

14 ASH RAE 2008 H VA C Systems and Equipme nt Handbook (Av ailable at: https://www.ashrae.org/resour ce s

-- pu

b li c ati ons/ha ndbook ).

15 Characteriza ti on Industrial Co mm ercial Bo il er Po pu la ti on (20 05) (Avai lable at : h tt ps: // www1. ee re.energy.g ov /ma nu fact ur ing/distributedenergy/ pd fs/characteriza ti o n_ industri al _co mm eri ca l_ bo il er _p o pu la tion. pd f ).

16 The heat is transferred in the first pass of fire tube bo il er by radiation and conv ec ti on then by conv ec ti on on th e

r em aining pa ss es of the bo il e r. 17 DO E' s Impr ov ing Steam System Per fo rmance: A Sour cebook fo r In du stry (2012) (Avai lable at: h tt p :// www1. ee re.energy. go v /m anufacturing/t ec h_ a ss is ta n ce/ pd fs/ste am sour cebo ok. pd f ).

22Cast iron bo il er s are made up of ca st pre ss ure s ec tions bolted together or co nn ec ted by push nipples to form a block a ss embly. 1 8 The water is conta in ed inside ca st iron s ec tions, and

co mb ustion gases flow thro ughdesignated pa ss ages outside the s ec tions. 1 9 Cast iron bo il ers ma y be of dry-base, wet-le g, or wet-base design.

Tubeles s bo il er s u se the outside of it s she ll a s p art of the h ea t exchanger surface. There i s

a ce ntral flue su rr ounded by water wh ich serve s the first pas s of the co mb ustion gases. 2 0 Th e

co mb ustion gase s then exit the central flue thro ugh a no zz le that co nn ec ts it to the hollow she ll wall which has in ternal steel fins that run the length of the bo il er tank. Then the co mb ustion gases make several passes thro ughthe she ll wall before exit in g th e s t ac k. 21

Controls

A bo il er must be ca pable of providing immediate response to load demand variations while ma in taining it s efficiency and safety f ea tures. Thus, bo il er s come equipped with a variet y of controls.

The main operating control (pre ss ure- ac tuated for steam bo il er s and temperatu re ac tuated for hot water bo il ers) control s the firing rat e of the fuel by monitor in g hot water temperature or st eam pre ss ure. 22 Op erating control s could provi de on/off, high/lo w/ o ff , and modulat in g functions. 23

The low-water cutoff switch stop s fuel flow to the burner if minimum water level s are not detected. 24

The pre ss ure gauge & regulator monitors bo il er pre ss ure and shuts off the fue l supply to the bo il er if allowable bo il er pre ss ure is exc ee ded. Additiona ll y, th e temperature /p re ss ure re li ef valve release s steam if the pre ss ure gage/regulator fails and pre ss ure builds dangerously high. 25

The flame safe gu ard control monitor s the burner for proper operation and shut s off the fuel supp ly if a flame is not detected in the burne r. 26

18 Hese lt on , Kenn et h E

. Mar ce l De kk er , Bo il er operator's handb oo k (2005).

19 Be tt erBric ks “ Bo il ers Intro du c ti on H ow Bo il ers Wor k” (Av ai lable at : h tt p :// www.be tt erbricks.co m/ s it es/default/f il es/operations/om_ of

_ bo il ers_final.pdf ).
20 Se e h tt p :// www.spthermal.com/hurst.html

. 21 Hese lt on , Kenn et h E

. Mar ce l De kk er , Bo il er oper at or's handb oo k (2005).

22 Be tt erBric ks “ Bo il ers Intro du c ti on H ow Bo il ers Wor k” (Av ai lable at: h tt p :// www.be tt erbricks.co m/ s it es/default/f il es/operations/om_ of

_ bo il ers_final.pdf ).

23 ASH RAE 2008 H VA C Systems and Equipme nt Handbook (Av ailable at: https://www.ashrae.org/resour ce s

-- pu

b li c ati ons/ha ndbook ).
24 ASH RAE 2008 H VA C Systems and Equipme nt Handbook (Av ailable at: https://www.ashrae.org/resour ce s

-- pu

b li c ati ons/ha ndbook ).
25 Se e h tt p :/ /homerep air.abo ut.co m/ od/hea tingc oo li ngrepair/ ss /Residen ti al-St ea m- Bo il er-Controls.htm

. 26 Se e h tt ps: // www.osha.g ov /dte/grant.../fy 07 /sh

.. ./mo d_7_ bo il er_safety2. pp tx

. 23Draft

Dr aft types in clude natural and mechanical draft, a s w ell a s a for ce d-draft mechanis m

ac hieved by pulse co mb ustion. A natural draft bo il er i s d esigned to work with a negat iv e pre ss ure in the firebox and flue conn ec tion, where the pre ss ure di ff erence i s d eveloped by th e buoyancy of hot gases in the chimney. A mec hanical draft bo il er ha s either a for ce d draft o r indu ce d draft blower. A for ce d draft bo il er use s a blower upstream of the co mb ustion chamber,

and the fan is lo ca ted at the inlet of a bo il er and pushe s air thro ughthe burner, there by ensur in g that adequate air i s d elivered to the co mb ustion pro ce ss

. 2 7 Th e b lower pu ll s air from the bo il er room or may be conn ec ted to a duct system which pu ll s in outside air, then de li ver s air to th e

co mb ustion chamber at a posit iv e pre ss ure above atmospheric pre ss ure. An in duced draft bo il e r

use s a blower lo ca ted at the outlet side of the bo il er to pull flue gase s out of the bo il er due to a negat iv e pressure in the co mb ustion chamber, there by ca us in g air flow in to the inlet of the boiler.

5.4.2 T ec hno logy O pt io n s to Improve Co mbu stion and/orThermal Boiler Eff ici ency

DOE i s stud yi ng t ec hnol og y options by reviewing co mm ercial p ac kaged bo il e r manuf ac turer specification sh ee ts and equipment literatur e, r ece nt trade pub li ca tions, t ec hni ca l journals, and patent f il ings. DOE also in tends to consult with t ec hni ca l expert s w ho hav e worked on co mm ercial p ac kaged bo il er designs and to conduct manuf ac turer interview s abou t these t ec hn ol og y options. At thi s t im e, DOE i s aware of a set of t ec hnology option s (discu ss ed in further detail belo w) that could be used to im prove co mm ercial packaged bo il er efficiency. T ec hnol og y option s that are app li cable only to equipment subj ec t to a thermal efficienc y standard are noted. The foll ow ing li st in clude s technol og ie s that would improve the rated

e ff iciency:

1. J ac ket Insulation (Thermal Efficiency Only) 2. Condensing Bo il ers and Other Heat Exchanger Improvements 3. Burner Derat in g 4. Improved Burner T ec hnol og y 5. Co mb ustion Air Preh ea ters 6. Econo mi ze rs 7. Integrated, High-Efficiency Steam Bo il ers

Jacket Ins ulation (Thermal E ff

ici ency On ly)

The outside surf ac e s of the bo il er tank/pre ss ure ve ss el are usual ly covered with insulation
to reduce h ea t lo ss e s thro ughthe bo il er j ac ket. A poorly insulated j ac ket ca n result in h ea t l os s of up to several percent of the bo il er Btu/hr ca pacity.

27 DO E' s Impr ov ing Steam System Per fo rmanc e: A Sour cebook fo r In du stry (Av ailable at: h tt p :// www1. ee re.energy. go v /m anufacturing/t ec h_ a ss is ta n ce/ pd fs/ste am sour cebook. pd f ).

24Condensing Boilers and Othe r Heat Exc hang e r Impro ve men ts

At mos t operat in g temperatures, condensing commercial p ac kaged bo il ers operate a t higher efficiencies than the traditional noncondens in g co mm ercial p ac kaged bo il er by ca ptur in g some of the latent h ea t result in g from the phase change of the water vapor in the co mbustio n gases. The level of efficiency gain by condensing bo il ers, compared to non-condensi ng designs, is usual ly gr ea ter at low distr ib ution syste m operat in g temperatures, when non-condensing b o il ers somet im es use s up ply/return water mi xing valve s to ma in tain bo il er temperature s that ar e high eno ugh to prevent condensation and possible related corrosion.

Improvement s to the h ea t exchanger can be achieved by mod if yi ng baseli ne design s o f standard bo il ers to: (1) incr ea se h ea t exchanger surf ac e area; (2) mod ify or add h ea t exchange r surf ac e f ea tur es ; ( 3) mod ify or add h ea t exchanger baffle s and turbulators; and (4) in cr ea se th e

co rrosion resistance of the pr im ary h ea t exchanger, or use a corrosion-resistant s ec ondary hea t exchanger, to withstand flue ga s condensation.

Mechanical draft system s can be added to boiler s to enable the use of more-efficient h ea t exchangers. In natural draft systems, the movement of air thro ughthe bo il er i s dr iv en by th e buoyancy of the flue gases. M ec hanical draft system s allow for extended heat exchange surf ac e s and/or tighter flueways by overco min g the drop in pre ss ure a ss ociated with restrict iv e flo w pa ss ages in mo re -efficient h ea t exchanger s and by supplement in g the los s o f buoyancy in c oo le r flue gase s to provide sufficient airflow to the burners.

Improv in g the h ea t exchanger for a bo il er can im prove the e ff ec t iv eness of h ea t transfe r from the hot co mb ustion gase s to the water that is distr ib uted to the h ea ted sp ace . The im prov ed

e ff ec t iv enes s of the heat exchanger can incr ea se the co mb ustion and thermal efficienc y. High
pre ss ure-drop h ea t exchanger s can also serve to reduce off-cycle draft lo ss es by restrict in g th e flow of air thro ughthe h ea t exchanger, and subsequent los s of h ea t, when the burner i s n o t operat in g.

Burne r D er ating

Burner derat in g i s the operation of a bo il er at a redu ce d firing rate. Reduc in g burne r firing rate for ga s and oil bo il er s wh il e k ee ping heat exchanger geometry, the surf ac e are a, and the fuel-to-air ratio the same, wi ll increase the ratio of h ea t transfer surface area to energy input, there by increasing the e ff iciency of the bo il er. H ow ever, dependi ng on the degree of reduction, a lower energy input mea ns that les s heat wi ll be produ ce d, and, thus, lower utility may b e pr ovided than with conventional burner firing rates.

Impro ve d Burne r T ec hn ology

Pulse Combus tion

Pulse co mb ustion burner s operate on self-sustaining, resonat in g pre ss ure wave s tha t alternately depre ss urize the co mb ustion chamber (draw in g a fresh fuel-air mix ture in to th e chamber) and pressurize it (thro ughh ea t in g and e xp ansion of the fuel/air mix ture dur in g

25co mb ustion). Pu lse co mb ustion systems f ea ture hi ghh ea t transfer rates, and can achieve high er

e ff iciency level s than conventional bo il er designs.

Pr e mix Burners

Pre mi xing fuel ga s and co mb ustion air prior to arr iv al at the flame results in mor e complete co mb ustion using lower level s of excess air. The lower level s of exces s air not o nl y reduce the amount of fuel required to h ea t the co mb ustion air but also raise the temperature o f the gase s enter in g the heat exchanger wh ich enhan ce s h ea t exchan ge and im prove s efficiency. Lower level s of ex ce s s air also raise the water va po r due po in t wh ich facilitate s c ondensation and the r ec overy of latent h ea t and im proves efficiency when the unit i s operat in g in condensi ng mode.

Low-Pressur e, Air-A tomized OilBurner

Fuel input rate i s contro ll ed by the size of the no zz le orifi ce . Pre ss ure-ato mi z in g nozzle s that are designed for low firing rate s su ff er rapid fou li ng of the small in ternal pa ss ages, l ea di ng to in adequate spray pattern s and poor co mb ustion performance. To overcome the low in put lim itations of conventional oil burners, Brookhaven National Labora to ry developed a lowpre ss ure, air-ato mi ze d oil burner. 2 8 In addition, it can operate with low level s of ex ce ss

co mb ustion air for lean-burni n g, ult ra -clean com bu stion. A lower level of ex ce s s air genera lly improves co mb ustion efficiency.

Com bu s tion A irPrehe ate rs

Co mb ustion air preh ea ters (also kno wna s r ec uperators) are air-to-air h ea t exchanger s that transfer energy from the flue gase s b ac k in to th e system. However, inst ea d of transferr in g the energy in to the f ee d water a s i s d one with an econo mi ze r, the energy i s transfe rr ed to in creas e the temperature of the inco mi ng co mb ustion air, there by potential ly resulting in im proved

e ff iciency.

Econo mizers

Econo mi ze rs may allow for an in crease in bo il er thermal e ff iciency 29 by transferr in g excess flue ga s h ea t in to in co mi ng f ee dwater. 3 0 Econo mi ze r s are usua lly air-to-water h ea t exchangers. There are noncondensing and condens in g ec ono mi ze r s available on the market. Condensing ec ono mi ze r s are designed to allow condensation of the exhaust gas.

I

ntegrated, Hig h-E ff

ici ency Ste am Boilers

Certain manuf ac turer s have developed in tegrated, high-efficiency steam bo il er s tha t combine multiple design f ea tures to in cr ea se fuel-to-st eam efficiency. Su ch feature s can in clude enhan ce d heat transfer surf ac e s ( e.g. , spiral fire t ub es), a s w ell as f ee dwater ec ono mi ze r s and

28 See: http://www.os ti .g ov /bri dg e/servlets/pur l/ 24 853 9-wWbYod/webv ie wable/ 248539

. pd f

. 29 Note that ec ono miz ers would only sh ow an increase in thermal e ff iciency if they are an integral component of th e bo il er. 30 Se e h tt ps: // www1. ee re.energy.gov /ma nu fact ur ing/t ec h_deployment/ pd fs/ste am sour cebook. pd f.

26high-turndo wnmodulat ing burner s ca pable of maintaining low level s of exces s co mb ustion air. Cl ea ver-Brooks, in partnership with DOE and the Ga s T ec hnol og y Institute (GTI), developed th e first in tegrated, high-efficiency steam bo il ers called a "Super Bo il er ." 31

5.4.3 T ec hno logy O pt io n s to Re du c e S tand by Mode a nd Of f Mode Energy Con sumption

In the event that standby mode and off mode standards are pursued, DOE has developed the foll ow ing li st of t ec hn ol og ie s that would reduce standby mode and/or off mode el ec trica l energy consumption:

1. Toroidal Transformer (Stan dby Mode/Off Mode) 2. Control Relay for Model s with Brushles s P ermanent Magnet (BPM) Motors (Stand by Mode/Off Mode) 3. Switching Mode Power Supply (Standby Mode/Off Mode)

Toroidal Transforme r ( Sta ndby Mode /O ff Mode)

A toroidal transformer ha s an annular core made of tightly-wound, grain-oriented, silicon steel ribbons, wh ich are a rr anged such that all their molecule s are a li gned with the dir ec tion o f flux. T hi s all ow s b etter performance ( i.e. , more q ui et and efficient operation) than a traditiona l laminated transformer, in wh ich unaligned molecules in crease the core’ s reluctan ce , or ca pacit y for oppos in g magnetic induction. These im provements in efficiency allow an up to 50 per ce n t reduction in size and weight, such that they can be used in ne w, innovat iv e app li cations. Overa ll

e ff iciency of toroidal transformers is 90 to 95 percent.

B eca use transformer s cont in ue to supply power to the control board in all mode s o f operation ( in cluding stand by mod e)

, in creas in g their operat in g efficiency will also reduce th e bo il er’ s stand by electrical power consumption.

Control Relay for Mode ls w ith Brus hle s s Permane nt Magnet (BPM) Motor s ( Sta ndby Mode /O ff Mode)

Du r in g testing of stand by mode and off mode components performed for the DO E furnac e and ce ntral air conditioner rulemaki ng, 32 DOE found that B PM mo to r s and thei r

a ss ociated control s consume power wh il e in stand by and/or off modes, whi le permanent splitca pacitor ( PS C) motor s d id not have a ny stand by mode or off mode power draw. Therefor e, for those bo il er s that utilize them, the B PM moto r and a ss ociated controls c ou ld be disconn ec ted whi le the system is in stand by mode or off mode thro ughthe use of a control relay to furthe r reduce a system’s standby mode/off mode power consumption. A typical control relay activate s a switch when cu rr ent run s thro ughit, and when there i s no cu rr ent, a spr in g hold s the switch in the open position.

31 Se e h tt p :// www.cbbo il ers.co m/ s up er bo il er.htm fo r fu rther inf orm ati on. 32 U.S. Depar tm ent of Energy, O ff ic e of Ener gy E ff iciency a ndRenewable Energy, Ene rgy Conserv ati on Pro gr a m fo r Pro du cts: Techni ca l S upp ort Document: Ener gy Efficiency S ta ndar ds fo r Pro du cts: Residen ti al Fu rn a ce s a nd Central Air Condi ti oners and Heat Pum ps Including: Market and T ec hnology Ass e ss ment (2 0 10) (Av ailable at : h tt p :// www1. ee re.energy. go v/bu il di ng s /appl ia n ce _standards/residentia l/ residential_f urn a ce s_ ce ntr al _ac_h p_ dir ec t _f inal_rule_tsd.html ).

27Sw it c hi ng Mode Power Supply ( Sta ndby Mode /O ff Mode)

While li near power supp li e s regulate voltage supply to the dir ec t c urr ent circuit with a serie s element, switching mode power supp li e s (SM PS) do so in an alternative, more-e ff ec t iv e way. In a switching mo de power supply, power handling el ec tronic s switch on and off (wher e “on” means the switch i s closed and volta ge drop i s negligibl e, and “off” mean s the switch i s open and cu rr ent i s negligible) with high frequency, e ff ect iv e ly conn ec t in g and disconnect in g th e output (load) to the in put sour ce . Continuous power flow to the load can b e

ma in tained/contro ll ed by var yi ng the duty cycle or frequency of the SM PS.

Lin ear power supp li e s experience signifi ca nt h ea t lo ss e s because they use resistanc e elements, wh ich convert el ec trical energy to h ea t energy, to re gu late power supp ly . By using a switch to control energy flow in stead, switching mode power supp li e s avoid such heat lo ss e s and have much higher efficiency. SM PS do in troduce transient lo ss e s that in crease with frequency, but these losse s are negligible in comparison with the energy saved. Thus, repl ac in g a li near powe r supply with an SM PS ha s the potential to reduce the el ec trical power consumption o f

co mm ercial p ac kaged bo il ers in stand by mode and off mode.

5.4.4 T ec hno logy O pt io n s to Re du c e S easonal Boiler Energy Con sumption

DOE i s aware of a number of bo il er t ec hn ol og ies that exist that reduce overall fue l consumption by improving the avera ge seasonal efficiency. DOE would like to bette r understand whether a ny of the foll ow ing t ec hnologie s sh ou ld be considered a s t ec hnol og y option s to im prove efficiency and how e ff iciency improvements could be ca ptured in an updated test pro ce dure.

1. Modulat in g Burners 2. El ec t ronic Ignition 3. Dampers 4. Temperature Reset Controls 5. Thermal Post- Pu r ge Controls 6. Delayed-Action O il Pump Solenoid Valve

Modulating Burners

Two-sta ge and modulat ing burner s can d ec rease lo ss e s ca used by burner cycli ng at partia l loads. However, modulat in g burners may not ac complish net energy gains if exces s co mb ustion air levels must be in cr ea sed at low firing rate s (in order to ma in tain combustion performan ce ) o r if

el ec trical power requirements for the burner do not d ec r ea se in li n ear proportion to the firi ng rate. In condensing bo il er app li ca tions, an in crease in exces s co mbustion air ratio can result in redu ce d latent h ea t recovery due to d ec r ea sed flue ga s d ew po in t temperatures. Thi s can result in an energy los s that outweigh s the benefit of reduced burner cycli ng.

28E le ctronic I gnition

Bo il er s can be equipped with el ec tro ni c ignition systems, wh ich ignite burner s on demand using el ec trical components.

There are different type s of el ec tronic ignition systems in cludi ng: (1) Intermi tt ent Pilot I gn ition: This i s a device that li ght s a pilot light by generat in g a spark. The pilot li ght in turn li ght s the main burner. (2) Dir ec t Sp ark Ignition ( DS I) : D SI ignite s the main burner dir ec tly by generat in g a spark. (3) Inte rr upted Duty Ignition Systems: All modern oil burner s h ave a ty pe o f el ec tronic ignition called an in te rr upted duty ignition. A step-up transforme r supp li e s p ower to two el ec trodes, which ca use s a spark to jump. The in te rr upted duty ignition system for an oil burner ac t iv ate s the spark until either a st ea dy flame i s established or the end of the trial-for-ignition (T FI) period. 33

(4) Hot Su rf ac e Ignition: The igniter in thi s system is an el ec trica ll y-h ea ted resistanc e element that therma lly ignite s the main burner directly without the use of a pilo t light.

Unl ike standing pilot ignition system s that consume fuel cont in uous ly , electronic device s and their control modules operate only dur in g the ac t iv e mo de, wh ich im prove s efficiency. So li d-state el ec tronic ignition component s can also ac hieve el ec tricity sav in g s compared to older, iron-core transformer t ec hnologies.

Da mpers
Off-cycle (which refer s to the burner off-cycle) damper s restrict the in take and exhaus t air flow thro ughthe vent in g system dur in g stand by mode by closing when the burner is no t operat in g, there by trapp in g residual h ea t in the heat exchanger. Dur in g the burner off-cycle, th e bo il er loses h ea t by natural conv ec tion and conduction thro ughthe co mb ustion air inlet and flue. Installing a damper at these po in ts im prove s efficiency by prevent in g h ea t from es ca ping and minimizing off-cycle h ea t lo ss es.

Tempe rature Reset Controls

Temperature reset controls monitor outside air temperature or burner operat in g hour s (BOH ) to est im ate the required h ea t in g load, wh ich can vary a s a function of outdoor temperatur e, solar and w in d conditions, in ternal heat ga in , or thermostat setb ac k/r ec overy. Th e hydronic water supply temperature is then modulated up or do wn to enable the thermal distr ib ution ca pacity to match the ac tual h ea t in g demand. 34

33 “T rial fo r ignitio n” is the period during which the bu rner is att empting to ignite the fuel it is de li veri ng to th e nozzle.

34 2 008 AS HRAE Handboo k – H VA C Systems and E qu ipme nt (Avai lable at: https: // www.as hr ae.org/resour ce s

-- pu

b li c ati ons/ha ndbook ).

29Therm al Post-Purge Controls

Thermal post-pur ge control s allow the hydronic circulat in g pump to cont in ue operation after the ter mi nation of a thermostat demand for heat. The circulation pump cont in ue s to operat e after the shutdo wnof the burner until the bo il er temperature drops do wn to a programm ed leve l that depends on ty pe of bo il er and fuel. The thermal post-pur ge con ce pt functions mos t

e ff ect iv e ly when the control anticipate s the end of the h ea t in g demand and shut s o ff the burne r

early eno ughso that the residual h ea t transfe rr ed dur in g the post-purge cycle just satisfie s th e temperature requirement of the building. Su bstantial benefit s are ac hieved by reduced bo il e r temperature dur in g stand by mode/off mode through redu ce d j ac ket and draft h ea t lo ss es.

Delayed-Ac tion Oil Pu mp Solen o id V alve

A delayed- ac tion oil pump solenoid valve is instal led between the oil pump and th e burner nozzle to supplement the fuel pump regulator. It doe s so by delayi ng the fuel release by three to six s ec ond s after the igniter and burner blower start until the oil pressure r eac he s th e level required to fu lly discharge the oil in to the combustion chamber without dripping. Thi s

ensure s that the oil burns more completely, which im prove s efficiency since heat exchanger s w i ll

su ff er less f ou li ng.

I

tem 5-4 DOE we lco me s com me nts on the te chnologies identif ie d, as we llas any additional te chnology options w hich have not b ee n identif ied.

6. SC R EE NI NG ANAL YS IS

The purpose of the scr ee ning analysis i s to scr ee n out t ec hnolog y option s that DOE wi ll not analyze further in the engin ee ring analysis or downstr eam analyses. DOE wi ll develop a li s t of t ec hn ol og y option s (thro ughit s o wnres earch and in consultation with in terested parties) a s part of the t ec hn ol og y asse ss ment (s ec tion 5.4 ) . The identified candidate t ec hn ol og y options wi ll
encompas s a ll those t ec hnol og ie s that may im pro ve the efficiency of co mm ercial packaged bo il ers. DOE wi ll then review ea ch t ec hn ol og y option considering the foll ow ing four criteria, a s provided under s ec tio ns 4 (a )( 4) and 5(b) of 10 C FR P art 430, Subpart C, Appendix A:

1. T ec hnol og ical feasibility. DOE w il l screen out t ec hnol og ie s that are not in corporated in co mm ercia ll y-available equipment or work in g prototypes.

2. Pr ac ticability to manufacture, install, and service. If DOE deter mi ne s that mas s production and re li able insta ll ation and servicing of the t ec hnol og y cannot b e

ac hieved on the scale n ec e ss ary to serve the relevant market by the t im e of th e compliance date of the standard, it wi ll not consider that t ec hn ol og y further.

303. Adverse im p ac t on equipment ut il ity or ava il ability. If DOE deter mi ne s that a t ec hn ol og y will have a signifi ca nt adverse im p ac t on the utility of the relevan t equipment for significant consumer subgroups, or wi ll result in the unavailability o f

any covered equipment ty pe with performance char ac teristic s ( in cluding re li ability), f ea tures, si ze , ca pacities, and volume s that are substantia lly the same as equipmen t
genera lly available in the Un ited State s at the t im e, it wi ll not consider tha t
t ec hn ol og y further.

4. Adverse im p ac t s on health or safety. If DOE determine s that a t ec hn ol og y will hav e significant adverse im p ac t s on health or safety, it wi ll not consider that t ec hn ol og y further.

DOE wi ll fu lly document the r ea sons for el im inat in g a ny design options dur in g th e screeni ng analysi s and so li cit in terested parties’ comment.

I

tem 6-1 Of the te chnologie s li s ted in s ec tion 5.4 , are there any that should be scr ee ned out based on the four scr ee ning cr it eria? If so, w hich cr it er ia apply and why?

7. E NG INEERI NG ANALYSIS

After conduct in g the screening ana ly sis, DOE w il l perform an engineer in g analysis based on the remaining t ec hn ol og ie s that are available to improve co mm ercial p ac kaged bo il e r

e ff iciency. Thi s section provide s an overview of the engin ee ring ana ly sis (s ec tion 7.1), discusse s baseline models (s ec tion 7.2.1), descr ib e s D OE’ s p lanned appro ac h for deter mi ning the coste ff iciency relationship (s ec tion 7.2.3), and addresse s p roprietary designs (s ec t ion 7.2.4).

7.1 Engin ee ring Ana lys is Ov er view

The purpose of the engin ee ring analysis i s to determine the relationship between equipment efficiency and the manuf ac turer se lli ng price (M SP ). In deter mi ning the coste ff iciency relationship, DOE est im ate s the in cr ea se in manuf ac turer se lli ng price a ss ociated with
t ec hn ol og y change s that incr ea se the efficiency of co mm ercial p ac kaged bo il ers relat iv e to th e baseline model. DOE wi ll develop cost est im ate s for bo il er s at a ran ge of efficiency levels based

on the t ec hn ol og ies in corporated in to equipment at those level s and the a ss ociated changes in material, labor, shippi ng, and overhead costs. This relationship between price and efficienc y

serve s a s the basis for cost/benefit calculations to in dividual consumers in the LC C analysi s and
to the Nation in the national imp ac t analysi s (NIA).

DOE wi ll develop separate engin ee r in g analyses for eac h of the baseline models i t analyzes for the equipment classe s considered in t hi s rulemaking. Due to the large variation o f si ze s and char ac teristic s of the equipment considered in thi s standard s rulemaki ng, DOE ma y sel ec t a sma ll er subset of representative equipment to ana ly ze. Typica ll y, ea ch representat iv e equipment type would ca pture the f ea ture s and char ac teristic s common to the majority of the

31shipments. However, in case s where equipment with di ff erent char ac teristic s acc ount s fo r significant market share but cannot be r ea sonably a ss umed to be representat iv e of the remaini ng equipment, multiple representat iv e equipment types may be ana ly zed within an equipment cla ss

. Once DOE has identified the cost-efficiency relationships for the representat iv e units, th e analysis may be s ca led to include co mm ercial p ac kaged bo il er s with other f ea ture s (such a s di ff erent ca pacities) if there i s a significant di ff erence betw ee n the cost-e ff iciency relationships of such units.

The engineer in g analysis w ill identify and evaluate co mm ercially-available p ac kaged bo il er s within ea ch equipment clas s that incorpora te t ec hn ol og ies that im prove efficiency. Th e engin ee ring analysis w ill also identify the highest-e ff iciency model that i s t ec hn ol og ica lly f ea sible within each equipment clas s ( i.e., the “max-t ec h” model). DOE may deter mi ne the maxt ec h model by investigat in g the existence of a ny co mm ercial packaged bo il er work in g prototype s with higher efficiency than those co mm ercial ly ava il able. DOE wi ll ensure that thes e t ec hn ol og ies mee t the scr ee ning criteria li sted in section 6.

7.2 Engin ee ring Ana lys is Ap proach

For the engin ee r in g analysis, DOE wi ll examine incremental incr ea ses in th e manuf ac turer selling price a ss ociated with incr ea ses in co mm ercial p ac kaged bo il er efficiency. For the prel im inary ana ly sis phase of the rulemaking, DOE in tend s to use manuf ac turer-provided cost and e ff iciency data, if ava il able, to develop cost-e ff iciency relationships for the co mm ercia l
p ac kaged bo il ers analy ze d. DOE wi ll also utilize publicly-available data from manuf ac ture r website s and ca talo gs for co mm ercial p ac kaged boilers in the market to cate go rize relationship s between e ff iciency and t ec hn ol og ical options, where the t ec hn ol og y options used can b e identified. DOE encourages in terested partie s to submit test data or information that wi ll improve DOE’ s u nderstanding of co mm ercial p ac kaged bo il er performance as it relate s to th e di ff erent t ec hnol og y options. DOE wi ll also use t hi s information to select the char ac teristic s o f unit s that are representat iv e of the bo il ers in each equipment class. DOE wi ll then focus it s analyse s on these representat iv e units.

7.2.1 Baseline Models

For eac h equipment class, DOE wi ll identify one or more baseli ne model s that wi ll serv e

a s a reference po in t aga in st wh ich DOE can measure change s resulting from potential energ y conservation standards. The baseli ne model (or models) w il l represent the char ac teristics and input ca pacity of a typical co mm ercial p ac kaged bo il er in a g iv en equipment cla ss . The baseli ne model i s typica lly the most common, least-efficie ntequipment sold in a given equipment class,

and just meet s (but doe s not ex cee d) curr ent energy conservation standards

. DOE may sel ec t more than one representat iv e baseline model for the equipment class if a ll models in that clas s

cannot be r ea sonably represented by a single set of common ch ar ac teristics.

327.2.2 Eff ici ency Levels

For eac h equipment class, DOE wi ll undertake analyse s to deter mi ne potential efficienc y level s and seek to develop in cremental manuf ac turing cost data at eac h of these levels. DO E plans to conduct eng in eer in g and other downstream analyse s at various efficiency levels for eac h equipment class. DOE wi ll select e ff iciency levels between the baseli ne and max-t ec h level s based on information obta in ed in the market and technol og y asse ss ment. The efficiency level s b etween the baseline and max-t ec h level s w ill be based on the most common efficiencie s o f model s available, or on significant t ec hnol og ies for im prov in g efficiency, or on a combination o f these two f ac tors. DOE may conduct test in g on sel ec t unit s to aid in deter mi ning appropriat e

e ff iciency levels.

To estab li sh the e ff iciency levels for the analysi s, DOE wi ll consider the design change s

a ss ociated with im provi ng co mm ercial p ac kaged bo il er e ff iciency from the base li ne thro ughth e max-t ec h model. Thi s wi ll include consider in g the t ec hnol og ies identified in the t ec hnol og y

a ss essment that are pa ss ed on thro ughthe scr ee ning analysis. DOE also in tend s to co ll ec t

co mm ercial p ac kaged bo il er e ff iciency data from various manuf ac turer catalo gs and the AHR I
D ir ec tory 35 to estab li sh the ran ge of e ff iciencie s curr ently availabl e on the market in the market

a ss essment (see s ec tio n 5 ). DOE wi ll also use these data to categorize relationships between

e ff iciency and t ec hn ol og ical option s where the technol og ical options used can be identified.

DOE notes that the maximum efficiency level s available in co mm ercial p ac kaged bo il er s

cu rr ently on the market may not n ece ssari ly co rr espond to the max-t ec h levels. Model s at th e highest e ff iciency ava il able on the market today may not in corporate all possible design option s for in cr ea sing efficiency and, therefore, may not achieve the highest possible efficiency at th e max-t ec h level. It is also possible that some of the design options that have met the scr ee ni ng criteria ( i.e. , pa ss ed the screeni ng ana ly sis) may be work in g prototype s that are not ye t

co mm ercia lly ava il able and, therefore, would not be found in today’ s available ma xi mu m

e ff iciency equipment. DOE wi ll s ee k input from interested partie s to deter mi ne appropriate

max-t ec h efficiency levels. DOE wi ll ensure that such units meet the scr ee ning criteria in s ec tion 6 us in g other means, such as information gathered from manuf ac turer in terviews.

I

tem 7-1 DOE s eek s input regarding the range of eff ici ency le vels and any ke y e ffici enc y le vels that should be ex amin ed as part of its analysis.

I

tem 7-2 DOE s eek s com me nt on the appropr iate max

- te ch l eve l s for com me rc ial

pa ck aged boile rs

.

I

tem 7-3 DOE s eek s input on the represe ntative capac ity and other represe ntative charac te ris ti c s for each com me rcial pa ck aged boiler equipment c la ss.

35 Air-Condi ti oning, He at ing, a ndRefrigeration Inst it ute (AHR I), 2013 Dir ec tory of Cer ti fied Pro du ct Per fo rman ce : Co mm er ci al Packaged Bo il ers (Av ai lable at: http: // www.a hr idir ec tory.org/ )

.

33I tem 7-4 DOE s eek s input on charac te ris ti cs w hich may require multiple represe ntative equipment typ es w ithin a single equipment c la ss.

7.2.3 Met hodo logy for Devel opi ng t he Co st-E ff ici ency Relat io ns hip

The engineer in g analysi s p rimari ly involve s est im at in g the production cost of co mm ercia l
p ac kaged bo il er s at various level s of in creased efficiency. These est im ates of production cost ar e then used in conjunction with equipment efficiency information to deter mi ne the cost-e ff icienc y relationship for the equipment. DOE typica lly structure s it s est im ation of the cost-efficienc y relationship around one of three methodol og ies: ( 1) the desi gn

- option app ro ac h, wh ich calculate s the incremental cost of add in g sp ec ific design option s to the baseline model; (2) the e ff icien cy level appro ac h, wh ich calculate s the in cremental costs of achievi ng in creases in energ y

e ff iciency, without regard to the particular design option s u sed to ac hieve such incr ea ses; and ( 3) the reverse engin ee r in g cost-a ss essment appro ac h, wh ich involve s a “bo tt om-up” manufactur in g cost a ss essment based on a deta il ed bill of materia ls (BOM) derived from t eardown s o f equipment being analyzed. Decid in g which methodol og y to use for the engin ee r in g analysi s depend s on the equipment, the t ec hn ol og ie s under study, and any historical data DOE can draw upon. For the analysi s of potential amended energy conservation standards for co mm ercia l
p ac kaged bo il ers, DOE ha s tentat iv e ly d ec ided to use a combination of the design-option
appro ac h and the e ff iciency-level appr o ac h to identify incremental im provements in efficienc y for eac h equipment class and to develop a cost for ea ch e ff iciency level. In the event tha t stand by mode or off mode standards are pursued, DOE would like ly employ the design-option
appro ac h to evaluate the cost-e ff iciency relationship of the app li cable t ec hn ol og ies identified in

s ec tion 5.4.3.

After identifyi ng the representative models for eac h equipment clas s and sel ec t in g

e ff iciency levels for ana ly sis, DOE plan s to develop production cost est im ates for eac h representat iv e model thro ugh in terview s with manuf ac turer s and by bu il di ng on expertis e developed thro ughcost-efficiency analyse s of s imi lar products or equipment. DOE plan s to in

terview co mm ercial p ac kaged bo il er manuf ac turers to discus s the manuf ac tur in g pro ce ss e s and production cost s a ss o ciated with ea ch model and to use these discussions to inform it s manuf ac tur in g cost est im ates. DOE may supplement and validate its cost s estimates by conduct in g survey s of the cost of si mi lar models to contractors, adjusted for distr ib ution chain markups. DOE may also consider perfor mi ng t eardo wnanalyses, if necessary, to supplement th e engin ee ring analysis. If multiple type s of equip me nt with di ff erent cost-e ff iciency relationship s

are included within a s ingle equipment class, DOE wi ll then a gg regate the cost nu mb er s by weight in g in dividual data po in t s by company-level sale s volumes for eac h ty pe of equipmen t within a given clas s to produce a s in gle cost-e ff ic ie ncy relationship for that equipment class. Manufacturer cost information should reflect the variability in baseline models, design strategies, and cost structures that exist among manufacturers.

DOE wi ll est im ate the contr ib ution of the depreciation of ca pital conversion expenditure s to the in cremental overhead. Dur in g the in terview s with manuf ac turers, DOE in tend s to gathe r information about the ca pital expenditure s needed to in crease the efficiency of baseline models

34to various e ff iciency levels. DOE also in tends to gather information about the depreciation method(s) used to expense the co nv ersion expenditures.

The proposed appro ac h w il l enable DOE to char ac terize the cost-efficiency relationship for co mm ercial packaged bo il er s ac ross the entire e ff iciency range for eac h equipment cla ss

. DOE wi ll ma in tain the confidentiality of proprietary data, wh il e all ow ing the public to exa mi ne the cost and design a ss umptio ns that under li e the cost-e ff iciency est im ates.

After de ter mi ning est im ates for the manuf ac turer production cost (MPC), DO E plans to apply est im ated manuf ac turer markups to co nv ert manuf ac turer production costs to manuf ac ture r selling pri ces . DOE in tends to est im ate manuf ac turer markups from publicly-available financia l information ( e.g. , S ec uritie s and Exchan ge Com mi ssion (SEC) 10-K reports) and supplement th e est im ates with information obtained dur in g discussion s with manuf ac turers. 36

7.2.4 Propr iet ary Des ig ns

DOE wi ll consider in it s engin ee r in g and ec onom ic analyse s a ll t ec hnol og ies that ar e commercia lly ava il able or present in a work in g prototype, in cluding proprietary designs tha t

m ee t the scr ee ning criteria discussed in section 6. However, DOE wi ll consider a proprietar y design in the subsequent analyse s only if it doe s not represent a unique path to a g iv en efficienc y level. If the proprietary design i s the only appro ac h available to ac hieve a given efficiency level,
t hen DOE wi ll e lim inate that e ff iciency level from further analysis. DOE wi ll reject a standard level that can only be met with a single proprietary t ec hnol og y, b ecause it could result in an anticompetit iv e market, a pr in ciple consistently applied in past DOE rulemaki ngs a s ec ono mi ca lly unjustifiable. However, if a g iv en energy efficiency level ca n be achieved by a number of design
appro ac hes, in cluding a proprietary design, DOE wi ll cont in ue to exa mi ne the given efficienc y level, in spite of the proprietary nature of that one design.

DOE i s sensitive to manuf ac turer con ce rns about proprietary designs and w ill take steps
to ma in tain the confidentiality of a ny proprietary data provided by manufacturers. Thi s information wi ll provide in put to the competit iv e imp ac t s a ss essment and other ec ono mi c analyses.

8. MARKUPS ANAL YS IS

To carr y out the life-cycle cost (L CC ) and pa yb ack period (PB P) calculations, DO E

n ee d s to deter mi ne the cost to the co mm ercial consumer of baseline equipment that satisfies any

cu rr ently applicable energy conservation standards, a s w ell as the cost of the more-efficient uni t the co mm ercial consumer would purchase under po tential amended standards. This i s d one by applyi ng a markup multiplier to the manuf ac turer’ s selling price to est im ate the co mm ercia l consumer’ s p ri ce

.

36 See http: // www.sec. go v/e dg ar.shtml

.
35DOE use s retail (consumer) price data in its LCC, PB P, and national imp ac t analyses. DOE typica lly use s distr ib ution channel markups (and sale s tax) to co nv ert est im ates of th e manuf ac turer selling price der iv ed from the engineer in g ana ly si s (s ec tion 7) to consumer pri ce s.

Before devel op ing markups, DOE first n ee ds to identif y how distr ib ution from th e manuf ac turer to the co mm ercial consumer take s p l ace . Two di ff erent market s exist for h ea t in g systems: (1) new construction and (2) repla ce ments. Fi gu re 8.1 s ho ws how DOE plans to char ac terize the replacement distr ib ution channels for co mm ercial packaged bo il ers:

Manufacturer Wholesaler M ec hanical
Con tract or Consumer

F ig ure 8.1 Repla ce me nt Distribution C hann el

Fi gu re 8.2 sho ws how DOE plans to char ac terize the new construction distr ib ution channel for co mm ercial packaged bo il ers:

Manufacturer Wholesaler M ec hanical
Con tract or Gene ral Con tract or Con sumer

F ig ure 8.2 New Construction Distribution Cha nn el

In addition, DOE pla ns to consider distr ib ution channel s where the manuf ac turer se ll s th e equipment dir ec tly to a co mm ercial consumer through a national acc ount (see Fi gure 8.3 ) or th e

co mm ercial consumer purchase s the equipment dir ec tly thro ugha wholesaler (see Fi gure 8.4 ).

Manufacturer Con sumer

F ig ure 8.3 Nat io nal Acc ount Di stribution Cha nnel

Manufacturer Wholesaler Con sumer

F ig ure 8.4 W ho lesaler Di stribution Cha nnel

36To develop markups for the parties involved in the distr ib ution of co mm ercial p ac kaged bo il er equipment, DOE plans to ut ili ze several sour ce s in cludi ng: (1) the Heat in g, AirConditioni ng and Refrigeration Distr ib utor s International (HARDI) 2012 Profit Report 37 to develop wholesaler markups; (2) the 2005 Air Conditioning Contractors of America’ s (ACCA) financial analysis for the HVAC R contr ac t in g in dustry 38 to develop mechanical contr ac tor markups, and (3) the U.S. Census Bur ea u’s 2007 Econo mi c Census data 3 9 for th e co mm ercia l and institutional building construction industry to develop general contractor markups. DO E previous ly der iv ed general contr ac tor markups for co mm ercial p ac kaged bo il ers from U.S. Census Bur ea u financial data for the co mm ercial and institutional build in g construction s ec tor. In addition, DOE pla ns to consider ca se s where the contractor’ s sale of the equipment in clude s a start-up/ch ec k-out contract, in which ca se s the equipment markup is in cluded in the contrac t costs.

DOE wi ll also develop and include regional sale s ta xe s to ca lculate retail pri ce s fo r repl ac ement units. The State Tax Cl earinghouse is an on- li ne source that DOE in tends to use to calculat e app li cable sale s taxes. 4 0 DOE may use co ll ec ted retail price data to va li date th e overal l manuf ac turer-to-consumer markup.

DOE plans to consider whether the wholesaler and contractor s markups w ou ld b e di ff erent depending on the bo il er ca pacity, fuel type h ea t in g output (hot water or st eam), and th e type of bo il er draft system (natural draft or mechanical draft).

The markup analysi s g enerate s consumer pri ce s for eac h considered efficiency level. DO E’s markup s analysi s ca ptur es the e ff ec t on consumer price s that may result from highe r production volume s of more-efficient equipment a s required by the standard. The overal l markups, wh ich include manufacturer, wholesaler, and contractor markups, are di ff erent for ne w and repl ac ement markets, s in ce different markups apply to eac h of them. The manuf ac turer cos t i s t hen multiplied by the overall markup to genera te the consumer pri ce

.

I

tem 8-1 DOE s eek s interes ted par ty input on whe th er the distribution channe ls descr ibed above are appropr iate for com me rcial pa ck aged boile rs

.

I

tem 8-2 DOE s eek s input on the per ce ntage of equipment being distributed th rough the different distribution channels, and whethe r the s ha re of equipment th rough each channe l

var ies based on equipment c la ss or equipment c apa c it y.

37 Hea ti ng , Air Co nditioni ng & Ref rigera ti on Distri bu tors In te r na ti on al 2012 Profit Re port, (URL: h tt p :// www.ha rd in et .org/Pr of it-Report ) (Last a cce ssed A pr il 10, 2013 ).

38 Air Conditioni ng Contractors of America (A CC A), Fin an cial A na lysis f or

the HVACR Co ntracti ng Indu stry : 2005, (20 0 5) (Ava ilable at : h tt ps:/ /http://www.a cc a.org/store/pro du ct.php?pid=142 ) (Last a cce ssed A pr il 10, 2 013 ).
39 U.S. Cens us Bu reau, 2 007 Ec ono mic Cens us Data. (2007) (Av ailable at: http: // www.census.g ov /eco n/ ) (Las t

a cce ssed A pr il 10, 2 0 13).
40 S al es Ta x Cl ea ringhouse, Inc. pr ov ides S tat e sales tax r at es, al ong with combined avera ge c it y and c ou nty rates

. (Av ailable at: http:/ /t

hestc.co m/ STrates.stm

. )

37I tem 8-3 DOE we lco me s suggestions and com me nts concerning its p roposed approach

to deve loping es timat e s of future com me rcial pa ck aged boiler re tailpr ic es.

I

tem 8-4 DOE s eek s r ece nt data to establish the ma rkups for the parti es invol ve d w ith the distribution of the equipment.

9. ENE RGY USE A NAL YS IS

The purpose of the energy use analysis i s to determine the annual energy consumption o f the co mm ercial p ac kaged bo il er equipment classes descr ib ed in the engin ee r in g analysis fo r representat iv e user s of co mm ercial p ac kaged bo il ers and to a ss es s the energy-savings potential o f increased equipment e ff iciencies. DOE uses the annual energy consumption and energy-savi ngs potential in the LC C and PBP ana ly si s to estab li sh the savings in building owner operat in g cost s at various equipment e ff iciency levels.

DOE plans to est im ate the ann ual energy consumption o f co mm ercial p ac kaged bo il er s a t specified energy efficiency level s ac ros s a range of app li ca tions, co mm ercial bu il ding types, and climate zones. The annual energy consumption include s u se of natural gas, li quefied petroleu m ga s (L PG), oil, or el ec tricity for hot water or steam production, a s w ell a s u se of electricity fo r the auxiliary components ( e.g. , circulat in g pumps, draft in du ce rs, electronic ignition devices, and

c ontrols). DOE plan s to ac count for the energy used to h ea t hot water for the fr ac tion o f

co mm ercial p ac kaged bo il er s that provide both sp ac e h ea t in g and water h ea t in g.

DOE in tend s to base the energy use analysi s on building char ac teristics and energy us e data from the Energy Information Administration’ s (EI A) 2003 Co mm ercial Building Energ y Consumption Su rvey ( CB ECS) 41 for the subset of bu il ding type s that use co mm ercial packaged bo il er equipment covered by thi s standard. DOE doe s not plan to l oo k at sma ll residentia l
app li ca tions for co mm ercial packaged bo il ers, because it is unlike ly that co mm ercial p ac kaged bo il e r s w ou ld be used for sma ll residential application s to any significant extent. Co mm ercia l
p ac kaged bo il ers used in large residentia l building s ( i.e. , multi-fam ily dwe ll ings) will, however, be considered in thi s a nalysis; DOE in tend s to base t hi s analysi s on multi-fa mily bu il di ng char ac teristic s and energy use data from EI A’s 2009 Residential Energy Consumption Su rve y (RECS). 42

Both CB ECS and RECS surveys include information on the physical char ac teristic s o f building units, h ea t in g equipment used, fuel type s u sed, energy consumption and expenditures,

41 Ener gy In fo rmation Ad mi nistration (EIA) , 2003 Commer cia l Bu il ding Ener gy Consump ti on Survey (C BECS ) (Av a ilab le at: http: // www.e ia .g ov /c onsumption/co mm er ci al/ )(Last a cce ss ed April 10, 2 0 13). Please note tha t CBE CS 2012 is c urren tl y in development, and DOE will use this later version if it b ec omes av ailable in the require d tim e frame.

42 Ener gy In fo rmation Administration (EIA) , 2009 Residential Ene rgyConsump ti on Survey (RECS) (Av ai lable at : h tt p :// www.e ia .g ov /c onsump ti on/residential/ ) (Last a cce ss ed A pr il 10, 20 13 )

. Please note that DO E inten ds t o character iz e la rge multi-famil y bu il din gs based o n number of apartment units and fl oo rs of multi-famil y bu il dings.

38and other relevant char ac teristics. 4 3 Us in g CB ECS and RECS data, a s w ell as information fro m American Society of Heat in g, Refrigerat in g and Ai r-Conditioning Engin ee rs (A SH RAE), 44 DO E wi ll develop a bu il ding sample for eac h co mm ercial p ac kaged bo il er equipment class based on the typi ca l type s and input ca pacity of co mm ercial packaged bo il ers used in different bu il di ng type s and appli ca tions.

Deta il s on how DOE wi ll deter mi ne the annual energy consumption of co mm ercia l
p ac kaged bo il er s are provided belo w. DOE plan s to use the co mm ercial bu il ding and climat e zone data not only to estab li sh each equipment type’ s annual energy consumption, but also a s th e basis for conduct in g the LC C and PBP analysi s (see s ec tion 10 ).

9.1 Estimating An nual Energy Con sumption of Bo il ers

DOE wi ll est im ate annual energy consumption of co mm ercial packaged bo il er s ( by equipment class) by matching h ea t in g usa ge prof il e s to eac h bu il ding type considered in th e analysis.

To develop h ea t in g usa ge and water temperature prof il es, DOE wi ll ca lculate the numbe r of hour s that a co mm ercial p ac kaged bo il er would have to run at full and part-load ca pacity to serve a total h ea t in g load. Based on A SH RAE and El ec tric Power Res earch Institute (E PRI ) data, a s w ell a s d ata from National Renewable Energy Labora to ry (NREL) and La wr enc e Berkeley National Laboratory (LBNL), DOE wi ll develop representat iv e h ea t in g usa ge and
water t emperature profiles for various app li cations for eac h co mm ercial p ac kaged bo il er and building ty p e combination being analy ze d. 45

, 4 6 Thi s appro ac h w il l ca ptur e th e variability in
sp ac e h ea t in g use due to f ac tor s such a s building ac tivity, schedule, o cc upancy, local weather, building envelope char ac teristics, tank losses, cyc li ng lo ss es, and piping losses.

To ca lculate the to tal h ea t in g load for di ff erent building types, DOE plans to use bu il di ng char ac teristic s and energy use data from CB ECS 2003 and RECS 2009. DOE in tend s to develop a bu il ding sample for eac h equipment class based on the CB ECS 2003 bu il ding types, a s w ell a s multi-fa mily buildi ngs from RECS 2009.

A SH RAE Standard 90.1 and DOE set standards for co mm ercial p ac kaged bo il ers in
term s of thermal efficiency for most equipment cla ss e s and in term s of co mb ustion efficiency fo r two equipment cla ss es. DOE doe s not in tend to chan ge the metric for standards, but for th e purpose of est im ating energy use, DOE wi ll develop a relationship between bo il er usa ge and

43 Neither CBE CS nor RE CS pr ov i de data on wh et her the bo il er used in the building is a co mm er ci al package d bo il er c ov ered in this rule ma king ( i.e ., h ea ting could also be pr ov ided by a residential s iz e bo il er)

. DO E inten ds t o develop a m et hodology for adjusti ng it s bu il di ng s am ple to ta ke into a cc ount only bu il din gs that use a co mm er ci a l packaged bo il ers covered in this rule ma king.

44 Ameri ca n Society of He ati ng, Refrigerati ng and Air-Conditioning E ng in ee rs, Inc. ( AS HRAE), AS HRA E Handbook of H

VA C A pp li c ati ons: Chapter 50 (Service Wa te r He at in g) (2 011) pp. 5 0.1 to 50.32.
45 National Renewable Ener gy Labor at ory (NREL ). U.S. Depar tm ent of Ener gy Co mm er ci al Reference Bu il di ng Models of the N ati onal Building Stock (February 2011) (Av ailable at : h tt p :// www.nr el .g ov / do cs/fy11os ti/ 4686 1. pd f ) (Last a cce ss ed April 10, 2 0 13).

46 Hua ng, J., Akbari, H., R ai ne r, L, Rit scha rd. 481 Prototypical Co mm ercial Buildin gs fo r 20 Urban Market Areas

, LBL- 29798 (April 1991 )(Av ai lable at: h tt p://gundog.lbl.g ov /dir pu bs/ 2979 8. pd f ) (Last a cce ssed A pr il 10, 2 0 13 ).

39thermal e ff iciency to deter mi ne energy usage by efficiency level. DOE is in tending to us e thermal e ff iciency in the energy use analysis for all equipment cla ss es be ca use thermal efficienc y is be tt er suited for defining the relationship between energy input and useful output of the bo il er. For equipment classes required to mee t e ff iciency standards using the co mb ustion efficienc y metric, DOE could develop co rr espond in g est im ates for thermal efficiency based on the "avera ge pe r ce n ta ge p o in t di ff eren ce " method used in the 2009 F in al Rule. 47 It should be noted that DOE anticipate s the 2013 AHRI ce rtification dir ec tory for co mm ercial p ac kaged bo il ers to provi de both combustion and thermal efficiencies for most models. 48

DOE reco gn iz es that the thermal efficiency of a c om mercial packaged boiler in the field depend s on the return-water conditions; this i s especia lly true in the ca se of condensing bo il er s where most condensing boiler s wi ll not condense unles s the return-water temperature is lowe r than some threshold or they are operat in g in a low-fire reg im e, or both. DOE plans to us e representat iv e water temperature profile s to adjust bo il er e ff iciencies to refl ec t return-wate r conditions based on insta ll ation types in exist in g co mm ercial buildings. 49

In thi s rulemaki ng, DOE plan s to also acc ount for the el ec tricity consumption of bo il e r components in cluding but not l im ited to: pumps, fans, el ec tronic ignition, and controls used in

co mm ercial p ac kaged bo il ers. Many of these component s come standard with co mm ercia l
p ac kaged bo il er units, and DOE be li eve s the el ec tricity consumption should be considered. DO E also plans to consider, a s app li cable, a ny other energy use by the co mm ercial p ac kaged bo il e rs , such a s a pilot li ght.

In addition to the energy use for sp ac e h ea t in g, DOE plans to acc ount for co mm ercia l
p ac kaged bo il er energy use for h ea t in g service water. DOE plan s to use CB ECS 2003, REC S 2009, and other sour ce s to deter mi ne the fr ac tion of buildi ngs that use commercial p ac kaged bo il ers for h ea ting water in addition to sp ac e h ea t in g.

To represent “normal” weather, the CB ECS 2003 and RECS 2009 bu il ding energ y consumption value s w ill be adjusted based on 10-year average h ea t in g degree-day (HD D) dat a (2002−2011) for eac h geographical region. 5 0 In addition, DOE wi ll make adjustment s to the

47 In the 20 09 Final Rul em aking (C hapter 4 of the T SD

, s ec ti on 4.3.1) fo r the two e qu ipment c la ss es wit h combus ti on e ff iciency as the re qu ired m et ric fo r rati ng, DO E developed es tim ates of the r at ed thermal e ff icienc y based on an estimated 1.5 avera ge per ce nta ge point di ff erence between thermal and combus ti on e ff iciency for la rge , gas-fired hot-w at er bo il ers a nd an estim at ed 2.0 avera ge per ce nta ge point di ff erence betw ee n thermal a nd combus ti on e ff iciency fo r large, oil-fired hot-w at er bo il ers. The avera ge per ce n ta ge poi nt values were based o n

avera ge differen ce s betw ee n thermal a ndcombus ti on e ff ic ie ncies fo r these two c la ss es of e qu ipment in the DO E bo il er da tabase used in the 2009 rule ma king . ( Av ailable at: h tt p: // w ww.re gu l ati ons.g ov / #!d ocumentDetail;D= EE RE2008 -BT-STD-00 13

- 00 11 )

48 Air-Condi ti oning, He at ing, a ndRefrigeration Inst it ute (AHR I), 2013 Dir ec tory of Cer ti fied Pro du ct Per fo rman ce : Co mm er ci al Packaged Bo il ers (Av ai lable at: http: // www.a hr idir ec tory.org/ )

. 49 DOE a ss umed that most of the exis ting systems using hot-w at er bo il ers had b ee n designed fo r typical hydronic system desi gn condi ti ons of 180 °F su pp ly water a nd 160 °F retu rn

w

at er to m ee t peak h eating loads. DOE plans t o develop a seasonal e ff iciency fo r condensing bo il ers to a cc ou nt fo r low s upp ly-w at er temperatures at higher outd oo r air temperatures.

50 A 10-year avera ge is used in order to m at ch with EIA ’s A nnu al Ener gy Ou tl oo k m et hodology (see Residen ti a l Demand Mo du le at p. 3 2) (Avai lable at : h tt p:// www .e ia .g ov /for ec asts /a eo /a ss umptions/ pd f/residential. pd f ).

40building heat in g load to refl ec t the exp ec tation that bu il ding s u s in g co mm ercial p ac kaged boiler s in the y ear in which comp li ance with the amended standards i s exp ec ted to be required wi ll hav e a di ff erent h ea t in g load than the bu il ding s sampled in the CB ECS 2003 and RECS 2009 surveys. The adjustment wi ll consider proj ec ted improvements in building envelope and other efficienc y pr ac tice s and incr ea ses i n co mm ercial building floor area at the 2019 comp li anc e date of th e standards.

DOE also plans to a ss es s the app li cability of the “rebound e ff ect” in the energy us e analysis for commercial p ac kaged bo il ers. A rebound e ff ec t o cc ur s w hen a piece of equipmen t that is made more efficient i s u sed more in tensively, so that the expected energy savings from th e

e ff iciency improvement may not fu lly materiali ze . However, at thi s t im e, DOE is not aware o f

any information abo uta rebound effect for co mm ercial packaged bo il e rs.

I

tem 9-1 DOE s eek s input on the planned approach for determining the ener gy consumption of com me rcial pa ck aged boil er s in com me rcial buildings.

I

tem 9-2 DO E s eek s his to ricalshipment-weighted commercial pa ck aged boile r eff ici ency data or shipment data by eff ici ency bins

. DOE is p r ima r ily interes ted in obtaining this data dur ing the la st 10 ye ar s to capture the impa ct of the mo st cu rr e nt
te chnologies on the boiler s ma r ke t.

I

tem 9-3 DOE s eek s input on data sour ce s that it can use to charac te rize the var iability in annual energy consumption for com me rcial pa ck aged boile rs . DOE is pa rti cular ly interes ted in f ield monitoring studies and data.

I

tem 9-4 DOE reques ts com me nt on what other energy use by com me rcial pa ck aged boiler s should be in cluded in the energy use analysis.

I

tem 9-5 DOE we lco me s com me nt on whe th er the r ated ther male ffici enc ies f or al l

com me rcial pa ck aged boil e r equipment should be adjus ted to ref le ct re tu rn-wate r conditions (pr ev io us ly done for condensing boilers only).

I

tem 9-6 DOE s eek s input on what fractions of hot-wate r c om me rcial pa ck aged boiler s are used both for space heating and hot water.

I

tem 9-7 DOE s eek s input on the frac tion of com me rc ialpackaged boil er s u sed in residential applications. I s this ma r ke t la rge enough that DOE should ta ke it into

a cc ount?

I

tem 9-8 DOE s eek s com me nts on the rebound eff ec t that may be a ss ociated w ith mo reeff ici ent com me rcial pa ck aged boil er s.

4110. L IF E-CYCL E COST A ND PAY BA CKPERI OD ANAL YS IS

Thi s s ec tion describe s the life-cycle cost and payb ac k period ana lysi s that DOE wi ll perform for co mm ercial p ac kaged bo il ers, in cluding how DOE develops the in put s to th e calculations. The LC C ana ly si s establishes the total cost o f equipment over its lifet im e ( in clud in g purchase price, in sta ll ation cost, and operat in g costs). The PBP ana ly si s calculate s th e amount of t im e required for energy cost savi ngs to pay b ac k a nyincreased cost of highere ff icienc y equipment.

10.1 Over view

The e ff ec t s of amended energy conservation standards on the consumer of co mm ercia l
p ac kaged bo il ers include a change in operat in g cost (usua ll y d ec reased) and a chan ge in purchas e price (usual ly increased)

. DOE ana ly ze s the net e ff ec t on consumer s by calculat in g the LC C and PBP, in corporat in g the engin ee r in g performance data (descr ib ed in section 7), the equipmen t retail price (described in section 8 ), and the energy consumption data (descr ib e d ins ec tion 9 ). Inputs to the calculation of LC C and PBP in clude the total in sta ll ed cost to the consume r (purchase price plu s any insta ll ation cost) and operat in g cost (energy expenditures and, i f
app li cable, repair and ma in tenance costs). Additional in put s to the LC C calculation include energy price proj ec tions, the li fetime of the equipment or other defined period of analysis, and discount rates.

10.2 Ap proach

DOE wi ll conduct the LC C and PBP analysis for the equipment classe s on wh ich it plan s to perform an analysi s (section 5.3 ). In the prel imi nary analysi s stage of the co mm ercia l
p ac kaged bo il er s rulemak in g, DOE w il l conduct the LC C and PBP analysis by usi ng Mont e Carlo s im ulation and probability distr ib utions to model both the un ce rtainty and variability in th e inputs. The Monte Carlo appro ac h provide s a signifi ca nt advanta ge over alternative appro ac he s ( e.g. , an appro ac h using typical or average value s to char ac terize in puts) b eca use it identi fi e s th e per ce ntages of consumers benefiting from or be in g im pa cted by a prosp ec t iv e standard.

DOE plans to develop an LC C and PBP model that incorporate s both Monte Carlo

s im ulation and probability distr ib utions by us in g computer spr ea dsh ee t s combined with a

co mm ercia ll y-available add-in program. E ac h Monte Carlo s im ulation will consist of 10,000 LC C and PBP calculations. The model w ill perform ea ch calculation using in put value s sampled from probability distr ib utions where possible, or char ac teri ze d using single-po in t values in othe r

ca s es. The analyti ca l result s are a distr ib ution of 10,000 data po in t s sh ow in g the ran ge of LC C savi ngs and PB Ps for a given e ff iciency level relat iv e to the baseline level.

DOE wi ll use probability distr ib utions to char ac terize most of the operat in g cost input s to the LC C and PBP analysis, including equipment lifet im e s and consumer discount rates. A s described in s ec tion 9, DOE wi ll establish the annual energy consumption of ea ch equipmen t class. A s d escr ib ed in s ec tio n 10.3 , the LC C and PBP analysi s w ill ca pture the regional

42variability in energy pri ce s. The methodologies for devel op in g ma in tenance/repair and insta ll ation costs are descr ib ed in s ec tion s 10.4 and 10.5 resp ec t iv ely.

As described in s ec tio n 8, DOE wi ll derive markups and sale s taxes using probabilit y distr ib ution s that ca pture regional variability, in orde r to ca lculate equipment cost.

Another f ac tor in identifying how consumers w ou ld be im p ac ted by a particular standard i s the exp ec ted distr ib ution of equipment efficienc ies in the absence of amended standards (th e base ca se). In the ca se of co mm ercial packaged boilers, equipment efficiency i s expressed a s

co mb ustion efficiency for lar ge hot water gas-fired and large hot water oil-fired co mm ercia l
p ac kaged bo il ers and thermal efficiency for all other equipment cla ss e s ( sma ll gas-fired ho t

wa ter, small gas-fired steam, sma ll o il -fired hot water, sma ll o il -fired steam, lar ge gas-fired steam, lar ge oil-fired steam, and el ec tri c) . DOE notes that g as -fired natural draft co mm ercia l
p ac kaged bo il er s are subj ec t to Tier 2 standard level s e ff ec t iv e March 2022. Based on the
outcome o f the A ug ust 2013 NOPD 51 , DO E w i ll ac count for thi s change in natural draft bo il e r base- ca se efficiency distr ib ution (the absence of amended standards) in the LC C and PBP analyses in thi s rulemaking. DO E p lans to develop probability distr ib utions to char ac terize th e

cu rr ent equipment mi x, and wi ll consider li ke ly trends in proj ec t in g the e ff iciency distr ib ution in the anticipated year of compliance (2019).

DOE wi ll deter mi ne the LC C and PBP for a particular standard level relative to the baseca se distr ib ution of efficiencies. In perfor mi ng an iteration of the Monte Carlo s im ulation for a g iv en consumer, equipment efficiency w ill be chosen based on it s p robability. If the chosen equipment efficiency i s g r ea ter than or equal to the efficiency of the standard level unde r consideration, the LC C and PBP calculation wi ll rev ea l that a consumer is not im p ac ted by th e standard level. By acc ount in g for consumers who alr ea dy purchase mo re -e ff icient equipment, DOE avoid s overstating the potential benefits from incr ea sing equipment e ff iciency. To enabl e DOE to use this methodol og y, DOE asks in terested partie s to provide data on the curr ent mi x o f equipment efficiencies. DOE also plan s to use the AHRI data descr ib ed in s ec tio n 5.1 to develop

e ff iciency distr ib utions based on availability of various models.

The foll ow ing s ec tion s discus s the methodol og ie s D OE plans to use to develop several o f the in put s to the LC C and PBP analysis, in cludi ng: ( 1) el ec tricity prices; (2) ma in tenan ce , repair, and insta ll ation costs; (3) equipment li fet im es; and (4) discount rates. The other in put s to th e LC C and PBP analysis—manuf ac turer cost s (s ec tion 7), markups for the deter mi nation o f consumer retail pri ce s (s ec tio n 8 ), and annual energy consumption (s ec t ion 9)—were discussed previously.

DOE i s also required to perform a PBP ana ly si s to deter mi ne wh ether the rebuttabl e presumption of ec ono mi c justifi ca tion applie s (where the higher insta ll ed cost of more energye ff icient equipment is les s than three t im e s the value of the lowered operat in g costs in the firs t
year of the energy conservation standard). (42 U.S.C. 6295(o )( 2 )( B )( iii ) ) To deter mi ne th e rebu tt able-presumption PB P, DOE wi ll deter mi ne the value of the first y ear’ s e nergy savi ngs by calculat in g the quantity of those sav in gs in acc ordance with DOE’ s test pro ce dure. Although DOE wi ll examine the rebu tt able-presumption criteria, DO E deter mi nes whether potential

51 78 FR 49202 (A ugu st 13, 2 013)

43standards are ec ono mi ca lly justified thro ugh anana ly si s of the ec ono mi c imp ac t s of in creased

e ff iciency pursuant to EPCA. (42 U.S.C. 6313(a)(6)(B)) The result s of thi s analysi s serve a s th e basis for DOE to definit iv e ly evaluate the ec onom ic justification for a potential standard leve l (there by support in g or rebutt in g the result s of any pre li minary deter mi nation of ec ono mi c justifi ca tion).

In prepar in g the NOPR, DOE carefu lly review s all the co mm ents it r ece ive s on th e pre li minary analysis LC C analysis, make s any nece ss ary revisions to the analysis, and i f necessary, evaluate s additional parameter s not in cluded in the prel im inary analysis.

I

tem 10-1 DO E s eek s int eres ted par ty input on its p roposed app roach of using probability distr ibutions and Monte Car lo simulation to conduct the LC C and PB P analysis.

I

tem 10-2 DOE requests data from in te res ted parties to charac te rize the current mix of

com me rcial pa ck aged boil e r eff ici enc ies in the mar ke t.

10.3 Energy Pr ic es

DOE in tend s to deter mi ne gas, o il , and el ec tricity pri ce s based on r ece nt or curr ent tari ff s from a representat iv e sample of utilities. Thi s a pp ro ac h deter mi nes energy expense s based on

ac tual energy price s that customer s are pa yi ng. As an additional sour ce , DOE plans to compar e thes e results to data provided in EI A’s Form 861 data 52 to ca lculate co mm ercial el ec tricit y pri ce s, EI A’ s N atural Gas Navigator 53 to ca lculate co mm ercial natural ga s p rices, and EI A ’ s State Energy Data System s (SE DS ) 54 to ca lculate liquefied petroleum ga s (L PG) and fuel oi l pri ce s. DOE wi ll use proj ec tions of average energy prices by Census Division for co mm ercia l
users—pr in cipal ly from EI A’s 2013 Annual Energy Outlook ( AE O ), or the most r ece nt y ear availabl e, to est im ate future energy prices in it s LCC analysis. 55

I

tem 10-3 DO E s eek s input on the planned approach for estimating future energy pr ic es.

10.4 Mai nt enance and Repair Co sts

DOE wi ll consider a ny expected change s to ma in tenance and repair cost s for th e

co mm ercial p ac kaged bo il er s subj ec t to amended standards. Typi ca lly, sma ll incrementa l changes in equipment efficiency incur li tt le or no change in repair and ma in tenance costs over

52 Ener gy In fo rmation Ad mi nistration (EIA ), Survey fo rm EIA- 861

-- Annual El ect ric Power I ndu stry Repo rt

. (Av ailable at: http: // www.e ia .g ov /e le ctri ci ty/d at a/ ei a 86 1/index.html ) (Last a cce ss ed April 15 , 2013 ).

53 Ener gy In fo rmation Ad mi nistration (EIA ), Natural Gas Navig at o r. (Avai lable at: h tt p :/ /tonto.e ia .doe. go v/ dn av/ ng /ng_pri_sum _d cu_ nu s_m.htm ) (Last a cce ssed A pr il 15, 2 013 )

. 54 Ener gy In fo rmation Ad mi nistration (EIA ), St at e Ene rgyD at a System (SE DS ). (Av ai lable at : h tt p :// www.e ia .g ov /s tat e/seds/ ) (Last a cce ssed A pr il 15, 2013).

55 Ener gy In fo rmation Ad ministration (EIA ). 2013 A nnu al Ener gy Ou tl ook ( AEO ) Full Version (May 2, 20 13). (Av ailable at: htt p: // www

. ei a.go v/ forecasts/aeo/er/ind ex. cf m ).

44baseline equipment. Equipment having efficiencie s that are significantly higher than the base li ne

are more li ke ly to incur in cr ea sed repair and ma intenance costs, b eca use such equipment type s

are more li ke ly to incorporate t ec hn ol og ie s that are not wide ly available. DOE w il l use input from manuf ac turer s and other in terested parti es to develop appropriate repair and ma in tenanc e cost est im ates, a s n ece ssary. In the 2009 F in al Rule, DOE est im ated annual rout in e ma in tenanc e costs and repair cost s for co mm ercial p ac kaged bo il er equipment from data provided in MARS 8
Fac il ity Cost For eca st System database. 5 6 For t hi s analysis, DOE in tend s to develop

ma in tenance and repair cost s for it s analysi s using th e most r ece nt RS M ea n s d at a ava il able. 57 DOE plans also to consider the ca se s w hen the equipment is covered by service and/o r

ma in tenance agreements. DOE in tend s to a ss es s w hether repair cost s vary with equipmen t

e ff i ciency a s p art of it s analysis.

I

tem 10-4 DO E s eek s int eres ted par ty input on the maintenance and repair cos ts approach. Sp ec if ically, DOE reques ts com me nt on frequency and cost of maintenan ce , major repair issues, re pair frequen cy , and repair cos ts for com me rc ialpa ck aged boiler s that meet the minimum eff ici ency standards, as well as for higher-eff ici ency boile rs

.

10.5 Installation Co sts

DOE plans to derive national avera ge insta ll ation cost s for co mm ercial p ac kaged bo il er s from data provided in the most r ece nt RS M eans data for co mm ercial bo il er equipment with

e ff iciencies at the cu rr ent e ff iciency standard level. 5 8 RS M ean s p rovide s estimate s fo r insta ll ation costs to set- up and put in to pl ac e a new co mm ercial packaged bo il er by equipment

ca pacity, fuel type, and material type, a s w ell a s cost indi ce s that refl ec t the variation in insta ll ation cost s for 656 cities in the Un ited States. D OE plan s to in corporate lo ca tion-based
cost in dices in to the analysi s to ca pture variation ininsta ll ation cos t, depend in g on the lo ca tion of the customer. In addition, DOE plan s to take in to acc ount in sta ll ation cost item s such a s pip in g, vent length, vent material, number of e lb ows, vent ter mi nations, vent co nn ec tors, condensat e removal, el ec trical requirements, control mod ifi ca tions, and mod ificatio ns to the bu il ding such a s dr il ling hol es

.

I

tem 10-5 DO E s eek s int eres ted par ty input on its p roposed in s tallation cost approac h. Sp ec if ically, DOE requests data on the fractions of in stallations that would e ntail significant additional in s tallation ex penses.

56 Wh it estone Research, MA RS 8 Fac il ity Cost For ec ast Sys te m Database CDR OM , Wh it estone Research ( 2008 )

. 57 RS Means, 2 013 Facilitie s Maintenance & Repair Cost Data (Av ai lable at : h tt p :/ /rsm ea ns.r ee dconstru ct iondata.co m/ 603 03.aspx )( Last acc e ss ed April 10 , 2013 ).
58 RS Means, 2 013 M ec hanical Cost Data (Avai lable at: http://rsm ea ns.r ee dconstruc ti o nd ata.co m/ 6002 3.aspx ) (Last

a cce ssed A pr il 10, 2 0 13).

4510.6 E qui pme nt Lifetime

DOE defines “equipment li fet im e” a s the a ge when a co mm ercial p ac kaged bo il er i s retired from servi ce . In the 2009 F in al Rule, DOE used a 30-y ear lifet im e for co mm ercial p ac kaged bo il ers, a s established in the 2000 Scr ee ning Analysis 59 that wa s based on data from ASHRAE’ s 1995 Handbook of HVAC Applications. 6 0 In today’s rulemaki ng, DOE plans to use 2011 dat a from A SH RAE’ s Serv ice Li fetime and Maintenance Cost Database , a s w ell a s review availabl e literatur e and consult with industry experts to establish typical equipment li f etimes

. 61 ,6 2 Based on these data, DOE plans to develop Weibull probability distr ib ution s to char ac teriz e

co mm ercial p ac kaged bo il er li fet im e. 63

I

tem 10-6 DO E s eek s com me nts on the methodology used to de te r mine equipment li

fe tim es for com me rcial pa ck aged boiler s.

10.7 Di sc ount Rat es

The calculation of LC C require s the use of an appropriate discount rate for thos e companie s that purchase co mm ercial p ac kaged bo il ers in order to deter mi ne the present value o f future costs/savings. DOE wi ll derive the discount rate s for these commercial user s by
est im at in g the ca pital cost s for companie s that purchase co mm ercial p ac kaged bo il e rs . The cos t of ca pital i s commonly used to est im ate the present value of ca sh fl ow s to be der iv ed from a typical compa ny proj ec t or investment. Most companie s u se both debt and equity ca pital to fund investments, so the cost of ca pital i s the weighted-avera ge cost of equity and debt financi ng, wh ich i s refe rr ed to as the weighted-avera ge cost of capital.

I

tem 10-7 DO E s eek s int eres ted par ty input on its planned approach for estimating discount r ates for com me rcial customer s.

10.8 Energy Eff ici ency in t he Base Ca se

In the market a ss essment, DOE attempt s to char ac te rize the distr ib ution of equipmen t

e ff iciencie s cu rr ently being sold in the marketplace. If market share e ff iciency data are not available, DOE may develop e ff iciency distr ib utions based on available model s and information

59 So ma sundaram S.

, P.R

. Armstrong, D.B. Be lz er , S.C. Gaines, D.L. Hadley, S. Kati pumula

, D.L

. Smit h, and D.W

. Winiarski , 20 00 Scr ee ning An al ysis for E PA CT C ov ered Co mm ercial H VA C a nd Wa ter He at ing E qu ipment

. PNN L 13232, Pacific Northwest N ati onal Labo ratory.
60 Ameri ca n Society of He ati ng, Refrigerati ng and Air Condi ti oning ( AS HRAE ), ASH RAE Handboo k: 1995 He at ing, Ventila tin g, and Air Conditioni ng App li ca ti ons (1 9 95).
61 Ameri ca n Society of He ati ng, Refrigerati ng and Air Condi ti oning ( AS HRAE ), ASH RAE Handboo k: H VA C A

pp li cati ons (201 1) pp. 3 7.2 to 37

. 3.
62 Ameri ca n Society of He ati ng, Refrigerati ng and Air Condi ti oning ( AS HRAE ), ASH RAE: Service Life a nd Maintenance Cost Database (2013) (Avai lable at: http: // x p2 0.ashr ae.org/ pu

b li cdatabase/ ) (Last a cce ssed May 10, 2013).
63 If the data are av ai lable, DO E also plans to ta ke into a cc ount di ff eren ce s in co mm ercial packaged bo il er life tim e based on usa ge and applic ati on.

46from co mm ercial p ac kaged bo il ers manuf ac turers and other in terested parties. In the LC C and PBP analysis, DOE wi ll evaluate whether the cu rr ent distr ib ution provide s a r ea sonabl e approx im ation of the co mm ercial packaged bo il ers market in the compliance year in the absenc e of amended standards, or whether there i s r ea son to exp ec t im provement in efficiency a s a resul t of mark et for ce s.

I

tem 10-8 DOE requests data on the eff ici ency distribution and we lco me s com me nt on the li ke lihood and degree of imp ro ve ment in eff ici ency of com me rcial pa ck ag ed boilers in the n ex t 5 to 10 ye ar s as a result of ma r ke t for ce s or indu stry trends ( in the absence of amended energy conservation standards).

11. SH IPMENTS ANAL YS IS

DOE’ s shipment ana ly si s require s shipment projections by equipment clas s to ca lculat e the national imp ac t s of standards on energy consumption, NPV, and future manuf ac turer ca sh flows. DOE plan s to develop shipment s p roj ec tions based on an analysi s of key market dr iv er s ( e.g ., co mm ercial buildi ng construction s trends, growth in industrie s that use co mm ercia l
p ac kaged bo il ers) for the co mm ercial packaged boilers covered in thi s rulemaking.

DOE’ s appro ac h consider s that shipment s of co mm ercial p ac kaged bo il ers are dr iv en by the ec ono mi c growth of co mm ercial and industrial s ec tors that use thi s equipment. Historica l data wi ll be used to estab li sh the relationship between shipment s of co mm ercial p ac kaged bo il er s and the appropriate growth in dex for the s ec tor. To estab li sh historical shipment s by equipmen t class, DOE plans to rely on pub li cly-available sour ce s and in dustry-provided data. 6 4 If publi c

sour ce s of shipments information are not ava il able, then DO E plans to ut ili ze the appro ac h
app li ed in the 2009 Final Rule and to rely on the 2007 bo il er shipments data provided by AHRI. DO E then plan s t o disa gg regate shipment s by product clas s based on the number of availabl e models in the AHRI ce rtifi ca tion dir ec tory. DOE also plans to utilize regional dat a, if availabl e, so that the national shipment s d ata can be further disa gg regated.

DOE in tend s to use Gros s D omestic Product (GDP) a s an in di ca tor of the performance in the in dustrial and co mm ercial s ec tor s w here com mer cial p ac kaged bo il ers are used.

DOE plans to project shipment s of co mm ercial packaged bo il er s by pr im ar ily acc ount in g for sale s to two market segments: (1) the replace me nt market and (2) the new construction market. To proj ec t shipment s to the new construction market, DOE pla ns to ut ili ze est im ate s o f proj ec ted new co mm ercial fl oo r sp ac e (from the NEMS proj ec tion published in the lates t available edition of EI A’s AE O ) and saturation ra tes of various bo il er types in new buildings. In
pr oj ec t in g future new build in g saturation rates of co mm ercial packaged bo il ers, DOE wi ll

64 For the 20 09 Commer ci al Packaged Bo il ers Final Rulemaking (Chapter 6 of the T SD

, s ec ti on 6.3.1) , h istorica l shipments were not avai lable. There fo re, DO E developed a model relying on i ndu stry-pr ov ided shipments fo r a si ng le year (2 0 07) to ma ke its predic ti ons. (Avai lable at : h tt p :// www.re gu l ati ons.g ov / #!d ocumentDetail;D= EE RE2008 -BT-STD-00 13

- 00 11 ).

47consider exp ec ted trends in builder and consumer preferen ce s, in cluding competition from othe r sp ac e h ea t in g products and equipment. 65

To proj ec t shipments to the replacement market, D OE a ss ume s that in most ca se s

consumer s replace a bo il er with the same ty pe of equipment; altho ughin a limited amou nt o f

ca ses, replacements may result in fuel switching (oil to gas) and/or conversion from steam to hot water. The stock model acc ount s for retirement s u s in g methodol og y that app li e s the bo il e r l if et im e distr ib ution a s d escribed in s ec tion 10.6

.

I

tem 11-1 DOE we lco me s com me nt on the shipments projec tion methodology.

I

tem 11-2 DOE invites com me nts regarding the se le c tion of appropr iate ec onomic dr iv ers and sour ce s of data for his to r icalshipments and shipment breakdowns by equipment c la ss.

I

tem 11-3 DOE s eek s his to r icalc om me rcial pa ck aged boile r shipments data fr om interes ted parti es, di saggregated by equipment c la ss and eff ici ency le vel if po ss ible.

11.1 Impa c t of Ame nd e d S t anda rds on E qui pme nt S hi pments

DOE wi ll develop a set of shipment proj ec tions for eac h set of e ff iciency level s ana ly zed for eac h equipment class

. DO E u se s these standards- ca se projection s to evaluate the im p ac t s o f amended standards on unit shipments. B eca use the standards- ca se projections take in to acc oun t the incr ea se in purchase price and the d ec r ea se in operat in g cost s ca used by amended standards, proj ec ted shipments for a standards ca se typica lly deviate from those fo r the base ca se. Th e magnitude of the di ff erence between the standards- ca se and base- ca se shipment projections depend s on the est im ated purchase price in crease, a s w ell a s the operat in g-cost sav in gs from th e standard. DOE plans to a ss es s w hether the purchase price wi ll have a gr ea ter imp ac t on equipment purchase decisions than operat in g cos t, in which case the standards- ca se proj ec tion s may show a d ec r ea se in shipment s relat iv e to the base ca se. To model the im p ac t of the in creas e in relat iv e price from a particular standard ca se on the shipments, DOE plan s to a ss ume tha t

some consumer s a ff ec ted by an incr ea se in to tal insta ll ed cost would repair their equipmen t rather than repl ac e it, th us extending the life of the product. The extended repaired unit s w ill b e repl ace d when they fail.

DOE’ s p ast standards analyses have attempted to quantify the sensitivity of shipments to increased purchase price and operat in g cost sav in gs. DO E w i ll attempt to develop purchas e price and operat in g cost sensitivities specific to c om mercial packaged bo il ers. If the dat a required to develop those sensitivitie s are unava il able, DOE wi ll consider mode li ng standardsca se shipments projection s u sing scenario s ( i.e. , specified im pacts to equipment shipments).

65 For the 20 09 Commer ci al Packaged Bo il ers Final Rulemaking (Chapter 6 of the T SD

, s ec ti on 6.2.1. 2), DO E

a ss umed cons ta nt bo il er s at uration rates across the stock and in new construc ti ons . ( Av ailable at : h tt p :// www.re gu lations.g ov / #!d ocumentD et ai l;D= EE RE-2008-BT-STD- 0013

- 0011 ).

48DOE typica lly project s shipment s for a 30-y ear period beginning in the exp ec ted compliance date of any standards.

I

tem 11-4 DOE s eek s input from interes ted parti es on the potential impa ct of amended standards on com me rcial pa ck aged boiler s hipm ents.

12. NATI ONAL IMPAC T A NALYSIS

In the national imp ac t analysi s (NIA), DOE est im ates national energy savi ngs (NE S) from new or amended energy conservation standards and the net present value (NPV) of to ta l consumer benefits. The NIA considers: (1) NES attributable to ea ch potential standard; ( 2) monetary value of the NES to purchaser s o f the considered equipment; (3) in creased to ta l insta ll ed cost of the equipment b eca use of standards; and (4) NPV of the difference between th e

o perat in g cost savi ngs and incr ea sed total insta ll ed cost. DOE perform s a ll NIA calculation s

us in g a computer spr ea dsh ee t model. The spr ea dsh ee t s combine the calculations for deter mi ni ng the NES and NPV for eac h considered equipment class with in put from the shipments model.

12.1 Proj ec ted Eff ici ency Tre nds

A key component of DOE’ s est im ate s of NES and NPV are the equipment energ y

e ff iciencies proj ec ted over t im e for the base case (without new standards) and ea ch standard s

ca se. Proj ec ted e ff iciencie s represent the shipment-weighted annual energy consumption o f covered co mm ercial packaged bo il ers dur in g the proj ec tion period ( i.e. , from the a ss umed compliance date of a new or amended standard to 30 year s after that date).

S ec tion 9 descr ib e s how DOE estab li she s the shipment-weighted efficiency for th e

a ss umed compliance date of the standard. To proj ec t base- ca se efficiencies over the 30-year period, DOE in tends to extrapolate from the historical trends to the extent that i s r ea sonable.

To develop the various standards ca ses, DOE plans to develop market-share efficienc y data ( i.e. , data on the distr ib ution of equipment shipment s by efficiency) for the co mm ercia l
p ac kaged bo il er equipment cla ss es described in section 5.3 to est im a te the im pact that standards may have in the year compliance b ec ome s required. Historica ll y, DOE ha s u sed "roll-up " and/o r "shift " scenarios in it s standards rulemakings. Und er the "roll-up " scenario, DOE a ss umes: ( 1) equipment efficiencies in the base ca se that do not m ee t the standard level under consideration would "roll up" to mee t the new standard level; a nd (2) equipment shipment s at e ff iciencie s above the standard level under consideration would not be a ff ec ted. Under the "shift " scenario, DOE reta in s the pa tt ern of the base-case efficiency distr ib ution but re-orient s the distr ib ution a t and above the new min im um energy conservation standard. After DOE estab li she s the avera ge

e ff iciency for the a ss umed compliance date of a s tandard, it can est im ate future e ff iciency by

us in g the same rate of proj ec ted efficiency growth as for the base-case efficiency trend. DOE i s consider in g the “roll-up” scenario for co mm ercial p ac kaged bo il ers.

49I tem 12-1 DOE s eek s com me nts on the appropr iate a ss umptions to use regarding longrun change s in com me rc ialpa ck aged boiler energy eff ici ency independent of amended energy conservation standards.

I

tem 12-2 DOE reques ts com me nt on whe th e r it should pu rs ue a roll-up or shif t approach for the national impa ct analysis.

12.2 Natio nal Energy Savings

DOE wi ll calculate annual national energy savings by fuel ty pe for the base ca se s and fo r

ea ch standard s- ca se analyzed where the energy savi ngs w ill be calculated a s the difference in energy consumption between the base ca se and the standards ca ses. DOE plans to perform thi s calculation thro ughthe use of a spr ea dsheet model that e ff ec t iv e ly a cc ount s for the stock of equipment a ff ec ted by standards. 6 6 The energy savin gs are m ea sured over the entire lifet im e of equipment purchased in the 30-year shipments proj ec tion period. 67

DOE in tend s to deter mi ne whether there i s a rebound e ff ec t a ss ociated with mor e

e ff icient co mm ercial p ac kaged bo il ers. If data ind ic ates that there i s a rebound e ff ec t, DOE wi ll

acc ount for the rebound e ff ec t in it s calculation of NE S.

DOE ha s h istori ca l ly presented NES in term s of primary energy savings. OnA ugu st 18, 2011, DOE pub li shed in the Federal Regis ter a notice announcing its in tention to use full-fuelcycle ( FF C) mea sure s of energy use and greenhouse ga s and other e mi ss io ns in the nationa l imp ac t analyse s and e mi ss ion s analyses included in future energy conservation standards rulemakings. 76 FR 51281. While DOE stated in that notice that it in tended to use th e Gr ee nhouse Gases, Regulated E mi ss ions, and Energy Use in Tr ansportation (GREE T) model to conduct the analysis, it also said it would review alternat iv e methods, in cluding the use of th e National Energy Mode li ng System (NEMS). After evaluat in g both model s and the appro ac he s discussed in the A ug ust 18, 2011 notice, DOE ha s d eter mi ned NEMS i s a more appropriate to o l for this purpose. 77 FR 49701 (A ug. 17, 2012). Therefore, DOE in tends to use the NEM S model to conduct FF C analyses. The method used to der iv e the F FC multiplier s wi ll b e described in the pre li minary T SD.

12.3 Ne t Prese nt Va l ue of Con sumer Savings

The in puts for deter mi ning NPV of the to tal costs and benefit s experien ce d by

co mm ercial consumer s of the considered equipment are: ( 1) to tal annual insta ll ed cost; (2) to tal

66 Several examples of NES spr ea dsh ee t models from previo us rul em akin gs ca n be fo und on DO E ’s webs it e at : h tt p :// www. ee re.ene rg y. go v/bu il dings /appl ia n ce _standards/

. 67 In the past, DOE presented ene rgy savin gs resu lt s fo r only the 30-year period that begins in the year o f
comp li ance. In the c al culation of econo mi c im pacts, howeve r, DOE considered opera ting cost savin gs measure d over the en tire life tim e o f e qu ipmen t p urchased in the 30-year perio d. DOE has chosen to modi fy it s presenta ti on o f national ener gy savin gs to be consistent with the approach used fo r it s nati onal ec ono mi c an al ysis.

50annual savings in operating costs; (3) a discount factor; (4) present value of costs; and (5) presen t value of sav in gs.

To develop the national NPV of user benefits from potential standards, DOE mus t calculate annual energy expenditure s and annual equipment expenditures for the base case and the standards ca ses. DOE ca lculates in cr ea ses in total insta ll ed cost s as the difference in tota l insta ll ed cost between the base case and a standards ca se. DOE ca lculate s annual energ y expenditures by multip lying the annual operat in g cost per unit by the number of proj ec ted shipments, us in g the proj ec tion s of shipment s d escr ib ed in s ec tion 11. 6 8 The differenc e ea ch
year between energy bill savi ngs and in creased e qu ipment expenditures i s the net savi ngs (if posit iv e) or net cost (if n egat iv e). DOE discount s t hose annual value s to the present t im e and

sum s them to obtain a NPV to ca lculate savi ngs over the li fe of ea ch unit. DOE ca lculate s NPV

a s the di ff erence between the present value of operat in g cost savi ngs and the present value o f
to tal insta ll ed costs.

Based on U. S. O ff ice of Management and Budget (OMB) guidelines for Federa l agencies, DOE wi ll con du ct two NPV calculations, one us in g a real discount rate of 3 per ce n t and another us in g a real discount rate of 7 per ce nt. 6 9 The discount rate s for th e d eter mi nation o f NPV are in contrast to the discount rate s u sed in the LC C analysis, which are designed to refl ec t a consumer’ s p ersp ec t iv e. The 7-per ce nt r ea l value i s an est im ate of the avera ge before-tax rat e of return to pr iv ate ca pital in the U. S. econo my . The 3-percent r ea l value represent s the “societal rate of t im e preferen ce ,” wh ich i s the rate at wh ich society discounts future consumption fl ow s to their present value.

13. CONSU MER SU B GROUPANAL YS IS

The LC C analysi s d escribed in s ec tion 10 analyze s the im p ac t s of amended energ y conservation standards on all consumer s of co mm ercial packaged bo il ers. For the consume r subgroup analysis, DOE divide s consumers in to subgroups, wh ich comprise subsets of th e population that are li kely, for one r ea son or another, to be affected disproportionately by new o r amended energy conservation standards ( e.g. , fir ms that use co mm ercial p ac kaged bo il e rs in particular app li ca tions where energy savi ngs are l ik ely to be small). 7 0 The purpose of a subgroup analysis i s to deter mi ne the extent of thi s disproportional imp ac t. DOE wi ll work with in terested partie s t o identify a ny subgroups for co nsideration and will conduct a subgroup ana ly sis for any NO PR d eveloped for thi s rulemaki ng.

68 DO E expre ss es savin gs in opera ting costs as d ec reases a ss o ciat ed with the lower ener gy consump ti on o f

e qu ipment bo ug ht in the sta nd ar ds case compared to the base case

. Total savi ngs in oper at i ng costs are the pro du c t of

savin gs per unit a ndthe number of un it s of each vinta ge that survive in a given yea r. 69 OM B, Circular A-4: Re gu latory Analysis (Sept. 17, 20 03 ).

70 These firms di ff er from any co mm ercial packaged bo il er manufacturers who ma y qu ali fyas a small busines s und er the s iz e s ta ndar ds estab li shed by the Sm al l Business Administr ati on. DO E an al yzes im pacts to these smal l busine ss es, which would be dir ec tl y im pacted by any final s ta nda rds DO E mi ght estab li sh

, as re qu ired by th e Re gu lat ory Flexib ilit y Act (see sec ti on 14.3 ).

51I tem 13-1 The Departm ent requests input as to what consume r subgroups ar e appropr iate to ev aluate for com me rcial pa ck aged boil er s.

14. MANUFACTURER IMPACT ANAL YS IS

DOE in tend s the MIA to provide an asse ss ment of the potential imp ac t s of amended energy conservation standards on manuf ac turer s of co mm ercial p ac kaged bo il e rs . A wide ran ge of quantitat iv e and qualitat iv e e ff ect s may o cc ur foll ow ing the adoption of an amended standard that may require change s to manuf ac tur in g pr ac tices. DOE wi ll identify these potential eff ec t s thro ugh in tervie ws with manuf ac turer s and other experts.

For the NOPR, DOE wi ll conduct an in dustry-wide ca sh-flow analysi s u sing th e Government Regulatory Imp ac t Model (GRIM), identify and analyze subgroups o f manuf ac turer s w hose busine ss e s vary signifi ca ntly from the in dustry a s a whole, perform a competit iv e im pact s a ss e ss ment, and review the cumulat iv e regulatory burden for the in dustry.

14.1 Sources of Information for t he Manufacturer Impa c t Ana lys is

Many of the analyse s d escribed ear li er provide i mp ortant information that DOE wi ll us e

as in puts for the MIA. Su ch information include s financial parameter s d eveloped in the marke t

a ss essment (s ec tion 5 ), cost data developed in the engin ee ring analysi s ( section 7), and shipments for eca st s (s ec tion 11). DOE w il l supplement this information with data gathered dur in g manuf ac turer in terviews, a s discussed belo w.

Du r in g the prel im inary analysi s phase, DOE wi ll conduct interview s with manuf ac turer s to gain insight in to the ran ge of possible im pact s from potential amended energy conservation standards. These in tervie ws w ill co in cide with pre lim inary t ec hnical in tervie ws for th e engin ee ring analysis.

Du r in g the NO PR p hase, DOE w il l conduct more deta il ed MIA in terview s with manuf ac turers. The in terview pro ce s s plays a key role in the MIA, b eca use it provide s an opportunity for dir ec tly-a ff ected partie s to express their view s on im portant i ss ues. Dur in g th e in

terviews, DOE wi ll so li cit information on the possible im pacts of potential amended standards on manufactur in g costs, equipment pri ce s, sales, dir ec t employment, ca pital a ss ets, and in dustry compe tit iv ene ss . Both qu alitat iv e and quantitat iv e information are valuable in thi s analysis. DOE prefer s an in ter ac t iv e in terview pro ce s s b ec ause it help s to clarify manuf ac turer in put and provide s the opportunity to identify additional issues.

DOE wi ll ask in terview participant s to identify confidential information and w il l pro te c t confidential inform at ion from disclosure, consis te nt with app lica ble law. DOE wi ll also ask participant s to identify a ny information they wish to have in cluded in the public r ec ord, but do
not want to have a ss ociated with their in terview (there by identifyi ng that particular

52manuf ac ture r) . DOE wi ll incorporate such information into the pub li c r ec ord, without
attr ib ution.

DOE wi ll co ll ate the in terview result s and prepare a su mm ary of the major issue s and outcomes. Thi s summary w ill become part of the te chni ca l support document for thi s rulemaki ng.

14.2 I ndu str y Ca sh-Fl ow Ana lys is

The in dustry ca sh-flow ana ly si s re li e s p r im ar ily on the GRIM. DOE use s the GRIM to analyze the financial imp ac t s of new or amended energy conservation standards on the in dustrie s that produce the equipment covered by the standard.

The GRI M analysi s u se s a number of in puts—annual exp ec ted revenues; manuf ac ture r costs such a s costs of go ods sold; selli ng, general, and administrative ( SG& A) costs; taxes; and

ca pital expenditure s (both ord in ary ca pital expenditure s and those related to standards)—to deter mi ne a serie s of annual cash fl ow s beginning from the announcement of the new o r amended standard and cont in uing thro ughthe analysi s p eriod. DOE compare s the result s agains t base- ca s e proj ec tion s that invo lv e no new standards. The financial im p ac t of new or amended standards i s the di ff erence between the two sets of discounted ann ual cash flows. Othe r performance metrics, such a s return on invested ca pital, also are available from the GRIM.

DOE wi ll gather the in put s needed for the GRI M from two pr im ary sour ce s: (1) th e analyse s conducted to thi s p o in t; and (2) in terview s with manuf ac turer s and other in terested parties. Information gathered from previous ana ly se s wi ll include financial parameters, manuf ac tur in g costs, price fore ca sts, and shipments for eca sts. Intervie ws with manuf ac turer s and other in terested partie s supplement this information.

14.3 Manufacturer Subg roup Ana lys is

Average industry cost values may not reveal differential im p ac t s among co mm ercia l
p ac kaged bo il er manuf ac turer subgroups. Smaller manuf ac turers, niche players, and manuf ac turer s e xh ibiting a cost structure that di ff er s signifi ca ntly from the in dustry avera ge ma y be a ff ected di ff erently by new or amended standards. Id ea lly, DOE would consider the im p ac t on every firm in dividua ll y. In highly concentrated industries, this may be possible. In in dus trie s having numerous participants, however, DOE uses the result s of the market and t ec hn olog y

a ss essment to group manuf ac turer s in to subgroups, a s appropriate. For co mm ercial packaged bo il ers, DOE is in terested in f ee db ac k about potential subgroups, in cludi ng sma ll businesses. DOE wi ll conduct a Re gu latory Flexib il ity Act analysi s to deter mi ne the im pacts of a ny amended standards on sma ll busine ss e s consistent with the Regulatory Flexib il i ty Act.

I

tem 14-1 DOE s eek s com me nt on appropr iate manufac tu re r subgroups, if any, that DO E should cons ider in a man ufac tu re r subgroup analys is for com me rc ialpa ck ag ed boile rs

.

53I tem 14-2 DOE we lco mes data on the names and numbe r of small man ufac tu rer s in the

com me rcial pa ck aged boil ers industry.

14.4 Co mpetitive Impa cts A ss essme nt

EPCA dir ec t s D OE to consider a ny le ss eni ng of competition li ke ly to result from th e imposition of energy conservation standards. (42 U.S.C. 6313(a)(6 )( B)( ii )( V)) It further dir ec t s the A tt orney General to deter mi ne in writ in g the im p ac ts, if any, of a ny lessening of competition like ly to result from standards. Id

.

DOE wi ll make a deter mi ned effort to gather firm-specific information regard in g financia l and other im p ac t s a ss ociated with amended energy conservation standards and report th e anticipated a gg regate imp ac t of the amended standard on manuf ac turers. A key aspect of th e competit iv e im pact s analysi s w ill be to focus on a ss e ss in g imp ac t s on smaller manuf ac turers. DOE wi ll base thi s asse ss ment on manuf ac tur in g cost data and information co ll ec ted fro m in

t ervie ws with manuf ac turers. The manuf ac turer in tervie ws w ill focus on gather in g information that would help in a ss essing as ym metrical cost in cr ea se s to some manuf ac turers, in cr ea sed proportion of fixed cost s potentia lly incr ea sing busines s risks, and potential barrier s to marke t entry ( e.g ., proprietary t ec hnol og ies). DOE w il l provide the Attorney General with a co py of th e NO PR and the T SD for consideration in hi s evaluation of the im p ac t of amended standards in
term s of the le ss ening of competition. DOE w il l publish the Attorney General’s le tt er and addres s a ny related co mm ent s in the final rule.

14.5 Cu mulative Regulatory Burden

Other re gu lation s (Federal, State, local, or in ternational) may app ly to manuf ac turers o f

co mm ercial p ac kaged bo il ers covered under thi s rulemaking and to other equipment made by these manuf ac turers. Multiple regulations may result in a significant, cumulat iv e regulator y burden on these manuf ac turers. DOE w il l consider the imp ac t on these manuf ac turers o f multiple, equipment-specific regulatory ac tions.

I

tem 14-3 DOE we lco me s com me nts on what other ex is ting regulations or pending regulations it should cons ider in its ex amination of cumulative regulatory burden.

15. EMI SS I ONS ANAL YS IS

In the e mi ss ions analysis, DOE w il l est im ate the reduction in power s ec tor e mi ss ion s o f

carbon dioxide (CO 2 ), nitrogen oxide s (NO X), sulfur dioxi de (SO 2 ), and mercury ( Hg) fro m potential energy conservation standards for co mm ercial packaged bo il er equipment. In addition, DOE wi ll est im ate e mi ssions im p ac ts in production ac tivitie s (extr ac t in g, pro ce ss in g, and transport in g fuels) that provide the energy input s to power plants. These are refe rr ed to a s “up str eam” e mi ss ions. Together, these e mi ss ions acc ount for the full-fuel-cycle (FFC). In

54acc ordance with DOE’s FF C S tatement of Po li cy (76 FR 51281 (A ug. 18, 2011)), the FF C analysis includes im p ac t s on e mi ss ion s of methane and nitrous oxide, both of wh ich ar e

r ec o gn i ze d a s g reenhouse gases. DOE i s aware of the EI SA 433 Fossil Fuel rulemaking wh ich i s

cu rr ently under revie w. It plans to consider the impacts of thi s rule once it b ec ome s e ff ective.

DOE conducts the e mi ss ion s analysi s using e mi ss ions f ac tors der iv ed from data in th e latest version of EI A’s Annual Energy Outlook ( AEO )

, supplemented by data from other sour ce s.

EI A prepares the An nual Energy Ou tl oo k us in g NEMS. E ac h annual version of NEM S incorporates the proj ec ted imp ac t s of exist in g air quality regulation s on e mi ss ions. The text below refer s to AEO 2013

, wh ich genera lly represent s curr ent legislation and environmenta l regulations, in cluding r ec ent government ac tions, for wh ich implement in g regulation s w er e available a s of December 31, 2012.

B eca use the on-site operation of co mm ercial p ac kaged bo il er s require s u se of fossil fuel s and results in emi ss ion s of CO 2 , NO x , and SO 2 at the site s w here these appliances are used, DO E also acc ount s for the reduction in these site emission s and the a ss ociated up str eam emi ss ion s due
to potential standards.

SO 2 e mi ss ions from a ff ec ted el ec tric generat in g unit s (E GUs) are subj ec t to nationwi de and regional emi ss ion s ca p and trad in g programs. Title IV of the Clean Air Act set s an annua l

e mi ss ions ca p on SO 2 for a ff ec ted EGU s in the 48 conti gu ous State s and the District of Columbi a (D.C.). SO 2 e mi ss io ns from 28 ea stern State s and D.C. were also l im ited under the Clean Ai r Interstate Rule (CAIR), wh ich cr ea ted an all ow ance-based trad in g program that operate s a lon g with the Title IV program in those State s and D.C. 70 FR 25162 (May 12, 2005). CAI R w a s remanded to E PA by the U. S. Court of Appeals for the District of Columbia Circuit (D.C. Circuit), but remained in e ff ect. See North Carolina v. EPA , 550 F.3d 1176 (D.C. Cir. 2008) ; North Carolina v. EPA

, 531 F.3d 896 (D.C. Cir. 2008). On A ugu st 21, 2012, the D.C. Circui t issued a decision to v aca te CSAPR. See EME Homer City Generation, LP v. EPA, 696 F.3d 7, 38 (D.C. Cir. 2012). The court ordered E PA to cont in ue ad mi nister in g CAIR. AE O 2013

a ss umes that CAI R remains a binding regulation thro ugh2040.

The attainment of e mi ss ion s ca ps i s typica lly fle xib le among EGU s and i s enfor ce d thro ughthe use of e mi ss ion s allowance s and tradable permits. Under exist in g E PA regulations,

any exces s S O 2 e mi ss io ns all ow ance s result in g from the lower el ec tricity demand ca used by th e adoption of an efficiency standard c ou ld be used to permit o ff se tt in g incr ea ses in SO 2 e mi ss ions by a ny regulated EGU. In past rulemakings, DOE r ec o gn ize d that there wa s un ce rta in ty about th e e ff ec t s of efficiency standard s on SO 2 e mi ssio ns covered by the exist in g ca p-and-tra de system, but it concluded that no reductions in power s ec tor e mi ss ion s w ou ld o cc ur for SO 2 a s a result of standards.

Beginning in 2015, however, SO 2 e mi ss ions wi ll fall a s a result of the Mercury and Ai r To xi c s S tandards (MAT S) for power plants, wh ich were ann ounced by E PA on December 21, 2011. 77 FR 9304 (Feb. 16, 2012). In the final MATS rule, E PA estab li shed a standard for HC l

a s a su rr ogate for ac id ga s hazardous air po llutant s (HAP), and also estab li shed a standard fo r SO 2 (a non-HAP acid gas) a s an alternat iv e equivalent surrogate standard for acid ga s HAP. Th e

sam e control s are used to reduce HAP and non-HAP acid gas; thus, SO 2 e mi ssions wi ll be

55redu ce d a s a result of the control t ec hn ol og ies in sta ll ed on co al -fired power plant s to comp ly with the MATS requirement s for acid gas. AE O 2013 a ss ume s that, in order to cont in ue operat in g, coal plant s must have either flue ga s d esulfuri za tion or dry sorbent inj ec tion system s insta ll ed by 2015. Both t ec hnol og ies, wh ich are used to reduce ac id ga s emi ss ions, also reduc e SO 2 e mi ss ions. Under th e MAT S, NEMS sho ws a reduction in SO 2 e mi ss ion s when el ec tricit y demand d ec rease s ( e .g ., a s a result of energy effic ie ncy standards). E mi ss ion s w ill be far belo w th e ca p that would be established by CSAPR, so it i s unlike ly that excess SO 2 e mi ss ions allowance s resulting from the lower el ec tricity demand w ou ld be n ee ded or used to permi t

o ff se tt in g in creases in SO 2 e mi ss ions by a ny regu la ted EGU. Therefore, DOE be li eve s tha t

e ff iciency standards will reduce SO 2 e mi ss ions in 2015 and beyond.

CAIR estab li shed a ca p on NO X e mi ss ions in ea stern State s and the District of Columbia. Energy conservation standards are exp ec ted to have li tt le or no physical e ff ec t on these e mi ss ions in those State s covered by CAI R b eca use ex ce s s NO X e mi ss ions allowan ce s resulting from th e lower el ec tricity demand could be used to permit o ff se tt in g in creases in NO X emi ss ions. However, standards would be exp ec ted to reduce NO X emi ss ions in the State s not affected by CAIR, so DOE est im ate s N O X emi ss ion s reductions from potential standards in th e S tate s w her e

e mi ss ion s are not ca ppe d.

The MATS li mit mercury emissions from power plants, but they do not in clude emi ss ion s

ca ps, and, a s such, DOE’ s energy conservation standards w ou ld li ke ly reduce Hg e mi ss ions. DOE wi ll est im ate mercury emi ss ions reduction using e mi ss ions f ac tor s based on AEO 2013

, wh ich incorporates the MAT S.

Power plants may emit particulates from the smok e st ac k, wh ich are kno wn a s dir ec t particulate matter (PM) e mi ss ions. NEMS doe s not acc ount for dir ec t PM e mi ss ions from powe r plants. DOE is investigat in g the possibility of using other methods to estimate reduction in PM

e mi ss ions due to standards. The great majority of ambient PM a ss ociated with power plants is in the form of s ec ondary sulfate s and nitrates, wh ich are produ ce d at a significant distance fro m po wer plant s by complex atmospheric che mi ca l re ac tions that often invo lv e the gaseous

e mi ss ions of power plants, main ly SO 2 and NO x . The monetary benefit s that DOE est im ates fo r reductions in SO 2 and NO x e mi ss ion s resulting from standards are in fact pr im ari ly related to th e health benefit s of redu ce d ambient PM.

DOE wi ll also acc ount for the e mi ss ions from the bo il er co mb ustion at the building site.

I

tem 15-1 DOE s eek s input on its app roach to conduct the e mi ss ions analysi s f or the

com me rcial pa ck aged boil er equipment co ve red by this rulemaking.

5616. M ON ET IZI NG CO 2 AN D OTHER EMI SS I ONS REDUC TI ONS

DOE plans to consider the est im ated monetary benefits li kely to result from the redu ce d

e mi ss ions of CO 2 and NO X that are exp ec ted to result from e ac h of the standard level s considered.

To est im ate the monetary value of benefit s resulting from redu ce d e mi ss ion s of CO 2 , DOE plans to use the most curr ent Social Cost of Carbon (S CC ) value s d eveloped and/or agr ee d
to by an in teragency pro ce ss . The SCC is in tended to be a monetary m ea sure of the in crementa l damage resulting from gr ee nhouse ga s (GH G) e mi ssions, in cludi ng, but not limited to, ne t agricultural productivity loss, human h ea lth e ff ects, property damage from sea level rise, and

c hanges in ec osystem services. A ny effort to quantify and to monetize the harm s a ss ociated with climate change will raise serious questions of scien ce , ec ono mi cs, and ethics. But with ful l regard for the l im it s of both quantifi ca tion and moneti za tion, the SC C can be used to provi de
est im ate s of the social benefit s of reductions in G HG e mi ss ions.

The Interagency Work in g Gr oup on Social Cost of Carbon released an update of it s previous report in 2013. 7 1 The most r ece nt est im ate s of the SCC in 2015, expre ss ed in 2012$, were $12.9, $40.8, $62.2, and $117 per metric ton of CO 2 avoided. For e mi ss ion s reductions that o cc ur in later y ea rs, these value s g row in real te rm s over t im e. Additiona ll y, the in teragenc y group deter mi ned that a ran ge of values from 7 per ce nt to 23 per ce nt sh ou ld be used to adjust th e global SC C to ca lculate domestic e ff ects, altho ughDOE wi ll give preference to consideration o f th e g lobal benefit s of re du cing CO 2 e mi ss ions.

DOE multiplie s the CO 2 e mi ss ion s reduction estima ted for eac h y ear by the SC C value for that year in ea ch of the four ca ses. To ca lculate a present value of the str eam of monetar y values, DOE discount s the values in ea ch of the four ca se s u s in g the discount rates that had been used to obtain the SCC values in each ca se.

DOE reco gn ize s that scientific and ec ono mi c kn ow le dge cont in ue s to evolve rapid ly as to th e contr ib ution of CO 2 and other GHG to changes in the future global c li mate and the potentia l result in g damage s to the world ec ono my . Thus, these value s are subj ec t to change.

DOE also est im ate s the potential monetary benefit of redu ce d NO X emissions result in g from the standard levels it considers. For NO x emissions, est im ate s s ugg est a very wide ran ge o f monetary values, ranging from $468 to $4,809 per ton in 2012 $. 7 2 In acc ordance with OM B guidan ce , 73 DOE ca lculate s a range of monetary benefit s u sing ea ch of the ec ono mi c values fo r NO X and real discount rates of 3 per ce nt and 7 per ce nt

71 Tec hn ic al U

pd ate of t

he So ci al Cost of Ca r bon f or

Regulatory Impact A na lysis Under Executive Or der 128 66

. In teragency Working Gro up on Soc ia l Cost of Car bo n , United St at es G ov e rn me nt (May 2013) (Av ai lable at : h tt p : // w ww.wh it ehouse.g ov /s it es/defau lt/ f il es/omb /i n fo reg/soc ial _cost_ of _car bo n_ fo r_r ia

_

2013_ u

pd ate. pd f ).

72 For add iti onal in fo rma ti on, refer to U.S. O ff ice of Manag eme nt a ndB udg et
, O ff ice of In fo rmation and Re gu lat or y Aff ai rs, 2 006 Re po rt to Co ngress on t he Co sts and Benefits of Feder al

Regulati ons a nd Unf un ded Man dates on State

, Local, and Tr ib al Entiti es , Washingto n, D.C. 73 OM B, Circul ar A- 4: Re gu latory A na lysis, 20 03 (Posted Sept . 1 7, 20 03 ).

57DOE i s evaluat in g appropriate valuation of avoided SO 2 and Hg e mi ss ions. Whethe r moneti za tion of redu ce d SO 2 and Hg e mi ss ions wi ll o cc ur in thi s rulemaki ng is yet to b e deter mi ned.

I

tem 16-1 DOE reques ts com me nts on the approach it plans to use for es timating

mon e ta ry benef its a ss ociated w ith e mi ss ions reduc tion s.

17. UTILITY IMPAC T A NALYS IS

In the ut il ity im p ac t ana ly sis, DO E analyzes the changes in e lect ric insta lle d ca pacity and generation that result for ea ch trial standard level. The utility im p ac t analysis uses a variant of EIA ’s NE MS

, wh ich i s a public domain, multi-s ec tored, partial equ il ibrium model of the U. S. energ y

s ec tor. 7 4 E ac h year, DOE/EI A use s N EMS to produce an energy proj ec tion for the Un ited States, th e Annual Energy Outlook ( AE O ). DOE use s a variant of this model, refe rr ed to a s N EMS-BT 75

to acc ount for sel ec ted utility im pact s of new or amended energy conservation standards

. DO E’ s analysi s consist s of a comparison between model results for the most r ece nt AEO Reference Cas e and for ca ses in which energy use i s d ec remented to refl ec t the im p ac t of potential standards. For the analysi s o f standards on co mm ercial p ac kaged bo il ers, DOE wi ll use the version o f NEMS based on the most r ece nt AEO.

I

tem 17-1 DOE we lcom es input from interes ted parti es on its p roposed approach to conduct the utility impa ct analysis.

18. EMPL OY ME NT IMPAC T A NAL YS IS

Employment im p ac ts in clude dir ec t and in dir ec t changes in the domestic workforc e result in g from new or amended energy conservation standards. Dir ec t employment imp ac t s ar e

any changes in the number of employ ee s of manuf ac turers of the equipment subject to standards. The MIA addresses imp ac ts in the number of employee s w ork in g for the manuf ac turers. Indir ec t employment im pact s from standards consist of the net jobs cr ea ted or el im inated in the nationa l

ec ono my , other than in the manuf ac tur in g s ec tor be in g regulated, ca used by: (1) redu ce d spending by end users on energy; (2) redu ce d spend in g on new en ergy supply by the utilit y industry; ( 3) in creased spending on new equipme nt to wh ich the new standards app ly ; and (4) th e

e ff ec t s of those three f ac tors throughout the ec on om y.

74 For more in fo rmati on on NE MS , refer to the U.S

. Depar tm e nt of Ene rg y, Ener gy In fo r ma tion Ad mi nistrati o n documentati o n. A usef ul su mma ry is Na ti onal Energy Mod el i ng System: An Overview 200 3 , DOE/EIA-05 81(20 0 3), (March 20 0 3).

75 DO E/E IAappr ov es use of the name NEMS to describe only an official version of the model witho ut an y modific ati on to co de or data. B ec ause this an al ysis entails some minor co de modific ati ons and the model is ru n und er vario us po li cy s ce narios that are variati ons on DO E/E IA a ss ump ti ons , DO E refers to it bythe name NEMSBT. (BT is DOE ’s Bu il ding Technologies Offi ce , under whose aegis this work has b ee n per fo rmed.)

58One method for a ss essi ng the possible e ff ec t s on the demand for labor of such shifts in

ec ono mi c ac tivity i s to compare s ec tor employment statistic s d evel op ed by the Labo r Department’ s Bur ea u of Labor Statistic s (BLS). The BLS regularly publishes it s est im ate s of th e number of jobs per m ill ion do ll ar s of ec ono mi c ac tivity in different s ec to rs of the ec ono my , a s well a s the jobs cr ea ted elsewhere in the ec onomy by this same ec ono mi c ac tivity. Data fro m BLS in di ca t e that expenditures in the utility s ec tor genera lly cr ea te fewer jobs (both dir ec tly and indir ec tly) than expenditures in other s ec tors of the ec onomy. 7 6 There are ma ny reasons for these di ff e rences, in cluding wa ge differen ce s and the fact that the utility s ec tor is more ca pit al in

tensive and less labor- in t ensive than other s ec tors. Energy conservation standard s have th e

e ff ec t of reduc in g consumer utility bills. B eca use redu ce d consumer expenditures for energ y like ly lead to incr ea sed expenditures in other s ec to r s of the ec onomy, the general e ff ect o f

e ff iciency standards i s to shift ec ono mi c ac tivity from a less labor- in tensive s ec tor ( i.e. , th e utility s ec tor) to more labor- in tensive s ec tors ( e.g. , the retail and service s ec t ors).

In the NO PR sta ge of this rulemaki ng, DOE plans to est im ate in dir ec t nationa l employment im pact s u s ing an input/ou tp ut model of the U. S. economy called Impact of S ec to r Energy Technol og ies version 3.1.1 (I mS ET)

. 7 7 ImSET i s a special-purpose version of th e “U.S. Benchmark National In pu t- Ou tput” (I–O) model, wh ich wa s d esigned to est im ate the nationa l employment and in come e ff ects of energy-savi ng te chnol og ies. The ImSET software in clude s a computer-based I–O model havi ng structural coefficient s that char ac terize ec ono mi c flo ws among 187 s ec tors most relevant to in dustrial, co mm ercial, and residential building energy use.

DOE notes that ImSET i s not a general equilibrium for ec ast in g model and understand s the un ce rta in ties invo lv ed in proj ec t in g emplo ym ent im pacts, especia lly changes in the late r yea r s of the analysis. B eca use ImSET doe s not in corporate price changes, the employmen t

e ff ec ts predicted by ImSET may over-est im ate ac tu al job imp ac t s over the long run. DOE ma y consider the use of other mode li ng appro ac hes for examining long-run employment im p ac ts.

I

tem 18-1 DOE we lco me s f ee dback on i ts p roposed approach to a ss e ss ing national

e mplo yment i mpa cts.

19. RE GU LAT ORY IMPAC T ANA LYSIS

In the NO PR sta ge of thi s rulemaki ng, DOE w il l prepare a re gu latory imp ac t analysi s tha t wi ll addres s the potential for non-regulatory appro ac he s to supplant or augment energ y conservation standards to improve the efficiency of co mm ercial p ac kaged bo il ers on the market. DOE reco gn ize s that voluntary or other non-regulatory effort s by manufacturers, utilities, and other in terested partie s can result in substantial efficiency improvements. DOE in tends t o

76 See Bureau of Econo mi c Analysis, Regional Multipliers: A User Handbook for the Regional Input-Out put Mode li ng System (RIMS II )

, U.S. Departme nt of Co mm erce (199 2 ).

77 J

. M

. Roo p, M

. J

. Sco tt
, and R. W

. Sc hu ltz, ImSET 3.1: Impact of S ec tor Ene rgy T ec hn ologies ( PNN L- 18412 )

, Pacific Northwest N ati onal La bo ratory (2009) (Avai lable at :

www.pnl.g ov /ma in/ pu

b li cati ons/exte rn al /t ec hn ical_reports/P NN L- 18412

. pdf ).

59analyze the like ly eff ec t s of non-regulatory initiative s and compare such e ff ec t s with thos e proj ec ted to result from amended energy conservation standards. DOE wi ll a tt empt to base it s

a ss essment on the ac tual im p ac t s of any such initiat iv e s to date, bu t wi ll also conside r information presented regard in g the im p ac t s that a ny exist in g initiat iv e mi ght have in the future.

If DOE proposes amended energy conservation standards for co mm ercial p ac kaged bo il ers and the NO PR constitute s a signifi ca nt regulatory ac tion, DOE would prepare and submi t
to OM B for review the a ss e ss ment of cost s and benefit s required under s ec tion 6(a )( 3) o f Ex ec ut iv e Ord er 12866, “Regulatory Planni ng and Review,” 58 FR 51735 (Oct. 4, 1993).

60APPENDIX A – LI ST OF I TE MS F OR CO MME NT

Item 2-1 DOE welcome s co mm ent on the proposed scope of covera ge and on whether there

are any additional type s of co mm ercial packaged bo il er s that should or should not be included in the scope of thi s rulemak in g.

................................ ................................ ... 12

Item 2-2 DOE welcome s co mm ent s regard in g the need to include el ec tric co mm ercial
p ac kaged bo il ers in thi s rulemaking.

................................ .......................................... 12

Item 2-3 DOE request s co mm ent on pursu in g stand by mode and off mode energy conservation standards for co mm ercial p ac kaged bo il er s

............................................................... 12

Item 2-4 DOE welcomes co mm ent as to whether there are a ny size-related i ss ue s with conduct in g test in g under the DOE test pro ce dure wh ich the agency sh ou ld consider addressing in it s test pro ce dure rulemaking. DOE i s also in terested in any co mm ents regard in g whether there i s a ca pacity l im it beyond wh ich amended energy conservation standards would not be t ec hn olog ica lly feasible and ec ono mi ca l ly jus tified

................................ ................................ ....................................................... 12

Item 3-1 DOE welcome s co mm ent on all asp ec t s of the current DOE test pro ce dure for

co mm ercial p ac kaged bo il er s and on whether the te st pro ce dure is in n ee d of updates or revisions

................................ ................................ ................................................. 13

Item 3-2 DOE request s f ee db ac k on issue s or problem s with the cu rr ent test pro ce dure that may make it burdensome or infeasible for manufacturers to conduct test in g on some or all model s of co mm ercial p ac kaged bo il ers. Sp ecifica ll y, DOE request s co mm ent whether the o perat in g pre ss ure s required by BTS-2000 are not ac hievable for any

co mm ercial p ac kaged bo il er s within the scope of th i s rulemaking.

........................... 15

Item 3-3 DOE request s f ee db ac k on test in g condition s wit hinthe curr ent test pro ce dure that
may n ee d to be refined to ensure fair comparison of e ff iciencie s ac ros s co mm ercial
p ac kaged bo il er model s

................................ .............................................................. 15

Item 3-4 DOE welcome s co mm ent on alternative in dustry te st methods for deter mi ning the

e ff icienc y for co mm ercial p ac kaged bo il ers, particular ly with regards to how an alternat iv e standard would improve or not im prove upon the curr ent test pro ce dure based on BTS-2000, and on the comparability of efficiency rat in gs d eter mi ned us in g the alternative standards to those from a BTS-2000 test.

........................................... 15

Item 5-1 DOE welcome s d ata that would contr ib ute to the market a ss essment, including but not l im ited to information on national histori ca l shipments, distr ib ution channels, and manuf ac t urer market share s of co mm ercial packaged bo il er s

................................ ... 18

Item 5-2 DOE welcome s co mm ent on the li sted national trade a ss ociations for co mm ercial
p ac kaged bo il ers. Sp ecifica ll y, are there trade a ss ociations not li sted here that should be included ?

................................ ................................ ............................................... 19

61Item 5-3 DOE welcome s co mm ent s on it s considered equipment classes. Are there a ny other performance-related f ea tures that should be considered for co mm ercial p ac kaged bo il er s equipment cla ss es ?

................................ ......................................................... 20

Item 5-4 DOE welcome s co mm ent s on the t ec hn olog ies identified, a s w e ll a s a ny additional
t ec hn ol og y option s wh ich have not been identified.

.................................................. 30

Item 6-1 Of the t ec hn ol og ies listed in s ec tion 5.4, are there a ny that should be screened out based on the four scr ee ning criteria? If so, wh ich criteria app ly and wh y ?

............... 31

Item 7-1 DOE s ee ks in putregard in g the ran ge of efficiency level s and a ny key e ff iciency level s that sh ou ld be examined a s p art of it s ana ly si s

................................................ 33

Item 7-2 DOE s ee ks co mm ent on the appropriate max-t ec h levels for co mm ercial p ac kaged bo il er s.

................................ ................................ ........................................................ 33

Item 7-3 DOE s ee ks in puton the representat iv e ca pacity a nd other representat iv e char ac t eristics for eac h co mm ercial p ac kaged bo il er equipment clas s

...................... 33

Item 7-4 DOE s ee ks in puton char ac teristic s wh ich may re qu ire multiple representat iv e equipment type s within a single equipment clas s

...................................................... 34

Item 8-1 DOE s ee ks in terested party in put on whether the distr ib ution channel s d escribed above are appropriate for co mm ercial p ac kaged boiler s

............................................ 37

Item 8-2 DOE s ee ks in puton the per ce ntage of equipment be in g distributed thro ughthe di ff e rent distr ib ution channels, and whether the share of equipment thro ugh eac h channel varies based on equipment clas s or equipment ca pacit y

............................... 37

Item 8-3 DOE welcome s s ugg estion s and co mm ent s con ce rning it s p roposed appro ac h to devel op ing est im ate s of future co mm ercial p ac kaged bo il er retail pri ce s

................. 38

Item 8-4 DOE s ee ks r ece nt data to estab li sh the markups for the parties involved with the distr ib ution of the equipmen t

................................ ..................................................... 38

I tem 9-1 DOE s ee ks in puton the planned appro ac h for deter mi ning the energy consumption of

co mm ercial p ac kaged bo il ers in co mm ercial buildin gs

............................................. 41

Item 9-2 DOE seeks historical shipment-weighted co mm ercial p ac kaged bo il er e ff iciency data or shipment data by efficiency bins. DOE i s p r im ar il y in terested in obtaini ng this data dur in g the last 10 y ear s to ca pture the im p ac t of the most cu rr ent t ec hnol og ie s on the b o il ers marke t

................................ ................................ ....................................... 41

Item 9-3 DOE s ee ks in puton data sour ce s that it can use to char ac terize the variability in annual energy consumption for co mm ercial packaged bo il ers. DOE i s p articular ly in

terested in field monitor in g studie s and dat a

.......................................................... 41

Item 9-4 DOE request s co mm ent on what other energy use by co mm ercial p ac kaged bo il ers sh ou ld be included in the energy use analysi s

............................................................ 41

Item 9-5 DOE welcome s co mm ent on whether the rated thermal efficiencies for all

co mm e rcial p ac kaged bo il er equipment sh ou ld be adjusted to refl ec t return-water condition s (previ ou sly done for condensing bo il er s on ly )

......................................... 41

Item 9-6 DOE s ee ks in puton what fr ac tion s of hot-water c om mercial packaged bo il er s are used both for sp ac e h ea t in g and hot wate r

................................ ................................ . 41

62Item 9-7 DOE s ee ks in puton the fr ac tion of co mm ercial packaged bo il er s u sed in residential
app li ca tions. Is this market lar ge eno ughthat DOE sh ou ld take it in to ac count ?

...... 41

Item 9-8 DOE s ee ks co mm ent s on the rebound e ff ec t that may be a ss ociated with moree ff icient co mm ercial p ac kaged bo il er s

................................ ....................................... 41

Item 10-1 DOE s ee ks in terested party in put on it s p roposed appro ac h of us in g probability distr ib ution s and Monte Carlo s im ulation to conduct the LC C and PBP analysi s

..... 44

I tem 10-2 DOE request s d ata from in terested partie s to char ac terize the curr ent mi x of

co mm ercial p ac kaged bo il er e ff iciencies in the market.

............................................ 44

Item 10-3 DOE s ee ks in put on the planned appro ac h for est im at in g future energy price s

........ 44

Item 10-4 DOE s ee ks in terested party in put on the ma in tenance and repair cost s appro ac h. Sp ecifica ll y, DOE request s co mm ent on frequency and cost of ma in tenan ce , major repair issues, repair frequency, and repair cost s f or co mm ercial p ac kaged bo il er s that

m ee t the mi nimum e ff iciency standards, a s w ell a s for higher-efficiency bo il er s

..... 45

Item 10-5 DOE s ee ks in terested party in put on it s p roposed in sta ll ation cost appro ac h. Sp ecifica ll y, DOE request s d ata on the fr ac tion s of insta ll ation s that would entail significant additional insta ll ation expense s

................................ ................................ 45

Item 10-6 DOE s ee ks co mm ent s on the methodolog y used to deter mi ne equipment li fet im es for

co mm e rcial p ac kaged bo il er s

................................ ..................................................... 46

Item 10-7 DOE s ee ks in terested party in put on it s p lanned appro ac h for est im at in g discount
rate s for co mm ercial customer s

................................ ................................................. 46

Item 10-8 DOE request s d ata on the efficiency distr ib ution and welcome s co mm ent on the likelih oo d and degree of im provement in efficiency of co mm ercial p ac kaged bo il ers in the next 5 to 10 y ea r s a s a result of market for ce s or in dustry trends (in the absence of amended energy conservation standards )

.............................................................. 47

Item 11-1 DOE welcome s co mm ent on the shipment s p roj ec tion methodolog y

....................... 48

Item 11-2 DOE invites co mm ent s regard in g the selection of appropriate ec ono mi c dr iv er s and

sour ce s of data for historical shipment s and ship me nt br eakdowns by equipment clas s

................................ ................................ ............................................................ 48

Item 11-3 DOE s ee ks historical co mm ercial p ac kaged bo il er shipment s d ata from in terested parties, disa gg regated by equipment clas s and efficiency level if possibl e

................ 48

Item 11-4 DOE s ee ks in put from in terested partie s on the potential im p ac t of amended standards

on co mm ercial p ac kaged bo il er shipment s

................................ ................................ 49

Item 12-1 DOE s ee ks co mm ent s on the appropriate a ss umption s to use regard in g long-run changes in co mm ercial p ac kaged bo il er energy e ff iciency independent of amended energy conservation standards

................................ ................................................... 50

I tem 12-2 DOE request s co mm ent on whether it sh ou ld pursue a roll-up or shift appro ac h for the national im pact ana lysi s

................................ ............................................................. 50

Item 13-1 The Department request s in put as to what consumer subgroups are appropriate to evaluate for co mm ercial packaged bo il er s

................................ ................................ . 52

63Item 14-1 DOE s ee ks co mm ent on appropriate manuf ac turer subgroups, if any, that DOE sh ou ld consider in a manufacturer subgroup analysis for co mm ercial packaged bo il er s

...... 53

Item 14-2 DOE welcome s d ata on the name s and number of sma ll manuf ac turers in the

co mm ercial p ac kaged bo il ers in dustry

................................ ....................................... 54

Item 14-3 DOE welcome s co mm ent s on what other exist in g regulation s or pend in g regulations it sh ou ld consider in it s examination of cumulat iv e re gu latory burden

..................... 54

I tem 15-1 DOE s ee ks in put on it s appro ac h to conduct the emi ss ion s analysis for the commercial p ac kaged bo il er equipment covered by thi s rulemaking.

....................... 56

Item 16-1 DOE request s co mm ent s on the appro ac h it plan s to use for est im at in g monetary benefit s associated with e mi ss ion s reduction s

........................................................... 58

Item 17-1 DOE welcomes input from in terested partie s on it s p roposed appro ac h to conduct the utility imp ac t analysi s

................................ ................................ ................................ 58

I tem 18-1 DOE welcomes feedb ac k on it s p roposed appro ac h to a ss essing national employment imp ac t s

................................ ................................ ....................................................... 59

64