## ADVANCE TRA NSF O RMER CO

10275 W Higgins Rosemont, 11 60018

April 6, 2000

US Department of Energy Attn: Brenda Edwards-Jones Office of Energy Efficiency and Renewable Energy EE-41 1000 Independence Ave, SW Washington, DC 20585-0121 Subject: Docket No EE-RM-97-500 Public Hearing; Fluorescent Lamp Ballasts

Dear Ms Edwards-Jones: Attached is a statement from Advance Transformer for the April 18, 200 Public Hearing on Fluorescent Lamp Ballasts. I look forward to presenting a summary of these comments at the hearing. If you need further information I can be reached at 847-913-8238 by phone or at 847-913-0266 by fax.



### Robert W Wisbey Consultant to Advance Transformer

cc; P Franco, N Grimshaw, R MoorheadComments of Advance Transformer Co April 18, 2000 Public Hearing Energy Conservation Program for Consumer Products : Fluorescent Lamp Ballasts

Docket No EE-RM-97-500

I am Bob Wisbey. I would like to provide comments on the Proposed Rule regarding fluorescent lamp ballast efficiency standards, as published in the Federal Register Notice of March 15, 2000. I am submitting these comments on behalf of Advance Transformer Company. Advance is an operating division of Philips Electronics North America Corporation. Advance is a leader in the design, manufacture and sale of both magnetic and electronic ballasts, and is one of the largest manufacturers of each technology. Advance's business is very dependent on energy saving initiatives and products. Advance, and Philips, have participated in all aspects of fluorescent lamp ballast efficiency regulations dating back to the State of California regulations of the early 1980's. Advance representatives were very involved in advocating and developing the initial US regulations in 1987/88. I, personally, and Advance/Philips as a company, have been extremely involved in the current rulemaking process, since the publication of the poorly conceived and ill-fated "eight product rulemaking" NOPR on March 4, 1994. Fluorescent lamp ballasts are components utilized in lighting fixtures primarily used in commercial and industrial buildings

. In 1987/88, ballasts were incorporated in NAECA legislation , which otherwise covers home appliances used in primarily residential applications. At that time , a national ballast efficiency regulation was considered desirable by all concerned parties

. Attaching it to NAECA was an expediency , agreed to by all stakeholders, and in retrospect, was an overall good choice. However , the periodic review process ofNAECA is basically designed for residential appliances

. In fact, the title of the program , as listed in the heading of these comments is; "Energy Conservation Program for Consumer Products" Fluorescent lamp ballasts are not generally " consumer products ". Ballasts are different because they are only components of lighting fixtures and because they are mostly used in commercial and industrial applications. Advance has been a very active member of the NEMA Ballast Section Energy Task Force that has been the primary industry group dealing with this issue. This group of six companies comprises the vast majority of both magnetic and electronic ballast sales and manufacturing in this country. Even though the product lines and business interests of the six are not all the same, our interests in and commitment to a regulation process that is open and transparent and based on thorough and factual analyses are all the same.The majority of our input has been expressed through the NEMA Ballast Section. Advance

supports and endorses all of the comments that have been and are being provided by the NEMA Ballast Section. Advance is also one of the signatories to the "Agreement on Consensus Recommendations to the Department of Energy Relating to Energy Efficiency Standards for Fluorescent Lamp Ballasts" (October 1999); Advance also participated in the development of the "Joint Comments Relating to Energy Conservation Standards for Ballasts" (December 1999). We affirm our support of the Agreement and the Joint Comments. The NOPR issued by DOE and published in the Federal Register on March 15, 2000 accurately reflects the proposal agreed to by the Joint Stakeholders. Advance and Philips support the proposal's adoption. I would like to make some comments on the three primary ingredients in the DOE economic analysis: Life Cycle Cost (LCC) analysis, which evaluates the impact of potential rules on users; National Energy Savings (NES) analysis, which evaluates impacts on the nation as a whole; and Manufacturers Impact Analysis (MIA), which evaluates impacts on manufacturers. The quality of these analyses has improved immensely since the original NOPR in 1994, particularly since the implementation of DOE's Process Improvement Rule in 1996. We have some specific comments on the latest round of these analyses; released in September of 1999: The MIA shows that a rule requiring essentially only electronic ballasts, taking effect in 2003, would have a major negative economic impact on companies that manufacture magnetic ballasts, and their suppliers. We believe this analysis is very thorough and accurate.

The LCC shows an economic advantage to a very large majority of users

. There are four factors in this analysis with which we continue to disagree . They are: the derivation of user ballast prices , the use of the same electricity prices for all ballast users, the comparison of T8 lighting systems vs T12 lighting systems and the comparison of 3 and 4 lamp fixtures using one ballast vs fixtures using multiple ballasts. These points are covered in more detail in previous and concurrent NEMA comments. We do not suggest that the analyses be redone at this time. We also are not submitting our own version of the LCC analyses as we have done in the past. It is virtually impossible to determine user ballast prices with any degree of certainty. The ballast price information previously used is now four years old and not representative of today's market. We are satisfied that properly done LCC analyses today would show advantages for most users, just not the overwhelming majority shown in the TSD. The NES shows a substantial national energy savings. We believe the basic energy savings portion of this analysis is thorough and accurate, given the acknowledged uncertainty range of continued electronic ballast market penetration without further regulation. The economic national benefit is overstated because of the problems with user ballast prices and electricity prices described above in the LCC commentary.By last summer, the analyses had improved to the point that the items listed above were the only

major disagreements. At the ballast workshop in June Dan Reicher suggested that the interested stakeholders try to reach a consensus recommendation. Our NEMA group, spearheaded by Randy Moorhead of Philips, organized a negotiating session. All of the interested stakeholders, as well as representatives of DOE and their technical consultants, ADL and LBNL, were invited and participated. The NEMA group included the affected ballast companies, several suppliers to the ballast industry, luminaire manufacturers and lamp manufacturers. The other stakeholders included the energy advocacy groups and state energy offices who had shown ongoing interest in this regulation. DOE representatives were able to observe the negotiation and provide guidance.

After two days of negotiation , a consensus was reached on a common proposal that could be presented to DOE by the Joint Stakeholders. This proposal will achieve greater overall energy savings than could have been accomplished had DOE elected to try to go ahead with an all electronic ballast regulation in the shortest possible time frame, in view of the rebuttable presumptions that would have been triggered by the negative impacts on manufacturers. The estimated direct lighting energy savings will be 1.2 quads compared to a base case where magnetic ballast shipments decline at a rate of 5% of 1997 shipments per year, 2.3 quads compared to a base case with a magnetic decline rate of 3% and 4.9 quads compared to an unlikely base case where there is no further shift from magnetic to electronic. (See TSD, Appendix E, Table E. 1) The market shift in recent years has approximated the 5% reduction scenario. It is our opinion the rate of natural market shift to electronic ballasts in the future will increase to an even higher degree. In any event, additional energy savings of approximately 5 quads will be achieved by the combined effect of this regulation and market forces. The proposal has a reasonable level of safeguards against economic damage and inconvenience to users, based on delayed implementation for replacement ballasts and the allowance of T8 magnetic ballasts. The negative impacts on manufacturers will be reduced compared to those shown in the MIA portion of the TSD, because the implementation dates will allow a more orderly transition from magnetic to electronic ballasts. Advance is one of the companies that manufacture both magnetic and electronic ballasts who would suffer significant economic hardships as shown in the MIA. According to the MIA the value of the affected portions of the business would be reduced by between 25 and 50 %, and cash flows would be reduced dramatically beginning in 2002. We are satisfied that these economic losses will be reduced under the proposal. We are prepared to tolerate the level of negative economic impacts that will result under the joint proposal.Finally, while we fully support the language of the proposed rule, we do have two issues with the

preamble portion of the NOPR that we would like to see addressed adequately in the preamble to the Final Rule. First, DOE presumes that all of our previous comments are superseded by the Joint Comments. "... NEMA ... submitted a joint comment .... While these stakeholders had previously commented on the above three documents ... the Department assumes, based on their joint comment, that it supersedes their previous comments. Therefore, the previous comments are not addressed in today's notice. " This is an incorrect presumption and the Final Rule should include acknowledgement of the disputed and unresolved issues in the Life Cycle Cost analysis described earlier. We do not request that DOE redo these analyses, or delay the implementation of the Proposed Rule to respond to these comments, only that they be acknowledged as unresolved. Secondly, there is undo emphasis in the NOPR on a scenario in which a major US ballast factory is closed in the base case. ". . . there is evidence to suggest that magnetic ballast production facilities in the US may be closed regardless of a standard, ... " Advance operates the major US magnetic ballast factory. There is no evidence to indicate the potential closure of that plant without standards. DOE must rephrase its comments regarding this "sensitivity analysis", because it is extremely unlikely, and is only a hypothetical scenario. We believe DOE can adequately address these two issues in the preamble section of the Final Rule and their resolution should result in no change to the proposal and no delay in adoption of the Final Rule. We appreciate the opportunity to participate in this rulemaking process and pledge ourselves to participate openly and thoroughly in any future rulemaking process conducted as this one has been conducted since the Process Improvement Rule was enacted. In conclusion, Advance Transformer and Philips Electronics fully support the adoption of the rule provided by the Joint Stakeholders and published in the NOPR as a Final Rule.

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