```

[Federal Register Volume 90, Number 11 (Friday, January 17, 2025)]
[Rules and Regulations]
[Pages 5560-5566]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2025-01082]

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DEPARTMENT OF ENERGY

10 CFR Part 431

[EERE-2024-BT-DET-0012]
RIN 1904-AE57

Energy Conservation Program: Commercial Warm Air Furnaces; Final 
Determination

AGENCY: Office of Energy Efficiency and Renewable Energy, Department of 
Energy.

ACTION: Final determination.

-----------------------------------------------------------------------

SUMMARY: On June 2, 2023, the U.S. Department of Energy (``DOE'' or the 
``Department'') published a test procedure final rule which established 
test procedures for commercial warm air furnaces (``CWAFs''). On August 
1, 2023, the Air-Conditioning, Heating, and Refrigeration Institute 
(``AHRI'') filed a petition for review of the final rule in the United 
States Court of Appeals for the Fourth Circuit. In a February 6, 2024, 
order, the Fourth Circuit granted a voluntary remand of the final rule 
to the Department of Energy (``DOE'') to determine whether 
establishment of the test procedure for the thermal efficiency two 
(``TE2'') metric is supported by the specific provisions applicable to 
CWAFs under the Energy Policy and Conservation Act (``EPCA''). More 
specifically, DOE agreed in this voluntary remand to not enforce the 
TE2 test procedure unless and until the Department determines that the 
TE2 test procedure is consistent with the amended industry test 
procedure, or determines, supported by clear and convincing evidence, 
that the amended industry test procedure fails to satisfy the statutory 
requirements. This document provides DOE's determination that the 
amended industry test procedure fails to satisfy EPCA's statutory 
requirements.

DATES: The effective date of July 3, 2023, for the TE2 test procedure 
is confirmed.

ADDRESSES: The docket for this activity, which includes Federal 
Register notices, comments, and other supporting documents/materials, 
is available for review at www.regulations.gov. All documents in the 
docket are listed in the www.regulations.gov index. However, not all 
documents listed in the index may be publicly available, such as 
information that is exempt from public disclosure.
    The docket web page can be found at www.regulations.gov/docket/EERE-2024-BT-DET-0012. The docket web page contains instructions on how 
to access all documents, including public comments, in the docket.
    For further information on how to review the docket, contact the 
Appliance and Equipment Standards Program staff at (202) 287-1445 or by 
email: [email protected].

FOR FURTHER INFORMATION CONTACT: Ms. Julia Hegarty, U.S. Department of 
Energy, Office of Energy Efficiency and Renewable Energy, Building 
Technologies Office, EE-5B, 1000 Independence Avenue SW, Washington, DC 
20585-0121. Telephone: (240) 597-6737. Email: 
[email protected].
    Mr. Pete Cochran, U.S. Department of Energy, Office of the General 
Counsel, GC-33, 1000 Independence Avenue SW, Washington, DC 20585-0121. 
Telephone: (202) 586-4798. Email: [email protected].

SUPPLEMENTARY INFORMATION: 

Table of Contents

I. Introduction
    A. Authority
    B. Energy Conservation Standards Rulemaking Process Under EPCA
    C. Background
II. Discussion
    A. Appendix B Test Procedure for TE2
    B. Comment Period Length
    C. Application of the ASHRAE Trigger Provision in 42 U.S.C. 
6314(a)(4)(B)
III. Conclusion
IV. Procedural Issues and Regulatory Review
V. Approval of the Office of the Secretary

I. Introduction

A. Authority

    The Energy Policy and Conservation Act, Public Law 94-163, as 
amended (``EPCA''),\1\ authorizes DOE to regulate the energy efficiency 
of a number of consumer products and certain industrial equipment. (42 
U.S.C. 6291-6317, as codified) Title III, Part C of EPCA, added by 
Public Law 95-619, title IV, sec. 441(a), established the Energy 
Conservation Program for Certain Industrial Equipment, which sets forth 
a variety of provisions designed to improve energy efficiency. This 
equipment includes CWAFs, the subject of this document. (42 U.S.C. 
6311(1)(J)).
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    \1\ All references to EPCA in this document refer to the statute 
as amended through the Energy Act of 2020, Public Law 116-260 (Dec. 
27, 2020), which reflect the last statutory amendments that impact 
Parts A and A-1 of EPCA.
---------------------------------------------------------------------------

    The energy conservation program under EPCA consists essentially of 
four parts: (1) testing, (2) labeling, (3) Federal energy conservation 
standards, and (4) certification and enforcement procedures. Relevant 
provisions of EPCA include definitions (42 U.S.C. 6311), test 
procedures (42 U.S.C. 6314), labeling provisions (42 U.S.C. 6315), 
energy conservation standards (42 U.S.C. 6313), and the authority to 
require information and reports from manufacturers (42 U.S.C. 6316; 42 
U.S.C. 6296).
    The Federal testing requirements consist of test procedures that 
manufacturers of covered equipment must use as the basis for: (1) 
certifying to DOE that their equipment complies with the applicable 
energy conservation standards adopted pursuant to EPCA (42 U.S.C. 
6316(b); 42 U.S.C. 6296), and (2) making other representations about 
the efficiency of that equipment (42 U.S.C. 6314(d)). Similarly, DOE 
uses these test procedures to determine whether the equipment complies 
with relevant standards promulgated under EPCA. DOE's test procedures 
for CWAFs are currently prescribed at subpart D of part 431 of title 10 
of the Code of Federal Regulations (``CFR'').
    Federal energy efficiency requirements for covered equipment 
established under EPCA generally supersede state laws and regulations 
concerning energy conservation testing, labeling, and standards. (42 
U.S.C. 6316(a) and 42 U.S.C. 6316(b); 42 U.S.C.

[[Page 5561]]

6297) DOE may, however, grant waivers of Federal preemption for 
particular state laws or regulations, in accordance with the procedures 
and other provisions of EPCA. (42 U.S.C. 6316(b)(2)(D)).
    Under 42 U.S.C. 6314, EPCA sets forth the criteria and procedures 
DOE must follow when prescribing or amending test procedures for 
covered equipment. EPCA requires that any test procedures prescribed or 
amended under this section must be reasonably designed to produce test 
results that reflect energy efficiency, energy use, or estimated annual 
operating cost of a given type of covered equipment during a 
representative average use cycle (as determined by DOE) and requires 
that test procedures not be unduly burdensome to conduct. (42 U.S.C. 
6314(a)(2)).
    EPCA generally requires that, at least once every seven years, DOE 
evaluate test procedures for each type of covered equipment, including 
CWAFs, to determine whether amended test procedures would more 
accurately or fully comply with the requirements for the test 
procedures to not be unduly burdensome to conduct and be reasonably 
designed to produce test results that reflect energy efficiency, energy 
use, and estimated operating costs during a representative average use 
cycle. (42 U.S.C. 6314(a)(1)-(3)) DOE refers to these provisions as the 
``lookback'' provisions and rulemakings conducted under these 
provisions as ``lookback'' rulemakings.
    Specific to certain commercial equipment, including CWAFs, EPCA 
required that the initial test procedures for this equipment be those 
generally accepted industry testing procedures or rating procedures 
developed or recognized by AHRI or ASHRAE, as referenced in ASHRAE 
Standard 90.1, ``Energy Standard for Buildings Except Low-Rise 
Residential Buildings'' (``ASHRAE Standard 90.1''), that were in effect 
on June 30, 1992. (42 U.S.C. 6314(a)(4)(A)) Further, if such an 
industry test procedure is amended, DOE must update its test procedure 
to be consistent with the amended industry test procedure unless DOE 
determines, by rule published in the Federal Register and supported by 
clear and convincing evidence, that the amended test procedure would 
not meet the requirements in 42 U.S.C. 6314(a)(2) and (3), in which 
case DOE may establish an amended test procedure that does satisfy 
those statutory provisions. (42 U.S.C. 6314(a)(4)(B) and (C)) DOE 
refers to these provisions as the ``ASHRAE trigger'' provisions and 
rulemakings conducted under these provisions as ``ASHRAE trigger'' 
rulemakings.
    Whether pursuant to the lookback provision or the ASHRAE trigger 
provision, if DOE determines that a test procedure amendment is 
warranted, EPCA requires that the Department publish proposed test 
procedures in the Federal Register and afford interested persons an 
opportunity (of not less than 45 days duration) to present oral and 
written data, views, and arguments on the proposed test procedures. (42 
U.S.C. 6314(b)).

B. Energy Conservation Standards Rulemaking Process Under EPCA

    The purpose of energy conservation standards issued under EPCA is 
to reduce energy use by improving the energy efficiency of covered 
products and equipment. (See 42 U.S.C. 6312(a)). The first step in 
establishing new or amended energy conservation standards for any 
covered product or equipment is to determine what energy use by a 
covered product or equipment will be within the scope of the energy 
conservation standard, i.e., what is the representative average use 
cycle for the covered product or equipment. For example, prior to the 
Energy Independence and Security Act of 2007 (``EISA 2007''), the 
representative average use cycle for many covered products only 
included active mode energy use, i.e., energy used while the product 
was performing its main function. As such, the representative use cycle 
did not include any energy used while the product was in a standby or 
off mode. Thus, manufacturers had little incentive to reduce standby or 
off mode energy use as it had no effect on whether a covered product 
complied with the applicable energy conservation standards. But in EISA 
2007, Congress required DOE to include standby and off mode energy use 
as part of the representative average use cycle for any energy 
conservation standard adopted after July 1, 2010. (42 U.S.C. 
6295(gg)(3)).
    Representative average use cycles for covered products and 
equipment can also change over time as DOE's understanding of how the 
product or equipment is used in the field improves, consumer habits 
change, or technologies improve. Of particular importance here is the 
introduction of variable-speed compressors in the heating, ventilation, 
and air conditioning (HVAC) market. Variable-speed technology allows 
compressors used in HVAC equipment to run at part-load values in 
response to different operating conditions in the field. For example, 
if a room temperature is only 2 or 3 degrees warmer than the set 
temperature, an HVAC unit with variable-speed technology could run at 
partial capacity, e.g., 40% capacity, to cool the room to the setpoint. 
This saves energy as the HVAC unit uses less energy running at a lower 
speed. And variable-speed HVAC units still maintain the capability of 
operating at 100% capacity when needed, e.g., cooling down a home after 
a homeowner returns from vacation. As HVAC units with variable-speed 
technology have become more prevalent in the market, the representative 
average use cycle for this equipment has changed. HVAC units with 
variable-speed technology run for longer periods of time at slower 
speeds that single-speed HVAC units. As a result, DOE amends the test 
procedures for specific HVAC equipment to ensure the representative 
average use cycle reflects manufacturer innovation and how models with 
this technology will operate in the field. For example, DOE recently 
issued an amended test procedure for air-cooled commercial package air 
conditioners and heat pumps that, among other things, has provisions 
for measuring part-load energy use because of the presence of variable-
speed technology in the market. 89 FR 43986 (May 20, 2024). DOE adopted 
this new test procedure for air-cooled commercial air conditioners and 
heat pumps with the support of a cross-section of stakeholders, 
including the heating and cooling industry, who recommended the details 
of the new test procedure to DOE as part of a negotiated consensus 
recommendation. Id. at 89 FR 43991. In fact, every type of HVAC 
consumer product or covered equipment regulated by DOE that has an 
energy conservation standard that accounts for part-load operation, 
e.g., residential central air conditioners and heat pumps and variable 
refrigerant flow air conditioners and heat pumps has an associated test 
procedure that has provisions for measuring energy use during part-load 
operation.
    Having determined a representative average use cycle for a covered 
product or equipment, the next step in EPCA's energy conservation 
standards rulemaking process is to prescribe a test procedure that is 
reasonably designed to produce test results that measure energy use of 
the covered product or equipment for that representative average use 
cycle and that is not unduly burdensome to conduct. (42 U.S.C. 
6293(b)(3); 42 U.S.C. 6314(a)(2)). For example, when Congress required 
DOE to include standby and off mode energy use in standards for covered 
products, it first directed DOE to amend test procedures

[[Page 5562]]

for all covered products to include provisions for measuring standby 
and off mode energy use. (42 U.S.C. 6295(gg)(2)(A)). Congress then 
directed DOE to use these amended test procedures when prescribing new 
or amended standards that incorporate standby and off mode energy use. 
(42 U.S.C. 6295(gg)(3)(A)). As the new standards would be based on a 
different representative use cycle, i.e., one that includes active 
mode, standby mode, and off mode, Congress clarified that the amended 
test procedures ``shall not be used to determine compliance with 
product standards established prior to the adoption of the amended test 
procedures.'' (42 U.S.C. 6295(gg)(2)(C)). It would have made little 
sense for Congress to require manufacturers to use test procedures that 
measure active, standby, and off mode energy when determining 
compliance with an energy conservation standard that is only based on 
active mode energy use. DOE takes the same approach when prescribing an 
amended test procedure for use in evaluating new or amended energy 
conservation standards that are based on an updated representative 
average use cycle. Use of the amended test procedure is only required 
upon the compliance date of the new or amended energy conservation 
standards. See section 8(f) of appendix A to subpart C of 10 CFR part 
430.

C. Background

    Under EPCA's lookback provision, DOE initiated a test procedure 
rulemaking for CWAFs by publishing a request for information (``RFI'') 
in the Federal Register on May 5, 2020 (``May 2020 RFI''). 85 FR 26626. 
The current energy conservation standards for CWAFs are based on a 
representative average use cycle that assumes CWAFs always operate at 
100 percent capacity in the field and that the only energy losses are 
from flue exhaust gases. The May 2020 RFI solicited public comments, 
data, and information on aspects of the existing DOE test procedure for 
CWAFs at 10 CFR part 431, subpart D, appendix A (``appendix A''), which 
measures Thermal Efficiency (``TE'') and is used for determining 
compliance with the current energy conservation standards for CWAFs, 
including whether there were any issues with the existing test 
procedure at that time and whether it was in need of updates or 
revisions. Id.
    DOE subsequently published a notice of proposed rulemaking 
(``NOPR'') for the CWAFs test procedure in the Federal Register on 
February 25, 2022, which proposed amendments to the existing test 
procedure for TE as well as a new test procedure based on DOE's 
tentative determination that the representative average use cycle for 
CWAFs should include jacket losses and part-load operation. 87 FR 10726 
(``February 2022 NOPR''). DOE noted that CWAFs are typically installed 
outdoors and, as a result, jacket losses can be a significant source of 
energy loss. 87 FR 10726, 10735. DOE also noted that many CWAFs now 
have multiple heating stages and performance for these CWAFs can vary 
at different heating loads. Id. As a result, DOE proposed that any new 
or amended energy conservation standards for CWAFs should be based on a 
representative average use cycle that includes jacket losses and part-
load operation, and proposed a new metric, TE2, that captured those 
aspects of CWAF energy use. DOE proposed a new test procedure in 10 CFR 
part 431, subpart D, appendix B (``appendix B''), to measure energy 
efficiency under the TE2 metric. DOE tentatively determined that the 
appendix B test procedure met the statutory criteria in 42 U.S.C. 
6314(a)(2) and (3). 87 FR 10726, 10737-10738. The February 2022 NOPR 
had a 60-day comment period and DOE held a webinar public meeting on 
March 29, 2022.
    Following publication of the February 2022 NOPR, the latest update 
to ASHRAE Standard 90.1 was released in January 2023 (``ASHRAE Standard 
90.1-2022''). ASHRAE Standard 90.1-2022 references CSA/ANSI Z21.47-
2021, Gas-fired central furnaces (``ANSI Z21.47-2021''), as the test 
method for gas-fired CWAFs and Underwriters Laboratories (``UL'') 
standard UL 727-2018, ``Standard for Safety Oil-Fired Central 
Furnaces'' (``UL 727-2018''), as the test method for oil-fired CWAFs.
    On June 2, 2023, DOE published a test procedure final rule for 
CWAFs. 88 FR 36217 (``June 2023 Final Rule''). In the June 2023 Final 
Rule, DOE amended the current test procedure for TE in appendix A and 
incorporated by reference the latest industry test procedures 
referenced in ASHRAE Standard 90.1-2022. The amendments to the industry 
test procedure were relatively minor and not based on any updates to 
the representative average use cycle for CWAFs. Rather, they were 
clarifications to the existing test procedure intended to improve 
clarity and help with the execution of the current test procedure. DOE 
also finalized the proposed appendix B test procedure that is based on 
an updated representative average use cycle that includes jacket losses 
and part-load operation. Similar to other rulemakings where DOE has 
determined that the representative average use cycle should be updated, 
e.g., air-cooled commercial air conditioners and heat pumps, the June 
2023 Final Rule states that use of the appendix B test procedure would 
not be required until such time as compliance is required with amended 
energy conservation standards based on the new metric, should DOE adopt 
such standards.
    On August 1, 2023, following publication of the June 2023 Final 
Rule, the Air-Conditioning, Heating, and Refrigeration Institute 
(``AHRI'') filed a petition for review of the final rule in the United 
States Court of Appeals for the Fourth Circuit. In its opening brief, 
AHRI argued that DOE failed to provide notice and an opportunity for 
comment after being triggered by the ASHRAE Standard 90.1-2022 
publication prior to publishing the June 2023 Final Rule; that DOE did 
not undertake the required analysis under 42 U.S.C. 6314(a)(4)(B); and 
that if DOE had conducted the correct analysis under that provision, it 
would necessarily have concluded that it lacked clear and convincing 
evidence that the industry test procedure did not meet the statutory 
requirements. See Air-Conditioning, Heating, and Refrigeration 
Institute v. United States Department of Energy, No. 23-1793 (4th Cir. 
Oct. 23, 2023), 15-1.
    On February 6, 2024, the Fourth Circuit granted the Department's 
motion for voluntary remand. In its order, the Court granted DOE's 
motion for voluntary remand to clarify that, in this particular 
circumstance, where ASHRAE published an amended industry test procedure 
during the pendency of a rulemaking under the 7-year lookback 
provision, the Department will solicit public comment prior to making: 
(1) a final determination that the test procedure in appendix B for the 
TE2 metric is consistent with the amended industry test procedure; or 
(2) a final determination, supported by clear and convincing evidence, 
that the industry test procedure fails to satisfy the statutory 
requirements. See Air-Conditioning, Heating, and Refrigeration 
Institute v. United States Department of Energy, No. 23-1793 (4th Cir. 
Feb. 6, 2024), 22-1 (hereafter ``Remand Order''). The Remand Order did 
not vacate the June 2023 Final Rule; the challenged failure to solicit 
public comment (and other related claims brought in the petition for 
review) applied only to the determination that the industry test 
procedure did not meet the applicable statutory requirements and not 
DOE's determination that the appendix B test procedure satisfied the 
applicable statutory criteria. But, per the Remand Order, DOE will not 
enforce the

[[Page 5563]]

appendix B test procedure until the Department determines that the 
appendix B test procedure is consistent with the amended industry test 
procedure or DOE determines, supported by clear and convincing 
evidence, that the amended industry test procedure fails to satisfy the 
statutory requirements in 42 U.S.C. 6314(a)(2) and (3). See Remand 
Order at 2.
    In accordance with the Remand Order from the Fourth Circuit, on 
December 26, 2024, DOE published a notification of tentative 
determination and request for comment (``December 2024 NOTD''), which 
tentatively determined, supported by clear and convincing evidence, 
that the industry test procedure is not reasonably designed to produce 
test results that reflect energy efficiency during a representative 
average use cycle that, as determined by DOE, includes jacket losses 
and part-load operation. 89 FR 104859. The December 2024 NOTD sought 
comment on DOE's proposed determination that the amended industry test 
procedure, which does not have provisions for measuring energy loss to 
the ambient environment (jacket losses) and energy use during part-load 
operation, is not reasonably designed to produce test results that 
reflect energy efficiency during a representative average use cycle 
that, as determined by DOE, includes jacket losses and part-load 
operation.
    DOE received comments in response to the December 2024 NOTD from 
the interested parties listed in table I.1.

          Table I.1--List of Commenters With Written Submissions in Response to the December 2024 NOTD
----------------------------------------------------------------------------------------------------------------
                                                               Comment No.  in
         Commenter(s)                   Abbreviation             the docket               Commenter type
----------------------------------------------------------------------------------------------------------------
Michael Ravnitzky.............  Ravnitzky..................                   2  Individual.
Air-Conditioning, Heating, and  AHRI.......................                   6  Trade Association.
 Refrigeration Institute.
Appliance Standards Awareness   ASAP and NEEA..............                   7  Efficiency Organization.
 Project and Northwest Energy
 Efficiency Alliance (Joint
 Commenters).
Trane Technologies............  Trane......................                   8  Manufacturer.
Johnson Controls..............  JCI........................                   9  Manufacturer.
Daikin Applied Americas Inc...  Daikin.....................                  10  Manufacturer.
----------------------------------------------------------------------------------------------------------------

    A parenthetical reference at the end of a comment quotation or 
paraphrase provides the location of the item in the public record.\2\
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    \2\ The parenthetical reference provides a reference for 
information located in the docket. (Docket No. EERE-2024-BT-DET-
0012-0001, which is maintained at www.regulations.gov.) The 
references are arranged as follows: (commenter name, comment docket 
ID number, page of that document).
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II. Discussion

    As discussed in the December 2024 NOTD, EPCA requires that if the 
industry test procedure for CWAFs is amended, DOE must update its test 
procedure to be consistent with the amended industry test procedure 
unless DOE determines, by rule published in the Federal Register and 
supported by clear and convincing evidence, that the amended test 
procedure would not meet the requirements in 42 U.S.C. 6314(a)(2) and 
(3), in which case DOE may establish an amended test procedure that 
does satisfy those statutory provisions. (42 U.S.C. 6314(a)(4)(B) and 
(C)) The publication of ASHRAE Standard 90.1-2022 represented an ASHRAE 
trigger for CWAFs.
    However, due to the timing of the ASHRAE trigger, which occurred 
after DOE had published the February 2022 NOPR, but prior to the June 
2023 Final Rule, DOE had not sought comment in the February 2022 NOPR 
on whether the amended industry test procedure met the applicable 
statutory requirements for measuring energy use for the TE2 metric, 
which is based on a representative average use cycle that includes 
jacket losses and part-load operation in the field. DOE also did not 
initiate a separate process to determine whether the amended industry 
test procedure satisfied the applicable statutory criteria. DOE did, on 
the other hand, follow all of the procedural requirements in 42 U.S.C. 
6314(b) for prescribing the appendix B test procedure. DOE published 
the proposed appendix B test procedure in the Federal Register, 
provided a comment period of not less than 45 days (i.e., 60 days), and 
held a public webinar meeting on March 29, 2022. See 42 U.S.C. 
6314(b)(1)-(2). As a result, in accordance with the Remand Order, DOE 
is addressing only the challenged failure to determine, after notice 
and comment, whether the amended industry test procedure is consistent 
with the appendix B test procedure, or whether, as supported by clear 
and convincing evidence, the amended industry test procedure fails to 
satisfy the statutory requirements. Remand Order p. 2.
    In the December 2024 NOTD, DOE tentatively determined, supported by 
clear and convincing evidence,\3\ that the amended industry test 
procedure is not reasonably designed to produce test results that 
reflect energy efficiency during a representative average use cycle 
that, as determined by DOE, includes jacket losses and part-load 
operation. In making that tentative determination, DOE noted that a 
CWAF with a TE of 81 percent as measured by the amended industry test 
procedure could, depending on jacket losses and part-load operation, 
have an actual range of efficiencies from 77.5 to 82 percent using the 
appendix B test procedure for TE2. 89 FR 104859, 104864. DOE found that 
to be a significant difference that would impact both consumers and 
manufacturers. The following sections discuss comments received in 
response to the December 2024 NOTD and DOE's decision to finalize its 
determination that the amended industry test procedure is not 
reasonably designed to produce test results that reflect energy 
efficiency during a representative average use cycle that, as 
determined by DOE, includes jacket losses and part-load operation.
---------------------------------------------------------------------------

    \3\ ``[C]lear and convincing evidence requires a factfinder . . 
. to have an `abiding conviction' that her findings . . . are 
`highly probable' to be true.'' Am. Pub. Gas Ass'n v. United States 
Dep't of Energy, 22 F.4th 1018, 1025 (D.C. Cir. 2022) (quoting 
Colorado v. New Mexico, 467 U.S. 310, 316 (1984)).
---------------------------------------------------------------------------

A. Appendix B Test Procedure for TE2

    DOE received several comments that focused on the appendix B test 
procedure. For example, both Trane and JCI stated that DOE had not 
shown that the appendix B test procedure met the statutory requirement 
of not being unduly burdensome to conduct. (Trane, No. 8, p. 3; JCI, 
No. 9, pp. 1-2) Similarly, AHRI commented on the representativeness, 
burden, and costs of the appendix B test procedure and attached 
comments that were previously

[[Page 5564]]

submitted in response to the February 2022 NOPR. (AHRI, No. 6, pp. 6-
9).
    In response to these and similar comments, DOE reiterates that the 
scope of this rulemaking process, as laid out in the Remand Order, is 
to determine whether the amended industry test procedure is consistent 
with the appendix B test procedure for TE2, or whether the amended 
industry test procedure fails to satisfy the applicable requirements in 
42 U.S.C. 6314(a)(2) and (3). In accordance with the Remand Order, DOE 
issued the December 2024 NOTD, which tentatively determined, supported 
by clear and convincing evidence, that the amended industry test 
procedure was not reasonably designed to produce test results that 
reflect energy efficiency during a representative average use cycle 
that, as determined by DOE, includes jacket losses and part-load 
operation. DOE sought comment on this tentative determination. In the 
December 2024 NOTD, DOE specifically noted that the remand order did 
not vacate the June 2023 Final Rule, nor did it require DOE to revisit 
its determination that the appendix B test procedure meets the 
statutory requirements at 42 U.S.C. 6314(a)(2) and (3). 89 FR 104859, 
104862. As such, DOE will not address comments on whether the appendix 
B test procedure meets the statutory requirements in 42 U.S.C. 
6314(a)(2) and (3). Instead, DOE invites stakeholders to review the 
June 2023 Final Rule where these same comments regarding 
representativeness, burden, and cost of the appendix B test procedure 
were fully addressed.

B. Comment Period Length

    Several commenters expressed concerns about the length of the 
comment period provided in the December 2024 NOTD. (Daiken, No. 10, p. 
2; JCI, No. 9, p. 1; AHRI, No. 6, pp. 2-4) More specifically, JCI 
commented that there was not sufficient time to complete a notable 
research effort including the necessary internal reviews and approvals. 
(JCI, No. 9, p. 1) JCI also expressed concern that the shortened 
comment period could set a dangerous precedent for future rulemakings. 
Id. AHRI stated that the comment period fell short of the minimum 45-
day comment period required for proposed test procedures under 42 
U.S.C. 6314(b).
    In response to these comments, DOE first notes, as AHRI correctly 
pointed out, that prior to prescribing a final test procedure DOE is 
required to publish the proposed test procedure in the Federal Register 
and provide at least a 45-day comment period. (42 U.S.C. 6314(b)) But, 
as clearly stated in the Remand Order, the December 2024 NOTD, and 
throughout this document, the court did not vacate the June 2023 Final 
Rule, nor did it require DOE to revisit its determination that the 
appendix B test procedure meets the statutory requirements at 42 U.S.C. 
6314(a)(2) and (3), which remains in effect. Hence, this is not a 
rulemaking to prescribe a final test procedure to which the 45-day 
comment period would apply. Instead, DOE is determining, ``by rule, 
published in the Federal Register and supported by clear and convincing 
evidence,'' that the amended industry test procedure does not meet the 
applicable statutory criteria in EPCA. (42 U.S.C. 6314(a)(4)(B)) There 
is no minimum comment period specified in EPCA for this type of 
determination. In some cases, DOE may choose to conduct one rulemaking 
to make this determination and propose an amended test procedure (see 
42 U.S.C. 6314(a)(4)(C)), which would require a 45-day comment period. 
But in other cases, DOE may issue a rule that only makes a 
determination, supported by clear and convincing evidence, that the 
amended industry test procedure does not satisfy the requirements in 42 
U.S.C. 6314(a)(2) and (3). For example, if the current DOE test 
procedure satisfies the requirements in 42 U.S.C. 6314(a)(2) and (3) 
and DOE determines that the amended industry test procedure does not 
satisfy the requirements in 42 U.S.C. 6314(a)(2) and (3), there would 
be no need for DOE to propose an amended test procedure. As another 
example, if the ASHRAE trigger occurs after DOE has already proposed an 
amended test procedure under the 7-year lookback provision (as was the 
case here), DOE would conduct a separate rulemaking to make the 
required ASHRAE determination under 42 U.S.C. 6314(a)(4)(B).
    Under the Administrative Procedure Act (APA), an agency engaged in 
rulemaking must: (1) publish a general notice of proposed rulemaking in 
the Federal Register that includes the terms or substance of the 
proposed rule or a description of the subjects and issues involved; (2) 
give interested persons an opportunity to participate in the rule 
making through submission of written data, views, or arguments; and (3) 
after consideration of the relevant matter presented incorporate in the 
rules adopted a concise general statement of their basis and purpose. 
See 5 U.S.C. 553(b) and (c). Taken together, Courts have typically 
understood these provisions to require Federal agencies to provide the 
public with a ``meaningful opportunity'' to comment. See N. Carolina 
Growers' Ass'n, Inc. v. United Farm Workers, 702 F.3d 755, 763 (4th 
Cir. 2012). Daiken, JCI, and AHRI take issue with the length of time 
provided to stakeholders to review the December 2024 NOTD and develop 
comments.
    In response, DOE first notes that the Administrative Procedure Act 
does not provide for a minimum comment period (see 5 U.S.C. 553) and 
rules proposed by Federal agencies run the gamut from the incredibly 
complex to the relatively simple. In other words, the length of time 
required to give the public a meaningful opportunity to comment will 
vary based on the content of the proposed rule. For example, the 
National Highway Traffic Safety Administration typically used a 60-day 
comment period when it proposed new fuel economy standards for 
passenger cars and light trucks. 88 FR 56128 (Aug. 17, 2023). This 
proposed rule was over 260 pages and used complex analytical methods to 
propose new fuel economy standards.
    In contrast, the 7-page December 2024 NOTD simply sought comment on 
DOE's tentative determination that an amended industry test procedure 
that does not have provisions for measuring two sources of energy 
consumption, jacket losses and part-load operation, which can account 
for an over 4 percent difference in overall measured efficiency, is not 
reasonably designed to measure energy efficiency during a 
representative average use cycle that, as determined by DOE for the TE2 
metric, includes jacket losses and part-load operation. It should be 
emphasized that DOE was not seeking comment on methodologies for 
calculating jacket losses and energy use in part-load operation for a 
CWAF, which would have warranted a longer comment period to give 
stakeholders time to evaluate those testing provisions. Instead, DOE 
sought comment on whether--as opposed to every other type of HVAC 
equipment where DOE determined that part-load operation was part of the 
representative average use cycle--an amended industry test procedure 
for CWAFs that does not have provisions for measuring jacket losses and 
energy use during part-load operation of a CWAF is reasonably designed 
to measure energy efficiency during a representative average use cycle 
that, as determined by DOE, includes jacket losses and part-load 
operation.
    DOE posted the signed, pre-publication copy of the December 2024 
NOTD on the DOE website on December 13, 2024. That same day DOE sent an 
email to stakeholders, including AHRI, Daiken, and JCI, announcing the 
public

[[Page 5565]]

availability of the document and providing stakeholders with a website 
link to the document. The document was then published in the Federal 
Register on December 26, 2024, with a 14-day comment period that ended 
on January 8, 2025. In total, stakeholders like AHRI, Daiken, and JCI 
had 4 weeks to review the document and provide comments. As such, this 
proceeding provided stakeholders with sufficient time to review the 
December 2024 NOTD and develop any comments on why an amended industry 
test procedure that does not have provisions for measuring jacket 
losses and energy use during part-load operation still gives reasonable 
results when used to measure CWAF energy use in the field that includes 
jacket losses and part-load operation.

C. Application of the ASHRAE Trigger Provision in 42 U.S.C. 
6314(a)(4)(B)

    In the December 2024 NOTD, DOE evaluated the amended industry test 
procedure in the context of the ASHRAE trigger provision and presented 
DOE's tentative determination, supported by clear and convincing 
evidence, that the amended industry test procedure is not reasonably 
designed to produce test results which reflect energy efficiency during 
a representative average use cycle that, as determined by DOE, includes 
jacket losses and part-load operation. As support for this tentative 
determination, DOE estimated that the amended industry test procedure 
could not account for as much as a 4.5 percent difference in efficiency 
between a CWAF model with high jacket losses and poor part-load 
performance and a model with negligible jacket losses and good part-
load performance. DOE noted that this variation in efficiency was 
significant. For example, when DOE last amended the standards for gas-
fired CWAFs, the minimum required efficiency went from 80 to 81 
percent, which DOE determined would result in significant additional 
conservation of energy. 81 FR 2420, 2430. Further, the average life-
cycle cost savings to a consumer from that 1 percent increase in 
efficiency was $284. Id. at 81 FR 2423. Those already significant 
impacts are only magnified when larger differences in measured 
efficiency are considered. Therefore, DOE tentatively determined, 
supported by clear and convincing evidence, that the amended industry 
test procedures referenced in ASHRAE Standard 90.1-2022 are not 
reasonably designed to produce test results which reflect energy 
efficiency during a representative average use cycle that, as 
determined by DOE for the TE2 metric, includes jacket losses and part-
load operation.
    In response to the December 2024 NOTD, the Joint Commenters stated 
that the potential 4.5 percent difference in energy efficiency 
corresponds to a significant difference in energy consumption and that 
the amended industry test procedure would likely result in an 
inaccurate ranking of equipment in the market in terms of energy use 
and operating cost. (Joint Commenters, No. 7, p. 1) As such, the Joint 
Commenters agreed with DOE's tentative determination that the amended 
industry test procedure is not reasonably designed to measure energy 
efficiency during a representative average use cycle. Id.
    Daiken, on the other hand, stated that DOE did not provide any data 
to support its assertion that the industry test procedure is not 
representative but has stated that clear and convincing evidence is 
present. (Daiken, No. 9, p. 3) DOE strongly disagrees with this 
statement. As discussed previously, DOE provided estimates that jacket 
losses and part-load operation could account for as much as a 4.5 
percent difference in efficiency. And DOE noted that even a 1 percent 
increase in efficiency corresponded to average life-cycle cost savings 
of $284.
    AHRI asserted that DOE cannot satisfy the clear-and-convincing 
evidence requirements because AHRI believes the record did not 
demonstrate the test procedures referenced in Standard 90.1 would fail 
to meet the requirements of sections 6314(a)(2) and (a)(3). More 
specifically, AHRI commented that the range of efficiencies that would 
result from the inclusion of part-load operation is narrower than for 
other air-conditioning products. AHRI pointed to an example of a 
furnace in a large commercial unit in a milder climate primarily 
operating at night or during morning warm up to demonstrate its belief 
that CWAFs are basically on-off, i.e., do not spend a significant 
amount of time operating at part-load. (AHRI, No. 6 at p. 7)
    In the June 2023 Final Rule, after considering comments and input 
from stakeholders, DOE determined that the representative average use 
cycle for the TE2 metric should include part-load operation and adopted 
the 50 percent weighting at full load and part load. 88 FR 36217, 
36226. In making that determination, DOE reviewed modeling submitted by 
NEEA that showed a range of times for CWAF operation at full and part 
loads, from operating as much as 70 percent of the time at full load 
(and 30 percent of the time at part load) to operating as little as 25 
percent of the time at full load (and 75 percent at part load). DOE 
also observed that in the modeling certain building types (warehouses) 
were modeled to operate at full load over 50 percent of the time, while 
other buildings (retail) were modeled to operate at full load less than 
50 percent of the time. DOE acknowledges that the time a CWAF operates 
at full load and part load could vary based on the climate region, 
building type and load, and CWAF sizing. But based on the available 
data, it is clear that CWAFs in the field spend a significant amount of 
time operating at part-load.
    Even if AHRI were correct and part-load operation is less of a 
contributor to the overall energy efficiency of a CWAF, DOE notes that 
none of the commenters argued that jacket losses are not important to 
the overall efficiency of a CWAF. In fact, AHRI points out its 
importance by citing to the relevant provisions in ASHRAE 90.1 showing 
that CWAFs installed in buildings where ASHRAE 90.1-2022 building code 
requirements apply (e.g., newly constructed commercial equipment where 
a jurisdiction has adopted the ASHRAE Standard 90.1-2022 building 
energy codes) must meet certain jacket loss provisions. This position 
highlights the importance of including jacket losses in the 
representative average use cycle for any future standards, which as DOE 
noted in the December 2024 NOTD could account for as much as a 2.5 
percent difference in efficiency. 89 FR 104859, 104863.

III. Conclusion

    The potential difference in CWAF efficiency measured under the 
industry test procedure and the appendix B test procedure is an 
excellent example of why Congress updated representative use cycles for 
covered products to include standby and off mode energy use in new or 
amended energy conservation standards and why stakeholders, including 
manufacturers, asked DOE to update the representative average use cycle 
for air-cooled commercial air conditioners and heat pumps--consumers 
and manufacturers are both better off when DOE test procedures and 
energy conservation standards capture more energy use in the field. For 
example, as discussed previously, a CWAF with a TE of 81 percent as 
measured by the industry test procedure could, depending on jacket 
losses and part-load operation, have an actual range of efficiencies 
from 77.5 to 82 percent using the appendix B test procedure for TE2. 
That is a significant difference in efficiency and corresponds to a 
significant difference in fuel costs

[[Page 5566]]

over the lifetime of the CWAF, which is important information for 
consumers. The industry test procedure also does not allow 
manufacturers to fully differentiate their products in the market. For 
example, under the industry test procedure, a manufacturer with a line 
of CWAF models with well-insulated jackets has no way to advertise 
their improved efficiency in the market. Under the industry test 
procedure, these models will have the same advertised efficiency as 
similar models that lack insulation and have higher jacket losses.
    Having determined that any future, amended standards for CWAFs 
should be based on a representative average use cycle that includes 
jacket losses and part-load operation, DOE adopted the appendix B test 
procedure in the June 2023 Final Rule. The appendix B test procedure 
contains specific provisions for measuring jacket losses and energy use 
during part-load operation and will be used by DOE to evaluate 
potential amended standards for CWAFs. Use of the appendix B test 
procedure by manufacturers would not be required until such time as 
compliance is required with amended energy conservation standards based 
on the new representative average use cycle, should DOE adopt such 
standards.
    For this final determination, as was done initially in the December 
2024 NOTD, DOE evaluated whether the industry test procedure is 
reasonably designed to produce test results which reflect energy use 
during a representative average use cycle that, as determined by DOE, 
includes jacket losses and part-load operation. Unlike the appendix B 
test procedure, the industry test procedure does not have provisions 
for calculating jacket losses and changes in energy efficiency due to 
part-load operation. As discussed previously, this results in the 
industry test procedure producing test results that do not account for 
significant variations in energy use across different CWAF models. As a 
result, DOE has determined, supported by clear and convincing evidence, 
that the industry test procedure is not reasonably designed to produce 
test results which reflect energy efficiency during a representative 
average use cycle that, as determined by DOE, includes jacket losses 
and part-load operation for the TE2 metric.

IV. Procedural Issues and Regulatory Review

    DOE has concluded that the determinations made pursuant to the 
various procedural requirements applicable to the June 2023 Final Rule 
remain unchanged for this notification of final determination. These 
determinations are set forth in the June 2023 Final Rule. 88 FR 36217, 
36230-36233. DOE is publishing this document to present its final 
determination, supported by clear and convincing evidence, that the 
industry test procedure would not provide test results that are 
representative of an average use cycle for the TE2 metric.

V. Approval of the Office of the Secretary

    The Secretary of Energy has approved publication of this final 
determination.

Signing Authority

    This document of the Department of Energy was signed on January 13, 
2025, by Jeffrey Marootian, Principal Deputy Assistant Secretary for 
Energy Efficiency and Renewable Energy, pursuant to delegated authority 
from the Secretary of Energy. That document with the original signature 
and date is maintained by DOE. For administrative purposes only, and in 
compliance with requirements of the Office of the Federal Register, the 
undersigned DOE Federal Register Liaison Officer has been authorized to 
sign and submit the document in electronic format for publication, as 
an official document of the Department of Energy. This administrative 
process in no way alters the legal effect of this document upon 
publication in the Federal Register.

    Signed in Washington, DC, on January 13, 2025.
Treena V. Garrett,
Federal Register Liaison Officer, U.S. Department of Energy.
[FR Doc. 2025-01082 Filed 1-16-25; 8:45 am]
BILLING CODE 6450-01-P
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