47744 Federal Register / Vol. 86, No. 163 / Thursday, August 26, 2021 / Proposed Rules 

DEPARTMENT OF ENERGY 

10 CFR Part 460 

[EERE–2009–BT–BC–0021] 

RIN 1904–AC11 

Energy Conservation Program: Energy 

Conservation Standards for 

Manufactured Housing 

AGENCY: Office of Energy Efficiency and 

Renewable Energy, Department of 

Energy. 

ACTION: Notice of supplemental notice of 

proposed rulemaking and request for 

comment. 

SUMMARY: The U.S. Department of 

Energy (‘‘DOE’’ or ‘‘the Department’’) is 

publishing a supplemental notice of 

proposed rulemaking (‘‘SNOPR’’) to 

establish energy conservation standards 

for manufactured housing pursuant to 

the Energy Independence and Security 

Act of 2007. This document presents an 

updated proposal based on the 2021 

version of the International Energy 

Conservation Code (‘‘IECC’’) and 

comments received during interagency 

consultation with the U.S. Department 

of Housing and Urban Development, as 

well as from stakeholders. This proposal 

presents two potential approaches—one 

would provide a set of ‘‘tiered’’ 

standards based on the manufacturer’s 

retail list price for the manufactured 

home that would apply the 2021 IECCbased standards to manufactured 

homes, except that manufactured homes 

with a manufacturer’s retail list price of 

$55,000 and below would be subject to 

less stringent building thermal envelope 

requirements based on manufacturer’s 

retail list price. The alternative 

approach would apply standards based 

on the 2021 IECC to all manufactured 

homes, with no exceptions for building 

thermal envelope requirements based on 

manufacturer’s retail list price. 

DATES: 

Meeting: DOE will hold a public 

meeting via webinar on Tuesday, 

September 28, 2021, from 11:00 a.m. to 

4:00 p.m. See section VI, ‘‘Public 

Participation,’’ for webinar registration 

information, participant instructions 

and information about the capabilities 

available to webinar participants. 

Comments: DOE will accept 

comments, data, and information 

regarding this SNOPR not later than 

October 25, 2021. 

ADDRESSES: Interested persons are 

encouraged to submit comments using 

the Federal eRulemaking Portal at 

https://www.regulations.gov. Follow the 

instructions for submitting comments. 

Alternatively, interested persons may 

submit comments by email to: 

Manufactured_Housing@ee.doe.gov. 

Include docket number EERE–2009–BT– 

STD–0021 and/or RIN number 1904– 

AC11 in the subject line of the message. 

Submit electronic comments in 

WordPerfect, Microsoft Word, PDF, or 

ASCII file format, and avoid the use of 

special characters or any form of 

encryption. 

Although DOE has routinely accepted 

public comment submissions through a 

variety of mechanisms, including postal 

mail and hand delivery/courier, the 

Department has found it necessary to 

make temporary modifications to the 

comment submission process in light of 

the ongoing Covid–19 pandemic. DOE is 

currently suspending receipt of public 

comments via postal mail and hand 

delivery/courier. If a commenter finds 

that this change poses an undue 

hardship, please contact Appliance 

Standards Program staff at (202) 586– 

1445 to discuss the need for alternative 

arrangements. Once the Covid–19 

pandemic health emergency is resolved, 

DOE anticipates resuming all of its 

regular options for public comment 

submission, including postal mail and 

hand delivery/courier. 

No telefacsimilies (faxes) will be 

accepted. For detailed instructions on 

submitting comments and additional 

information on the rulemaking process, 

see section VI of this document. 

Docket: The docket for this activity, 

which includes Federal Register 

notices, comments, and other 

supporting documents/materials, is 

available for review at https://

www.regulations.gov. All documents in 

the docket are listed in the https://

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 

https://www.regulations.gov/ 

docket?D=EERE-2009-BT-BC-0021. The 

docket web page contains instructions 

on how to access all documents, 

including public comments, in the 

docket. See section VI for information 

on how to submit comments through 

https://www.regulations.gov. 

FOR FURTHER INFORMATION CONTACT: 

Mr. John Cymbalsky, U.S. Department 

of Energy, Office of Energy Efficiency 

and Renewable Energy, Building 

Technologies Program (EE–2J), 1000 

Independence Avenue SW, Washington, 

DC 20585; 202–287–1692; 

john.cymbalsky@ee.doe.gov. 

Mr. Matthew Ring, U.S. Department of 

Energy, Office of the General Counsel 

(GC–33), 1000 Independence Avenue 

SW, Washington, DC 20585; 202–586– 

2555; matthew.ring@hq.doe.gov. 

SUPPLEMENTARY INFORMATION: 

This SNOPR proposes to incorporate 

by reference into 10 CFR part 460 the 

following industry standards: 

ANSI/ACCA 2 Manual J–2016 

(‘‘ACCA Manual J’’), ‘‘Manual J— 

Residential Load Calculation (8th 

edition)’’, Copyright 2016. 

ANSI/ACCA 3 Manual S–2014 

(‘‘ACCA Manual S’’), ‘‘Manual S— 

Residential Equipment Selection (2nd 

edition)’’, Copyright 2014. 

Copies of Manual J and Manual S may 

be purchased from Air Conditioning 

Contractors of America Inc., (ACCA), 

2800 S Shirlington Road, Suite 300, 

Arlington, VA 22206, Telephone: 703– 

575–4477. www.acca.org/. 

PNL–8006 (‘‘Overall U-values and 

Heating/Cooling Loads—Manufactured 

Homes’’), ‘‘Overall U-values and 

Heating/Cooling Loads—Manufactured 

Homes’’, C.C. Conner and Z.T. Taylor of 

Pacific Northwest Laboratory, prepared 

for the Department of Housing and 

Urban Development, published 

February 1992. 

A copy of Overall U-Values and 

Heating/Cooling Loads—Manufactured 

Homes may be purchased from: 

www.huduser.org/portal/publications/ 

manufhsg/uvalue.html. Telephone: 

800–245–2691. 

See section V.M of this document for 

further discussion of these standards. 

Table of Contents 

I. Summary of the SNOPR 

A. Benefits and Costs to Purchasers of 

Manufactured Housing 

B. Impact on Manufacturers 

C. Nationwide Impacts 

D. Nationwide Energy Savings and 

Emissions Benefits 

E. Total Benefits and Costs 

F. Conclusion 

II. Introduction 

A. Authority 

B. Background 

1. Current Standards 

2. The International Energy Conservation 

Code (IECC) 

3. Development of the Initial Proposal and 

Responses 

4. Development of the Current Proposal 

III. Discussion of the Proposed Standards 

A. The Basis for the Proposed Standards 

1. Scope 

2. Proposed Standards 

B. Rulemaking Process 

C. Test Procedure 

D. Certification, Compliance, and 

Enforcement 

E. Energy Conservation Standards 

Requirements 

1. Subpart A: General 

2. Subpart B: Building Thermal Envelope 

3. Subpart C: HVAC, Service Water 

Heating, and Equipment Sizing 


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1The National Manufactured Housing 

Construction and Safety Standards Act of 1974, as 

amended, defines ‘‘manufactured home’’ as ‘‘a 

structure, transportable in one or more sections, 

which in the traveling mode is 8 body feet or more 

in width or 40 body feet or more in length or which 

when erected on-site is 320 or more square feet, and 

which is built on a permanent chassis and designed 

to be used as a dwelling with or without a 

permanent foundation when connected to the 

required utilities, and includes the plumbing, 

heating, air-conditioning, and electrical systems 

contained therein; except that such term shall 

include any structure that meets all the 

requirements of this paragraph except the size 

requirements and with respect to which the 

manufacturer voluntarily files a certification 

required by the Secretary [pursuant to 24 CFR 

3282.13] and complies with the standards 

established under this title [24 CFR part 3280]; and 

except that such term shall not include any selfpropelled recreational vehicle.’’ 42 U.S.C. 5402(6). 

2See 42 U.S.C. 5403(f). See also 24 CFR 3282.12. 

3Available at: https://www.regulations.gov/ 

document?D=EERE-2009-BT-BC-0021-0136. 

4. Remaining Comments Regarding the 

Energy Conservation Standard 

Requirements 

F. Crosswalk of Standards With the HUD 

Code 

IV. Discussion and Results of the Economic 

Impact and Energy Savings 

A. Economic Impacts on Individual 

Purchasers of Manufactured Homes 

1. Discussion of Comments and Analysis 

Updates 

2. Results 

B. Manufacturer Impacts 

1. Conversion Costs 

2. Manufacturer Production Costs and 

Markups 

3. Manufacturer Markup Scenarios 

4. Cash-Flow and INPV Results 

5. Impact of Any Lessening of Competition 

C. Nationwide Impacts 

1. Discussion of Comments and Analysis 

Updates 

2. Results 

D. Nationwide Energy Savings and 

Emissions Benefits 

1. Emissions Analysis 

2. Monetizing Emissions Impacts 

3. Discussion of Comments 

4. Results 

E. Total Benefits and Costs 

V. Procedural Issues and Regulatory Review 

A. Review Under Executive Orders 12866 

and 13563 

B. Review Under the Regulatory Flexibility 

Act 

1. Need for, and Objectives of, the Rule 

2. Significant Issues Raised in Response to 

the IRFA 

3. Description and Estimate of the Number 

of Small Entities Affected 

4. Description and Estimate of Compliance 

Requirements 

5. Significant Alternatives Considered and 

Steps Taken To Minimize Significant 

Economic Impacts on Small Entities 

C. Review Under the Paperwork Reduction 

Act 

D. Review Under the National 

Environmental Policy Act of 1969 

E. Review Under Executive Order 13132 

F. Review Under Executive Order 12988 

G. Review Under the Unfunded Mandates 

Reform Act of 1995 

H. Review Under the Treasury and General 

Government Appropriations Act, 1999 

I. Review Under Executive Order 12630 

J. Review Under the Treasury and General 

Government Appropriations Act, 2001 

K. Review Under Executive Order 13211 

L. Information Quality 

M. Materials Incorporated by Reference 

VI. Public Participation 

A. Participation in the Webinar 

B. Procedure for Submitting Prepared 

General Statements for Distribution 

C. Conduct of the Webinar 

D. Submission of Comments 

E. Issues on Which DOE Requests 

Comment 

VII. Approval of the Office of the Secretary 

I. Summary of the SNOPR 

The Energy Independence and 

Security Act of 2007 (‘‘EISA,’’ Pub. L. 

110–140) directs the U.S. Department of 

Energy (‘‘DOE’’ or in context, ‘‘the 

Department’’) to establish energy 

conservation standards for 

manufactured housing.1 (42 U.S.C. 

17071) Manufactured homes are 

constructed according to a code 

administered by the U.S. Department of 

Housing and Urban Development 

(‘‘HUD Code’’). 24 CFR part 3280. See 

also generally 42 U.S.C. 5401–5426. 

Structures, such as site-built and 

modular homes that are constructed to 

the state, local or regional building 

codes are excluded from the coverage of 

the HUD Code.2

EISA directs DOE to base the 

standards on the most recent version of 

the International Energy Conservation 

Code (‘‘IECC’’) and any supplements to 

that document, except in cases where 

DOE finds that the IECC is not costeffective or where a more stringent 

standard would be more cost-effective, 

based on the impact of the IECC on the 

purchase price of manufactured housing 

and on total lifecycle construction and 

operating costs. (See 42 U.S.C. 

17071(b)(1)) Standards shall be 

established after notice and an 

opportunity to comment by 

manufacturers of manufactured housing 

and other interested parties, and 

consultation with the Secretary of 

Housing and Urban Development 

(‘‘HUD’’), who may seek further counsel 

from the Manufactured Housing 

Consensus Committee. (42 U.S.C. 

17071(a)(2)) The energy conservation 

standards established by DOE may (1) 

take into consideration the design and 

factory construction techniques of 

manufactured homes, (2) be based on 

the climate zones established by HUD 

rather than the climate zones of the 

IECC, and (3) provide for alternative 

practices that result in net estimated 

energy consumption equal to or less 

than the specified standards. (42 U.S.C. 

17071(b)(2)) 

On June 17, 2016, DOE published in 

the Federal Register a notice of 

proposed rulemaking (‘‘NOPR’’), 

including proposals recommended by 

the negotiated rulemaking working 

group for manufactured housing. 81 FR 

39756 (June 2016 NOPR). DOE also 

issued a comprehensive technical 

support document. See Document ID 

EERE–2009–BT–BC–0021–0136.3 The 

agency also issued for public review and 

comment a draft Environmental 

Assessment (‘‘EA’’) pursuant to the 

National Environmental Policy Act. In 

conjunction with the draft EA, DOE 

issued a request for information that 

would help it analyze potential impacts 

of the proposed standards on the indoor 

air quality of manufactured homes. See 

Draft Environmental Assessment for 

Notice of Proposed Rulemaking, 

‘‘Energy Conservation Standards for 

Manufactured Housing’’ With Request 

for Information on Impacts to Indoor Air 

Quality, 81 FR 42576 (June 30, 2016) 

(‘‘2016 EA–RFI’’). DOE received nearly 

50 comments on the proposed rule 

during the comment period. In addition, 

DOE also received over 700 

substantively similar form letters from 

individuals. DOE also received 7 

comments to the 2016 EA–RFI during its 

comment period. 

During DOE’s interagency 

consultation with HUD, HUD expressed 

concerns about the adverse impacts on 

manufactured housing affordability that 

would likely follow if DOE were to 

adopt the approach laid out in its June 

2016 NOPR. A variety of commenters 

also expressed concerns over the 

potentially negative impacts on the 

affordability of manufactured housing 

flowing from increased consumer costs 

resulting from DOE’s approach in the 

June 2016 NOPR. DOE published a 

Notice of Data Availability (NODA) on 

August 3, 2018. 83 FR 38073 (August 

2018 NODA). In the August 2018 

NODA, DOE stated it was examining a 

number of possible alternatives to those 

proposed in the June 2016 NOPR on 

which it sought further input from the 

public, including the first-time costs 

related to the purchase of these homes. 

After evaluating the comments 

received in response to the June 2016 

NOPR and the August 2018 NODA, in 

this SNOPR, DOE proposes energy 

conservation standards for 

manufactured homes based on the 2021 

IECC. These standards would be based 

on the current HUD zones. 

In this SNOPR, DOE’s primary 

proposal is the ‘‘tiered’’ approach, based 

on the 2021 IECC, wherein a subset of 


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47746 Federal Register / Vol. 86, No. 163 / Thursday, August 26, 2021 / Proposed Rules 

the energy conservation standards 

would be less stringent for certain 

manufactured homes in light of the costeffectiveness considerations required by 

statute. DOE’s alternate proposal is the 

‘‘untiered’’ approach, wherein energy 

conservation standards for all 

manufactured homes would be based 

only on the 2021 IECC. Both proposals 

replace DOE’s June 2016 proposal and 

the selected approach would be codified 

in a new part of the Code of Federal 

Regulations (‘‘CFR’’) under 10 CFR part 

460 subparts A, B, and C. 

As proposed in this document, 

subpart A presents generally the scope 

of the rule and provides definitions of 

key terms. Proposed subpart B would 

establish new requirements for 

manufactured homes that relate to 

climate zones, the building thermal 

envelope, air sealing, and installation of 

insulation. Subpart C proposes new 

requirements related to duct sealing, 

heating, ventilation, and air 

conditioning (‘‘HVAC’’); service hot 

water systems; mechanical ventilation 

fan efficacy; and heating and cooling 

equipment sizing. 

Under either approach, subparts A 

and C would remain the same; however, 

the stringency of the requirements 

under proposed subpart B would 

depend on the manufacturer’s retail list 

price of the manufactured home for the 

tiered approach. Under the tiered 

proposal, two sets of standards would 

be established in proposed subpart B 

(i.e., Tier 1 and Tier 2). Tier 1 would 

apply to manufactured homes with a 

manufacturer’s retail list price of 

$55,000 or less, and also incorporate 

building thermal envelope measures 

based on certain thermal envelope 

components subject to the 2021 IECC 

but would limit the incremental 

purchase price increase to an average of 

approximately $750. Tier 2 would apply 

to manufactured homes with a 

manufacturer’s retail list price above 

$55,000, and incorporate building 

thermal envelope measures based on 

certain thermal envelope components 

and specifications of the 2021 IECC (i.e., 

the Tier 2 requirements would be the 

same as those under the proposed 

single, ‘‘untiered’’ set of standards). 

As mentioned previously, in the 

tiered proposal, DOE proposes to base 

the applicability of the two tiers on the 

manufacturer’s retail list price. This is 

more appropriate than basing the tiers 

on the purchase price as the purchase 

price may not be known until after a 

manufactured home leaves the 

manufacturer, and manufacturers may 

have limited control of the final 

purchase price of manufactured homes 

sold by third-party retailers. DOE also 

notes that the manufacturer’s retail list 

price is specified in EISA for the 

purpose of determining penalties for 

non-compliance. (42 U.S.C. 17071(d)) 

However, DOE relies on purchase price 

in its analysis for assessing incremental 

price increases for manufactured homes 

as an appropriate approximation for 

manufacturer’s retail list price because 

available data for manufactured homes 

are only in terms of purchase price. 

Under both approaches, DOE 

proposes to adopt a compliance date 

such that the standards would apply to 

manufactured homes starting one year 

after the publication date of the final 

rule in the Federal Register. While DOE 

has tentatively concluded that either 

approach could be considered costeffective, DOE requests comment 

regarding the cost-effectiveness of both 

options to inform its final decision. 

A. Benefits and Costs to Purchasers of 

Manufactured Housing 

As explained in greater detail in 

section IV.A of this document and in 

chapter 9 of the SNOPR technical 

support document (‘‘TSD’’), DOE 

tentatively estimates that benefits to 

manufactured home homeowners—in 

terms of lifecycle cost (‘‘LCC’’) savings 

and energy cost savings of the 

requirements as proposed in both 

proposals—could outweigh the 

potential increase in purchase price for 

manufactured homes. 

Table I.1 and Table I.2 present the 

average purchase price increase of a 

manufactured home as a result of the 

energy conservation standards for the 

tiered standards, i.e., Tier 1 standard 

and Tier 2 standard, respectively. Table 

I.3 presents the average purchase price 

increase of a manufactured home as a 

result of the energy conservation 

standards for manufactured homes 

under the proposed single set of 

standards based on 2021 IECC 

(‘‘untiered’’ standard). The average 

purchase price increase for the Tier 2 

standard and the untiered standard are 

the same. 

TABLE I.1—NATIONAL AVERAGE MANUFACTURED HOUSING PURCHASE PRICE (AND PERCENTAGE) INCREASES UNDER TIER

1 STANDARD

[2020$] 

Single-section Multi-section 

$ % $ % 

Climate Zone 1 ................................................................................................ $629 1.2 $900 0.9

Climate Zone 2 ................................................................................................ 629 1.2 900 0.9 

Climate Zone 3 ................................................................................................ 721 1.4 702 0.7 

National Average ............................................................................................. 663 1.2 839 0.8 

TABLE I.2—NATIONAL AVERAGE MANUFACTURED HOUSING PURCHASE PRICE (AND PERCENTAGE) INCREASES UNDER TIER

2 STANDARD

[2020$] 

Single-section Multi-section 

$ % $ % 

Climate Zone 1 ................................................................................................ $2,574 4.8 $4,143 4.0 

Climate Zone 2 ................................................................................................ 4,820 9.1 6,167 5.9 

Climate Zone 3 ................................................................................................ 4,659 8.8 5,839 5.6 

National Average ............................................................................................. 3,914 7.4 5,289 5.1 


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TABLE I.3—NATIONAL AVERAGE MANUFACTURED HOUSING PURCHASE PRICE (AND PERCENTAGE) INCREASES UNDER THE

UNTIERED STANDARD

[2020$] 

Single-section Multi-section 

$ % $ % 

Climate Zone 1 ................................................................................................ $2,574 4.8 $4,143 4.0 

Climate Zone 2 ................................................................................................ 4,820 9.1 6,167 5.9 

Climate Zone 3 ................................................................................................ 4,659 8.8 5,839 5.6 

National Average ............................................................................................. 3,914 7.4 5,289 5.1 

The analysis results for the annual 

energy cost savings and simple payback 

periods are projected to be the same for 

both the Tier 2 standard and the 

untiered standard because they have the 

same energy efficiency measures and 

inputs (e.g., purchase price inputs). 

Because the loan parameters are 

different for both proposed standards, 

however, the lifecycle cost savings 

results are different. See section IV.A.2 

for further details. 

Table I.4 presents the estimated 

national average LCC savings and 

energy savings for the compliance year 

that a manufactured homeowner would 

experience under the proposals 

compared to a manufactured home 

constructed in accordance with the 

minimum requirements of existing HUD 

Manufactured Home Construction and 

Safety Standards (‘‘HUD Code’’) at 24 

CFR part 3280 et. seq. Table I.4, Figure 

I.1, Figure I.2 and Figure I.3 present the 

nationwide average simple payback 

period (purchase price increase divided 

by first year energy cost savings) 

estimated under the proposals. The 

methods and information used for these 

analyses are discussed more in section 

IV.A. 

TABLE I.4—NATIONAL AVERAGE PER-HOME COST SAVINGS UNDER THE SNOPR * 

Single-section Multi-section 

Tier 1 Standards 

Lifecycle Cost Savings (30-Year Lifetime) ........................................................................................................ $1,643 $2,235 

Lifecycle Cost Savings (10-Year Lifetime) ........................................................................................................ $761 $1,050 

Annual Energy Cost Savings in 2020$ ............................................................................................................. $181 $242 

Simple Payback Period ..................................................................................................................................... 3.7 3.5 

Tier 2 Standards 

Lifecycle Cost Savings (30-Year Lifetime) ........................................................................................................ $2,105 $3,033 

Lifecycle Cost Savings (10-Year Lifetime) ........................................................................................................ $124 $264 

Annual Energy Cost Savings in 2020$ ............................................................................................................. $359 $499 

Simple Payback Period ..................................................................................................................................... 10.9 10.6 

Untiered Standard 

Lifecycle Cost Savings (30-Year Lifetime) ........................................................................................................ $1,727 $2,511 

Lifecycle Cost Savings (10-Year Lifetime) ........................................................................................................ ($12) $77 

Annual Energy Cost Savings in 2020$ ............................................................................................................. $359 $499 

Simple Payback Period ..................................................................................................................................... 10.9 10.6 

* Negative values in parenthesis. 

BILLING CODE 6450–01–P 


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a Single Section #l.Multi Section 

Figure 1.1: Simple Payback Period of the Tier 1 Standard 
47748 Federal Register / Vol. 86, No. 163 / Thursday, August 26, 2021 / Proposed Rules 

BILLING CODE 6450–01–C 

B. Impact on Manufacturers 

As discussed in more detail in section 

IV.B of this document and chapter 12 of 

the SNOPR TSD, the industry net 

present value (‘‘INPV’’) is the sum of the 

discounted cash flows to the industry 

from the reference year (2021) through 

the end of the analysis period (2052). 

Using a real discount rate of 9.2 percent, 

DOE tentatively estimates the INPV 

under a no-regulatory-action alternative, 

which would maintain energy 

conservation requirements at the levels 

established in the existing HUD Code, to 

be $16.2 billion. Under the tiered 

approach, the change in INPV would 

range from ¥1.7 percent to 2.0 percent. 

Industry would incur total conversion 

costs of $1.8 million. Under the untiered 

standard, the change in INPV would 

range from ¥2.1 percent to 2.4 percent. 

Industry would incur total conversion 

costs of $1.8 million. 

C. Nationwide Impacts 

As described in more detail in section 

IV.C of this document and chapter 11 of 

the SNOPR TSD, DOE’s national impact 

analysis (‘‘NIA’’) projects a net benefit to 

the nation as a whole under both the 

tiered and untiered proposals, in terms 

of national energy savings (‘‘NES’’) and 

the net present value (‘‘NPV’’) of 

expected total manufactured 

homeowner costs and savings compared 

with the baseline. In this case, the 

baseline is manufactured homes built to 

the minimum standards established in 

the HUD Code. As part of its NIA, DOE 

has projected the energy savings, 

operating cost savings, incremental 

costs, and NPV of manufactured 

homeowner benefits for manufactured 

homes sold in a 30-year period from the 

compliance year of 2023 through 2052. 

The NIA builds off the LCC analysis by 

aggregating results for all affected 

shipments over a 30-year period. All 

NES and percentage energy savings 

calculations are relative to a noregulatory-action alternative, which 

would maintain energy conservation 

requirements at the levels established in 

the existing HUD Code. 

Table I.5 illustrates the cumulative 

NES over the 30-year analysis period 

under both the tiered and untiered 

standards on a full-fuel-cycle (‘‘FFC’’) 

energy savings basis. FFC energy 

savings apply a factor to account for 

losses associated with generation, 

transmission, and distribution of 

electricity, and the energy consumed in 

extracting, processing, and transporting 

or distributing primary fuels. NES differ 

among the different climate zones 

because of varying energy conservation 

requirements and varying shipment 

projections in each climate zone. All 

NES and percentage energy savings 

calculations are relative to a noregulatory-action alternative, which as 

discussed would maintain energy 

conservation requirements at the levels 

established in the existing HUD Code. 

DOE tentatively estimates that, under 

the tiered standards, 2.32 quads of FFC 

energy would be saved relative to the 

baseline over the 30-year analysis 

period. DOE tentatively estimates that, 

under the proposed untiered standard, 

2.58 quads of FFC energy would be 

saved relative to the baseline over the 

30-year analysis period. 


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20 

18 

16 ! 14 

~ 12 

r:ll llll 

SingleSection 11$MultiSection 

l l hd 

Figure 1.2: Simple Payback Period of the Tier 2 Standard 

20 

18 

16 

s 14 

~ 12 ~ ,! 10 

.i: i 6 

4 

• Single Section ~Multi Section 

Figure 1.3: Simple Payback Period of the Untiered Standard 
Federal Register / Vol. 86, No. 163 / Thursday, August 26, 2021 / Proposed Rules 47749 

TABLE I.5—CUMULATIVE FULL-FUEL-CYCLE NATIONAL ENERGY SAVINGS OF MANUFACTURED HOMES PURCHASED 2023– 

2052 WITH A 30-YEAR LIFETIME

Single-section 

quadrillion Btu 

(quads) 

Multi-section 

(quads) 

Tiered Standards 

Climate Zone 1 .................................................................................................................................................... 0.222 0.616 

Climate Zone 2 .................................................................................................................................................... 0.172 0.491 

Climate Zone 3 .................................................................................................................................................... 0.324 0.499 

Total .............................................................................................................................................................. 0.718 1.606 

Untiered Standard 

Climate Zone 1 .................................................................................................................................................... 0.316 0.616 

Climate Zone 2 .................................................................................................................................................... 0.254 0.491 

Climate Zone 3 .................................................................................................................................................... 0.405 0.499 

Total .............................................................................................................................................................. 0.976 1.606 

Table I.6 and Table I.7 illustrate the 

NPV of consumer benefits over the 30- 

year analysis period under both 

proposals for a discount rate of 7 

percent and 3 percent, respectively. The 

NPV of consumer benefits differ among 

the three climate zones because of 

differing initial costs and corresponding 

operating cost savings, as well as 

differing shipment projections in each 

climate zone. 

TABLE I.6—NET PRESENT VALUE OF CONSUMER BENEFITS FOR MANUFACTURED HOMES PURCHASED 2023–2052 WITH A

30-YEAR LIFETIME AT A 7% DISCOUNT RATE

Single-section 

(billion 2020$) 

Multi-section 

(billion 2020$) 

Tiered Standards 

Climate Zone 1 .................................................................................................................................................... $0.22 $0.47 

Climate Zone 2 .................................................................................................................................................... 0.08 0.08 

Climate Zone 3 .................................................................................................................................................... 0.42 0.36 

Total .............................................................................................................................................................. 0.72 0.90 

Untiered Standard 

Climate Zone 1 .................................................................................................................................................... 0.24 0.46 

Climate Zone 2 .................................................................................................................................................... 0.00 0.06 

Climate Zone 3 .................................................................................................................................................... 0.26 0.35 

Total .............................................................................................................................................................. 0.49 0.87 

TABLE I.7—NET PRESENT VALUE OF CONSUMER BENEFITS FOR MANUFACTURED HOMES PURCHASED 2023–2052 WITH A

30-YEAR LIFETIME AT A 3% DISCOUNT RATE

Single-section 

(billion 2020$) 

Multi-section 

(billion 2020$) 

Tiered Standards 

Climate Zone 1 .................................................................................................................................................... $0.70 $1.69 

Climate Zone 2 .................................................................................................................................................... 0.38 0.79 

Climate Zone 3 .................................................................................................................................................... 1.34 1.50 

Total .............................................................................................................................................................. 2.42 3.98 

Untiered Standard 

Climate Zone 1 .................................................................................................................................................... 0.85 1.63 

Climate Zone 2 .................................................................................................................................................... 0.29 0.73 

Climate Zone 3 .................................................................................................................................................... 1.12 1.44 

Total .............................................................................................................................................................. 2.26 3.80 


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D. Nationwide Energy Savings and 

Emissions Benefits 

As discussed in section IV.C of this 

document and in the NIA included in 

chapter 11 of the SNOPR TSD, DOE’s 

analyses indicate that both the tiered 

and untiered proposals would reduce 

overall demand for energy in 

manufactured homes. Both proposals 

also would produce environmental 

benefits in the form of reduced 

emissions of air pollutants and 

greenhouse gases associated with 

electricity production. 

Emissions avoided under the 

proposed rule as a result of the energy 

savings that would be achieved within 

manufactured homes. As discussed 

previously, DOE tentatively estimates 

that, under the proposed tiered 

standard, 2.32 quads of FFC energy 

would be saved over the 30-year 

analysis period relative to the baseline. 

DOE tentatively estimates that, under 

the untiered standards, 2.58 quads of 

FFC energy would be saved over the 30- 

year analysis period relative to the 

baseline. DOE estimates reductions in 

emissions of six pollutants associated 

with energy savings: Carbon dioxide 

(CO2), mercury (Hg), nitric oxide and 

nitrogen dioxide (NOX), sulfur dioxide 

(SO2), methane (CH4), and nitrous oxide 

(N2O). These emissions reductions are 

referred to as ‘‘site’’ emissions 

reductions. Furthermore, DOE estimates 

reductions in emissions associated with 

the production of these fuels (including 

extracting, processing, and transporting 

these fuels to power plants or 

manufactured homes). These emissions 

reductions are referred to as ‘‘upstream’’ 

emissions reductions. Together, site 

emissions reductions and upstream 

emissions reductions account for the 

FFC. 

Table I.8 lists the emissions 

reductions under the proposed rule for 

both single-section and multi-section 

manufactured homes. 

TABLE I.8—EMISSIONS REDUCTIONS ASSOCIATED WITH ELECTRICITY PRODUCTION FOR MANUFACTURED HOMES

PURCHASED 2023–2052 WITH A 30-YEAR LIFETIME

Pollutant 

Tiered standard Untiered standards 

Single-section Multi-section Single-section Multi-section 

Site Emissions Reductions 

CO2 (million metric tons) ......................................................................... 31.7 67.7 42.4 67.7 

Hg (metric tons) ....................................................................................... 0.063 0.146 0.087 0.146 

NOX (thousand metric tons) .................................................................... 18.3 37.3 24 37.3 

SO2 (thousand metric tons) ..................................................................... 12.8 27.7 17.2 27.7 

CH4 (thousand metric tons) ..................................................................... 1.86 4.14 2.51 4.14 

N2O (thousand metric tons) ..................................................................... 0.35 0.74 0.47 0.74 

Upstream Emissions Reductions 

CO2 (million metric tons) ......................................................................... 3.1 6.32 4.09 6.32 

Hg (metric tons) ....................................................................................... 3.42E–4 7.67E–04 4.65E–04 7.67E–04 

NOX (thousand metric tons) .................................................................... 39.7 81.7 52.5 81.7 

SO2 (thousand metric tons) ..................................................................... 0.32 0.64 0.42 0.64 

CH4 (thousand metric tons) ..................................................................... 221 463 293 463 

N2O (thousand metric tons) ..................................................................... 0.016 0.033 0.021 0.033 

Total Emissions Reductions 

CO2 (million metric tons) ......................................................................... 34.8 74.0 46.4 74 

Hg (metric tons) ....................................................................................... 0.064 0.147 0.087 0.147 

NOX (thousand metric tons) .................................................................... 58 119 76.5 119 

SO2 (thousand metric tons) ..................................................................... 13.1 28.3 17.6 28.3 

CH4 (thousand metric tons) ..................................................................... 223 467 296 467 

N2O (thousand metric tons) ..................................................................... 0.37 0.78 0.49 0.78 

DOE calculates the value of the CO2, 

CH4, and N2O (collectively, greenhouse 

gases or GHGs) using a range of values 

per metric ton of pollutant, consistent 

with the interim estimates issued in 

February 2021 under Executive Order 

13990. The derivation of these Social 

Cost of Carbon, Methane, and Nitrous 

Oxide values is discussed in section 

IV.D of this document. DOE also 

estimated the monetary benefits of NOX

and SO2 emission reduction, also 

discussed in section IV.D of this 

document. 

Table I.9 provides the NPV of 

monetized emissions benefits from 

reduction in emissions of GHGs for 

which social cost is considered, and 

NOX and SO2 under both proposals. 

TABLE I.9—NET PRESENT VALUE OF MONETIZED BENEFITS FROM GHG AND EMISSIONS REDUCTIONS UNDER THE

SNOPR 

Monetary benefits 

Discount 

rate 

(%) 

Net present value 

(million 2020$) 

Tiered standard Untiered standards 

Single-section Multi-section Single-section Multi-section 

GHG Reduction (using avg. social costs at 5% discount rate) * ........................ 5 344.4 731.0 459.5 731.0 

GHG Reduction (using avg. social costs at 3% discount rate) * ........................ 3 1,448.6 3,076.4 1,932.9 3,076.4 

GHG Reduction (using avg. social costs at 2.5% discount rate) * ..................... 2.5 2,372.9 5,039.4 3,166.2 5,039.4 


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4To convert the time-series of costs and benefits 

into annualized values, DOE calculated a present 

value in 2020, the year used for discounting the 

NPV of total consumer costs and savings. For the 

benefits, DOE calculated a present value associated 

with each year’s shipments in the year in which the 

shipments occur (e.g., 2020 or 2030), and then 

discounted the present value from each year to 

2020. The calculation uses discount rates of 3 and 

7 percent for all costs and benefits. Using the 

present value, DOE then calculated the fixed annual 

payment over a 30-year period, starting in the 

compliance year, which yields the same present 

value. 

TABLE I.9—NET PRESENT VALUE OF MONETIZED BENEFITS FROM GHG AND EMISSIONS REDUCTIONS UNDER THE

SNOPR—Continued 

Monetary benefits 

Discount 

rate 

(%) 

Net present value 

(million 2020$) 

Tiered standard Untiered standards 

Single-section Multi-section Single-section Multi-section 

GHG Reduction (using 95th percentile social costs at 3% discount rate) * ....... 3 4,347.5 9,235.5 5,801.6 9,235.5 

NOX Reduction ** ................................................................................................ 3 149.0 297.1 194.6 297.1 

7 52.4 104.8 68.6 104.8 

SO2 Reduction ** ................................................................................................. 3 240.9 493.8 317.2 493.8 

7 84.8 174.5 111.8 174.5 

* Estimates of SC-CO2 SC-CH4, and SC-N2O are calculated using a range of discount rates for use in regulatory analyses. Three sets of values are based on the 

average social costs from the integrated assessment models, at discount rates of 5 percent, 3 percent, and 2.5 percent. The fourth set, which represents the 95th 

percentile of the social cost distributions calculated using a 3-percent discount rate, is included to represent higher-than-expected impacts from climate change further 

out in the tails of the social cost distributions. The social cost values are emission year specific. See section IV.D for more details. 

** The benefits from NOx and SO2 were based on the low estimate monetized value. See section IV.D.2 of this document for more details. 

E. Total Benefits and Costs 

Table I.10 summarizes the economic 

benefits and costs expected to result 

from the proposed standards for 

manufactured homes. 

TABLE I.10—SUMMARY OF ECONOMIC BENEFITS AND COSTS TO MANUFACTURED HOME HOMEOWNERS UNDER THE

PROPOSED STANDARDS

Net present value 

(billion 2020$) Discount rate 

(%) 

Tiered Untiered 

Benefits: 

Consumer Operating Cost Savings ............................................................................ 5.5 .................... 6.1 .................... 7. 

14.3 .................. 15.9 .................. 3. 

GHG Reduction (using avg. social costs at 5% discount rate) * ................................ 1.1 .................... 1.2 .................... 5. 

GHG Reduction (using avg. social costs at 3% discount rate) * ................................ 4.5 .................... 5.0 .................... 3. 

GHG Reduction (using avg. social costs at 2.5% discount rate) * ............................. 7.4 .................... 8.2 .................... 2.5. 

GHG Reduction (using 95th percentile social costs at 3% discount rate) * ............... 13.6 .................. 15.0 .................. 3 

NOX Reduction ........................................................................................................... 0.2 .................... 0.2 .................... 7. 

0.4 .................... 0.5 .................... 3. 

SO2 Reduction ............................................................................................................ 0.3 .................... 0.3 .................... 7. 

0.7 .................... 0.8 .................... 3. 

Total Benefits ............................................................................................... 7 to 19.5 ........... 7.8 to 21.6 ........ 7 plus GHG range. 

10.5 .................. 11.6 .................. 7. 

20.0 .................. 22.2 .................. 3. 

16.6 to 29.1 ...... 18.4 to 32.2 ...... 3 plus GHG range. 

Costs: 

Consumer Incremental Product Costs † .............................................................. 3.9 .................... 4.7 .................... 7. 

7.9 .................... 9.6 .................... 3. 

Total Net Benefits: 

Including GHG and Emissions Reduction Monetized Value ............................... 3.1 to 15.6 ........

6.6 ....................

3 to 16.9 ...........

6.9 ....................

7 plus GHG range. 

7. 

12.1 .................. 12.6 .................. 3. 

8.7 to 21.2 ........ 8.7 to 22.6 ........ 3 plus GHG range. 

Note: This table presents the costs and benefits associated with manufactured homes shipped in 2023–2052. 

* The benefits from GHG reduction were calculated using global benefit-per-ton values. See section IV.D.2 of this document for more details. 

** Total Benefits for both the 3-percent and 7-percent cases are presented using the average GHG social costs with 3-percent discount rate. In 

the rows labeled ‘‘7% plus GHG range’’ and ‘‘3% plus GHG range,’’ the consumer benefits and NOX and SO2 benefits are calculated using the 

labeled discount rate, and those values are added to the GHG reduction using each of the four GHG social cost cases. 

† The incremental costs include incremental costs associated with principal and interest, mortgage and property tax for the analyzed loan 

types. 

The benefits and costs of the proposed 

standards for manufactured housing 

sold in 2023–2052 can also be expressed 

in terms of annualized values. The 

monetary values for the total annualized 

net benefits are (1) the savings in 

consumer operating costs, minus (2) the 

increases in product installed costs, 

plus (3) the value of the benefits of GHG 

and NOX and SO2 emission reductions, 

all annualized.4 Total Benefits for both 

the 3-percent and 7-percent cases are 

presented using the average social costs 


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47752 Federal Register / Vol. 86, No. 163 / Thursday, August 26, 2021 / Proposed Rules 

with 3-percent discount rate. Estimates 

of social cost of greenhouse gases (‘‘SC– 

GHG’’) values are presented for all four 

discount rates in section IV.D.4.b of this 

document. 

The national operating cost savings 

are domestic private U.S. consumer 

monetary savings that occur as a result 

of purchasing the covered housing and 

are measured for the lifetime of 

manufactured housing shipped in 2023– 

2052. The benefits associated with 

reduced GHG emissions achieved as a 

result of the proposed standards are also 

calculated based on the lifetime of 

manufactured housing shipped in 2023– 

2052. 

Table I.11 and Table I.12 present the 

total estimated benefits and costs to 

manufactured housing homeowners 

associated with the proposed tiered 

standard and the untiered standards, 

expressed in terms of annualized values. 

TABLE I.11—ANNUALIZED BENEFITS AND COSTS TO MANUFACTURED HOME HOMEOWNERS UNDER THE PROPOSED TIERED

STANDARD

Category Primary 

estimate 

Low-netbenefits 

estimate 

High-netbenefits 

estimate 

Discount 

rate 

(%) 

(Million 2020$/year) 

Benefits: 

Consumer Operating Cost Savings ............................................................................... 509 ..................

774 ..................

471 ..................

701 ..................

554 ..................

858 ..................

7. 

3. 

GHG Reduction (using avg. social costs at 5% discount rate) ** .................................. 70 .................... 69 .................... 74 .................... 5. 

GHG Reduction (using avg. social costs at 3% discount rate) ** .................................. 231 .................. 227 .................. 243 .................. 3. 

GHG Reduction (using avg. social costs at 2.5% discount rate) ** ............................... 354 .................. 348 .................. 374 .................. 2.5. 

GHG Reduction (using 95th percentile social costs at 3% discount rate) ** ................. 693 .................. 681 .................. 730 .................. 3. 

NOX Reduction ** ........................................................................................................... 13 .................... 12 .................... 13 .................... 7. 

23 .................... 22 .................... 24 .................... 3. 

SO2 Reduction ** ............................................................................................................ 21 .................... 21 .................... 22 .................... 7. 

37 .................... 37 .................... 39 .................... 3. 

Total Benefits †† ..................................................................................................... 613 to 1,236 .... 573 to 1,185 .... 663 to 1,319 .... 7 plus GHG range. 

773 .................. 731 .................. 832 .................. 7. 

1,065 ............... 987 .................. 1,165 ............... 3. 

904 to 1,527 .... 829 to 1,441 .... 995 to 1,651 .... 3 plus GHG range. 

Costs: 

Consumer Incremental Product Costs † ........................................................................ 359 ..................

427 ..................

352 ..................

407 ..................

385 ..................

464 ..................

7. 

3. 

Total Net Benefits: 

Including GHG and Emissions Reduction Monetized Value †† ..................................... 254 to 877 .......

414 ..................

221 to 833 .......

379 ..................

278 to 934 .......

447 ..................

7 plus GHG range. 

7. 

638 .................. 580 .................. 701 .................. 3. 

477 to 1,100 .... 422 to 1,034 .... 531 to 1,187 .... 3 plus GHG range. 

Note: This table presents the annualized costs and benefits associated with manufactured homes shipped in 2023—2052. These results include benefits to consumers which accrue after 2052 from the products purchased in 2023—2052. The Primary, Low Net Benefits, and High Net Benefits Estimates utilize projections of 

energy prices from the AEO2020 Reference case, Low Economic Growth case, and High Economic Growth case, respectively. In addition, incremental product costs 

reflect a medium decline rate in the Primary Estimate, a low decline rate in the Low Net Benefits Estimate, and a high decline rate in the High Net Benefits Estimate. 

The methods used to derive projected price trends are explained in section IV.A and IV.C of this document. Note that the Benefits and Costs may not sum to the Net 

Benefits due to rounding. 

* The benefits from GHG reduction were calculated using global benefit-per-ton values. See section IV.D.2 of this document for more details. 

** The benefits from NOX and SO2 were based on the low estimate monetized value. See section IV.D.2 of this document for more details. 

† The incremental costs include incremental costs associated with principal and interest, mortgage and property tax for the analyzed loan types. Further discussion 

can be found in chapter 8 of the TSD. 

†† Total Benefits for both the 3-percent and 7-percent cases are presented using the average social costs with 3-percent discount rate. In the rows labeled ‘‘7% 

plus GHG range’’ and ‘‘3% plus GHG range,’’ the consumer cost and benefits and NOX and SO2 benefits are calculated using the labeled discount rate, and those 

values are added to the GHG reduction calculation using each of the four social cost cases. 

TABLE I.12—ANNUALIZED BENEFITS AND COSTS TO MANUFACTURED HOME HOMEOWNERS UNDER THE PROPOSED

UNTIERED STANDARDS

Category Primary 

estimate 

Low-netbenefits 

estimate 

High-Netbenefits 

estimate 

Discount 

rate 

(%) 

(Million 2020$/year) 

Benefits: 

Consumer Operating Cost Savings ............................................................................... 565 ..................

859 ..................

523 ..................

778 ..................

615 ..................

951 ..................

7. 

3. 

GHG Reduction (using avg. social costs at 5% discount rate) ** .................................. 77 .................... 76 .................... 81 .................... 5. 

GHG Reduction (using avg. social costs at 3% discount rate) ** .................................. 256 .................. 251 .................. 269 .................. 3. 

GHG Reduction (using avg. social costs at 2.5% discount rate) ** ............................... 392 .................. 385 .................. 414 .................. 2.5. 

GHG Reduction (using 95th percentile social costs at 3% discount rate) ** ................. 767 .................. 754 .................. 808 .................. 3. 

NOX Reduction ** ........................................................................................................... 14 .................... 14 .................... 15 .................... 7. 

25 .................... 25 .................... 26 .................... 3. 

SO2 Reduction ** ............................................................................................................ 23 .................... 23 .................... 24 .................... 7. 

41 .................... 41 .................... 43 .................... 3. 

Total Benefits †† ..................................................................................................... 679 to 1,369 .... 636 to 1,314 .... 735 to 1,462 .... 7 plus GHG range. 

858 .................. 811 .................. 923 .................. 7. 

1,181 ............... 1,095 ............... 1,290 ............... 3. 

1,003 to 1,693 920 to 1,597 .... 1,102 to 1,829 3 plus GHG range. 

Costs: 

Consumer Incremental Product Costs † ........................................................................ 440 ..................

530 ..................

429 ..................

503 ..................

471 ..................

576 ..................

7. 

3. 


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5The statute uses the term ‘‘climate zones’’ in 

reference to the HUD requirements (42 U.S.C. 

17071(b)(2)(B). HUD has not established ‘‘climate 

zones’’ but has established ‘‘insulation zones.’’ See, 

U/O Value Zone Map for Manufactured Housing at 

24 CFR 3280.506. DOE understands the statutory 

reference to ‘‘climate zones’’ in this context to mean 

the established insulation zones at 24 CFR 

3280.506. 

TABLE I.12—ANNUALIZED BENEFITS AND COSTS TO MANUFACTURED HOME HOMEOWNERS UNDER THE PROPOSED

UNTIERED STANDARDS—Continued 

Category Primary 

estimate 

Low-netbenefits 

estimate 

High-Netbenefits 

estimate 

Discount 

rate 

(%) 

(Million 2020$/year) 

Total Net Benefits: 

Including GHG and Emissions Reduction Monetized Value †† ..................................... 239 to 929 .......

418 ..................

207 to 885 .......

382 ..................

264 to 991 .......

452 ..................

7 plus GHG range. 

7. 

651 .................. 592 .................. 714 .................. 3. 

473 to 1,163 .... 417 to 1,094 .... 526 to 1,253 .... 3 plus GHG range. 

Note: This table presents the annualized costs and benefits associated with manufactured homes shipped in 2023—2052. These results include benefits to consumers which accrue after 2052 from the products purchased in 2023—2052. The Primary, Low Net Benefits, and High Net Benefits Estimates utilize projections of 

energy prices from the AEO2020 Reference case, Low Economic Growth case, and High Economic Growth case, respectively. In addition, incremental product costs 

reflect a medium decline rate in the Primary Estimate, a low decline rate in the Low Net Benefits Estimate, and a high decline rate in the High Net Benefits Estimate. 

The methods used to derive projected price trends are explained in section IV.A and IV.C of this document. Note that the Benefits and Costs may not sum to the Net 

Benefits due to rounding. 

* The benefits from GHG reduction were calculated using global benefit-per-ton values. See section IV.D.2 of this document for more details. 

** The benefits from NOX and SO2 were based on the low estimate monetized value. See section IV.D.2 of this document for more details. 

† The incremental costs include incremental costs associated with principal and interest, mortgage and property tax for the analyzed loan types. Further discussion 

can be found in chapter 8 of the TSD. 

†† Total Benefits for both the 3-percent and 7-percent cases are presented using the average social costs with 3-percent discount rate. In the rows labeled ‘‘7% 

plus GHG range’’ and ‘‘3% plus GHG range,’’ the consumer cost and benefits and NOX and SO2 benefits are calculated using the labeled discount rate, and those 

values are added to the GHG reduction calculation using each of the four social cost cases. 

DOE’s analysis of the national impacts 

of the proposed standards is described 

in sections IV.C, IV.D, and IV.E of this 

document. 

F. Conclusion 

DOE has tentatively determined that 

the energy conservation standards under 

either approach in this SNOPR (i.e., the 

tiered approach or the untiered 

approach) could be considered costeffective when evaluating the impact of 

the standards on the purchase price of 

a manufactured home and on the total 

lifecycle construction and operating 

costs, but DOE requests comment 

regarding the cost-effectiveness of both 

options to inform its final decision. 

Additionally, DOE has tentatively 

determined that under either proposal 

the benefits to the Nation of the 

standards (energy savings, consumer 

LCC savings, positive NPV of consumer 

benefit, and emission reductions) 

outweigh the burdens (loss of INPV, 

LCC increases for some homeowners of 

manufactured housing, and pricesensitive consumers who do not 

purchase manufactured homes). 

II. Introduction 

This section addresses the legal and 

factual background to date regarding 

DOE’s efforts to establish energy 

conservation standards for 

manufactured housing. By statute, DOE 

is obligated to set standards for 

manufactured housing in consultation 

with HUD and to consider certain 

specific factors when establishing these 

standards. DOE is also obligated to 

update these standards within a 

prescribed period of time. 

A. Authority 

Section 413 of EISA directs DOE to: 

• Establish standards for energy 

conservation in manufactured housing; 

• Provide notice of, and an 

opportunity for comment on, the 

proposed standards by manufacturers of 

manufactured housing and other 

interested parties; 

• Consult with the Secretary of HUD, 

who may seek further counsel from the 

Manufactured Housing Consensus 

Committee (MHCC); and 

• Base the energy conservation 

standards on the most recent version of 

the IECC and any supplements to that 

document, except in cases where DOE 

finds that the IECC is not cost-effective 

or where a more stringent standard 

would be more cost-effective, based on 

the impact of the IECC on the purchase 

price of manufactured housing and on 

total lifecycle construction and 

operating costs. 

(42 U.S.C. 17071(a) and (b)(1)) 

Section 413 of EISA also provides that 

DOE may: 

• Consider the design and factory 

construction techniques of 

manufactured housing; 

• Base the climate zones on the 

climate zones established by HUD 5

rather than the climate zones under the 

IECC; and 

• Provide for alternative practices 

that, while not meeting the specific 

standards established by DOE, result in 

net estimated energy consumption equal 

to or less than the specific energy 

conservation standards. 

(42 U.S.C. 17071(b)(2)) 

DOE is directed to update its 

standards not later than one year after 

any revision to the IECC. (42 U.S.C. 

17071(b)(3)) Finally, under EISA, a 

manufacturer of manufactured housing 

that violates a provision of Part 460 ‘‘is 

liable to the United States for a civil 

penalty not exceeding 1 percent of the 

manufacturer’s retail list price of the 

manufactured housing.’’ (42 U.S.C. 

17071(c)) 

B. Background 

1. Current Standards 

Section 413 of EISA provides DOE 

with the authority to regulate energy 

conservation in manufactured housing, 

an area of the building construction 

industry traditionally regulated by HUD. 

HUD has regulated the manufactured 

housing industry since 1976, when it 

first promulgated the HUD Code. (42 

U.S.C. 5401 et seq.; 24 CFR part 3280) 

The purpose of the HUD Code includes 

protecting the quality, durability, safety, 

and affordability of manufactured 

homes; facilitating the availability of 

affordable manufactured homes and 

increasing homeownership for all 

Americans; protecting residents of 

manufactured homes with respect to 

personal injuries and the amount of 

insurance costs and property damages 

in manufactured housing; and ensuring 

that the public interest in, and need for, 

affordable manufactured housing is duly 

considered in all determinations 

relating to the Federal standards and 

their enforcement. (42 U.S.C. 5401(b)) 

The HUD Code includes requirements 

related to the energy conservation of 


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47754 Federal Register / Vol. 86, No. 163 / Thursday, August 26, 2021 / Proposed Rules 

6The current status of the adoption of the IECC 

is provided at https://www.energycodes.gov/statusstate-energy-code-adoption. 

7Modular homes are generally excluded from the 

coverage of the National Manufactured Housing 

Construction and Safety Standards Act and 

constructed to the same state, local or regional 

building codes as site-built homes. See 42 U.S.C. 

5403(f); 24 CFR 3282.12. 

8U.S Census Bureau, American Housing Survey 

2019—National Summary Tables. Available at 

https://www.census.gov/programs-surveys/ahs/ 

data.html. 

manufactured homes. Specifically, 

Subpart F of the HUD Code, entitled 

‘‘Thermal Protection,’’ establishes 

requirements for Uo of the building 

thermal envelope. Uo is a measurement 

of the heat loss or gain rate through the 

building thermal envelope of a 

manufactured home; therefore, a lower 

Uo corresponds with a more insulated 

building thermal envelope. The HUD 

Code contains maximum requirements 

for the combined Uo value of walls, 

ceilings, floors, fenestration, and 

external ducts within the building 

thermal envelope for manufactured 

homes installed in different zones. 24 

CFR 3280.506(a). 

The HUD Code also provides an 

alternate pathway to compliance that 

allows manufacturers to construct 

manufactured homes that meet adjusted 

Uo requirements based on the 

installation of high-efficiency heating 

and cooling equipment in the 

manufactured home. 24 CFR 

3280.508(d). Moreover, Subpart F of the 

HUD Code establishes requirements to 

reduce air leakage through the building 

thermal envelope. 24 CFR 3280.505. 

Subpart H of the HUD Code, entitled 

‘‘Heating, Cooling, and Fuel Burning 

Systems,’’ establishes requirements for 

sealing air supply ducts and for 

insulating both air supply and return 

ducts. 24 CFR 3280.715(a). R-value is 

the measure of a building component’s 

ability to resist heat flow (thermal 

resistance). A higher R-value represents 

a greater ability to resist heat flow and 

generally corresponds with a thicker 

level of insulation. The HUD Code 

contains no requirements for 

fenestration solar heat gain coefficient 

(‘‘SHGC’’), mechanical system piping 

insulation, or installation of insulation. 

The statutory authority for DOE’s 

rulemaking effort is different from the 

statutory authority underlying the HUD 

Code. EISA directs DOE to establish 

energy conservation standards for 

manufactured housing without 

reference to existing HUD Code 

requirements that also address energy 

conservation. However, EISA also 

requires DOE to consult with HUD. (42 

U.S.C. 17071(a)(2)(B)) Such 

consultations have informed DOE in 

development of the regulations 

proposed in this document, and DOE 

remains cognizant of the HUD Code, as 

well as HUD’s Congressional charge to 

protect the quality, durability, safety, 

affordability, and availability of 

manufactured homes. Compliance with 

the DOE requirements would not 

prevent a manufacturer from complying 

with the requirements set forth in the 

HUD Code. Section III.F provides a 

crosswalk of the energy conservation 

standards that are proposed in this rule 

with the standards in the HUD Code. 

Moreover, as discussed further in 

section III, DOE considered the potential 

impact on manufactured home 

purchasers resulting from costs 

associated with additional energy 

efficiency measures. 

2. The International Energy 

Conservation Code (IECC) 

The statutory authority for this 

rulemaking requires DOE to base its 

standards on the most recent version of 

the IECC and any supplements to that 

document, subject to certain exceptions 

and considerations. (42 U.S.C. 

17071(b)(1)) The IECC is a nationally 

recognized model code, developed 

under the auspices of and published by 

the International Code Council (‘‘ICC’’). 

Many state and local governments have 

adopted the IECC6 in establishing 

minimum design and construction 

requirements for the energy efficiency of 

residential and commercial buildings, 

including site-built residential and 

modular homes.7 The IECC is developed 

through a consensus process that seeks 

input from a number of relevant 

stakeholders and is updated on a rolling 

basis, with new editions of the IECC 

published approximately every three 

years. The IECC was first published in 

1998, with the most recent version, the 

2021 IECC, being published in January 

2021. 

The 2021 IECC is divided into two 

major sections, with provisions for both 

residential and commercial buildings. 

The manufactured housing energy 

conservation standards and test 

procedure are based on the 

requirements for residential buildings. 

The residential building requirements of 

the 2021 IECC, however, are not specific 

to manufactured housing. 

Chapter 4 of the residential section of 

the 2021 IECC sets forth specifications 

for residential energy efficiency, 

including specifications for building 

thermal envelope energy conservation, 

thermostats, duct insulation and sealing, 

mechanical system piping insulation, 

heated water circulation system, and 

mechanical ventilation. To the extent 

that the HUD Code regulates similar 

aspects of energy conservation as the 

2021 IECC, the 2021 IECC is generally 

considered more stringent than the 

corresponding requirements in the HUD 

Code, given that many areas of the HUD 

Code have not been updated as 

frequently as the IECC. 

DOE notes that the IECC is designed 

for building structures that have a 

permanent foundation. Manufactured 

housing structures, however, are not 

built on permanent foundations but are 

built on a steel chassis to enable them 

to be moved or towed when needed. As 

a result, because they present their own 

set of unique considerations that the 

IECC was not intended to address, some 

aspects of the IECC are unable, or highly 

impractical, to be applied to 

manufactured housing. Instead, as DOE 

proposed in its June 2016 NOPR and 

consistent with the considerations 

required by EISA, this supplemental 

proposal utilizes aspects of the IECC 

that are appropriate for manufactured 

housing as the basis for the standards 

proposed herein, thereby accounting for 

the unique physical characteristics of 

manufactured housing. 

Additionally, the ‘‘tiered’’ proposal 

provides an approach to mitigate the 

potential adverse impacts of increased 

costs on manufactured housing 

affordability that may arise from 

increasing the stringency of energy 

efficiency requirements applied to 

manufactured homes. In its tiered 

proposal, by dividing the market into 

designated manufacturer retail list 

price-based segments and assigning 

efficiency levels as appropriate for each 

segment, DOE suggests a way to address 

the affordability concerns presented in 

this housing segment, and relatedly the 

cost-effectiveness considerations set 

forth in EISA, while also promoting that 

the statutory objective of improving 

manufactured housing energy 

efficiency. 

3. Development of the Initial Proposal 

and Responses 

Manufactured housing accounts for 

approximately six percent of all homes 

in the United States.8 Because the 

purchase price of manufactured homes 

often is lower than similarly sized sitebuilt homes, manufactured homes serve 

as affordable housing options, 

particularly for low-income families. 

However, many manufactured homes 

often have higher utility bills than 

comparably sized site-built and modular 

homes in part due to different energy 

conservation standards and variability 


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9American Council for an Energy-Efficient 

Economy; Mobilizing Energy Efficiency in the 

Manufactured Housing Sector, July 2012; https://

www.aceee.org/sites/default/files/publications/ 

researchreports/a124.pdf. 

10The ANOPR comments can be accessed at: 

https://www.regulations.gov/ 

#!docketDetail;D=EERE-2009-BT-BC-0021. 

11These included discussions with the 

Manufactured Housing Institute (‘‘MHI’’) and 

several of its member manufacturers, the California 

Department of Housing and Community 

Development, the Georgia Manufactured Housing 

Division, three private-sector third-party primary 

inspection agencies under the HUD manufactured 

housing program, and one private-sector 

stakeholder familiar with manufactured housing. 

12Available at https://www.regulations.gov/ 

document?D=EERE-2009-BT-BC-0021-0069 and 

https://www.regulations.gov/document?D=EERE2009-BT-BC-0021-0058. 

13The NOPR analysis, NOPR TSD, and NOPR 

public meeting information are available at https:// 

regulations.gov under docket number EERE–2009– 

BT–BC–0021. 

among building codes and industry 

practices.9

Establishing improved energy 

conservation requirements for 

manufactured homes results in the dual 

benefit of reducing manufactured home 

energy use and enabling owners of 

manufactured homes to experience 

lower utility expenses over the longterm. Improved energy conservation 

standards are also expected to provide 

nationwide benefits of reducing utility 

energy production levels that would in 

turn reduce greenhouse gas emissions 

and other air pollutants. 

DOE published an advance notice of 

proposed rulemaking (‘‘ANOPR’’) to 

initiate the process of developing energy 

conservation standards for 

manufactured housing and to solicit 

information and data from industry and 

stakeholders.10 See 75 FR 7556 

(February 22, 2010). DOE also consulted 

with HUD in developing the 

requirements and in obtaining input and 

suggestions that would increase energy 

conservation in manufactured housing, 

while maintaining affordability. In 

addition to meeting with HUD on 

multiple occasions, DOE attended three 

MHCC meetings, where DOE gathered 

information from MHCC members. DOE 

also initiated discussions with members 

of the manufactured housing industry 

following the issuance of the ANOPR.11

A summary of each meeting is available 

at the regulations.gov web page at 

https://www.regulations.gov/ 

docket?D=EERE-2009-BT-BC-0021. The 

June 2016 NOPR provides more details 

on the comments received in response 

to the ANOPR. 81 FR 39755 (June 17, 

2016). 

On June 25, 2013, DOE published a 

request for information (‘‘RFI’’) seeking 

information on indoor air quality, 

financing and related incentives, model 

systems of enforcement, and other 

studies and research relevant to DOE’s 

effort to establish energy conservation 

standards for manufactured housing. 78 

FR 37995 (‘‘June 2013 RFI’’). The June 

2016 NOPR provides more details on 

the comments received on the RFI. 81 

FR 39765 (June 17, 2016). 

After reviewing the comments 

received in response to the ANOPR, the 

June 2013 RFI, and other stakeholder 

input, DOE ultimately determined that 

development of proposed manufactured 

housing energy conservation standards 

would benefit from a negotiated 

rulemaking process. On June 13, 2014, 

DOE published a notice of intent to 

establish a negotiated rulemaking 

manufactured housing (‘‘MH’’) working 

group to discuss and, if possible, reach 

consensus on a proposed rule. 79 FR 

33873. On July 16, 2014, the MH 

working group was established under 

the Appliance Standards and 

Rulemaking Federal Advisory 

Committee (‘‘ASRAC’’) in accordance 

with the Federal Advisory Committee 

Act and the Negotiated Rulemaking Act. 

79 FR 41456; 5 U.S.C. 561–570, App. 2. 

The MH working group consisted of 

representatives of interested 

stakeholders with a directive to consult, 

as appropriate, with a range of external 

experts on technical issues in 

developing a term sheet with 

recommendations on the proposed rule. 

The MH working group consisted of 22 

members, including one member from 

ASRAC, and one DOE representative. 79 

FR 41456. The MH working group met 

in person during six sets of public 

meetings held in 2014 on August 4–5, 

August 21–22, September 9–10, 

September 22–23, October 1–2, and 

October 23–24. 79 FR 48097 (Aug. 15, 

2014); 79 FR 59154 (Oct. 1, 2014). 

On October 31, 2014, the MH working 

group reached consensus on energy 

conservation standards in manufactured 

housing and assembled its 

recommendations for DOE into a term 

sheet that was presented to ASRAC. 

Public docket EERE–2009–BT–BC– 

0021–0107 (‘‘Term Sheet’’). ASRAC 

approved the term sheet during an open 

meeting on December 1, 2014 and sent 

it to the Secretary of Energy to develop 

a proposed rule. 

On February 11, 2015, DOE published 

an RFI requesting information that 

would aid in determining proposed 

solar heat gain coefficient (‘‘SHGC’’) 

requirements for certain climate zones. 

80 FR 7550 (‘‘February 2015 RFI’’). 

Following preparation and submission 

of the term sheet by the MH working 

group, DOE also consulted further with 

HUD regarding DOE’s proposed energy 

conservation standards. In addition to 

meeting with HUD, DOE prepared two 

presentations to discuss the proposed 

rule with MHCC members, which were 

designed to gather information on 

development of the proposed 

standards.12

On June 17, 2016, DOE published a 

NOPR for the manufactured housing 

energy conservation standards 

rulemaking. 81 FR 39755. (‘‘June 2016 

NOPR’’) DOE posted the NOPR analysis 

as well as the complete NOPR TSD on 

its website.13 In response to comments 

on the 2013 RFI DOE also published the 

2016 EA–RFI to accompany the 2016 

NOPR. The draft EA drew no 

conclusions regarding the potential 

impacts on the indoor air quality of 

manufactured homes as a result of 

implementing any final energy 

conservation standard for these 

structures. DOE held a public meeting 

on July 13, 2016, to present the June 

2016 NOPR, which included the 

proposed prescriptive and performance 

requirements, in addition to the LCC, 

NIA, manufacturer impact analysis 

(‘‘MIA’’), and emissions analyses. In 

response to the June 2016 NOPR, DOE 

received comments from a variety of 

stakeholders. 

TABLE II.2—JUNE 2016 NOPR WRITTEN COMMENTS

Organization(s) Reference in this SNOPR Organization type 

Advanced Energy ..................................................................................................... Advanced Energy .................. Manufacturer. 

Air Conditioning Contractors of America ................................................................. ACCA .................................... Trade association. 

American Chemistry Council ................................................................................... ACC FSSC ............................ Trade association. 

American Council for an Energy-Efficient Economy ............................................... ACEEE .................................. Efficiency organization. 

American Gas Association and American Public Gas Association ......................... AGA and APGA .................... Trade association. 

Arkansas Manufactured Housing Association ......................................................... AMHA .................................... Trade association. 

Better Homes AHEAD ............................................................................................. Better Homes ........................ Manufacturer. 


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TABLE II.2—JUNE 2016 NOPR WRITTEN COMMENTS—Continued 

Organization(s) Reference in this SNOPR Organization type 

Cato Institute ............................................................................................................ Cato Institute .........................

Cavco Industries ...................................................................................................... Cavco .................................... Manufacturer. 

Clayton Home Building Group ................................................................................. Clayton Homes ...................... Manufacturer. 

Commodore Corporation ......................................................................................... Commodore Corporation ....... Manufacturer. 

Community Owners (7 Part) Business Alliance ...................................................... COBA .................................... Trade association. 

Earthjustice .............................................................................................................. Earthjustice ............................ Efficiency organization. 

Environmental Defense Fund, Institute for Policy Integrity, Natural resources Defense Council, and Union of Concerned Scientists.Joint Advocates ..................... Efficiency organizations. 

George Washington University Regulatory Studies Center .................................... GWU ...................................... Academia. 

International Code Council ...................................................................................... ICC ........................................ Codes organization. 

Lippert Components ................................................................................................. Lippert Components .............. Manufacturer. 

Manufactured Housing Association for Regulatory Reform .................................... MHARR ................................. Trade association. 

Manufactured Housing Consensus Committee ....................................................... MHCC .................................... Advisory committee. 

Manufactured Housing Industry of Arizona ............................................................. MHIAZ ................................... Trade association. 

Manufactured Housing Institute ............................................................................... MHI ........................................ Trade association. 

Manufactured Housing Institute of Maryland ........................................................... MHIM ..................................... Trade association. 

Manufactured Housing Institute of South Carolina .................................................. MHISC ................................... Trade Association. 

Mississippi Manufactured Housing Association ....................................................... MMHA ................................... Trade association. 

Modular Lifestyles, Inc. ............................................................................................ Modular Lifestyles ................. Manufacturer. 

National Propane Gas Association .......................................................................... NPGA .................................... Trade association. 

New Mexico Manufactured Housing Association .................................................... NMMHA ................................. Trade association. 

Next Step Network, Inc. ........................................................................................... Next Step .............................. Efficiency organization. 

North Carolina Justice Center ................................................................................. NCJC ..................................... Consumer organization. 

Northwest Energy Efficiency Alliance ...................................................................... NEEA ..................................... Efficiency organization. 

Ohio Manufactured Homes Association .................................................................. OMHA .................................... Trade Association. 

Palm Harbor Homes, Inc. ........................................................................................ Palm Harbor Homes ............. Manufacturer. 

Pennsylvania Manufactured Housing Association ................................................... PMHA .................................... Trade association. 

Bob Pfeiffer .............................................................................................................. Pfeiffer ................................... Individual. 

Pleasant Valley Homes, Inc. .................................................................................... Pleasant Valley Homes ......... Manufacturer. 

Responsible Energy Codes Alliance ....................................................................... RECA .................................... Efficiency organization. 

Skyline Corporation .................................................................................................. Skyline Corporation ............... Manufacturer. 

South Mountain Co., Inc. ......................................................................................... South Mountain ..................... Manufacturer. 

Systems Building Research Alliance ....................................................................... SBRA ..................................... Trade association. 

U.S. Chamber of Commerce, American Chemistry Council, American Coke and 

Coal Chemicals Institute, American Forest & Paper Association, American 

Fuel & Petrochemical Manufacturers, American Petroleum Institute, Association of Home Appliance Manufacturers, Brick Industry Association, Council of 

Industrial Boiler Owners, National Association of Home Builders, National Association of Manufacturers, National Mining Association, National Oilseed 

Processors Association, Portland Cement Association.

U.S. Chamber of Commerce Trade association. 

U.S. Small Business Administration’s Office of Advocacy ...................................... Advocacy ............................... Government agency. 

Vermont Energy Investment Corporation ................................................................ VEIC ...................................... Efficiency organization. 

West Virginia Housing Institute, Inc. ........................................................................ WVHI ..................................... Trade association. 

Window and Door Manufacturers Association ........................................................ WDMA ................................... Trade association. 

DOE also received over 700 

substantively similar form letters from 

individuals. All of the comment 

submissions are available in the docket 

for this rulemaking. The comments and 

DOE’s responses are discussed in 

sections III, IV, and V of this document. 

4. Development of the Current Proposal 

DOE received a number of responses 

to its June 2016 NOPR. In response to 

concerns related to potential adverse 

impacts on price-sensitive, low-income 

purchasers of manufactured homes from 

the imposition of energy conservation 

standards on manufactured housing, 

DOE sought additional information from 

the public regarding these impacts by 

publishing the August 2018 NODA. See 

83 FR 38073 (August 3, 2018). That 

NODA indicated that DOE had reexamined its available data and reevaluated its approach in developing 

standards for manufactured housing. 

The August 2018 NODA also indicated 

that HUD had made DOE aware of the 

adverse impacts on manufactured 

housing affordability that would likely 

follow if DOE were to adopt the 

approach laid out in its June 2016 

NOPR. See 83 FR 38073, 38075. These 

discussions with HUD, along with a 

concern over the initial first-cost 

impacts that DOE’s earlier proposal 

would have on low-income buyers, led 

DOE to examine a potential tiered 

proposal that would require varying 

levels of energy efficiency performance 

with specified increases in incremental 

upfront-costs that would still improve 

the overall energy efficiency of 

manufactured homes. See 83 FR 38077. 

DOE has not included test procedure 

or compliance and enforcement 

provisions in this SNOPR. DOE also has 

not included provisions related to 

waivers or exception relief that might be 

available to manufacturers regarding 

compliance with any standards that 

DOE may adopt. DOE does not intend to 

address test procedures or compliance 

and enforcement provisions in this 

rulemaking. DOE notes that HUD has an 

established design approval, monitoring 

and enforcement system, defined in 24 

CFR part 3282, that is robust and 

provides compliance and enforcement 

of the manufactured housing industry 

standards. Moreover, manufacturers 

must comply with referenced standards 

incorporated by HUD in its regulations. 

While DOE would consider HUD’s 

established compliance and 

enforcement mechanism appropriate to 

support any standards HUD 

incorporates by reference from any final 


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14See https://files.consumerfinance.gov/f/ 

201409_cfpb_report_manufactured-housing.pdf. 

15 In particular, the report noted: ‘‘There is 

evidence that some households who move into 

manufactured housing are less satisfied with their 

homes than those who choose to move into sitebuilt housing. These results suggest that for at least 

some households, the choice to live in a 

manufactured home may be more cost-driven than 

quality-driven.’’ CFPB Report at 22. 

manufactured housing rule, DOE is 

seeking comment on such an approach. 

DOE intends to continue consulting 

with HUD on potential approaches and 

is seeking comment on other potential 

approaches to compliance with, and 

enforcement of, a final energy 

conservation standard for manufactured 

housing. 

III. Discussion of the Proposed 

Standards 

A. The Basis for the Proposed Standards 

1. Scope 

DOE’s authority under 42 U.S.C. 

17071 to establish energy conservation 

standards for manufactured homes 

specifies that those standards ‘‘shall be 

based on’’ the most recent version of the 

IECC. Because the IECC is specific to 

site-built structures, DOE’s 

supplemental proposal, while based on 

the 2021 IECC, has required 

modifications to IECC provisions for 

application to manufactured homes. In 

DOE’s view, the language Congress used 

in instructing DOE to set standards for 

these structures is broad and does not 

require the imposition of requirements 

for manufactured homes that are 

identical to those that IECC provides for 

site-built structures. The use of the 

phrase ‘‘based on’’ readily indicates that 

Congress anticipated that DOE would 

need to use its discretion in adapting 

elements of the IECC’s provisions for 

manufactured housing use, including 

whether those elements would be 

appropriate in light of the specific 

circumstances related to the structure. 

Further, Congress indicated that DOE 

has discretion to depart from the IECC 

to the extent it is not cost-effective. 

Pursuant to this discretion afforded by 

Congress, as opposed to complete 

adoption of the 2021 IECC, DOE is 

proposing, first, a tiered standard 

whereby manufactured homes with 

manufactured retail list prices of 

$55,000 or less (‘‘Tier 1’’ manufactured 

homes) would be subject to different 

building thermal envelope requirements 

(subpart B of proposed 10 CFR part 460) 

than all other manufactured homes 

(‘‘Tier 2’’ manufactured homes). Both 

tiers are based on the 2021 IECC in that 

both tiers have requirements for the 

building thermal envelope, duct and air 

sealing, installation of insulation, HVAC 

specifications, service hot water 

systems, mechanical ventilation fan 

efficacy, and heating and cooling 

equipment sizing provisions of the 2021 

IECC. However, in light of costeffectiveness concerns, Tier 1 provides 

tailored improvements in efficiency 

with regard to building thermal 

envelope, which are projected to result 

in an approximately $750 incremental 

price increase. Tier 2 focuses on the 

building thermal envelope, duct and air 

sealing, insulation installation, HVAC 

specifications, service hot water 

systems, mechanical ventilation fan 

efficacy, and heating and cooling 

equipment sizing provisions, based on 

the 2021 IECC, and is estimated to result 

in an average incremental price increase 

of $3,900–$5,300 for single- and multisection homes, respectively. As an 

alternative, DOE is also proposing a 

single, untiered standard for 

manufactured homes that is the same as 

the Tier 2 standard. 

In establishing standards for 

manufactured housing, Congress 

directed DOE to: (1) Consult with the 

Secretary of HUD (42 U.S.C. 

17071(a)(2)(b)), and (2) base the 

standards on the most recent version of 

the IECC, except in cases in which the 

Secretary finds that the code is not costeffective, or a more stringent standard 

would be more cost-effective, based on 

the impact of the codeon the purchase 

price of manufactured housing and on 

total life-cycle construction and 

operating costs. (42 U.S.C. 17071(b)(1)) 

Relatedly, the Secretary of HUD is 

mandated to establish standards for 

manufactured housing that, in part, 

‘‘ensure that the public interest in, and 

need for, affordable manufactured 

housing is duly considered in all 

determinations relating to the Federal 

standards and their enforcement.’’ (42 

U.S.C. 5401(b)) 

In this consultative role, HUD raised 

a concern with the potential adverse 

impacts on manufactured housing 

affordability that could result from 

additional energy efficiency standards 

being established for manufactured 

homes. More specifically, HUD noted 

concerns that increases in the purchase 

prices for manufactured homes resulting 

from the costs of requiring to meet 

standards based upon the IECC could 

result in prospective manufactured 

homeowners being unable to purchase a 

manufactured home. With this concern 

in mind, in the August 2018 NODA, 

DOE requested comment on a report 

released in 2014 from the Consumer 

Financial Protection Bureau (‘‘CFPB’’) 

indicating manufactured housing 

purchasers face substantial constraints 

compared to traditional home 

purchasers.14 83 FR 38073, 38076. As 

discussed in the August 2018 NODA, 

the report, ‘‘Manufactured-Housing 

Consumer Finance in the United 

States,’’ (hereinafter, ‘‘CFPB Report’’) 

presented the following key findings: 

• Manufactured home ownership 

varies widely by region, with the 

majority of manufactured homes located 

outside of metropolitan areas; 

• Manufactured home owners tend to 

have lower incomes and less net worth 

than their counterparts who own sitebuilt homes; 

• There is an extremely constrained 

secondary market for manufactured 

homes, following the collapse of the 

manufactured home market in the late 

1990s through the early 2000s; 

• Most manufactured-housing 

purchasers who finance their homes 

obtained a loan of between $10,000 and 

$80,000, with a median loan value of 

$55,000. 

These constraints may make 

purchasers of manufactured homes 

more price sensitive to potential 

changes that would impact the costs to 

construct (and purchase) a 

manufactured home. Moreover, the 

CFPB Report suggests that manufactured 

home consumers are particularly costdriven.15

The CFPB Report stated that the 

median annual income of families living 

in manufactured homes is slightly over 

$26,000, and the median net worth of 

these families is $26,000 (a quarter of 

the median net worth for families in 

site-built homes). See id. at 16–18. 

Additionally, owners of manufactured 

homes who finance their homes tend to 

pay higher interest rates than their sitebuilt home counterparts. A key reason 

for this difference is that the vast 

majority of manufactured housing stock 

is titled as chattel (i.e. personal 

property), and as a result is eligible only 

for chattel financing. Chattel financing 

is typically offered to purchasers at a 

significantly higher interest rate than 

the rates offered to site-built home 

owners. While most manufactured home 


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16Manufactured Housing Survey 2019; U.S. 

Census Data; https://www.census.gov/data/tables/ 

time-series/econ/mhs/annual-data.html. 

17The report may be found at: 

files.consumerfinance.gov/f/documents/cfpb_

manufactured-housing-finance-new-insights-hmda_

report_2021-05.pdf. 

18https://www.census.gov/data/tables/timeseries/econ/mhs/annual-data.html. 

owners who also own the land on which 

the manufactured home is sited may be 

eligible for mortgage financing, there is 

a tradeoff between lower origination 

costs with significantly higher interest 

rates (chattel loans) and higher 

origination costs with significantly 

lower interest rates and greater 

consumer protections (mortgage). See 

id. at pp. 23–25. 

Therefore, in response to the 

affordability concerns raised by HUD 

and commenters, DOE is contemplating 

whether there are cost-effective 

approaches that would also mitigate 

first-cost impacts for purchasers at the 

lower end of the manufactured home 

price range. Accordingly, DOE is 

presenting a tiered proposal that would 

provide in proposed subpart B tiered 

standards based on a manufacturer’s 

retail list price. According to 2019 data, 

the average purchase price (i.e., sales 

price if the home is intended for sale) 

of a single section manufactured home 

is $53,200, the average purchase price of 

a multi-section manufactured home is 

$104,000, and the average purchase 

price of all manufactured homes is 

$81,900.16 To the extent that 

manufactured home purchasers are costdriven, in conjunction with the lower 

median income and net worth of these 

purchasers, consumers at the lower end 

of the manufactured home purchase 

price range generally would be more 

sensitive to increases in purchase price. 

Accordingly, DOE created a tiered 

proposal to address affordability issues 

associated with the full implementation 

of the 2021 IECC in the untiered 

proposal. 

Accordingly, under the tiered 

proposal, the stringency of the standards 

under proposed subpart B applicable to 

Tier 1 manufactured homes (i.e., 

manufactured homes with a 

manufacturer’s retail list price of 

$55,000 or less) would require building 

thermal envelope measures that would 

result in an incremental purchase price 

increase of approximately $750. Section 

III.A.2 provides further discussion on 

how the manufacturer’s retail list price 

tier threshold and $750 incremental 

purchase price were developed. 

DOE estimates the SNOPR would 

result in a loss in demand and 

availability of about 53,329 homes 

(single section and multi-section 

combined) for the tiered standard and 

about 71,290 homes (single section and 

multi-section combined) for untiered 

standards based on a price elasticity of 

demand of –0.48 for the analysis period 

(2023–2052). Out of the 53,329 homes in 

the tiered standard, the majority of the 

reduction is in Tier 2 (93 percent) vs. 

Tier 1 (7 percent). Within Tier 1, DOE 

estimates a 0.52 percent reduction 

(essentially no reduction) in availability 

due to Tier 1 standards for low income 

purchasers. Table III.1 provides a 

summary of the change in shipments for 

tiered standards. See section IV.c.1.b. 

for a discussion of price elasticity with 

respect to manufactured housing 

shipments and people who do not buy 

because they are price-sensitive. 

TABLE III.1—CHANGE IN SHIPMENTS FOR TIERED STANDARDS * 

No-standards shipments Standards case shipments Change in shipments, tiered 

Tier 1 Tier 2 Tier 1 Tier 2 Tier 1 Tier 2 Total 

30-year analysis ........... 703,725 2,086,927 700,032 2,037,291 (3,693) (49,636) (53,329) 

Annual .......................... ........................ ........................ ........................ ........................ (123) (1,655) (1,778) 

* Values in parenthesis are negative. 

As a sensitivity, DOE also considered 

a price elasticity of demand of –2.4 

instead of –0.48. Further discussion on 

this sensitivity is provided in section 

IV.C.2 of this document. Table III.2 

provides a summary of the change in 

shipments for tiered standards for price 

elasticity of –2.4 instead of –0.48. 

TABLE III.2—CHANGE IN SHIPMENTS COMPARED TO BASELINE, ¥0.48 AND ¥2.4 PRICE ELASTICITY

Change in shipments,–0.48 price elasticity Change in shipments,–2.4 price elasticity 

Tier 1 Tier 2 Total Tier 1 Tier 2 Total 

30-year analysis ....................................... (3,693) (49,636) (53,329) (18,375) (247,692) (266,067) 

Annual ...................................................... (123) (1,655) (1,778) (613) (8,256) (8,869) 

* Values in parenthesis are negative. 

On May 27, 2021, the CFPB issued 

another report entitled ‘‘Manufactured 

Housing Finance: New Insights from the 

Home Mortgage Disclosure Act Data’’ 

(the ‘‘2021 CFPB Report’’).17 DOE is 

aware of the 2021 CFPB report, but has 

not yet reviewed it in detail. 

Accordingly, DOE did not incorporate 

any new or additional data from the 

2021 CFPB report into the analysis 

presented in this SNOPR. DOE is also 

aware that the U.S. Census has released 

the 2020 Manufactured Housing 

Survey,18 but similarly has not reviewed 

the results in detail or incorporated 

these new data into the analysis 

presented here. DOE welcomes 

comment on the use of the data in 2021 

CFPB report and the 2020 Manufactured 

Housing Survey in DOE’s analyses for 

this rulemaking. 

DOE invites comment on whether (1) 

the manufacturer’s retail list price 

threshold for Tier 1 under the tiered 

proposal is appropriate, (2) the untiered 

proposal in this SNOPR is cost-effective, 

generally, and (3) the untiered proposal 

is cost-effective for low-income 

consumers. 

Finally, the scope proposed in this 

document provides additional 

clarification that the proposed energy 

conservation standards would apply to 

the design, construction and aspects of 

onsite completion of manufactured 


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homes—not to the installation of a 

home. 

On November 9, 2016, DOE published 

a NOPR for test procedures (2016 Test 

Procedure NOPR), as a companion to 

the draft energy efficiency standards 

rule for manufactured housing. See 81 

FR 78733 (November 9, 2016). The 2016 

Test Procedure NOPR proposed 

procedures for how those subject to 

energy conservation standards for 

manufactured housing would confirm 

products are in compliance with the 

standards. More specifically, the 2016 

Test Procedure NOPR proposed 

procedures to determine compliance 

with the following metrices from the 

June 2016 NOPR: The R-value of 

insulation; the U-factor of windows, 

skylights, and doors; the solar heat gain 

coefficient of fenestration; U-factor 

alternatives to R-value requirements; the 

air leakage rate of air distribution 

systems; and mechanical ventilation fan 

efficacy. 81 FR 78733. A discussion of 

the 2016 Test Procedure NOPR may be 

found in section III.C of this document. 

DOE is not addressing a test 

procedure, or compliance and 

enforcement provisions for an energy 

conservation standard for manufactured 

housing in this document. DOE 

continues to consult with HUD about 

pathways to address testing, compliance 

and enforcement for this proposed 

standard in a manner consistent with 

the current HUD inspection and 

enforcement process so that such 

testing, compliance and enforcement 

procedures are not overly burdensome 

for manufacturers. While many of the 

requirements in the proposed standard 

and alternative proposal would require 

minimal compliance efforts and costs 

(e.g., documenting the use of materials 

subject to separate Federal or industry 

standards, such as the R-value of 

insulation or U-factor values for 

fenestration), DOE acknowledges that it 

has not fully enumerated testing and 

enforcement costs at this time. However, 

because testing and compliance and 

enforcement requirements may be 

dependent upon the final outcome of 

this rulemaking, DOE is not proposing 

any testing, compliance or enforcement 

provisions at this time. DOE has also not 

included any potential associated costs 

of testing, compliance or enforcement. 

DOE intends to continue working with 

HUD on potential approaches and is 

seeking comment on other potential 

approaches for testing, compliance and 

enforcement that will ensure 

manufacturer compliance with the 

standard in a manner that is not overly 

burdensome or costly to manufacturers. 

DOE welcomes comment on 

approaches for testing, compliance and 

enforcement provisions for the proposed 

standards and alternative proposal. DOE 

also welcomes comments and 

information related to potential testing, 

compliance and enforcement under the 

current HUD inspection and 

enforcement process, and potential costs 

of testing, compliance and enforcement 

of the proposed standards and 

alternative proposal in this document. 

2. Proposed Standards 

EISA requires DOE to base standards 

for manufactured housing on the IECC. 

However, application of the IECC 

standards is also subject to a number of 

considerations set forth by the statute in 

order to ensure standards will be 

appropriately tailored for manufactured 

homes and the manufactured home 

market. Specifically, EISA requires that 

DOE establish energy conservation 

standards for manufactured housing that 

are ‘‘based on the most recent version of 

the [IECC], except in cases in which 

[DOE] finds that the [IECC] is not costeffective, or a more stringent standard 

would be more cost-effective, based on 

the impact of the [IECC] on the purchase 

price and on total life-cycle construction 

and operating costs.’’ (42 U.S.C. 

17071(b)(1)). 

In addition to the required costeffectiveness considerations, EISA 

explicitly allows DOE to consider the 

differences in design and factory 

construction techniques of 

manufactured homes, as compared to 

site-built and modular homes. (42 

U.S.C. 17071(b)(2)) As noted in section 

II.B.2, the 2021 IECC applies generally 

to residential buildings, including sitebuilt and modular housing, and is not 

specific to manufactured housing. The 

energy conservation standards proposed 

in this SNOPR are generally based on 

certain specifications included in the 

2021 IECC while also accounting for the 

unique aspects of manufactured 

housing. DOE carefully considered the 

following aspects of manufactured 

housing design and construction in 

developing the standards: 

• Manufactured housing structural 

requirements contained in the HUD 

Code; 

• External dimensional limitations 

associated with transportation 

restrictions; 

• The need to optimize interior space 

within manufactured homes; and 

• Factory construction techniques 

that facilitate sealing the building 

thermal envelope to limit air leakage. 

Upon consideration of these aspects 

of manufactured housing design and 

construction, DOE is not proposing to 

include several of the 2021 IECC 

requirements such as more stringent 

ceiling R-value requirements (greater 

than R-38) in the northern climate zones 

and the requirement for the exterior 

ceiling insulation to be of uniform 

thickness or uniform density given the 

space constraints of manufactured 

homes (discussed in further detail in 

section III.E.2.b). 

EISA also allows DOE to base 

standards on the climate zones of the 

HUD Code instead of the IECC. (42 

U.S.C. 17071(b)(2)(B)) There are 

differences in the number and 

boundaries of the HUD zones as 

compared to the IECC climate zones. For 

example, under the 2021 IECC climate 

zone map, California is divided into five 

climate zones (including zone variation 

based on moisture regimes), with four of 

the zones subject to SHGC maximums 

(0.40 applicable to climate zones 4 and 

5, and 0.25 applicable to climate zones 

2 and 3). Under the HUD zone map, all 

of California is within a single zone. 

Developing energy conservation 

standards based on the HUD climate 

zones, as DOE is proposing to do in this 

SNOPR and as permitted under EISA, 

necessitates deviating from the IECC. 

The updated proposal would establish 

thermal envelope requirements, as does 

the 2021 IECC, but setting the values for 

those requirements necessitates that 

DOE develop standard levels different 

than those in the 2021 IECC to account 

for the difference in the number of 

climate zones. 

In addition, DOE has conducted a 

sensitivity analysis for an alternative 

exterior insulation requirement, R–21, 

for Tier 2 in zones 2 and 3. This 

alternative insulation requirement is 

based on (but not identical to) the 2021 

IECC, which includes a requirement for 

continuous insulation (R–20+5). DOE 

developed this sensitivity analysis to 

evaluate the effects on life-cycle costs 

and payback period for Tier 2 

consumers. This sensitivity analysis is 

further discussed in section IV.A.2 of 

this document. 

In modifying the IECC requirements, 

DOE relied, in part, on the statutorily 

required interagency consultation with 

HUD. As discussed, the HUD 

consultation ensures that DOE is 

informed by HUD’s expertise and 

statutory duties as they pertain to the 

role of manufactured housing in the 

U.S. housing market, as recognized by 

Congress. As a result of concerns raised 

by HUD regarding the need to maintain 

affordability, which interrelate with the 

cost-effectiveness concerns specified in 

42 U.S.C. 17071, DOE is presenting a 

primary proposal based on tiered 

standards that would prescribe a 

complement of cost-effective energy 


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19CFPB report, 2014. https://

files.consumerfinance.gov/f/201409_cfpb_report_

manufactured-housing.pdf. At the time of this 

analysis, the 2014 CFPB report was the latest that 

was available. 

20Manufactured Housing Survey, Public Use File 

(PUF) 2019. https://www.census.gov/data/datasets/ 

2019/econ/mhs/puf.html. 21The Consumer Finance Protection Bureau 

(CFPB) in general describes a higher-priced 

mortgage loan as a loan with an annual percentage 

rate, or APR, higher than a benchmark rate called 

the Average Prime Offer Rate. The requirements for 

this loan can be found in 12 CFR 1026.35. 

conservation requirements based on 

requirements in the 2021 IECC. 

The proposed Tier 1 standards would 

apply to manufactured homes with a 

manufacturer’s retail list price of 

$55,000 or less (in real 2019$). The 

proposed Tier 1 requirements 

incorporate IECC-based building 

thermal envelope component measures 

that result in an incremental purchase 

price increase of approximately $750. 

The proposed Tier 2 standards would 

apply to manufactured homes with a 

manufacturer’s retail list price that is 

greater than $55,000 (in real 2019$). The 

Tier 2 standards would be based on the 

most recent version of the IECC, with 

consideration of the design and factory 

construction techniques of 

manufactured homes. As an alternative, 

DOE also proposes an untiered standard 

in which all manufactured homes 

would be at the same stringencies as the 

standards based on the most recent 

version of the IECC, similar to the Tier 

2 standard. 

a. Manufacturer’s Retail List Price Tier 

Threshold 

The proposed manufacturer’s retail 

list price tier threshold for the tiered 

standard was developed using loan and 

manufactured home purchase price 

data. The loan data were derived from 

the CFPB report.19 The purchase price 

data were derived from the 

manufactured housing survey (‘‘MHS’’) 

2019 public use file (‘‘PUF’’) data, 

which provide estimates of average sales 

prices for new manufactured homes 

sold or intended for sale by geographical 

region and size of home.20 The CFPB 

report states that high-priced 

manufactured housing loans (including 

chattel loans) account for roughly 68 

percent of total manufactured housing 

loans.21 If people typically receive one 

primary loan, the percentage of highpriced loans used should roughly equal 

the percentage of people receiving highpriced loans and, thus, homes 

purchased with high-priced loans (i.e., 

68 percent). Assuming that pricesensitive, low-income purchasers rely 

on high-priced loans, and pairing the 

CFPB figure with the MHS 2019 PUF 

data, the 68th percentile manufactured 

housing price gives a reasonable 

estimate for the upper bound for a 

manufactured home sales price that a 

price-sensitive low-income purchaser 

would pay. DOE considered that lowincome purchasers would mainly 

purchase single-section homes that are, 

on average, at a lower sales price than 

multi-section homes. Accordingly, 

applying the 68th percentile for a singlesection manufactured home using the 

MHS 2019 PUF data, yields a sales price 

of approximately $55,000. This price 

serves as the proposed threshold for 

Tier 1. Using this threshold, Tier 1 

consists of approximately 25 percent of 

the total sales (single-section and multisection) of manufactured homes. Tier 2 

consists of approximately 75 percent of 

the sales total (single-section and multisection) of manufactured homes. 

DOE acknowledges that the boundary 

of the proposed tiers is being applied to 

manufacturers’ retail list prices, while 

the underlying data from which the 

boundary is derived in the MHS 2019 

PUF data are sales and/or purchase 

price data of manufactured homes. DOE 

understands the manufacturer’s retail 

list price to be the price that the 

manufacturer provides in the sales 

contract to a distributor or retailer—i.e., 

the price that the manufactured home is 

originally listed at by the manufacturer. 

On the other hand, the purchase price 

is the final sales price of the home to the 

consumer. The manufacturer’s retail list 

price and the purchase price are not the 

same. However, the MHS 2019 PUF 

purchase price data are the most robust 

and reliable data of the manufactured 

housing market that, to date, DOE has 

found in its own search, or that has been 

provided to DOE. DOE believes these 

data are still largely representative of 

the overall manufactured housing 

market and that the tiers are 

appropriately set based on this data. 

DOE believes the proposed threshold 

based on manufacturer’s retail list price 

can sufficiently address the affordability 

concerns previously expressed by HUD 

and other stakeholders. DOE also notes 

that, based on its understanding of the 

MHS 2019 PUF data, the proposed 

$55,000 threshold would not vary 

significantly across regions. Although 

DOE is proposing a national retail pricebased threshold, in consultations with 

HUD and the MHCC, DOE received 

comments and questions regarding the 

use of alternative metrics upon which to 

base the boundary between tiers, such 

as the size of the manufactured home. 

Accordingly, DOE also considered other 

threshold types that would be based on 

size (e.g., square footage or for singlesection vs. multi-section homes) or 

region (e.g., retail price thresholds 

tailored to specific regions rather than a 

single national value). For example, the 

MHS 2019 PUF data set provides data 

that relates home size (in terms of 

square feet) with purchase price. Table 

III.3 summarizes the average, minimum 

and maximum sales prices based on 

home size using square footage and 

section. In general, the data indicates 

that while price increases with home 

size, the minimum and maximum prices 

do not vary significantly with home size 

(with certain exceptions). 

TABLE III.3—MHS PUF 2019 HOME SIZE AND SALES PRICE DATA

Home size 

(square feet) 

Single-section sales price (2019$) Dual-section sales price (2019$) 

Average Minimum Maximum Average Minimum Maximum 

440–539 ................................................... $36,786 $28,400 $53,000 ........................ ........................ ........................

540–639 ................................................... 46,769 29,600 100,000 ........................ ........................ ........................

640–739 ................................................... 45,012 32,100 100,000 ........................ ........................ ........................

740–839 ................................................... 49,011 28,400 101,000 ........................ ........................ ........................

840–939 ................................................... 44,497 28,400 101,000 $90,274 $60,000 $226,000 

940–1039 ................................................. 49,943 32,100 101,000 87,596 55,000 156,000 

1040–1139 ............................................... 52,698 29,600 101,000 79,413 52,000 226,000 

1140–1239 ............................................... 57,330 29,600 101,000 94,153 54,000 256,000 

1240–1339 ............................................... 59,781 28,400 100,000 84,873 52,000 256,000 

1340–1439 ............................................... 63,848 39,000 74,000 105,697 54,000 256,000 

1440–1539 ............................................... ........................ ........................ ........................ 97,973 52,000 256,000 

1540–1639 ............................................... ........................ ........................ ........................ 94,109 52,000 256,000 


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22See Table 20. Macroeconomic Indicators; GDP 

Chain-type Price Index; Reference case. 

TABLE III.3—MHS PUF 2019 HOME SIZE AND SALES PRICE DATA—Continued 

Home size 

(square feet) 

Single-section sales price (2019$) Dual-section sales price (2019$) 

Average Minimum Maximum Average Minimum Maximum 

1640–1739 ............................................... ........................ ........................ ........................ 101,684 52,000 256,000 

1740–1839 ............................................... ........................ ........................ ........................ 109,921 52,000 256,000 

1840–1939 ............................................... ........................ ........................ ........................ 103,365 60,000 226,000 

1940–2039 ............................................... ........................ ........................ ........................ 105,981 52,000 256,000 

2040–2139 ............................................... ........................ ........................ ........................ 117,584 52,000 226,000 

2140–2239 ............................................... ........................ ........................ ........................ 118,631 52,000 226,000 

2240–2339 ............................................... ........................ ........................ ........................ 122,939 79,000 164,000 

2340–2439 ............................................... ........................ ........................ ........................ 136,305 103,000 162,000 

2440–2539 ............................................... ........................ ........................ ........................ 136,428 60,000 226,000 

All ...................................................... 53,246 28,400 101,000 104,006 52,000 256,000 

The MHS 2019 PUF data set also 

provides data that relates Census region 

(the U.S. Census Bureau divides the 

country into four census regions) with 

purchase price. Table III.4 summarizes 

the average, minimum and maximum 

sales prices based on census region and 

section. In general, the data indicates 

that average price (specifically for 

single-section homes) does not differ 

significantly based on census region. 

TABLE III.4—MHS PUF 2019 CENSUS REGION AND SALES PRICE DATA

Census region 

Single-section sales price (2019) Dual-section sales price (2019) 

Average Minimum Maximum Average Minimum Maximum 

Northeast .................................................. $54,430 $33,800 $101,000 $106,502 $55,000 $256,000 

Midwest .................................................... 54,025 32,100 75,000 98,512 54,000 162,000 

South ........................................................ 52,879 29,600 74,000 102,222 52,000 164,000 

West ......................................................... 53,318 28,400 100,000 113,312 60,000 226,000 

All ...................................................... 53,246 28,400 101,000 104,006 52,000 256,000 

At this time, DOE has tentatively 

determined that a national retail pricebased threshold will accomplish the 

purposes of EISA while taking into 

account the importance of affordable 

housing. However, DOE is considering 

conducting additional analyses on 

alternative thresholds prior to the final 

rule stage. DOE requests comment on 

this approach and whether other types 

of thresholds are worth considering for 

the final rule stage. 

DOE requests comment on the use of 

a tiered approach to address 

affordability and PBP concerns from 

HUD, other stakeholders, and the 

policies outlined in Executive Order 

13985. DOE also requests comment 

regarding whether the price point 

boundary between the proposed tiers is 

appropriate, and if not, at what price 

point should it be set and the basis for 

any alternative price points. DOE also 

requests comment on its assumptions 

regarding the use of high-priced loans 

(e.g., chattel loans) by low-income 

purchasers, or other purchasers, of 

manufactured housing. 

DOE also requests comment on 

alternate thresholds (besides price 

point) to consider for the tiered 

approach, including a size-based 

threshold (e.g., square footage or 

whether a home is single- or multisection). DOE requests comment on the 

square footage and region versus sales 

price data provided in the notice (from 

MHS PUF 2019) and how that data (or 

more recent versions of that data) could 

be used to create either a size-based or 

region-based threshold instead. DOE 

further requests input on whether there 

should be single national threshold as 

proposed, or whether it should vary 

based on geography or other factors, and 

if so, what factors should be considered. 

As mentioned previously, the 

threshold proposed in this SNOPR is 

based in real 2019 dollars. Accordingly, 

DOE also proposes under the tiered 

proposal that the manufacturer’s retail 

list price thresholds would be adjusted 

for inflation (for the applicable year of 

compliance) using the most recently 

available Annual Energy Outlook 

(‘‘AEO’’) GDP deflator time series. For 

AEO 2020, Table III.5 provides the 

values of the GDP deflator time series.22

TABLE III.5—AEO 2020 GDP 

DEFLATOR

GDP deflator 

2019 ................................ 1 

2020 ................................ 1.024394 

2025 ................................ 1.152839 

2030 ................................ 1.296141 

2035 ................................ 1.445744 

2040 ................................ 1.614055 

2045 ................................ 1.809366 

2050 ................................ 2.041051 

DOE requests comment on using the 

AEO GDP deflator series to adjust the 

manufacturer’s retail list price threshold 

for inflation. DOE requests comment on 

whether other time series, including 

those that account for regional 

variability, should be used to adjust 

manufacturer’s retail list price. 

b. Tier Proposals 

The proposed lower incremental 

purchase price for manufactured homes 

covered by the Tier 1 standard was 

developed in response to concerns from 

HUD and other commenters regarding 

the incremental purchase price, and the 

ability of the first homeowner/purchaser 

for these homes to recoup the increase 

in purchase price and realize the 

savings offered by the greater energy 


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efficiency of a Tier 1 manufactured 

home. As discussed in section IV.A.1.a, 

several commenters expressed concern 

that first homeowners of manufactured 

homes would not live in the homes long 

enough to recoup the increases in 

purchase price or realize the energy 

savings of the energy efficiency 

measures proposed in the June 2016 

NOPR. 

In determining the energy efficiency 

measure (EEM) combinations, DOE 

ensured that the performance-based 

overall thermal transmittance (Uo) for 

these combinations would be more 

stringent than the current HUD 

requirements. DOE’s objective in 

defining the Tier 1 incremental 

purchase price threshold was based on 

which threshold a low-income buyer 

purchasing a single-section home (using 

typical loan terms available to these 

homebuyers, primarily chattel loans 

with higher interest rates) would, on 

average, realize a positive cash flow 

within Year 1 of the standard based on 

the down payment, incremental loan 

payment, and energy cost savings. As 

such, DOE preliminarily determined 

that an incremental purchase price of no 

more than $750 provided a beneficial 

financial outcome for these consumers 

given lifecycle cost savings and energy 

cost savings, while minimizing first cost 

impacts. Specifically, for single-section 

manufactured homes, DOE determined 

the set of energy efficiency measures 

with an average incremental purchase 

price of $663 (as presented in Table I.1) 

with a 10 percent down payment (using 

a chattel loan, as discussed in section 

IV.A.1.d) would, on average, result in a 

positive cash flow within the first year, 

as presented in Table III.6. Further 

discussion on the LCC inputs to this 

subgroup calculation are presented in 

section Chapter 9 of the TSD. 

TABLE III.6—TIER 1 LCC SUB-GROUP NATIONAL RESULTS

Single-section only; 30-year analysis period; national results Tier 1 

Incremental cost .................................................................................................................................................................................. $662.64 

Down-payment (10%) .......................................................................................................................................................................... 66.26 

Yearly Incremental Loan Payment ...................................................................................................................................................... 78.55 

First Year Incremental Payment (Down-payment + Loan) ................................................................................................................. 144.81 

Yearly Energy Cost Savings ................................................................................................................................................................ 180.83 

First Year Savings (Energy Cost Savings¥Incremental Payment) .................................................................................................... 36.01 

Accordingly, by focusing the Tier 1 

standards on those measures that would 

result in an incremental purchase price 

increase of approximately $750, DOE 

proposes a way to take into account 

energy efficiency and cost-effectiveness 

in a manner consistent with the statute. 

Further discussion is provided in 

Chapter 6 of the TSD. 

The proposed Tier 2 standard would 

be at the same stringencies as the 

standards based on the most recent 

version of the IECC, with consideration 

of cost-effectiveness and design and 

factory construction techniques of 

manufactured homes. (42 U.S.C. 

17071(b)(1); 42 U.S.C. 17071(b)(2)(A)) 

The proposed building thermal 

envelope requirements for both tiers are 

presented in section III.E.2.b of this 

document. 

c. General Comments to the June 2016 

NOPR on Energy Conservation 

Standards 

This SNOPR reflects general 

comments to the June 2016 NOPR 

regarding the need to update the energy 

conservation standards for 

manufactured homes and the basis for 

any standards established. MHARR 

stated that HUD-regulated manufactured 

homes are already energy efficient, with 

median monthly energy costs that are 

either lower or comparable to the 

median monthly costs for site-built 

homes, without high costs to the 

consumer. (MHARR, No. 143 at p. 4) 

Next Step cited a study done by the 

American Council for Energy Efficient 

Economy (‘‘ACEEE’’) that found that 

residents of manufactured homes spend 

30 percent more income on energy than 

the average American household and 66 

percent more than owners of site-built 

homes. (Next Step, No. 174 at p. 1) 

DOE also received several comments 

regarding the use of the IECC as a basis 

for this rulemaking. SBRA stated that 

the IECC is a weak regulatory basis for 

developing manufactured housing 

standards, as IECC is not developed 

with cost-effectiveness as a primary 

consideration. SBRA recommended that 

in the future, DOE base changes to 

energy conservation standards for 

manufactured housing primarily on 

methods and practices specific to the 

MH industry. (SBRA, No. 163 at p. 1) 

As described in section II.A, EISA 

mandates that the manufactured 

housing energy conservation standards 

be based upon the most recent IECC, 

except in cases in which the Secretary 

finds that the IECC is not cost-effective, 

or a more stringent standard would be 

more cost-effective, based on the impact 

of the IECC on the purchase price of 

manufactured housing and on total lifecycle construction and operating costs. 

(42 U.S.C. 17071(b)(1)) As discussed, 

DOE evaluated the requirements of the 

IECC along with the other 

considerations enumerated by EISA. 

EISA also requires DOE to update the 

energy conservation standards no later 

than one year after any revisions to the 

IECC; therefore, future revisions to the 

standards will also be based on the IECC 

along with the other considerations 

identified by EISA. In this SNOPR, DOE 

proposes to include several IECC 

provisions with modification, 

incorporating some of the MH working 

group’s recommendations that were 

based on cost-effectiveness. DOE also 

proposes to include modified IECC 

provisions to make the DOE standards 

better tailored to the manufactured 

housing industry, as discussed in 

further depth in the next paragraphs. 

Regarding the statutory requirement 

to base standards on the IECC, the ICC 

stated in its comments that its codes 

generally do not apply rules that 

distinguish among buildings based on 

their structure or how they were built. 

ICC went on to state that it understands 

there may be technical reasons that 

warrant modifying the IECC standards, 

but it asserted that those changes should 

be based on a showing of impossibility 

and incompatibility with the 

manufactured housing process. (ICC, 

No. 160 at p. 2) 

One of the considerations provided by 

EISA in establishing standards is ‘‘the 

design and factory construction 

techniques of manufactured homes.’’ (42 

U.S.C. 17071(b)(2)(A)) The design and 

construction of manufactured homes 

was a main focus of the MH working 

group while developing the 

recommendations that DOE has 

considered in this rulemaking. For 

example, section R402.2.4 of the 2015 

IECC (which was considered by the MH 

working group) and the 2021 IECC 

(which is the latest version of the IECC 

and considered in this SNOPR) include 


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a specification for vertical doors that 

provide access from conditioned to 

unconditioned spaces to meet certain 

fenestration insulation requirements. 

However, doors that separate 

conditioned and unconditioned space 

rarely are relevant to manufactured 

homes. Therefore, the MH working 

group recommended that this provision 

be removed from the energy 

conservation standards as it was 

deemed not relevant to manufactured 

housing design and construction. 

Modifications to the IECC in this 

proposal were based on unique, 

technical aspects of the manufactured 

housing industry, as well as use of the 

HUD zones and to address costeffectiveness concerns related to the 

potential impact cost increases would 

have on the affordability of the 

manufactured housing market. 

Additionally, as noted previously, the 

authority under 42 U.S.C. 17071 to 

establish energy conservation standards 

for manufactured homes specifies that 

those standards ‘‘shall be based on’’ the 

most recent version of the IECC. In 

DOE’s view, this does not require the 

energy conservation standards for 

manufactured homes to be an identical 

or verbatim equivalent of the IECC, 

especially in light of the other 

considerations DOE must make under 

the statute (i.e., the design and 

construction techniques of 

manufactured homes, cost-effectiveness, 

etc.). Because the IECC is specific to 

site-built structures, both approaches 

proposed in this document would 

establish requirements using modified 

versions of those related IECC 

provisions that can be adapted for 

manufactured homes. 

In another comment regarding the 

IECC, VEIC commented that DOE 

should include a provision to regularly 

update the standards with changes 

made to the IECC in the future. (VEIC, 

No. 187 at p. 2) In response, DOE notes 

that EISA already requires the agency to 

update its energy conservation 

standards for manufactured housing not 

later than ‘‘one year after any revision 

to the IECC.’’ (42 U.S.C. 17071(b)(3)(B)) 

DOE has considered the latest version of 

the IECC (the 2021 IECC) for this 

SNOPR, and is proposing energy 

conservation standards based on the 

latest version of the IECC. DOE will 

review subsequent IECC standards 

issued in the future and evaluate 

whether to update the energy 

conservation standards for 

manufactured housing based on the 

considerations required by EISA. 

Southern Company questioned 

whether the new regulations are subject 

to the seven-factor test for costeffectiveness as found in 10 CFR part 

430. (Southern Company, Public 

Meeting Transcript, No. 148 at p. 143) 

DOE understands the question from 

Southern Company to refer to the seven 

statutory factors, as described in 42 

U.S.C. 6295(o)(2)(B)(i)(I)–(VII), that 

apply to energy conservation standards 

established under the Energy 

Conservation Program for Consumer 

Products Other than Automobiles (Title 

III, Part B of the Title III, Part B of the 

Energy Policy and Conservation Act of 

1975 (EPCA)). Manufactured housing is 

not a covered product under Title III, 

Part B of EPCA, and is subject to a 

separate statutory scheme (i.e., 42 U.S.C. 

17071). Therefore, this rulemaking is 

not directly subject to the EPCA sevenfactors test, although similar analyses 

have been conducted for this 

rulemaking (e.g., LCC, MIA). 

B. Rulemaking Process 

As part of developing energy 

conservation standards for 

manufactured housing, DOE is 

undertaking a multi-stage process 

providing numerous opportunities for 

public comment and engagement, as 

discussed in further detail in section 

II.B.3 of this document. For this 

rulemaking, EISA requires DOE to 

‘‘consult with the Secretary of HUD, 

who may seek further counsel from the 

Manufactured Housing Consensus 

Committee’’. 42 U.S.C. 17071(a)(2)(B). 

Pursuant to the statutory requirement, 

DOE has consulted with HUD 

throughout the development of these 

standards, as discussed in section II.B.3. 

DOE met with HUD multiple times 

during the preliminary stages of the 

proposed rule, as well as throughout the 

rest of the rulemaking process, and 

consulted HUD in the development of 

the proposals in this SNOPR. As EISA 

expressly states that the Secretary of 

HUD may engage with the MHCC with 

regard to this rulemaking, DOE has 

attended three MHCC meetings, most 

recently in June of 2021, to gather 

further information and input on the 

rule. This proposed rule includes a 

number of the changes submitted by the 

MHCC (MHCC, No. 162), which 

mirrored comments from other 

individual stakeholders on the June 

2016 NOPR. A number of other 

stakeholders, including industry 

stakeholders, have also provided 

information, data, and opinions 

regarding the rule. All interested 

stakeholders will have the opportunity 

to provide input and comments on this 

SNOPR. 

In response to the 2016 NOPR, DOE 

received several comments regarding 

the rulemaking process used by DOE for 

these energy conservation standards. 

MHARR had numerous comments 

regarding issues with the overall process 

used for this rulemaking. MHARR 

asserted that the DOE rulemaking 

process was not transparent, and that 

the proposed rule was a violation of the 

1974 National Manufactured Housing 

Construction and Safety Standards Act; 

the ‘‘arbitrary, capricious [or] abuse of 

discretion’’ standard of the 

Administrative Procedure Act; the 

Negotiated Rulemaking Act; and EISA. 

(MHARR, No. 154 at pp. 2–15) 

MHARR was also concerned that a 

2011 draft of the proposed rule was 

distributed to a select group of 

organizations. MHARR stated that 

following this distribution, a ‘‘fresh 

start’’ was required for the proposed 

rule, but there is no evidence that a 

‘‘fresh start’’ actually occurred. 

(MHARR, No. 154 at pp. 2–15; MHARR, 

No. 143 at pp. 1, 3; MHARR, Public 

Meeting Transcript, No. 148 at p. 149) 

As stated earlier, DOE is conducting 

this rulemaking pursuant to the 

statutory provisions in EISA that direct 

DOE to establish energy conservation 

standards for manufactured housing. 

This statutory directive is separate from 

the 1974 National Manufacturing 

Housing Construction and Safety 

Standards Act that governs HUD’s 

authority in promulgating regulations 

for manufactured housing. Additionally, 

DOE demonstrates in section III.F how 

the standards proposed in this SNOPR 

do not conflict with those established by 

HUD. Furthermore, this discussion and 

related supporting analyses together 

present the analytical approach used by 

DOE in evaluating the relevant 

information and on which DOE based 

its determinations regarding the 

proposed requirements in accordance 

with the directives in EISA, the 

Administrative Procedure Act and the 

Negotiated Rulemaking Act. 

Accordingly, as discussed previously, in 

preparation for the prior negotiated 

rulemaking that produced the June 2016 

NOPR, DOE set up a negotiated 

rulemaking process in accordance with 

the Federal Advisory Committee Act 

and the Negotiated Rulemaking Act, 

which included a broad and balanced 

array of stakeholder interests and 

expertise, and included a representative 

from MHARR. 79 FR 41456 (July 16, 

2014). 

DOE also received several comments 

regarding the consensus approach used 

in the June 2016 NOPR. SBRA and 

Clayton Homes supported the ASRAC 

decision to use a consensus approach 

for this rulemaking and recommended 

DOE should continue this method for 

future rulemakings regarding 


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manufactured housing. (SBRA, No. 163 

at p. 1; Clayton Homes, No. 185 at p. 5) 

DOE appreciates these comments 

supporting the use of a negotiated 

rulemaking process by DOE and will 

consider these and all other permissible 

options for future manufactured housing 

rulemakings. 

With regard to the rulemaking 

process, DOE received several 

comments regarding the inclusion of the 

MHCC during the rulemaking. Several 

commenters stated that the proposed 

rule should not be finalized until the 

views and comments of MHCC are 

incorporated, as they have done for past 

HUD rulemakings. (Pleasant Valley 

Homes, No. 154 at p. 2; WVHI, No. 156 

at p. 2; MHIM, No. 155 at p. 2; NMMHA, 

No. 157 at p. 2; MHIAZ, No. 161 at p. 

2; PMHA, No. 164 at p. 2; Skyline 

Corporation, No. 165 at p. 1; OMHA, 

No. 166 at p. 2; MHI, No. 182 at p. 2; 

MMHA, No. 170 at p. 2; MHISC, No. 191 

at p. 2; AMHA, No. 173 at p. 2, 

Commodore Corporation, No. 195 at p. 

2) AMHA also stated that the proposed 

rule should not be finalized without 

thoughtful consideration of the detailed 

comments of professionals involved 

with manufactured housing including 

the MHCC, as well as MHARR and MHI. 

(AMHA, No. 173 at p. 3) 

MHARR stated that DOE must consult 

with HUD and MHCC during the 

formulation of DOE standards, and that 

there is no evidence that these 

consultations ever occurred. (MHARR, 

No. 154 at p. 18) MHARR also 

commented that DOE never provided a 

chance for MHCC to provide substantive 

consensus input regarding the proposed 

rule and actively prevented any input 

from MHCC at any point when it would 

have mattered. (MHARR, No. 154 at p. 

19) As stated previously, DOE has 

consulted both with HUD and engaged 

with the MHCC with regard to this 

rulemaking, and has incorporated 

information and considerations 

provided by HUD and the MHCC into 

this SNOPR. 

C. Test Procedure 

DOE published a test procedure 

NOPR for manufactured housing on 

November 9, 2016. 81 FR 78733 

(November 2016 test procedure NOPR). 

The November 2016 test procedure 

NOPR proposed applicable test methods 

to determine compliance with the 

following metrics that were included in 

a June 2016 NOPR: the R-value of 

insulation; the U-factor of windows, 

skylights, and doors; the SHGC of 

fenestration; U-factor alternatives to Rvalue requirements; the air leakage rate 

of air distribution systems; and 

mechanical ventilation fan efficacy. The 

November 2016 test procedure NOPR 

proposed test methods that would 

dictate the basis on which a 

manufactured home’s performance is 

represented and how compliance with 

the energy conservation standards 

would be determined. DOE notes that a 

number of the test methods that were 

proposed were consistent with test 

methods from the IECC, which includes 

test methods for R-value of insulation, 

U-factor and SHGC of fenestration, duct 

leakage and mechanical fan efficacy. 

The November 2016 test procedure 

NOPR provided stakeholders an 

opportunity to comment on the 

proposed test procedure for 

manufactured housing. As discussed 

above, DOE is not addressing a test 

procedure in this rulemaking. DOE will 

consider the comments related to test 

procedures in any future action on test 

procedures. 

D. Certification, Compliance, and 

Enforcement 

In the November 2016 test procedure 

NOPR, DOE did not propose a system of 

certification, compliance, and 

enforcement (‘‘CCE’’), instead indicating 

those items would be addressed in a 

separate rulemaking. At this time, DOE 

is not addressing CCE issues in this 

rulemaking, but may do so in the future. 

DOE received several comments 

identifying compliance and enforcement 

as a major issue that needs to be 

addressed. Several commenters stated 

that they are concerned that establishing 

standards prior to the establishment of 

a compliance regime would risk 

manufacturers facing complicated, 

conflicting, and overlapping 

requirements from both HUD and DOE. 

(Pleasant Valley Homes, No. 153 at p. 2; 

WVHI, No. 156 at p. 2; MHIM, No. 155 

at p. 2; NMMHA, No. 157 at p. 2; 

MHIAZ, No. 161 at p. 2; OMHA, No. 166 

at p. 2; MHCC, No. 162 at p. 2; MHI, No. 

182 at p. 2; Clayton Homes, No. 185 at 

p. 1; Palm Harbor Homes, No. 193 at p. 

3; MHISC, No. 191 at p. 2; AMHA, No. 

173 at p. 2; Skyline Corporation, No. 

165 at p. 2; NCJC, No. 184 at p. 2; Form 

Letters, No. 182 at p. 1; MHARR, No. 

154 at p. 22) Commenters suggested that 

the proposed rule not be finalized until 

DOE and HUD can determine a single, 

efficient, and practical enforcement 

strategy, where HUD is the prime 

regulator. (MHI, Public Meeting 

Transcript, No. 148 at p. 11; MHI, Public 

Meeting Transcript, No. 148 at p. 142; 

Washington State University (WSU) 

Energy Program, Public Meeting 

Transcript, No. 148 at p. 146; Pleasant 

Valley Homes, No. 153 at p. 2; WVHI, 

No. 156 at p. 2; MHIM, No. 155 at p. 2; 

NMMHA, No. 157 at p. 2; MHIAZ, No. 

161 at p. 2; Better Homes, No. 168 at p. 

1; OMHA, No. 166 at p. 2; MHI, No. 182 

at p. 2; ACEEE, No. 178 at p. 3; Next 

Step, No. 174 at p. 2; MMHA, No. 170 

at p. 2; Clayton Homes, No. 185 at p. 1; 

Palm Harbor Homes, No. 193 at p. 3; 

MHISC, No. 191 at p. 2; AMHA, No. 173 

at p. 2; Skyline Corporation, No. 165 at 

p. 2; MHI, No. 182 at p. 8; Form Letters, 

No. 182 at p. 1, Commodore 

Corporation, No. 195 at p. 2) 

NEEA suggested that DOE establish a 

collaborative method with HUD to 

provide compliance oversight with the 

DOE standards. As suggested by NEEA, 

HUD could continue to use the existing 

Design Approval Primary Inspection 

Agencies (DAPIA) and Inspection 

Primary Inspection Agencies (IPIA) 

system, with DOE serving as a thirdparty review and technical support 

through periodic energy code 

compliance studies. (NEEA, No. 190 at 

p. 2) 

ACEEE and South Mountain stated 

that in order to have effective 

compliance, it is important that DOE 

provide training and tools to assist 

manufacturers in compliance and to 

monitor effectiveness of 

implementation, particularly during the 

initial implementation period. (ACEEE, 

No. 178 at p. 4; South Mountain, No. 

151 at p. 1) One particular technical tool 

that was suggested by SBRA and Palm 

Harbor Homes was a single software 

package that provides a platform for 

overall compliance. This software could 

check for HUD and DOE Code 

compliance, conduct loads analysis 

(Manual J), equipment sizing (Manual 

S), generate an Energy Rating Index, and 

check for ENERGY STAR® compliance. 

(SBRA, No. 163 at p. 2; Palm Harbor 

Homes, No. 193 at p. 3) Lastly, ACEEE 

commented that the residential 

compliance software used by DOE, 

REScheck, also be adapted to verify 

these new requirements. (ACEEE, No. 

178 at p. 4) 

DOE also received comments 

regarding specific aspects of compliance 

and enforcement. Earthjustice 

commented that DOE should move 

quickly to propose and finalize 

provisions related to compliance and 

enforcement, but that these specific 

provisions should not delay finalizing 

the overall rule. (Earthjustice, No. 169 at 

p. 2) 

WSU Energy Program commented that 

insulation installations and air leakage 

compliance must be clear for IPIA- and 

DAPIA-approved quality assurance, 

suggesting a compliance approach that 

relies on existing HUD mechanisms. 

(WSU Energy Program, Public Meeting 

Transcript, No. 148 at pp. 42, 57) 


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ACEEE commented that some degree 

of energy-related information should be 

provided to purchasers, renters, and 

owners. To make this possible, ACEEE 

urged DOE to require MH manufacturers 

to use effective labeling and sales 

information that would easily convey 

the effects of the energy conservation 

standards to consumers, but without 

undue burden on manufacturers. 

(ACEEE, No. 178 at p. 4) 

Modular Lifestyles commented that 

consumers do not usually buy homes 

directly from the manufacturer; 

normally, retailers will purchase the 

manufactured homes from the 

manufacturer to then sell to consumers. 

Modular Lifestyle commented that the 

manufacturer should be held 

accountable, upon the purchase of the 

manufactured home by the retailer, that 

the home meets the consumer’s local 

energy conservation standards, as the 

manufacturer and consumer may be 

located in different DOE climate zones. 

(Modular Lifestyle, No. 141 at p. 2) 

NCJC suggested both that compliance 

and enforcement standards be included 

in the energy conservation standard, 

and that a provision be added that 

would allow homeowners to sue 

manufacturers for failure to construct 

homes in accordance with these energy 

conservation standards. (NCJC, No. 184 

at p. 2) GWU suggested DOE consider 

retrospectively reviewing its rule after 

implementation to assess any potential 

overlap or conflicts with the existing 

HUD Code. (GWU, No. 175 at p. 11) 

DOE appreciates the comments 

received on potential options for a CCE 

system. DOE will consider the 

comments related to CCE received in 

this rulemaking and will consult with 

HUD in any future action on CCE. 

E. Energy Conservation Standards 

Requirements 

This section discusses in detail the 

energy conservation standards proposed 

in this SNOPR, in particular as 

compared to the energy conservation 

standards as proposed in the June 2016 

NOPR. In response to the 2021 IECC, 

additional analyses conducted by DOE, 

and comments received to the June 2016 

NOPR, including those regarding 

potential adverse impacts on pricesensitive low-income purchasers of 

manufactured homes, DOE is updating 

the proposed energy conservation 

standards as presented in the June 2016 

NOPR. 

The following paragraphs discuss the 

tiered and untiered standard proposed 

for manufactured homes based on the 

2021 IECC. As discussed previously, the 

proposed Tier 1 standard would include 

manufactured homes with a 

manufacturer’s retail list price of 

$55,000 or less (in real 2019$) and 

would be subject to a less stringent set 

of standards, while providing costeffective energy bill savings and positive 

cash flow within the first year of 

occupancy. 

DOE is continuing to propose that 

standards would be codified in a new 

part of the CFR under 10 CFR part 460 

subparts A, B, and C. Subpart A, as 

proposed, provides the scope of the 

standards, definitions of key terms, and 

other commercial standards that are 

incorporated by reference into this part. 

The subpart also would establish a 

compliance date of one year following 

the publication of the final rule. 

As proposed, subpart B would 

include energy conservation standards 

requirements associated with the 

building thermal envelope of a 

manufactured home according to the 

climate zone in which the home is 

located. DOE bases its proposed 

building thermal envelope energy 

conservation standards on the three 

HUD zones. Under the proposal, 

manufacturers may choose between two 

pathways to comply, with each one 

ensuring an appropriate level of thermal 

transmittance through the building 

thermal envelope. The first pathway 

relies on prescriptive requirements for 

components of the building thermal 

envelope. The second pathway relies on 

performance requirements, under which 

a manufactured home is required to 

achieve a maximum Uo in addition to 

fenestration U-factor and SHGC 

requirements. Manufactured homes 

would be required to comply with one 

of these two pathways. Subpart B would 

also establish prescriptive requirements 

for insulation and sealing the building 

thermal envelope to limit air leakage. 

Proposed subpart C includes 

requirements related to duct leakage, 

HVAC thermostats and controls, service 

water heating, mechanical ventilation 

fan efficacy, and equipment sizing. 

1. Subpart A: General 

DOE received several comments 

regarding the rulemaking in general, 

both in favor of and opposed. A number 

of commenters stated that they support 

the overall standards proposed by DOE 

in the June 2016 NOPR. (ACEEE, Public 

Meeting Transcript, No. 148 at p. 17; 

NEEA, No. 190 at p. 1; South Mountain, 

No. 151 at p. 1; RECA, No. 188 at p. 1) 

ACEEE and RECA also commented on 

the many benefits of the requirements as 

proposed in the June 2016 NOPR, 

especially on the energy savings for the 

owners of manufactured homes. 

(ACEEE, Public Meeting Transcript, No. 

148 at p. 17; RECA, No. 188 at p. 1) 

NEEA commented that it supports the 

improved overall building thermal 

envelope efficiency, citing both 

increased insulation and lower 

fenestration U-values. (NEEA, No. 190 at 

p. 1) Natural Resource Defense Council 

(NRDC) stated that DOE’s standards as 

proposed in the June 2016 NOPR have 

opportunities for very high return on 

investments and are justified on an 

overall economic perspective. (NRDC, 

Public Meeting Transcript, No. 148 at p. 

16) NJCJ and WSU Energy Program 

commented that the improved standards 

will help address not only high energy 

bills, but also help reduce physical 

degradation to the house, which is an 

issue that plagues many manufactured 

home homeowners. (NCJC, No. 184 at p. 

2; WSU Energy Program, Public Meeting 

Transcript, No. 148 at p. 106) While 

these commenters expressed general 

support for the rulemaking, some 

provided specific criticisms, which are 

discussed in more detail throughout this 

SNOPR. 

Earthjustice and NCJC urged DOE to 

implement the proposed rule as soon as 

possible, as it has gone through a 

prolonged development process and 

general consensus was reached in late 

2014. These commenters stated that 

additional time taken to implement this 

rule deprives new manufactured home 

homeowners the benefits of greater 

energy conservation standards. 

(Earthjustice, No. 169 at p. 1; NCJC, No. 

184 at p. 1) NEEA stated that DOE 

provided more than adequate time for 

stakeholders to participate and provide 

comment, and that the rule should be 

finalized. (NEEA, No. 190 at p. 1) 

DOE appreciates the comments 

supporting the proposed energy 

conservation standards and the 

projected benefits. DOE notes that the 

currently proposed standards were 

developed with consideration of 

recommendations received through an 

in-depth consensus process, 

recommendations received from a 

working group, consultations with HUD, 

and comments received during 

rulemaking. As noted, EISA requires 

DOE to base the energy conservation 

standards on the most recent version of 

the IECC (42 U.S.C. 17071(b)(1)), and 

that following the June 2016 NOPR, the 

2018 and 2021 editions of the IECC were 

published. In response, DOE considered 

the changes to the IECC from the version 

used in the June 2016 SNOPR (2015 

IECC), as well as cost-effectiveness 

considerations, in developing the energy 

conservation standards proposed in this 

SNOPR. 

DOE also received comments urging 

caution in establishing a final rule. 

SBRA and NCJC stated that while they 


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believe that sections of the document 

can be improved, the overall rule should 

be adopted. (SBRA, Public Meeting 

Transcript, No. 148 at p. 148; NCJC, No. 

184 at p. 1) Cavco stated that this 

rulemaking should be thoroughly vetted 

and reviewed because any errors in the 

calculation of cost-effectiveness could 

have a significant negative impact on 

consumers and the manufactured 

housing industry. (Cavco, Public 

Meeting Transcript, No. 148 at p. 151) 

MHI stated that given the magnitude of 

issues to be addressed (a general 

reference to all comments raised by 

MHI), DOE should consider publishing 

another draft rule for comment before 

moving to a final rule. (MHI, No. 182 at 

p. 8) 

Several commenters were specifically 

concerned with increased consumer 

cost, which is addressed in section 

IV.A.1.g, and issues regarding 

compliance, which is addressed in 

section III.D. (OMHA, No. 166 at p. 1; 

MHISC, No. 191 at p. 1; WVHI, No. 156 

at p. 1; MHIM, No. 155 at p. 1; NMMHA, 

No. 157 at p. 1; MHIAZ, No. 161 at p. 

1; PMHA, No. 164 at p. 1; Skyline 

Corporation, No. 165 at p. 1; 

Commodore Corporation, No. 195 at p. 

1) 

In response to comments received 

related to potential adverse impacts on 

price-sensitive, low-income purchasers, 

and in light of the consultation with 

HUD, DOE has updated its analyses 

specifically to evaluate the potential 

burden of incremental costs from energy 

conservation standards on low-income 

purchasers. To allow stakeholders to 

comment on the updated proposal 

contained in this SNOPR, DOE notes 

that it is proposing updated 

requirements based on further analyses 

and is requesting additional comments 

before establishing a final rule. 

a. Proposed § 460.1 Scope 

Section 431 of EISA directs DOE to 

establish energy conservation standards 

for manufactured housing. (42 U.S.C. 

17071(a)(1)) In this SNOPR, DOE 

proposes that § 460.1 (1) restate the 

statutory requirement and introduce the 

scope of the requirements, and (2) 

require manufactured homes that are 

manufactured on or after one year 

following publication of the final rule to 

comply with the requirements 

established, consistent with the June 

2016 NOPR. 81 FR 39756, 39766 DOE 

stated that a 1-year notice period is a 

common industry practice for changes 

to building codes, and would allow 

manufacturers to transition their 

designs, materials, and factory processes 

to comply with the finalized DOE 

energy conservation standards. Id. 

In response to the June 2016 NOPR, 

ACEEE and South Mountain supported 

the 1-year period before the rule 

becomes effective, stating a 1-year 

period appropriately balances the 

urgency of implementing the energy 

conservation standards and the work 

required of manufacturers to implement 

changes. (ACEEE, No. 178 at p. 1; South 

Mountain, No. 151 at p. 1) RECA 

recommended an implementation 

timeline of no longer than one year, as 

outlined in the June 2016 SNOPR. 

(RECA, No. 188 at p. 2) RECA, Next Step 

Network, and Modular Lifestyles 

commented that many manufacturers 

produce higher efficiency homes that 

already meet the energy conservation 

standards, indicating that the path to 

compliance was known and well 

established. (RECA, No. 188 at p. 2; 

Next Step, No. 174 at p. 1; Modular 

Lifestyles, No. 141 at p. 2) AGA and 

APGA suggested that the lead time for 

compliance instead be 5 years, as this 

would both allow more time for the 

market to adjust as well as give more 

time to educate consumers. (AGA and 

APGA, No. 172 at p. 1) In addition, 

Advocacy recommended that DOE 

adopt delayed compliance schedules for 

small manufacturers, as this would 

allow them to manage their limited 

resources. (Advocacy, No. 177 at p. 4) 

As noted in comments previously, the 

industry has experience with the means 

to comply with the proposed 

requirements. DOE notes that section 

413 requires DOE to update the 

manufactured home standards within 

one year following an update to the 

IECC. (42 U.S.C. 17071(b)(3)(B)) A oneyear lead time for compliance would 

allow DOE to evaluate industry 

compliance with the proposed 

standards, if made final, prior to 

consideration of updates to the IECC in 

2024, as required by the statute. The 

one-year lead time would also minimize 

the lag time between updates to the 

IECC and any potential updates to the 

DOE standards, ensuring that 

manufactured home purchasers are 

receiving energy savings based on the 

most recent model energy codes. 

DOE recognizes that compliance with 

the DOE energy conservation standards 

may require manufacturers to update 

designs and certifications required 

under the HUD Code. However, EISA 

requires DOE to base the energy 

conservation standards for 

manufactured homes on the latest 

edition of the IECC, with considerations 

made for cost-effectiveness. As 

discussed in detail in section I.A, while 

manufacturers may incur costs to 

update designs to meet the proposed 

standards, if finalized, these costs 

appear outweighed by the benefits 

gained in energy savings by 

manufactured home purchasers as a 

result of the standards. 

DOE requests comment on whether a 

one-year lead time would be sufficient 

given potential constraints that 

compliance with the DOE standards 

may initially place on the HUD 

certification process, and whether a 

longer lead time (e.g., a three-year lead 

time) or some other alternative leadtime for this first set of standards (e.g., 

phased-in over three years, with oneyear lead-times thereafter) should be 

provided. 

b. Proposed § 460.2 Definitions 

In this SNOPR, DOE proposes to 

maintain certain definitions proposed in 

the June 2016 NOPR, update other 

definitions from the June 2016 NOPR 

based on comments received, and add/ 

update certain definitions based on the 

later IECC version published since the 

June 2016 NOPR (the 2018 IECC and the 

2021 IECC). As such, DOE proposes the 

definitions for the following terms 

proposed in the June 2016 NOPR remain 

the same for § 460.2: ‘‘automatic,’’ 

‘‘ceiling,’’ ‘‘climate zone,’’ ‘‘continuous 

air barrier,’’ ‘‘door,’’ ‘‘duct,’’ ‘‘duct 

system,’’ ‘‘fenestration,’’ ‘‘floor,’’ 

‘‘glazed or glazing,’’ ‘‘insulation,’’ 

‘‘manufactured home,’’ ‘‘manufacturer,’’ 

‘‘manual,’’ ‘‘R-value (thermal 

resistance),’’ ‘‘rough opening,’’ ‘‘service 

hot water,’’ ‘‘solar heat gain coefficient 

(SHGC),’’ ‘‘state,’’ ‘‘thermostat,’’ ‘‘Ufactor (thermal transmittance),’’ ‘‘Uo

(overall thermal transmittance),’’ 

‘‘ventilation,’’ ‘‘vertical fenestration,’’ 

‘‘wall,’’ ‘‘whole-house mechanical 

ventilation system,’’ ‘‘window,’’ and 

‘‘zone.’’ 

Furthermore, DOE proposes 

definitions in the SNOPR for the 

following terms that are either (1) 

updates from the June 2016 NOPR, (2) 

new proposals based on the 2018 and 

2021 IECC, or (3) other clarifications 

needed, as discussed later in this 

section: ‘‘access (to)’’; ‘‘air barrier’’; 

‘‘building thermal envelope’’; 

‘‘conditioned space’’; ‘‘dropped 

ceiling’’; ‘‘dropped soffit’’; ‘‘eave’’; 

‘‘equipment’’; ‘‘exterior ceiling’’; 

‘‘exterior floor’’; ‘‘exterior wall’’; 

‘‘heated water circulation system’’; 

‘‘2021 IECC’’; ‘‘opaque door’’; 

‘‘skylight’’; ‘‘skylight well’’; 

The following paragraphs summarize 

the comments received to the June 2016 

NOPR and DOE’s analysis of the 2018 

and 2021 IECC updates to the 

definitions. 

COBA requested that a definition of 

the term ‘‘affordable housing’’ be added. 

COBA suggested the following: 


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23Allen, G. and Savage, B. The First 20 Years! 

2013. PMN Publishing; Franklin, IN. 

‘‘Housing is affordable when 

individuals or households earning less 

than half the Area Median Income or 

AMI can afford to rent a conventional 

apartment or buy a home in their local 

housing market.’’ 23 (COBA, No. 158 at 

p. 3) Regarding affordability, WSU 

Energy Program stated that 

‘‘affordability’’ should be defined as 

affordable to purchase at the upfront 

cost, as suggested by COBA, but also 

affordable to maintain and operate. 

(WSU Energy Program, No. 148 at pp. 

20, 85) Impact on purchase price is a 

particular consideration in the 

development of the energy conservation 

standards for manufactured housing, 

and DOE requested comments on the 

potential impact of standards on 

affordability/purchase price. 81 FR 

39756, 39765, 39784. However, 

affordability is not an element of the 

proposed regulatory text in this SNOPR 

and ‘‘affordability’’ as a defined term is 

not needed to support the energy 

conservation standard regulatory text (at 

10 CFR part 460). As such DOE is not 

proposing a definition of 

‘‘affordability’’. 

ACC FSC requested that DOE define 

‘‘continuous insulation.’’ (ACC FSC, No. 

186 at p. 1) DOE determined in the June 

2016 NOPR that a definition for 

‘‘continuous insulation’’ was not 

necessary, as it was deemed not relevant 

to the proposed energy conservation 

requirements. Because the regulatory 

text proposed does not use the term 

‘‘continuous insulation,’’ DOE is not 

proposing a definition for this term. 

NEEA commented that improved 

clarity on what is considered interior 

conditioned space is needed. NEEA 

stated that the space under the floor but 

above insulation should not be 

considered conditioned space. (NEEA, 

No. 190 at p. 2) DOE recognizes that 

there was some confusion regarding the 

definition of ‘‘conditioned space’’ 

proposed in the June 2016 NOPR. DOE 

intended to use the 2015 IECC 

definition for the term ‘‘conditioned 

space,’’ but an error led to an incorrect 

definition being listed in § 460.2 of the 

proposed regulatory text. For this 

SNOPR, DOE proposes that the 

definition of conditioned space match 

the 2021 IECC definition, which is the 

same as the 2015 IECC definition for 

conditioned space. Using this proposed 

definition, the space under the floor but 

above the insulation is considered 

conditioned space. As DOE is proposing 

the term as defined in the IECC, the 

term is appropriately understood by 

industry. Therefore, DOE proposes to 

define ‘‘conditioned space’’ as an area, 

room, or space that is enclosed within 

the building thermal envelope and that 

is directly or indirectly heated or 

cooled. Spaces are indirectly heated or 

cooled where they communicate 

through openings with conditioned 

space, where they are separated from 

conditioned spaces by uninsulated 

walls, floors or ceilings, or where they 

contain uninsulated ducts, piping, or 

other sources of heating or cooling. 

NEEA recommended that ‘‘skylight 

wells’’ be defined as exterior walls, to 

clearly indicate that they require 

insulation to at least exterior wall 

insulation levels. (NEEA, No. 190 at p. 

3) While ‘‘skylight’’ is defined in the 

2021 IECC, ‘‘skylight well’’ is not 

defined. As suggested by NEEA, a 

‘‘skylight well’’ would extend from the 

interior finished surface of the exterior 

ceiling to the exterior surface of the roof. 

For some homes, the upper part of this 

well may exist above the exterior ceiling 

insulation. This upper part of the well 

would provide an uninsulated path 

from the interior to the exterior of the 

home if the skylight well were not 

insulated. Per the proposed definition of 

exterior wall, ‘‘skylight wells’’ would be 

considered exterior walls. DOE agrees 

with NEEA’s suggestion to define the 

term ‘‘skylight well,’’ which DOE 

proposes to define as encompassing the 

walls underneath a skylight that extend 

from the interior finished surface of the 

exterior ceiling to the exterior surface of 

the location to which the skylight is 

attached. 

DOE also proposes to specify that 

skylight wells are exterior walls by 

updating the definition of ‘‘exterior 

wall’’ to include skylight wells. DOE 

proposes to define ‘‘exterior wall’’ as a 

wall, including a skylight well, that 

separates conditioned space from 

unconditioned space. 

HUD’s allowance of ‘‘alternative 

construction’’ of manufactured homes 

permits manufacturers to utilize new 

designs or techniques. 24 CFR 3282.14. 

One such home design can be a 

multistory manufactured home. In this 

SNOPR, DOE proposes that the ceiling, 

wall, and floor building thermal 

requirements for these energy 

conservation standards are only for the 

exterior ceiling, wall, and floor that 

separate conditioned space from 

unconditioned space, not for any 

internal ceilings that can be found in a 

multistory manufactured home, or for 

interior walls. Therefore, DOE proposes 

adding definitions for the term ‘‘exterior 

ceiling’’ as a ceiling that separates 

conditioned space from unconditioned 

space and ‘‘exterior floor’’ as a floor that 

separates conditioned space from 

unconditioned space. 

DOE also proposes to update the 

following definitions proposed in the 

June 2016 NOPR that included ‘‘ceiling’’ 

and ‘‘floor’’ to include the use of 

‘‘exterior ceiling’’ and ‘‘exterior floor,’’ 

as appropriate: ‘‘building thermal 

envelope,’’ ‘‘dropped ceiling,’’ ‘‘dropped 

soffit,’’ ‘‘eave,’’ and ‘‘rough opening.’’ 

DOE also reviewed several relevant 

definitions updated since the 

publication of the 2015 IECC (in the 

2018 IECC and the 2021 IECC). For the 

2018 IECC, the updates included the 

following terms: ‘‘air barrier’’ and 

‘‘building thermal envelope.’’ These 

same updates were carried over to the 

2021 IECC. DOE reviewed these updates 

and finds them to be clarifications 

rather than substantive changes. 

Specifically, the 2018 (and 2021) IECC 

definition for ‘‘air barrier’’ clarified that 

the materials should be joined together 

in a continuous manner to restrict or 

prevent passage of air through the 

building thermal envelope; the 

‘‘continuous manner’’ element was not 

part of the same definition in the 2015 

IECC. The addition of this term means 

that the material should be joined 

together without any thermal bridges, 

other than fasteners and service 

openings, so that any passage of air 

through the building thermal envelope 

is prevented. DOE notes that the term 

‘‘continuous’’ is one generally used by 

and understood within industry and is 

consistently used in the 2021 IECC 

(without being defined). 

The 2018 (and 2021) IECC definition 

for ‘‘building thermal envelope’’ 

specified that it should be building 

element assemblies as opposed to just 

building elements. DOE has tentatively 

determined this update to be nonsubstantive because it clarifies the 

original intent of the definition to 

include all components that separate 

conditioned from unconditioned space. 

In addition, the 2018 IECC also added 

a new definition for ‘‘opaque door.’’ The 

term opaque door is included in the 

definition for ‘‘vertical fenestration’’ but 

previously had not been defined. The 

2018 IECC defines an opaque door as a 

door that is not less than 50 percent 

opaque in surface area. 

For the 2021 IECC, the relevant 

updates included the following terms: 

‘‘accessible,’’ which was replaced by 

‘‘access (to),’’ and ‘‘skylights.’’ DOE had 

only previously proposed a definition 

for ‘‘accessible’’ because the 2015 IECC 

defined the term and included the term 

in the residential provisions, which 

DOE had incorporated into the 

regulatory text. However, the 2021 IECC 

replaces ‘‘accessible’’ with ‘‘access (to)’’ 


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47768 Federal Register / Vol. 86, No. 163 / Thursday, August 26, 2021 / Proposed Rules 

24 In the June 2016 NOPR, DOE proposed that 

access hatches, panels, and doors must provide 

access to all equipment that prevents damaging or 

compressing of the insulation. 

and no longer includes the term 

‘‘accessible’’ in the residential 

provisions of the IECC. In response to 

the June 2016 NOPR, NEEA commented 

that a clearer definition of the word 

‘‘access’’ was required.24 (NEEA, 190 at 

p. 2). As the definition of the word 

‘‘access’’ is now found in the 2021 IECC, 

DOE is proposing to include a definition 

for ‘‘access’’. Further, to prevent 

confusion, DOE proposes to revise the 

regulatory text to incorporate the use of 

the word ‘‘access’’ instead of 

‘‘accessible,’’ similar to the updates in 

the 2021 IECC. Therefore, DOE proposes 

to define the term ‘‘access (to)’’ as ‘‘that 

which enables a device, appliance or 

equipment to be reached by ready 

access or by a means that first requires 

the removal or movement of a panel or 

similar obstruction.’’ 

In addition, the 2021 IECC clarifies 

that skylights include ‘‘unit skylights, 

tubular daylighting devices, and glazing 

materials in solariums, sunrooms, roofs 

and sloped walls.’’ DOE understand 

these updates to be clarifications rather 

than a substantive change and does not 

alter the meaning of the original 

definition. Therefore, DOE proposes to 

include this clarification in the 

proposed skylight definition. 

Accordingly, DOE proposes to include 

the updated definitions for ‘‘air barrier,’’ 

‘‘building thermal envelope’’ and 

‘‘skylight’’ and the new definition for 

‘‘opaque door’’ and ‘‘access (to)’’ in this 

SNOPR. 

In review of the proposed regulatory 

text from the June 2016 NOPR, DOE also 

recognized that the term ‘‘Circulating 

hot water system’’ is defined, but the 

term ‘‘heated water circulation system’’ 

is used in the substantive requirements 

of the June 2016 NOPR. In this SNOPR, 

DOE proposes to change this defined 

term to reflect what is used in the 

substantive provisions of the 

regulations. Additionally, DOE defined 

the term ‘‘service hot water’’ in the June 

2016 SNOPR, but the proposed 

substantive requirements also used the 

term ‘‘service water heating.’’ The IECC 

uses both terms. For consistency DOE 

proposes to define and use the term 

‘‘service hot water’’ throughout the 

regulations. 

DOE also recognized that the June 

2016 NOPR definition for ‘‘equipment’’ 

included the term ‘‘appliances’’. 

However, the MH working group 

generally did not recommend provisions 

addressing appliances. Furthermore, 

this SNOPR is not proposing 

requirements for appliances that are 

regulated pursuant to the statutory 

scheme in EPCA. Therefore, DOE 

proposes to remove ‘‘appliances’’ from 

the definition of ‘‘equipment.’’ 

DOE also recognized that the term 

‘‘infiltration’’ was defined in the 

proposed regulations in the June 2016 

NOPR but was not otherwise used. As 

the term is not used in the regulatory 

text, DOE proposes to not include a 

definition for ‘‘infiltration’’ in this 

SNOPR. 

DOE requests comment on its 

understanding of the definitional 

changes in the 2018 IECC and the 2021 

IECC. DOE also requests comments on 

its changes to the proposed definitions 

as compared to those proposed in the 

June 2016 NOPR. 

c. Proposed § 460.3 Materials 

Incorporated by Reference 

In this SNOPR, DOE is not proposing 

to incorporate the 2021 IECC by 

reference. The 2021 IECC serves as the 

basis for the regulations proposed in 

this document, with the proposed 

requirements addressing technical 

issues specific to manufactured homes, 

relying on the HUD zones, and 

addressing issues related to health and 

safety, as well as the need to preserve 

the affordability of manufactured 

homes. 

Further, DOE continues to propose to 

incorporate by reference Air 

Conditioning Contractors of America 

(‘‘ACCA’’) Manual J; ACCA Manual S; 

and ‘‘Overall U-Values and Heating/ 

Cooling Loads—Manufactured Homes’’ 

by Conner and Taylor (the Battelle 

Method). DOE proposes that ACCA 

Manuals J and S would be incorporated 

by reference in § 460.205 of the 

regulatory text and would relate to the 

selection and sizing of heating and 

cooling equipment. In addition, the 

Battelle Method is an industry standard 

methodology for calculating the overall 

thermal transmittance (Uo) of a 

manufactured home and is also 

currently referenced in the HUD Code 

for calculation of overall thermal 

transmittance. DOE proposes to use the 

Battelle method to determine the same 

(Uo). 

In response to the June 2016 NOPR, 

ACCA commented in favor of the 

references to Manual J and Manual S. 

(ACCA, No. 159 at p. 2) DOE also 

received comments regarding the 2015 

IECC (which was the basis of the June 

2016 NOPR requirements). The ICC 

commented that it is concerned with the 

manner that DOE proposed to use and 

modify the IECC, which is copyrighted, 

specifically that DOE did not 

incorporate by reference the 2015 IECC. 

Referencing Circular OMB Circular A– 

119, ‘‘Federal Participation in the 

Development and Use of Voluntary 

Consensus Standards and in Conformity 

Assessment Activities, Revised,’’ ICC 

stated that all ‘‘Federal agencies must 

use voluntary consensus standards in 

lieu of government-unique standards in 

their procurement and regulatory 

activities,’’ and that DOE must report 

the reasons for its use of governmentunique standards in lieu of voluntary 

consensus standards. The ICC also 

commented that section 5.g of the OMB 

Circular A–119 directs agencies ‘‘to 

observe and protect the rights of the 

copyright holder.’’ (ICC, No. 160 at p. 3) 

ICC commented that in order to meet 

minimum requirements for OMB–A119, 

DOE must ‘‘(a) expressly acknowledge 

that the IECC is a copyright protected 

document, published and owned by 

ICC; (b) explicitly state that any 

reproduction or copying of the standard 

(other than for personal, noncommercial purposes) requires express 

written permission or license from ICC; 

and (c) state that copies of the IECC are 

available for purchase from ICC at its 

website, www.iccsafe.org.’’ (ICC, No. 

160 at p. 4) ACCA also commented that 

the incorporation of the 2015 IECC 

language, either directly or with slight 

modification, should require DOE to 

properly acknowledge the ICC and its 

work, as the 2015 IECC is copyright 

protected. (ACCA, No. 159 at p. 2) 

Subject to copyright law, DOE 

acknowledges that the IECC is a 

copyright protected document, 

published and owned by the ICC, and 

that reproduction or copying of the IECC 

requires written permission or license 

from the ICC. As noted above, copies of 

the IECC are available for purchase at 

www.iccsafe.org. They may also be 

viewed for free on ICC’s public access 

website at: https://codes.iccsafe.org/ 

public/collections/I-Codes. As discussed 

previously, DOE and the MH working 

group evaluated the 2015 IECC, and 

DOE subsequently evaluated the 2018 

and the 2021 IECC. The MH working 

group recommendations and the June 

2016 NOPR were based on the 2015 

IECC, but as explained throughout this 

document, modifications are necessary 

to address technical issues that are 

specific to manufactured housing, as 

opposed to site-built housing, which is 

the focus of the IECC. As such, the 

SNOPR’s proposals (1) are based 

directly on certain IECC sections, (2) are 

based on other sections of the IECC with 

modification, and (3) do not include 

certain other sections as they were 

either not pertinent to manufactured 


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Federal Register / Vol. 86, No. 163 / Thursday, August 26, 2021 / Proposed Rules 47769 

25 In the proposed regulatory text provided at the 

end of this document, bracketed language is specific 

to the tiered proposal. 

housing or not needed to establish 

energy conservation standards. 

DOE requests comment on 

incorporating by reference ACCA 

Manual J, ACCA Manual S, and 

‘‘Overall U-Values and Heating/Cooling 

Loads—Manufactured Homes’’ by 

Conner and Taylor. 

d. Proposed § 460.4 Energy 

Conservation Standards 

Proposed § 460.4 would specify that 

manufactured homes would be required 

to comply with the proposed building 

thermal envelope in subpart B and the 

equipment and controls requirements in 

subpart C, as applicable. The proposed 

requirements of subparts B and C are 

discussed in the following paragraphs. 

As discussed, DOE is proposing a tiered 

proposal with two tiers of energy 

conservation standards based on the 

manufacturer’s retail list price of a 

manufactured home. Under the tiered 

proposal proposed § 460.4 would 

specify the requirements applicable to 

the two tiers.25

2. Subpart B: Building Thermal 

Envelope 

The proposed requirements in subpart 

B relate to climate zones, the building 

thermal envelope, installation of 

insulation and building thermal 

envelope leakage for manufactured 

homes. The following sections provide 

further details, a discussion of 

comments on the June 2016 NOPR 

relevant to subpart B and responses to 

any such comments. As discussed 

above, the tiered standards approach is 

DOE’s primary proposal in this 

document i.e. manufactured homes with 

manufactured retail list prices of 

$55,000 or less (Tier 1 manufactured 

homes) would be subject to different 

building thermal envelope requirements 

than all other manufactured homes (Tier 

2 manufactured homes). The 

requirements are discussed in the 

following sections. 

a. Proposed § 460.101 Climate Zones 

Pursuant to EISA, DOE may base its 

energy conservation standards on the 

climate zones established by HUD rather 

than on the climate zones contained in 

the IECC. (42 U.S.C. 17071(b)(2)(B)) The 

potential for climactic differences to 

affect energy consumption supports an 

approach in which energy conservation 

standards account for geographic 

differences in climate. In this SNOPR, 

DOE proposes to align with the HUD 

climate zones. 

As indicated in Figure III.1, the HUD 

Code divides the United States into 

three distinct climate zones for the 

purpose of setting its building thermal 

envelope requirements, the boundaries 

of which are separated along state lines. 

By contrast, as indicated in Figure III.2, 

section R301 of the 2021 IECC divides 

the country into nine climate zones, the 

boundaries of which are separated along 

county lines. The 2021 IECC also 

provides requirements for three possible 

variants (dry, moist, and marine) within 

certain climate zones, as indicated in 

Figure III.2. The HUD Code zones were 

developed to be sensitive to the manner 

in which the manufactured housing 

industry constructs and places 

manufactured homes into the market. 

The IECC climate zones are separated 

along county lines to reflect a more 

granular overview of climate 

distinctions within the United States, 

and to facilitate state and local 

enforcement of the IECC for residential 

and commercial buildings, including 

site-built and modular construction. 

BILLING CODE 6450–01–P 


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3.-

Figure 111.1 Uo Zones in the HUD Code 
47770 Federal Register / Vol. 86, No. 163 / Thursday, August 26, 2021 / Proposed Rules 

In the June 2016 NOPR, proposed 

§ 460.101 provided for four climate 

zones, as illustrated in Figure III.3. This 

was based on the MH working group 

recommendation that DOE establish 

four climate zones that placed cities 

with the same set of most-cost-effective 

building thermal envelope requirements 

in the same climate zone. DOE’s 

proposed climate zones bifurcated 

Texas, Louisiana, Alabama, Mississippi, 

Georgia, and Arizona. 

BILLING CODE 6450–01–C 

DOE received several comments 

regarding climate zones. Modular 

Lifestyles recommended alternate 

climate zones. It stated that the local 

building ZIP code should be used to 

determine the building climate zone for 

the placement of a manufactured home. 

As an example, it referenced the 

California Energy Commission’s climate 

zones for California, which has 16 

building climate zones based on ZIP 

codes. (Modular Lifestyles, No. 141 at p. 

1) In essence, Modular Lifestyles 

advocated for a finer resolution in 

climate zones, potentially with even 

more climate zones than listed in the 

IECC. 

In the June 2016 NOPR, DOE 

proposed four climate zones based on 

the recommendation and analysis 

completed by the MH working group 

(using the 2015 IECC), which placed 

cities with the same set of most-costeffective building thermal envelope 

requirements in the same climate zone. 

As noted above, in this document DOE 

is proposing in this SNOPR a set of 

energy efficiency requirements 

applicable to Tier 1 manufactured 


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Figure 111.2 Climate Zones in the 2021 IECC 

Figure 111.3 June 2016 NOPR-Proposed Climate Zones 
Federal Register / Vol. 86, No. 163 / Thursday, August 26, 2021 / Proposed Rules 47771 

26UA is the U-factor multiplied by area. 

homes to provide energy savings at an 

incremental purchase price of 

approximately $750 and Tier 2 

manufactured homes. The June 2016 

NOPR climate zone analysis did not 

consider this tiered proposal. 

In this SNOPR, DOE proposes to 

incorporate the HUD zones instead of 

the June 2016 NOPR-proposed climate 

zones, as explicitly permitted under 

EISA. (42 U.S.C. 17071(b)(2)(B)) As 

noted, the HUD zones were developed 

with specific consideration of the 

manner in which the manufactured 

housing industry constructs and places 

manufactured homes into the market. 

The HUD zone boundaries are separated 

along state lines, whereas the June 2016 

NOPR-proposed climate zones 

bifurcated certain states. Aligning the 

climate zones between the DOE 

requirements and the HUD Code would 

reduce the complexities faced by 

manufacturers in coordinating 

compliance between the two sets of 

requirements. Additionally, it would 

reduce the potential for confusion of 

manufactured home purchasers, by 

allowing them to rely on a single map 

to determine whether a manufactured 

home would be appropriate for a given 

location, as opposed to requiring them 

to consult one map under the HUD Code 

and a different map under the DOE 

requirements. 

Modular Lifestyle’s suggestion to use 

local building zone ZIP codes to 

determine climate zones would extend 

the subdivision of states and be overly 

burdensome for manufacturers. 

Although its suggested climate zones 

could more accurately account for U.S. 

climatic conditions that affect energy 

use, the potential benefit of this 

accounting would be offset by the 

impracticality to the manufactured 

housing industry of developing homes 

per building ZIP code, with multiple 

zones existing within the same state, 

where the eventual destination of the 

home is not always known when the 

home is manufactured. 

DOE also received comments 

regarding the proposed climate zone 

map (Figure 460.101), Table 460.101–1, 

and Table 460.101–2 from the June 2016 

NOPR that provided a list of the U.S. 

states located in each climate zone. 

Several commenters stated that there 

was inconsistency between where 

Kentucky was located in Figure 460.101, 

and where it was located in Table 

460.101–1. (Cavco, No. 167 at p. 1; 

Earthjustice, No. 169 at p. 2; MHI, No. 

182 at p. 1; Clayton Homes, No. 185, at 

p. 2; PMHA, No. 164 at p. 3) Cavco, 

Clayton Homes, and MHI recommended 

that Kentucky be moved to climate zone 

3 in the map figure. Several commenters 

also stated that California was missing 

in Table 460.101–1 and Table 460.101– 

2, and therefore the tables needed to be 

updated. (Clayton Homes, No. 185 at p. 

2; MHCC, No. 162 at p. 1; Earthjustice, 

No. 169 at p. 2; Skyline, No. 165 at p. 

2) As already discussed, for this SNOPR, 

DOE proposes to align with the HUD 

zones as opposed to the June 2016 

NOPR-proposed climate zones. 

Accordingly, comments received 

regarding issues with the June 2016 

proposed climate zone map are no 

longer applicable to this SNOPR. 

DOE requests comment on basing the 

climate zones on the three HUD zones 

instead of the June 2016 NOPRproposed four climate zones, or other 

configuration of climate zones. DOE 

further requests input on whether 

energy efficiency requirements should 

be based on smaller geographic areas 

than provided with the 3 or 4 zone 

model. 

b. Proposed § 460.102 Building Thermal 

Envelope Requirements 

In this SNOPR, DOE’s primary 

proposal is the tiered proposal and the 

alternate proposal is the untiered 

proposal. Both proposals are based on 

the HUD zones. For the tiered proposal, 

Tier 1 would incorporate building 

thermal envelope measures based on 

certain thermal envelope components 

subject to the 2021 IECC but would limit 

the incremental purchase price increase 

to an average of approximately $750. 

For Tier 2, DOE proposes building 

thermal envelope measures based on 

those proposed in the June 2016 NOPR, 

updated to reflect the HUD zones and 

the 2021 IECC requirements. The 

alternate untiered proposal 

requirements would be the same as the 

Tier 2 requirements. 

Consistent with the June 2016 NOPR, 

DOE proposes to add § 460.102 in the 

regulatory text to establish requirements 

related to the building thermal 

envelope, including the materials 

within a manufactured home that 

separate the interior conditioned space 

from the exterior of the building or 

interior spaces that are not conditioned 

space. Further DOE also proposes that 

§ 460.102(a) would provide 

manufacturers the option of choosing 

one of two pathways for compliance to 

ensure that the building thermal 

envelope would meet more stringent 

energy conservation levels. These two 

pathways are known as the prescriptive 

approach and the performance 

approach. Consistent with the 

recommendation of the MH working 

group and the June 2016 NOPR, DOE 

proposes to allow manufacturers to 

choose between these two pathways for 

compliance, which would result in costeffective energy savings for homeowners 

while providing for flexibility within 

the manufactured housing industry. 

Term Sheet, No. 107 at pp. 3–4. This 

approach is consistent with the 2021 

IECC, which provides a climate zonespecific prescriptive building thermal 

envelope component pathway 

(R402.1.2) and an alternate pathway to 

compliance, which allows for a home to 

be constructed using a variety of 

materials as long as the entire building 

thermal envelope has a maximum, 

singular total UA value 26 (R402.1.5). 

Further, consistent with the June 2016 

NOPR, DOE continues to propose that 

the prescriptive requirements would 

establish specific component minimum 

R-value, maximum U-factor, and SHGC 

requirements, providing a 

straightforward option for construction 

planning. The prescriptive requirements 

were proposed under § 460.102(b), with 

the building thermal envelope 

requirements proposed under 

§ 460.102(b)(1) The compliance option 

based on performance requirements, on 

the other hand, would allow a 

manufactured home to be constructed 

using a variety of materials with varying 

thermal properties so long as the 

building thermal envelope achieved a 

required level of overall thermal 

performance. The performance 

requirements thus would provide 

manufacturers with greater flexibility in 

identifying and implementing costeffective approaches to building thermal 

envelope design. The Uo requirements 

would be determined by applying the 

proposed prescriptive building thermal 

envelope requirements to manufactured 

homes using typical dimensions and 

construction techniques and then 

calculating the resulting Uo. 

In developing the set of Tier 1 energy 

efficiency measures proposed in this 

document, DOE considered measures 

for building elements of manufactured 

homes based on building components 

subject to the 2021 IECC (i.e., exterior 

floor, exterior walls, exterior ceiling, 

and fenestration). DOE evaluated 

different combinations of energy 

efficiency measures and stringencies for 

exterior floor, wall, ceiling, and 

windows (fenestration). DOE compared 

the potential energy savings for each of 

the different combinations analyzed and 

preliminarily determined the optimal 

set of energy efficiency measures that 

would yield an incremental cost 

increase of approximately $750. For this 

analysis, DOE evaluated the same range 

of energy efficiency measures and costs 

that were used for the June 2016 NOPR. 


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47772 Federal Register / Vol. 86, No. 163 / Thursday, August 26, 2021 / Proposed Rules 

27 DOE used shipments for 2019 from the annual 

production and shipment data provided by MHI. 

See Manufactured Home Shipments by Product 

Mix, Manufactured Housing Institute (2019). 

In developing the set of Tier 2 energy 

efficiency measures proposed in this 

document, DOE first mapped the June 

2016 NOPR requirements (based on four 

climate zones) to HUD zones (based on 

three climate zones). DOE used the 

manufactured home national shipment 

percentages for each of the cities 

analyzed,27 and the corresponding HUD 

zone and the June 2016 NOPR climate 

zone identifiers for each of the cities. 

DOE then summed the shipment 

percentages of the cities with the same 

June 2016 NOPR proposed climate 

zones within each of the HUD zones. 

According to which of the June 2016 

NOPR-proposed climate zones showed 

the maximum shipment weight per 

HUD zone, DOE incorporated those 

proposed June 2016 NOPR requirements 

for that HUD zone. 

For proposed climate zone 1, the 

cities identified were in either the June 

2016 NOPR-proposed climate zones 1 or 

2; however, the summed shipment 

weights per the June 2016 NOPRproposed climate zone did not provide 

an obvious indicator as to which of the 

energy efficiency measures to 

incorporate for proposed climate zone 1. 

The only difference between the June 

2016 NOPR-proposed climate zone 1 

and 2 energy efficiency measures was 

the glazed fenestration requirement. 

Therefore, in this SNOPR, DOE 

proposes to use the less stringent glazed 

fenestration requirement (0.33 vs. 0.25) 

to accommodate cost-effective measures 

that were proposed in the June 2016 

NOPR for proposed climate zone 2. 

Next, DOE considered the updates to 

the 2021 IECC. In reviewing Section 

R402.1 of the 2021 IECC, DOE 

determined the following relevant 

updates are merited when compared to 

the 2015 IECC that the MH working 

group had considered: 

• The maximum fenestration Ufactors were updated from 0.35 to 0.30 

for IECC climate zones 3 and 4 (except 

marine); and from 0.32 to 0.30 for IECC 

climate zones marine 4, 5 through 8. 

• The maximum glazed fenestration 

SHGC was updated from NR to 0.40 for 

IECC climate zones 5 and marine 4. 

• The minimum ceiling R-value was 

updated from R-38 to R-49 for IECC 

climate zones 2 and 3; and from R-49 to 

R-60 for IECC climate zones 4 through 

8. 

• The minimum wall R-value was 

updated from R-13 to R-13 or R-0+10 for 

IECC climates zones 0 through 2; from 

R-20 or R-13+5 to R-20 or R-13+5ci or 

R-0+15 for IECC climate zones 3; from 

R-20 or R-13+5 to R-20+5 or R-13+10ci 

or R-0+15 for IECC climate zones 4 and 

5; and from R-20+5 or R-13+10ci to R20+5ci or R-13+10ci or R-0+20 for IECC 

climate zones 6 through 8. 

With regards to the 2021 IECC 

updates, DOE did not incorporate the 

minimum ceiling R-value updates given 

the physical space constraints of 

manufactured homes and because EISA 

allows DOE to consider the design and 

factory construction techniques of 

manufactured homes as compared to 

site-built and modular homes. (42 

U.S.C. 17071(b)(2)). Specifically, 

manufactured homes typically have a 

lower overall height compared to sitebuilt homes, which leads to constrained 

space, and therefore there is less 

exterior ceiling insulation. DOE did 

consider all other updates consistent 

with EISA and the analysis done for the 

June 2016 NOPR. Accordingly, DOE 

similarly mapped the 2021 IECC 

updates to the corresponding proposed 

climate zone. 

Therefore, for the tiered proposal, the 

Tier 1 prescriptive building thermal 

envelope requirements are presented in 

Table III.7 and the Tier 2 prescriptive 

building thermal envelope requirements 

are presented in Table III.8. The 

untiered proposal’s building thermal 

envelope requirements would be the 

same as the Tier 2 requirements 

presented in Table III.8. 

TABLE III.7—TIER 1 BUILDING THERMAL ENVELOPE PRESCRIPTIVE REQUIREMENTS

Climate 

zone 

Exterior 

wall 

insulation 

R-value 

Exterior 

ceiling 

insulation 

R-value 

Exterior 

floor 

insulation 

R-value 

Window 

U-factor 

Skylight 

U-factor 

Door 

U-factor 

Glazed 

fenestration 

SHGC 

1 ................................... 13 22 22 1.08 0.75 0.40 0.7 

2 ................................... 13 22 19 0.5 0.55 0.40 0.6 

3 ................................... 19 22 22 0.35 0.55 0.40 Not applicable 

TABLE III.8—TIER 2 (AND UNTIERED) BUILDING THERMAL ENVELOPE PRESCRIPTIVE REQUIREMENTS

Climate 

zone 

Exterior 

wall 

insulation 

R-value 

Exterior 

ceiling 

insulation 

R-value 

Exterior 

floor 

insulation 

R-value 

Window 

U-factor 

Skylight 

U-factor 

Door 

U-factor 

Glazed 

fenestration 

SHGC 

1 ................................... 13 30 13 0.32 0.75 0.40 0.33 

2 ................................... 20+5 30 19 0.30 0.55 0.40 0.25 

3 ................................... 20+5 38 30 0.30 0.55 0.40 Not applicable 

For the exterior wall insulation, the 

‘‘+5’’ involves using ‘‘continuous 

insulation,’’ which is insulation that 

runs continuously over structural 

members and is free of significant 

thermal bridging. As a sensitivity 

analysis, DOE considered the impacts 

on the LCC savings from requiring less 

stringent exterior wall insulation (at R21 instead of R-20+5) to remove the 

continuous insulation requirement. At 

R-20+5, the incremental cost relative to 

the baseline is $2,500, versus $850 for 

R-21. DOE considered this alternative 

insulation requirement for zones 2 and 

3 to address potential equity impacts in 

the regional distribution of benefits and 

costs and to ensure that each metro area 

analyzed could experience a positive 

LCC at Tier 2. DOE is considering 

additional analysis to further explore 

the impacts of R-21 for Tier 2 homes 

and the untiered proposal prior to the 

final rule stage. Further discussion on 

the sensitivity analysis results is 

provided in section IV.A.2. 


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28 ‘‘Overall U-Values and Heating/Cooling 

Loads—Manufactured Homes’’ by Conner and 

Taylor. 

As discussed, use of the HUD zones 

(or the climate zones proposed in the 

June 2016 NOPR) instead of the IECC 

climate zones does not allow for use of 

the IECC requirements absent 

modification. In line with the building 

thermal envelope requirements and use 

of the HUD zones, proposed in this 

document, DOE proposes the following 

changes to the June 2016 NOPRproposed regulatory text: 

• Update the requirement regarding 

the use of a combination of R-21 batt 

insulation and R-14 blanket insulation 

in lieu of R-30 for the purpose of 

compliance with the climate zone 3 

exterior floor insulation R-value 

requirement. (Under the tiered proposal 

this would be applicable for Tier 2 

only.) 

• Update the maximum U-factor 

values as alternatives to the minimum 

R-value requirements. DOE calculated 

the maximum U-factor values by using 

the Battelle method that was 

recommended by the MH working 

group.28 DOE performed these 

calculations based on typical wall, 

ceiling, and floor assemblies used by the 

manufactured home industry. Table III.9 

provides the updated maximum Ufactor values for Tier 1 manufactured 

homes under the tiered proposed rule. 

Table III.10 provides the updated 

maximum U-factor values for Tier 2 

manufactured homes (and the untiered 

manufactured homes) under the tiered 

proposed rule. 

TABLE III.9—U-FACTOR ALTERNATIVES TO THE TIER 1 R-VALUE REQUIREMENTS

Climate zone 

Exterior ceiling U-factor Exterior wall 

U-factor 

Exterior floor 

U-factor Single-section Multi-section 

1 ....................................................................................................................... 0.061 0.057 0.094 0.049 

2 ....................................................................................................................... 0.061 0.057 0.094 0.056 

3 ....................................................................................................................... 0.061 0.057 0.068 0.049 

TABLE III.10—U-FACTOR ALTERNATIVES TO THE TIER 2 (AND UNTIERED) R-VALUE REQUIREMENTS

Climate zone 

Exterior ceiling U-factor Exterior wall 

U-factor 

Exterior floor 

U-factor Single-section Multi-section 

1 ....................................................................................................................... 0.045 0.043 0.094 0.078 

2 ....................................................................................................................... 0.045 0.043 0.047 0.056 

3 ....................................................................................................................... 0.038 0.037 0.047 0.032 

• Update the building thermal 

envelope performance requirements. 

DOE calculated the updated Uo values 

using the Battelle method for single- and 

multi-section manufactured homes. 

Table III.11 provides the updated Uo

values for Tier 1 manufactured homes 

under the tiered proposal. The proposed 

Tier 1 standards provide energy 

efficiency standards more stringent than 

the HUD thermal protection standards 

required in 24 CFR 3280.506(a). Table 

III.12 provides the updated Uo values for 

Tier 2 (and untiered) manufactured 

homes. 

TABLE III.11—TIER 1 BUILDING THERMAL ENVELOPE PERFORMANCE REQUIREMENTS

Climate 

zone 

Single-section 

Uo

Multi-section 

Uo

1 ................ 0.110 0.109 

2 ................ 0.091 0.087 

3 ................ 0.074 0.072 

TABLE III.12—TIER 2 (AND UNTIERED) 

BUILDING THERMAL ENVELOPE PERFORMANCE REQUIREMENTS

Climate 

zone 

Single-section 

Uo

Multi-section 

Uo

1 ................ 0.086 0.082 

2 ................ 0.062 0.063 

3 ................ 0.053 0.052 

• Update the area-weighted average 

vertical fenestration U-factor 

requirements to the HUD zones instead. 

DOE proposes that the area-weighted 

average vertical fenestration U-factor 

must not exceed 0.48 in climate zone 2 

or 0.40 in climate zone 3. 

• Update the area-weighted average 

skylight U-factor requirements to reflect 

use of the HUD zones instead. DOE 

proposes that the area-weighted average 

skylight U-factor must not exceed 0.75 

in climate zone 2 and climate zone 3. 

DOE also notes that section R401.2.5 

of the 2021 IECC requires that in 

addition to the prescriptive compliance 

option, additional energy efficiency 

requirements must be utilized to 

achieve further energy savings. Section 

408.2 provides five additional efficiency 

package options to achieve these 

additional energy savings, which 

include: (1) Enhanced envelope 

performance; (2) more efficient HVAC 

equipment performance; (3) reduced 

energy use in service water heating; (4) 

more efficient duct thermal distribution; 

and (5) improved air sealing and 

efficient ventilation system. 

In developing recommendations the 

MH working group evaluated the 2015 

IECC, which does not include 

comparable provisions to section 

R401.2.5 and R408.2 of the 2021 IECC. 

However, the MH working group 

generally did not recommend provisions 

addressing minimum appliance 

efficiencies. For example, the MH 

working group reached consensus that 

R401.5 of 2015 IECC, which provided 

for tradeoffs between the building 

thermal envelope and HVAC equipment 

and other appliances, was not 

applicable to manufactured homes. (MH 

working group, No. 107 at p. 22) 

Consistent with the recommendations of 

the MH working group, the performance 

requirements in the proposed energy 

conservation standards are specific to 

the building thermal envelope only, and 

do not incorporate any specifications on 

HVAC energy efficiency. Accordingly, 


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47774 Federal Register / Vol. 86, No. 163 / Thursday, August 26, 2021 / Proposed Rules 

29Taylor, Zachary T. Residential Heat Recovery 

Ventilation. United States. https://doi.org/10.2172/ 

1488935. 

30 ‘‘Overall U-Values and Heating/Cooling 

Loads—Manufactured Homes’’ by Conner and 

Taylor. 

DOE did not consider the more efficient 

HVAC equipment performance and 

reduced energy use in service water 

heating options in this SNOPR. 

Further, DOE also did not examine 

the more efficient duct thermal 

distribution option based on EISA’s 

allowance to consider the design and 

factory construction techniques of 

manufactured housing. (42 U.S.C. 

17071(b)(2)) DOE understands that the 

requirements in R408.2 of the 2021 IECC 

focus primarily on the location of the 

duct or ductless systems in a home (in 

terms of duct thermal distribution 

design) as opposed to improving 

efficiency of the ducts as already 

installed and designed. Therefore, the 

options remaining were those that DOE 

considered are relevant to manufactured 

homes and this rulemaking, which 

include the enhanced envelope 

performance option and the improved 

air sealing and efficient ventilation 

option. 

The enhanced envelope performance 

option in the 2021 IECC requires that 

the total building thermal envelope UA 

(the sum of U-factor times assembly 

area) shall be less than or equal to 95 

percent of the total UA resulting from 

multiplying the U-factors in Table 

R402.1.2. (Section R408.2.1 of the 2021 

IECC) For this SNOPR, DOE was unable 

to incorporate this requirement given 

the proposed building thermal envelope 

requirements in Table III.8 and the 

space constraints of manufactured 

homes. 

The improved air sealing and efficient 

ventilation system option requires that 

the measured air leakage rate is less 

than or equal to three air changes per 

hour (‘‘ACH’’), with either heat recovery 

ventilators (‘‘HRV’’) or energy recovery 

ventilators (‘‘ERV’’), installed (with 

specific requirements on airflow). An 

HRV recovers heat from the exhaust air 

and then adds it to the supply air drawn 

from outside the home. An ERV also 

recovers heat from the exhaust air, but 

also transfers some of the moisture from 

the exhaust air to keep the humidity in 

the home at a constant level. DOE notes 

that ERV and HRV fans can be 

applicable to manufactured housing. 

However, this option would require an 

HRV or ERV, which the MH working 

group or DOE had not considered 

previously. 

Analysis conducted in support of the 

DOE Building Energy Codes Program 

(‘‘BECP’’) suggests that a primary first 

cost for HRV could be as high as 

$1,500.29 ERVs were not considered in 

the analysis. Although the BECP 

analysis concluded that HRVs are cost 

effective for certain northern climate 

zones, DOE notes that the analysis 

conducted is based on a single-family 

home size conditioned floor area (1,200 

to 4,500 ft2 CFA), whereas 

manufactured homes are typically 

smaller in size (single section homes are 

analyzed with 924 ft2 CFA). For this 

SNOPR, DOE is not proposing either the 

HRV or ERV option because DOE has 

not yet determined whether this 

requirement would be cost-effective in 

manufactured homes. 

DOE requests comment on the Tier 1 

energy conservation standards, which 

would be applicable to manufactured 

homes with a manufacturer’s retail list 

price of $55,000 or less. DOE also 

requests comment on the proposed 

energy conservation standards based on 

the most recent version of the IECC for 

the Tier 2 and untiered standards and 

the consideration of R–21 sensitivity for 

exterior wall insulation for climate 

zones 2 and 3. 

DOE requests comment on the 

additional energy efficiency 

requirements from the 2021 IECC and 

whether they should apply to 

manufactured homes, including those 

that DOE has initially considered as not 

applicable to manufactured homes. If so, 

DOE requests comment on how these 

requirements would apply and the costs 

and savings associated with these 

requirements. 

The following sections discuss 

comments DOE received regarding the 

building thermal envelope requirements 

proposed in the June 2016 NOPR, and 

any other corresponding proposed 

changes to the June 2016 NOPR 

requirements. 

General Comments on the Prescriptive 

Requirements 

DOE received several comments 

regarding the prescriptive requirements 

proposed in the June 2016 NOPR. NEEA 

commented that the prescriptive 

requirements for exterior walls, floor, 

ceiling, and fenestration should be 

based on U-factors, not current 

prescriptive requirements for R-value or 

U-factor alternative. NEEA stated that 

the proposed approach may result in 

two different thresholds depending on 

how the engineer chooses to calculate 

the U-factor alternative. (NEEA, No. 190 

at p. 2) In response, DOE notes that 

allowing for both insulation R-value and 

fenestration U-factor requirements, in 

addition to equivalent U-factor 

alternatives to R-values, allows for more 

flexibility for manufacturers to comply 

with the energy conservation standards. 

Having both insulation R-value and 

fenestration U-factor requirements are 

also in line with the 2021 IECC 

requirements. Further, DOE is proposing 

that manufacturers use the Battelle 

method for calculating the overall 

thermal transmittance (Uo) of a 

manufactured home, which is the same 

as the HUD Code and provides a 

consistent way to calculate the 

component U-factors to determine Uo. 

Therefore, DOE continues to propose in 

this SNOPR both R-value and U-factor 

options for the prescriptive 

requirements, and a U-factor alternative 

requirement. 

DOE also received several comments 

regarding the U-factor alternatives to Rvalue requirements. NEEA 

recommended that the U-factors used 

for the standard be recalculated based 

on framing factors used in the 

manufactured home industry. For 

example, in section 7.4.2 of the June 

2016 NOPR TSD, the assumed framing 

factor in walls is 25 percent, which 

NEEA commented is reasonable for sitebuilt homes, but not for manufactured 

homes. NEEA commented that typical 

framing factors in manufactured homes 

rarely exceed 18 percent because they 

are single-story structures built in 

factories with glazing fractions 

(applicable to windows, skylights, and 

doors, for example) most commonly less 

than 12 percent. NEEA also stated that 

updating the U-factors using 

manufactured home-specific factors 

would increase the cost-effectiveness of 

the proposal. (NEEA, No. 190 at p. 2) 

RECA and ACEEE commented that the 

proposed U-factor values for specified 

R-values were significantly less efficient 

that the equivalent U-factors set by the 

IECC. (RECA, No. 188 at p. 6 ACEEE, 

No. 178 at p. 2) WSU Energy Program 

commented that there might be some 

issues with the R-value and U-factor 

calculations and that the U-factor 

equivalent to R-21 that DOE used is 

much lower than the standard at R-21. 

WSU Energy Program provided the 

same comment with respect to the 

exterior floor. (WSU Energy Program, 

Public Meeting Transcript, No. 148 at p. 

42) 

Based on the comments received, 

DOE revisited the calculations 

performed to determine the U-factor 

alternatives to R-value requirements. To 

perform the calculations, DOE used the 

Battelle method that was recommended 

by the MH working group.30 DOE 

performed these calculations based on 

typical wall, ceiling, and floor 


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assemblies used by the manufactured 

home industry. 

DOE used a different R-value to Ufactor equivalency conversion than the 

IECC because the IECC equivalency 

conversion is primarily based on typical 

site-built home construction parameters 

(focus of the 2015 IECC and the 2021 

IECC) whereas DOE’s focus is typical 

manufactured home construction 

parameters. EISA allows for DOE to take 

the design and factory construction 

techniques of manufactured homes into 

consideration for the energy 

conservation standards. (42 U.S.C. 

17071(b)(2)(A)) As such, the R-value to 

U-factor equivalency conversion used in 

this SNOPR is modified from the 2021 

IECC conversion approach to reflect 

manufactured homes rather than sitebuilt homes. When comparing the Ufactors from the proposal and the Ufactors from the 2015 IECC and the 2021 

IECC, the largest difference is with the 

exterior ceiling and exterior floor Ufactors. The manufactured home 

dimensions that were used in the 

analysis were those recommended by 

the MH working group. Manufactured 

homes typically have a lower overall 

height compared to site-built homes, 

which leads to constrained space, and 

therefore there is less exterior ceiling 

and exterior floor insulation. See 

Chapter 7 of the TSD for further details 

on how the equivalent U-factors were 

determined. 

DOE based certain aspects of its 

rulemaking analysis (R-value to U-factor 

conversion, energy use calculations, 

incremental costs, etc.) on a home built 

to the typical specifications 

recommended by the MH working 

group. These specifications included an 

assumption of a 25 percent framing 

fraction, which the MH working group 

considered typical for manufactured 

homes. Absent sufficient justification to 

change the assumptions, which could 

result in significant changes to 

fundamental aspects of the 

recommendations of the MH working 

group, DOE maintains the assumptions 

from its analysis in the June 2016 

NOPR. As discussed previously, DOE is 

proposing that manufacturers use the 

Battelle method for calculating the 

overall thermal transmittance (Uo) of a 

manufactured home, which allows for 

the option to use framing fractions 

based on the construction of the home, 

in addition to typical framing fractions. 

Therefore, in practice, if a manufacturer 

uses a framing fraction specific to the 

construction of the home, the 

manufacturer may use more or less 

insulation relative to the representative 

home in DOE’s model, but the energy 

use will be the same when using the Ufactor alternative path to compliance. 

Therefore, in its analysis, DOE used the 

recommendations for typical assemblies 

and the calculation methodology from 

the MH working group. As previously 

discussed in this section, DOE has 

updated the U-factor alternatives to 

match the SNOPR-proposed prescriptive 

R-value building thermal requirements, 

which reflect use of the HUD zones and 

the tiered proposal. 

DOE also received a comment 

regarding U-factor alternatives for 

single-section versus multi-section 

homes. ACEEE stated that basing the Ufactor alternatives on single-section 

home construction means the values are 

less stringent (i.e., can be achieved with 

lower insulation R-values) for multisection homes. ACEEE urged DOE to use 

the more stringent multi-section Ufactors for all homes, or to provide 

separate values for the two types of 

homes as is done for the overall Ufactors (Uo) in the performance building 

thermal envelope requirements. 

(ACEEE, No. 178 at p. 3) 

In response, DOE notes that the 

objective of the U-factor alternative is to 

create an equivalent U-factor 

requirement when compared to the 

corresponding R-value. Based on this 

objective, DOE agrees that the U-factor 

alternative should be different for 

single-section compared to multisection homes for the external ceiling 

assembly because the assumed typical 

construction of the external ceiling 

differs in the ratio of insulation to 

framing members. Other assemblies, 

such as the external wall and floor, are 

assumed to be the same for single- and 

multi-section homes, so the U-factor 

alternative for those assemblies would 

also be the same for both home sizes. 

For this SNOPR, DOE proposes separate 

U-factor alternatives for the external 

ceilings of single- and multi-section 

homes. DOE used the Battelle method to 

determine the external ceiling U-factor 

for both single- and multi-section 

homes. More details on the assumptions 

used for this calculation are provided in 

chapter 7 of the TSD. See Table III.9 and 

Table III.10 for the updated proposed 

external ceiling U-factor alternatives. 

DOE also received specific comments 

regarding the prescriptive requirements. 

NEEA recommended that DOE should 

provide a list of typical constructions 

with nominal R-value batt insulation 

configurations that meet the U-value 

targets, as this allows designers to 

comply with standards without 

considering all possible framing, door 

and window configurations. (NEEA, No. 

190 at p. 2) The proposed prescriptive 

requirements already serve this purpose: 

The prescriptive requirements would 

allow a manufacturer or designer to 

simply install certain insulation and 

fenestration components in the house to 

achieve compliance with regulations. 

The U-factor alternative and the 

performance path would provide greater 

flexibility in selecting insulation and 

fenestration components if the 

manufacturer chooses to run the 

necessary calculations. 

ACC FSC stated that there should be 

a reference to a document that lists Ufactor assumptions for non-insulation 

components when calculating U-factors. 

(ACC FSC, No. 186 at p. 1) DOE notes 

that the Battelle method provides details 

on typical framing factors, and any 

component specific rules for U-factor 

calculations. The Battelle method also 

provides references (including the 

ASHRAE HOF) and values for noninsulation components. The Battelle 

method is referenced in proposed 

section 460.3. 

Palm Harbor Homes stated that Table 

460.102–2 lists alternative U-factors to 

the fourth decimal, which is 

inconsistent with the Battelle method 

incorporated by reference and in which 

U-values are to the third decimal. Palm 

Harbor Homes recommended rounding 

the listed U-values to three decimal 

points. (Palm Harbor Homes, No. 193 at 

p. 2) DOE agrees that the U-values 

should be consistent with the Battelle 

method, and therefore has rounded the 

proposed U-factor alternatives to three 

decimal places. 

General Comments on the Performance 

Requirements 

DOE received a comment regarding 

the performance requirements proposed 

in the June 2016 NOPR. ACC FSC stated 

that the performance requirements 

allow for unlimited tradeoffs to the 

building envelope, as long as the net 

thermal performance is achieved. It 

commented that this approach assumes 

that all components are working 

together simultaneously, and that the 

maintenance of HVAC components is 

sustained. ACC FSC stated, however, 

that the thermal envelope will last much 

longer than the service lives of tradeoff 

components such as HVAC, and the 

short-term components will be required 

to be replaced. It suggested that the 

performance path should have a backstop to prevent excessive tradeoffs of the 

thermal envelope. (ACC FSC, No. 186 at 

p. 1) 

The performance requirements in the 

proposed energy conservation standards 

are specific to the building thermal 

envelope, and do not incorporate any 

specifications on HVAC energy 

efficiency or maintenance. Therefore, 

tradeoffs are only allowed within the 


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building thermal envelope, and not 

HVAC equipment or other appliances. 

For the thermal envelope, DOE proposes 

to limit tradeoffs between insulation 

and fenestration products via the 

following constraints, consistent with 

the MH working group 

recommendations and the 2021 IECC: 

• A maximum area-weighted average 

vertical fenestration U-factor of 0.48 in 

climate zone 2, or 0.40 for climate zone 

3, 

• A maximum area-weighted average 

skylight U-factor of 0.75 in climate 

zones 2 and 3, 

• Windows, skylights, and doors 

containing more than 50 percent glazing 

by area to satisfy the SHGC 

requirements under § 460.102(a) on the 

basis of an area-weighted average. 

Prescriptive SHGC Requirements 

DOE received several comments on 

the June 2016 NOPR that suggested that 

climate zones 1 and 2 should be 

combined into one climate zone, such 

that there would be three climate zones 

in total. Commenters stated that a SHGC 

requirement of 0.33 would then apply to 

all homes in the new combined climate 

zone. (Lippert Components, No. 152 at 

p. 1; MHIAZ, No. 161 at p. 3; PMHA, 

No. 164 at p. 3; Cavco, No. 167 at p. 1; 

SBRA, No. 163 at p. 3; Skyline, No. 165 

at p. 2; OMHA, No. 166 at p. 2; MHI, 

No. 182 at p. 1; MMHA, No. 170 at p. 

3; Clayton Homes, No. 185 at p. 2; Palm 

Harbor Homes, No. 193 at p. 1; MHISC, 

No. 191 at p. 2; MHIM, No. 155 at p. 3; 

Commodore Corporation, No. 195 at p. 

3) During the June 2016 NOPR public 

meeting and in its written comments, 

ACEEE and South Mountain supported 

the four proposed climate zones. 

(ACEEE, Public Meeting Transcript, No. 

148 at p. 35; ACEEE, No. 178 at p. 2; 

South Mountain, No. 151 at p. 1) 

As part of its written comment, SBRA 

also performed its own analysis on 

SHGC for climate zones 1 and 2 and 

found that 0.33 for both climate zones 

1 and 2 was most cost-effective for both 

zones. SBRA stated that it believes that 

DOE’s analysis in the February 2015 RFI 

was based on an atypical set of 

assumptions (e.g., all windows due 

west, no window shading, no 

landscaping), which it stated would be 

at odds with the MH working group’s 

approach of using industry average or 

market representative assumptions 

when evaluating the economic benefits 

of measures that improve energy 

performance. (SBRA, No. 163 at p. 5) 

SBRA acknowledged that its analysis 

applied markedly different assumptions 

than DOE’s analysis. The differences 

included the following: Window 

shading, window orientation, window 

area, and window cost. In addition, 

SBRA used the REMRate computer 

model, which is different than the 

Energy Plus 5.0 model used by DOE. 

(SBRA, No. 163 at p. 5) 

Regarding the SHGC requirements 

proposed by DOE in the June 2016 

NOPR, Lippert Components stated that 

the increased stringency on solar heat 

gain only really benefits those in the 

glazing industry, and the increased cost 

associated with increased stringency 

will reduce the sales of manufactured 

homes. Lippert Components suggested 

that the more stringent value of SHGC 

only be considered after real energy 

usage in homes has been evaluated and 

shows that it is a cost-viable option. 

(Lippert Components, No. 152 at p. 1) 

For climate zone 2, RECA commented 

that SHGC should be 0.25, consistent 

with the 2015 IECC, but did not 

comment in the context of the number 

of climate zones. It stated that DOE 

should not diverge from the IECC value, 

as the statute only allows deviations 

from the IECC value when the code is 

either not cost-effective, or when ‘‘a 

more stringent standard would be more 

cost-effective.’’ RECA asserted that the 

IECC value of 0.25 is cost-effective, and 

the statute does not allow for a less 

stringent standard that would be more 

cost-effective. (RECA, No. 188 at p. 3) 

RECA also commented that DOE’s 

analysis of cost effectiveness for SHGC 

values did not use worst-case 

orientation of all windows facing west. 

(RECA, No. 188 at p. 3) (In response to 

comments received on the February 

2015 RFI, DOE changed the assumption 

from all windows oriented west to 

assuming an even distribution of the 

windows.) RECA also stated that lowSHGC fenestration is both widely 

available and widely used in the 

proposed climate zone 2. (RECA, No. 

188 at p. 4) ACEEE stated that it has no 

objection to climate zones 1 and 2 

having the same required SHGC level 

considering that all other aspects of the 

standard are the same for the two zones; 

however, ACEEE did not recommend 

any specific SHGC. (ACEEE, No. 178 at 

p. 2) 

As already discussed in III.E.2.a of 

this document, DOE proposes to align 

the climate zones to the HUD zones 

(three zones) instead of the June 2016 

NOPR-proposed climate zones (four 

zones). In addition, as detailed 

previously in this document, DOE is 

proposing energy conservation 

standards based on the 2021 IECC, with 

a tiered and untiered proposal. For Tier 

1 of the tiered proposal, DOE proposes 

to base the standards on an incremental 

cost increase maximum because of 

concerns from HUD and stakeholders 

regarding the high upfront cost from the 

June 2016 NOPR standards. For the Tier 

2 and untiered proposal, however, 

because of the proposed updates of the 

energy efficiency measures to HUD 

zones, DOE is proposing a glazed 

fenestration requirement of 0.33 for 

proposed climate zone 1. The proposed 

building thermal envelope measures are 

discussed in section III.E.2.b of this 

document. 

For the energy modeling in Energy 

Plus 5.0, DOE used the same 

assumptions as the June 2016 NOPR 

analysis for window-to-floor area, 

window shading, and window cost, 

which were recommendations from the 

MH working group and formed the basis 

of the MH working group’s deliberations 

and recommendations. DOE continues 

to find the assumptions of the MH 

working group appropriate and is 

continuing to apply them in this SNOPR 

rather than those assumptions from the 

SBRA analysis. As explained in the June 

2016 NOPR, DOE did not find reason to 

use assumptions different from those 

recommended by the MH working group 

based on the considerations of the MH 

working group arriving at them. 81 FR 

39756, 39772. 

In addition, while DOE had originally 

modeled all windows facing west, based 

on comments received in response to 

the February 2015 RFI, DOE changed 

the assumption from all windows 

oriented west to assuming an even 

distribution of the windows. DOE 

maintains the assumption of uniform 

window distribution in the SNOPR, 

rather than RECA’s assumption of all 

windows due west. As explained in the 

June 2016 NOPR, although the 

assumption of all windows facing west 

represents the highest energy use 

window orientation, consumers of 

manufactured homes with other 

window orientations would not 

experience as large an economic benefit. 

81 FR 39756, 39772. 

Regarding the window costs 

specifically, SBRA stated that DOE’s 

estimate for the incremental cost to the 

consumer to improve the SHGC from 

0.33 to 0.25 for a single-section home 

was too low. While DOE used an 

incremental cost of $91, SBRA stated 

that it determined that the incremental 

cost for the SHGC improvement would 

be $144. SBRA stated that it gathered 

pricing data from the industry’s major 

window suppliers but did not provide 

the sources for this information or the 

calculations used to arrive at this 

estimate. Additionally, it did not 

provide its estimate for the incremental 

cost for multi-section homes. 

In response to SBRA’s comment on 

window costs, DOE conducted further 


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research on the costs of windows with 

comparable U-factor and SHGC values. 

DOE’s research found that both DOE’s 

and SBRA’s window cost estimates are 

within the range of common industry 

costs per square foot of fenestration. 

Because DOE has seen no evidence that 

the assumptions agreed to by the MH 

working group are no longer 

representative of typical manufactured 

home construction, DOE continues to 

use the same assumptions from the MH 

working group for the SHGC analysis. 

Term Sheet, No. 107 at p. 3. 

RECA commented that reduced SHGC 

fenestration can result in benefits like 

smaller air conditioning systems (which 

have a lower purchase price) and the 

reduction of peak-load electricity 

demand due to smaller cooling loads 

(and the smaller cooling equipment). 

(RECA, No. 188 at p. 3) In the June 2016 

NOPR, DOE did not include air 

conditioner downsizing and associated 

cost savings opportunities in its SHGC 

analysis (or any of its cost-effectiveness 

analysis). 

DOE recognizes that decreases in air 

conditioning equipment size and peak 

electric load may result from the 

proposed requirements. However, these 

outcomes may not happen in practice 

for all consumers. Further, while 

reduction in peak demand is a benefit 

to the nation, not all consumers have an 

energy bill pricing structure (time of use 

based) that would afford them direct 

benefits. Therefore, DOE did not 

introduce the uncertainty associated 

with these potential benefits into the 

LCC analysis, and instead continues to 

focus on the direct impacts of 

improvements to the building thermal 

envelope insulation and other energy 

efficiency measures. 

Window/Fenestration U-Factors 

In the June 2016 NOPR, DOE 

proposed window U-factors of 0.35 for 

climate zones 1, 2, and 3; and 0.32 for 

climate zone 4. Skyline Corporation 

commented that the 2015 IECC allows 

for window U-factor of 0.40 for climate 

zones 1 and 2, which is higher than the 

window U-factor allowed in the 

proposed rule. It recommended that a Ufactor of 0.40 be used for climate zone 

1. (Skyline, No. 165 at p. 2) 

As already discussed, DOE is 

proposing to rely on the HUD zones. 

Further, for the Tier 2 and untiered 

proposals, DOE has updated the 

proposed requirements based on the 

latest version of the IECC (the 2021 

IECC), in accordance with the EISA 

mandate. See 42 U.S.C. 17071(b)(1) 

Accordingly, DOE proposes updated 

window U-factor requirements based on 

a review of the 2021 IECC, which are 

summarized in Table III.8. 

In the tiered proposed approach DOE 

is proposing as Tier 1 requirements a set 

of energy conservation requirements 

with a first-cost impact of 

approximately $750. The Tier 1 energy 

efficiency measures proposed in this 

document would provide energy savings 

exceeding that amount and are 

presented in section III.E.2.b. DOE has 

tentatively determined that a window 

U-factor of 1.08, 0.5 and 0.35 for climate 

zones 1, 2 and 3 respectively, in 

addition to the combination of the other 

thermal envelope measures, would 

provide savings above the first-cost 

impact in each of the proposed climate 

zones. 

Sections R405 and R406 From the IECC 

In the June 2016 NOPR, DOE did not 

propose including sections R405 and 

R406 from the IECC. Section R405 of the 

2015 IECC establishes criteria for 

compliance using a simulated energy 

performance analysis, which involves 

calculating expected building energy 

use and comparing that value to the 

energy use of a standard reference 

building that complies with the 

minimum specifications of the 2015 

IECC. Section R405 compliance is based 

on the total estimated annual energy 

usage across the whole building: 

Envelope, mechanical, and service 

water heating. Section R406 of the 2015 

IECC establishes criteria for compliance 

using an energy rating index that 

contemplates the use of software to 

calculate the energy use of a building. 

DOE stated that while both sections are 

valid and technically feasible options, 

the options do not appear to offer 

additional flexibility in the design of a 

manufactured home relative to the 

performance requirements for the 

building thermal envelope. 

Several commenters, however, stated 

that the proposed rule lacks a 

performance path that enables tradeoff 

among a wider range of energy features 

than the envelope alone, and 

recommended that DOE consider 

compliance options tailored for the 

manufactured housing industry, using 

section R405, Simulated Performance 

Alternative, and section R406, Energy 

Rating Index Compliance Alternative, 

from the 2015 IECC as models. (SBRA, 

No. 163 at p. 2; MHI, No. 182 at p. 8; 

Palm Harbor Homes, No. 193 at p. 2; 

NPGA, No. 171 at p. 2; AGA & APGA, 

No. 172 at p. 1) 

Sections R405 and R406 incorporate 

the energy use of the whole building, 

including mechanical equipment such 

as appliances. The performance 

requirements in the proposed energy 

conservation standards are specific to 

the building thermal envelope only. As 

discussed, the MH working group 

generally did not recommend provisions 

addressing minimum appliance 

efficiencies and specifically identified 

R405 and R406 as inapplicable to 

manufactured homes. (MH working 

group, No. 107 at p. 22) Consistent with 

the recommendations of the MH 

working group, the performance 

requirements in the proposed energy 

conservation standards are specific to 

the building thermal envelope only, and 

do not provide for tradeoffs with 

mechanical equipment such as 

appliances. DOE does capture a key 

element of sections R405 and R406 in its 

performance path to compliance. The 

IECC does not have a Uo-based 

performance path; it instead has the 

options described in sections R405 and 

R406. Similar to those sections, a Uo

calculation gives the manufactured 

home manufacturer the flexibility to 

design the manufactured home, as long 

as the overall Uo is met. 

DOE also received comments 

regarding the use of sections R405 and 

R406 of the IECC, citing the use of a fullfuel-cycle (FFC) calculation in those 

provisions as an advantage in terms of 

fully accounting for the impact of homes 

heated with different fuel types. (NPGA, 

No. 171 at p. 2; AGA & APGA, No. 172 

at p. 1) An FFC measure of energy 

includes point-of-use (site) energy; the 

energy losses associated with 

generation, transmission, and 

distribution of electricity; and the 

energy consumed in extracting, 

processing, and transporting or 

distributing primary fuels. 

NPGA commented that R405 includes 

an exception for the performance-based 

compliance approach, which allows the 

energy use to be based on source energy 

by using a source energy multiplier (one 

for electricity and another for fuels other 

than electricity). NPGA stated that this 

exception would be consistent with 

DOE’s approach of incorporating energy 

consumption and emissions beyond the 

site in DOE’s national impact analysis. 

In addition, NPGA commented that the 

adoption of R405 would provide a 

means for manufacturers of HUD homes 

to choose appliances based on their FFC 

efficiency ratings, and in turn, benefit 

from any reductions in FFC energy 

consumption and carbon emissions. 

(NPGA, No. 171 at p. 2) AGA and APGA 

encouraged DOE to reconsider 

incorporating sections R405 or R406 of 

the IECC, which utilizes the FFC 

analysis, for the national impact 

analysis. (AGA & APGA, No. 172 at p. 

1) 


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As discussed previously, sections 

R405 and R406 would incorporate the 

energy use of the whole building, 

including mechanical equipment. 

Therefore, any FFC energy use resulting 

from sections R405 and R406 would 

also include energy use of the whole 

building. However, for the reasons 

discussed, this rulemaking only 

proposes provisions specific to the 

building thermal envelope. Therefore, 

DOE continues to not propose 

requirements associated with alternative 

performance from the 2015 and the 2021 

IECC sections R405 and R406 in this 

SNOPR. 

Ceiling Insulation Requirement 

In the June 2016 NOPR, DOE 

proposed that exterior ceiling insulation 

must have uniform thickness or a 

uniform density. Several commenters 

stated that uniform thickness will 

generally not be possible, and uniform 

density would not allow high-density 

insulation in the truss heel area. (SBRA, 

Public Meeting Transcript, No. 148 at p. 

52; NEEA, Public Meeting Transcript, 

No. 148 at p. 53; MHIM, No. 155 at p. 

3; MHIAZ, No. 161 at p. 3; PMHA, No. 

164 at p. 3; Cavco, No. 167 at p. 2; 

SBRA, No. 163 at p. 3; Skyline, No. 165 

at p. 3; OMHA, No. 166 at p. 3; MHCC, 

No. 162 at p. 1; MHI, No. 182 at p. 3; 

MMHA, No. 170 at p. 3; Clayton Homes, 

No. 185 at p. 3; Palm Harbor Homes, No. 

193 at p. 2; MHISC, No. 191 at p. 3; 

Commodore Corporation, No. 195 at p. 

3) 

DOE tentatively agrees with 

commenters that the exterior ceiling 

insulation proposal of uniform 

thickness or a uniform density would 

prohibit effective insulation techniques. 

While uniform thickness and density is 

sound insulation installation practice in 

most situations, given that the space 

between the roof and exterior ceiling is 

limited, particularly at the eaves, this 

uniformity may not be possible at the 

insulation levels proposed in the NOPR. 

In addition, there is no requirement in 

the 2015 or the 2021 IECC for uniform 

thickness or density. Therefore, DOE is 

not proposing in this SNOPR to require 

that exterior ceiling insulation must 

have uniform thickness or a uniform 

density. 

DOE requests comment on the 

proposal to not require that exterior 

ceiling insulation must have uniform 

thickness or a uniform density. 

Total Area of Glazed Fenestration 

Requirement 

In the June 2016 NOPR, DOE 

proposed a maximum ratio of 12 percent 

for glazed fenestration area to floor area 

for energy modeling purposes, 

consistent with the recommendation 

from the MH working group. DOE used 

this ratio as a typical housing 

characteristic in its analyses for 

determining the prescriptive 

requirements. DOE also required the 

same ratio in the proposed prescriptive 

requirements. DOE received several 

comments regarding the proposed 

prescriptive requirement for the 

maximum total area of glazed 

fenestration. Several commenters stated 

that there is no such total area of glazed 

fenestration requirement in the 2015 

IECC, and therefore the requirement 

must be removed from DOE’s 

prescriptive requirements. (Skyline, No. 

165 at p. 3; MHCC, No. 162 at p. 1; MHI, 

No. 182 at p. 4; Clayton Homes, No. 185 

at p. 3; RECA, No. 188 at p. 5; PMHA, 

No. 164 at p. 4; WDMA, No. 183 at p. 

2) 

DOE agrees that there are no similar 

glazing requirements in the 2015 or the 

2021 IECC. DOE proposed a fenestration 

area to floor area limit in the June 2016 

NOPR to preserve energy savings 

associated with the prescriptive 

requirements. While the performance 

requirements improved building 

thermal envelope insulation to offset 

larger fenestration to floor area 

percentages (fenestration typically has a 

much higher U-factor than an exterior 

wall), the prescriptive requirements 

would prohibit a home to be 

constructed primarily from fenestration. 

DOE now tentatively finds that a 12- 

percent ratio was too restrictive given 

current manufacturing practices for 

manufactured homes. Therefore, in this 

SNOPR, DOE is not proposing a limit on 

the total area of glazed fenestration. 

DOE still maintains that a 12-percent 

ratio is typical in practice and does not 

expect the absence of such a 

requirement to result in an increase in 

the construction of homes with larger 

fenestration to floor area ratios. Such 

design would likely be much more 

expensive (windows are costly relative 

to opaque wall), and thereby limit the 

increase in use of fenestration. 

DOE requests comment on the 

proposal not to limit the total area of 

glazed fenestration. 

Using NFRC for U-Factor and SHGC 

Values 

DOE received several comments 

regarding the use of the National 

Fenestration Rating Council (‘‘NFRC’’) 

labels for the fenestration U-factor and 

SHGC values. RECA commented that 

the IECC has always had a requirement 

that fenestration be labeled and certified 

to certain NFRC standards, and that a 

set of default U-factors and SHGCs are 

given for fenestration that are not 

labeled to these standards. RECA 

recommended using NFRC standards to 

maintain consistency with the 2015 

IECC, and that DOE clarify that products 

lacking the NFRC labels shall be 

assigned the default U-factor or SHGC 

values. (RECA, Public Meeting 

Transcript, No. 148 at p. 45; RECA, No. 

188 at p. 7). Lippert Components 

commented that the June 2016 NOPR 

proposal was unclear as to when to use 

the default U-factor and SHGC values. 

Lippert Components stated that the MH 

working group intended the default Ufactor and SHGC tables to apply to 

fenestration that did not have thirdparty certified thermal performance 

ratings developed in accordance with 

NFRC methodology. Therefore, Lippert 

Components suggested updating the 

language, and clarifying what 

constitutes certified ratings by using 

similar wording to that found in 

C303.1.1 in the 2015 IECC. (Lippert 

Components, No. 152 at p. 2) 

WDMA commented that fenestration 

U-factor and SHGC should be 

determined with NFRC 100 and 200, 

respectively. WDMA also commented 

that the lack of a proposed test 

procedure leaves the proposed 

standards incomplete. (WDMA, No. 183 

at p. 2) Additionally, ACEEE stated that 

the 2015 IECC (section R303.1.3) directs 

that fenestration generally be rated by 

the NFRC. It recommended 

incorporating this standard, stating that 

it will ensure consistency with site-built 

homes and allow for more window 

options. (ACEEE, No. 178 at p. 2) 

NFRC standards are widely used by 

industry in a variety of capacities. Many 

component manufacturers affix an 

NFRC label to their fenestration 

products, which includes the U-factor, 

SHGC, visible transmittance, and air 

leakage values. The NFRC program has 

a large number of participants (more 

than 500 component manufacturers), 

and NFRC-certified products frequently 

are used to comply with local energy 

code requirements. In addition, a 

fenestration product must be NFRCcertified to meet the criteria for 

becoming an ENERGY STAR product. 

Also, the 2021 IECC reference NFRC in 

section R303.1.3 for fenestration 

product rating. 

Since DOE published the June 2016 

NOPR, DOE has also published the 

November 2016 test procedure NOPR 

for manufactured housing, which 

proposed NFRC standards to determine 

fenestration U-factor and SHGC. See 81 

FR 78733, 78738–78739. Specifically, in 

the November 2016 test procedure 

NOPR, DOE proposed that the 

fenestration U-factors and SHGC be 

tested based on ANSI/NFRC 100 and 


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31The first value is cavity insulation and the 

second value is continuous insulation. Therefore, 

‘‘13+5’’ would mean R-13 cavity insulation plus R5 continuous insulation. In general, the cavity 

insulation is interrupted by framing members, 

which lets heat through more readily, whereas 

continuous insulation is uninterrupted. Therefore, 

a layer of cavity insulation is less effective than a 

layer of continuous insulation for the same R-value. 

To calculate the wall assembly’s overall R-value, as 

would be required under the proposed rule, one 

would need to use the Battelle method, which 

references the ASHRAE HOF. 

32Lstiburek, Joseph, BSI–009: New Light in 

Crawlspaces, Building Science Corporation (2010), 

et al. 

200 respectively. In addition, DOE 

proposed that for the prescriptive 

requirements, manufacturers be allowed 

to use either the NFRC-rated 

fenestration U-factor and SHGC values, 

or the default U-factor and SHGC values 

provided by DOE. Because the use of the 

NFRC standards applies directly to the 

manufactured housing test procedure, 

DOE will address these comments in 

any future action addressing testing, 

compliance and enforcement provisions 

related to these standards. 

In addition, regarding NFRC labels, 

NEEA recommended that the final rule 

be explicit that the NFRC labels should 

remain on the windows until the house 

arrives at the site. (NEEA, No. 190 at p. 

3) DOE’s authority for this rulemaking is 

to establish energy conservation 

standards for manufactured housing as 

manufactured. (42 U.S.C. 17071(c)) The 

proposed energy conservation standards 

are specific only to the building thermal 

requirements for a manufactured home. 

However, DOE notes that the energy 

conservation standards, if finalized as 

proposed, would not prevent industry 

from pursuing this labeling practice 

suggested by NEEA. 

Other Remaining Comments Regarding 

§ 460.102 

DOE also received individual 

comments regarding the proposed 

building thermal envelope requirements 

in § 460.102. ACC FSC stated that 

exterior foam sheathing should be listed 

as an alternative to cavity-only 

insulation. (ACC FSC, No. 186 at p. 1) 

For this rule as proposed, DOE is not 

precluding the use of foam sheathing. 

As long as the installed insulation 

would meet the building thermal 

envelope requirements, as finalized, 

then it would be an acceptable option 

for use in a manufactured home. 

ACC FSC also specifically requested 

that DOE add an ‘‘R13+5ci’’ 31 option to 

climate zones 3 and 4 for the wall Rvalue under the prescriptive path. (ACC 

FSC, No. 186 at p. 1) As long as the 

installed insulation would meet the 

adopted building thermal envelope 

requirements, the proposed 

requirements would not prohibit certain 

insulation options from being used in 

the manufactured home. 

c. Proposed § 460.103 Installation of 

Insulation 

Consistent with the June 2016 NOPR, 

DOE proposes in § 460.103 of the 

regulatory text to require manufacturers 

to install insulation according to both 

the insulation manufacturer’s 

installation instructions and the 

instructions set forth in proposed Table 

460.103. DOE also proposes to require 

manufacturers to comply with the 

insulation manufacturer’s installation 

instructions to ensure that the intended 

performance of the insulation is 

achieved. Further, consistent with the 

June 2016 NOPR, DOE proposes to add 

as part of a new Table 460.103 several 

component installation requirements, 

including general requirements, and 

requirements for access hatches, panels 

and doors, baffles, ceiling or attic, eave 

vents, narrow cavities, rim joists, 

shower or tub adjacent to exterior wall, 

and walls. 

The following paragraphs discuss 

comments DOE received regarding the 

installation of insulations requirements 

proposed in the June 2016 NOPR, and 

any other corresponding proposed 

changes to the June 2016 NOPR 

requirements based on comments 

received, or updates to the 2021 IECC. 

DOE received a comment on the June 

2016 NOPR regarding the quality of 

insulation installation. Wisconsin 

Energy Conservation Corporation 

(WECC) commented that the overall 

quality of the insulation installation is 

important to avoid any degradation in 

insulation performance. (WECC, No. 150 

at p. 3) Consistent with the 2015 and the 

2021 IECC, DOE has maintained that 

insulation is to be installed according to 

the manufacturer’s instructions to 

ensure the insulation achieves its rated 

R-value. 

DOE received several comments on 

the June 2016 NOPR regarding the 

exterior floor insulation requirements. 

In general, commenters stated that the 

provision requiring exterior floor 

insulation be placed in contact with the 

subflooring material be removed 

because the requirement is not 

supported by building scientists; DOE 

has not demonstrated its value for 

manufactured home energy efficiency; 

assuming the bottom board acts as the 

air barrier (as seen in Table 460.104) 

obviates the need for the insulation to 

be in contact with the decking; the 

overall efficiency of the home decreases 

as exterior floor insulation between Ibeams is usually placed beneath ducts 

(effectively moving the ducts inside the 

thermal envelope minimizing thermal 

losses); and it is difficult to do in a 

factory setting. (MHIM, No. 155 at p. 3; 

MHIAZ, No. 161 at p. 3; PMHA, No. 164 

at p. 3; Cavco, No. 167 at p. 1; SBRA, 

No. 163 at p. 3; OMHA, No. 166 at p. 

3; MHI, No. 182 at p. 3; MMHA, No. 170 

at p. 3; Clayton Homes, No. 185 at p. 3; 

Palm Harbor Homes, No. 193 at p. 2; 

MHISC, No. 191 at p. 3; Commodore 

Corporation, No. 195 at p. 3; Skyline, 

No. 165 at p. 3; MHCC, No. 162 at p. 1). 

During the public meeting, NEEA also 

stated that the permanent contact with 

the underside of the subfloor is virtually 

impossible in the center of a 

manufactured home. (NEEA, Public 

Meeting Transcript, No. 148 at p. 55) 

WECC commented that it is impractical 

to require insulation to completely 

contact the subfloor; completely filling 

the floor with insulation results in 

cooler floor temperatures leading to 

consumer complaints. WECC also 

questioned how the insulation under 

the ductwork will be supported and 

maintained, and to what extent the 

cross-braces have an effect on 

compaction of increased fiberglass. 

Overall, WECC stated that it sees many 

logistical problems with the extra levels 

of insulation. (WECC, No. 150 at p. 2) 

The requirement that exterior floor 

insulation installed must maintain 

permanent contact with the underside 

of the subfloor is found in the 2015 

IECC, which was the basis of the June 

2016 NOPR requirement. However, a 

study provided by MHI and other 

stakeholders shows that this 

requirement is not necessary and can 

actually be harmful to homes.32 The 

study finds that installing insulation on 

the underside of the floor decking 

results in the wood floor joists from the 

floor framing to get cold enough that the 

temperature falls below the dewpoint 

temperature of the air in the crawlspace. 

The low temperatures would therefore 

form condensation on the surface of the 

wood, which could affect the integrity 

of the flooring. Based on the comments 

received, including the cited study, DOE 

tentatively agrees that it is inappropriate 

for MH manufacturers to give insulation 

permanent contact under the whole 

subfloor. In addition, in manufactured 

homes, the common practice is to lay 

blanket insulation over the duct work 

below the floor, placing the ducts 

between the insulation and the rough 

floor decking, which creates a pocket of 

air between the blanket insulation and 

the rough floor decking in the space 

near the ducts. Therefore, by taking into 

account common manufactured home 


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33 Green Fiber insulation fact sheet; https://

www.greenfiber.com/uploads/documents/FactSheet-INS541LD-19.05LB-Retail-Bag.pdf. 

34CertainTeed sustainable insulation installation 

manual; https://www.buildsite.com/pdf/ 

certainteed/CertainTeed-Sustainable-InsulationInstallation-Instructions-1814058.pdf. 

building practice, in this SNOPR, DOE 

is deviating from the 2015 and the 2021 

IECC and proposes to remove the 

requirement that exterior floor 

insulation installed must maintain 

permanent contact with the underside 

of the rough floor decking over which 

the finished floor, flooring material, or 

carpet is laid. 

DOE requests comment on removing 

the proposed requirement that exterior 

floor insulation installed must maintain 

permanent contact with the underside 

of the rough floor decking. 

DOE also received several comments 

specifically on duct material and 

insulation. Cavco and Pfeffer stated that 

high-density duct board and flex duct is 

subject to severe rodent degradation 

over time, and so ductwork material 

should be considered in the rulemaking. 

(Cavco, Public Meeting Transcript, No. 

148 at p. 67; Pfeiffer, No. 150 at p. 1) 

WECC and NCJC advocated using metal 

ductwork for the entire duct system. 

Metal ductwork is less susceptible to 

damage from animals, water, and 

moisture degradation. (WECC, No. 150 

at p. 1; NCJC, No. 184 at p. 2) In 

addition, WECC commented that both 

the flex duct and duct boards that are 

commonly used are capable of being 

crushed or compressed, which reduces 

efficiency, as well as being hard to 

install and permanently repair. (WECC, 

No. 150 at p. 1) 

EISA directs DOE to establish energy 

conservation standards for 

manufactured housing. While there may 

be an issue with the reliability of certain 

building materials, this issue only 

indirectly relates to the energy 

efficiency of manufactured homes and is 

beyond the scope of this rulemaking. 

Therefore, DOE is not assessing or 

proposing regulations relating to duct 

material. 

Regarding duct insulation, NEEA 

recommended that R-8 insulation 

should be required everywhere where 

ducts are not embedded in insulation. 

This specifically ensures that ducts 

under the floor are insulated. (NEEA, 

No. 190 at p. 3) VEIC stated that HVAC 

ductwork located in the floor assembly 

with crossover ducts should be 

eliminated and relocated inside the 

thermal envelope, as this would 

improve energy performance and 

increase durability. (VEIC, No. 187 at p. 

2) NEEA commented that all crossover 

ducts should have R-8 insulation. 

(NEEA, No. 190 at p. 3) 

DOE’s research indicates that HVAC 

ducts are generally located between the 

floor and the insulation and are 

therefore within the conditioned space. 

Cavco also commented that the common 

practice on entry-level products is to 

locate them in the floor. (Cavco, Public 

Meeting Transcript, No. 148 at p. 65) 

Therefore, because ducts are already 

located within the conditioned space, 

and would already be insulated because 

of the insulation required within the 

conditioned space, DOE is not 

proposing any additional insulation for 

ducts in this SNOPR. 

NEEA and WSU Energy Program 

stated that a clearer statement on how 

insulation should contain no voids or 

compression as installed, is necessary. 

(NEEA, No. 190 at p. 2; WSU Energy 

Program, Public Meeting Transcript, No. 

148 at p. 54, 57). Manufacturer 

installation instructions specify that 

insulation be installed per the 

insulation chart. Insulation charts, 

depending on the type of insulation, are 

required by the Federal Trade 

Commission (‘‘FTC’’) to show the Rvalue for a certain insulation thickness, 

or at an installed thickness. 16 CFR 

460.12. Because DOE requires that 

insulation must be installed according 

to the insulation manufacturer’s 

installation instructions, the MH 

manufacturer would have to determine 

the correct thickness for the R-value 

required in the manufactured home.33

Any compression would result in a 

different thickness, which would in turn 

change the R-value of the insulation. 

Additionally, certain insulation 

manufacturer’s installation instructions 

specifically state that compression must 

be avoided when installing insulation, 

because compression will reduce the Rvalue. Likewise, insulation 

manufacturer’s installation instructions 

also state that there cannot be gaps 

between pieces of insulation, as it can 

reduce the installed R-value of 

insulation.34 Therefore, DOE continues 

to find the requirements proposed in 

section 460.103 of the June 2016 NOPR 

are sufficient to prohibit compression 

and voids, and DOE continues to 

propose these requirements without 

change, consistent with R303.2 of the 

2021 IECC. 

The 2021 IECC included several 

updates (relative to the 2015 IECC) in 

sections R402.2 through R402.3 and 

Table R402.4.1.1 for insulation 

installation criteria relevant to 

manufactured housing, which are 

discussed in Table III.13. 

TABLE III.13—THE 2021 IECC UPDATES FOR INSTALLATION OF INSULATION

Component June 2016 NOPR proposal The 2021 IECC updates, SNOPR proposal 

General ..................... Air-permeable insulation must not be used as a material to 

establish the air barrier.

No relevant updates made from the 2015 IECC to the 2021 

IECC. Therefore, DOE proposes no changes between 

the 2016 NOPR and this SNOPR. 

Access hatches, panels, and doors.Access hatches, panels, and doors between conditioned 

space and unconditioned space must be insulated to a 

level equivalent to the insulation of the surrounding surface, must provide access to all equipment that prevents 

damaging or compressing the insulation, and must provide a wood-framed or equivalent baffle or retainer when 

loose fill insulation is installed within an exterior ceiling 

assembly to retain the insulation both on the access 

hatch, panel, or door and within the building thermal envelope.

Relevant updates from the 2015 IECC to the 2021 IECC 

include requiring access hatches and doors from conditioned to unconditioned spaces be insulated to the same 

R-value required by Table R402.1.3 for the wall or ceiling in which they are installed, with certain exceptions. 

For this SNOPR, DOE is seeking comment on whether the 

2021 IECC update applies to manufactured homes. 


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TABLE III.13—THE 2021 IECC UPDATES FOR INSTALLATION OF INSULATION—Continued 

Component June 2016 NOPR proposal The 2021 IECC updates, SNOPR proposal 

Baffles ...................... Baffles must be constructed using a solid material, maintain an opening equal or greater than the size of the 

vents, and extend over the top of the attic insulation.

Relevant updates from the 2015 IECC to the 2021 IECC 

include requirements that the baffle be installed to the 

outer edge of the exterior wall top plate so as to provide 

maximum space for attic insulation coverage over the 

top plate. In addition, where soffit ventilation is not continuous, requires that baffles be installed continuously to 

precent ventilation air in the eave soffit from bypassing 

the baffle. 

For this SNOPR, DOE is seeking comment on whether the 

2021 IECC update applies to manufactured homes. 

Ceiling or attic .......... The insulation in any dropped ceiling or dropped soffit must 

be aligned with the air barrier.

No relevant updates made from the 2015 IECC to the 2021 

IECC. Therefore, DOE proposes no changes between 

the 2016 NOPR and this SNOPR. 

Eave vents ............... Air-permeable insulations in vented attics within the building thermal envelope must be installed adjacent to eave 

vents.

No relevant updates made from the 2015 IECC to the 2021 

IECC. Therefore, DOE proposes no changes between 

the 2016 NOPR and this SNOPR. 

Floors ....................... Floor insulation must be installed to maintain permanent 

contact with the underside of the rough floor decking 

over which the finished floor, flooring material, or carpet 

is laid, except where air ducts directly contact the underside of the rough floor decking.

No relevant updates made from the 2015 IECC to the 2021 

IECC. However, as previously discussed in this section, 

DOE is no longer proposing this requirement from the 

June 2016 proposal. 

Narrow cavities ......... Batts in narrow cavities must be cut to fit or narrow cavities 

must be filled with insulation that upon installation readily 

conforms to the available cavity space.

Relevant updates from the 2015 IECC to the 2021 IECC 

were editorial in nature and intended to improve clarity. 

DOE proposes to include these updates in this SNOPR. 

Rim joists .................. Rim joists must be insulated ................................................. Relevant updates from the 2015 IECC to the 2021 IECC 

include additional updates that the insulation be installed 

such that the insulation maintain permanent contact with 

the exterior rim board. 

DOE proposes to include this update in this SNOPR as it 

provides further clarity on how the rim joists must be insulated. 

Shower or tub adjacent to exterior 

wall.

Exterior walls adjacent to showers and tubs must be insulated.No relevant updates made from the 2015 IECC to the 2021 

IECC. Therefore, DOE proposes no changes between 

the 2016 NOPR and this SNOPR. 

Walls ......................... Air permeable exterior building thermal envelope insulation 

for framed exterior walls must completely fill the cavity, 

including within stud bays caused by blocking lay flats or 

headers.

No relevant updates made from the 2015 IECC to the 2021 

IECC. Therefore, DOE proposes no changes between 

the 2016 NOPR and this SNOPR. 

Shaft, penetrations ... None ...................................................................................... Relevant updates from the 2015 IECC to the 2021 IECC 

include requirements that the insulation shall be fitted 

tightly around utilities passing through shafts and penetrations in the building thermal envelope to maintain required R-value. 

For this SNOPR, DOE is seeking comment on whether the 

requirement generally applies to manufactured homes. 

The 2021 IECC also includes building 

thermal envelope updates for mass 

walls, steel-framed buildings, basement 

walls, slab-on grade floors, crawl space 

walls, sunroom and heated garage 

insulation. DOE has not included these 

requirements in the proposed rule 

because they are not directly relevant to 

manufactured housing. 

DOE requests comment on the 

proposed updates to the installation of 

insulation criteria as it applies to 

manufactured homes construction only. 

DOE requests comments on whether 

there are any of the 2021 IECC updates 

relevant to manufactured housing that 

should be considered as part of this 

rulemaking. Specifically, DOE requests 

comment on whether the 2021 IECC 

updates for installation criteria for 

access hatches and doors, baffles and 

shafts are applicable to manufactured 

housing and should be considered in 

this rulemaking. 

d. Proposed § 460.104 Building Thermal 

Envelope Air Leakage 

Consistent with the June 2016 NOPR, 

DOE proposes to add a new § 460.104 

that would require manufacturers to seal 

manufactured homes against air leakage. 

Air leakage sealing limits air infiltration 

through the building thermal envelope, 

in turn reducing heating and cooling 

loads. Proposed § 460.104 would specify 

both general and specific requirements 

for sealing a manufactured home to 

prevent air leakage, all of which are 

based on Table R402.4.1.1 of the 2015 

IECC with modifications based on 

recommendations from the MH working 

group (Term Sheet No. 107 at p. 5) and 

any further modifications based on 

DOE’s review of the 2021 IECC 

(discussed further in this section). The 

MH working group also recommended 

prescriptive air leakage sealing 

requirements that are designed to 

achieve an overall air exchange rate of 

five air changes per hour (ACH) within 

a manufactured home. Term Sheet No. 

107 at p. 5. 

The proposed general requirements in 

§ 460.104 would require that 

manufacturers properly seal all joints, 

seams, and penetrations in the building 

thermal envelope to establish a 

continuous air barrier, and use 

appropriate sealing materials to allow 

for differential expansion and 

contraction of dissimilar materials. The 

proposed specific requirements in Table 

460.104 include air barrier criteria for 


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47782 Federal Register / Vol. 86, No. 163 / Thursday, August 26, 2021 / Proposed Rules 

35The letter comprised the joint comments of 

ACEE, MHI, National Association of State Energy 

Officials, National Consumer Law Center (on behalf 

of its low-income clients), National Manufactured 

Home Owners Association, Natural Resources 

Defense Council, Northwest Power & Conservation 

Council, and SBRA. 

ceiling or attic, duct system register 

boots, electrical box or phone on 

exterior walls, floors, mating line 

surfaces, recessed lighting, rim joists, 

shower or tub adjacent to exterior wall, 

walls and windows, skylights and 

doors. 

In developing its recommendations, 

the MH working group also identified 

concerns regarding the potential 

impacts of the air sealing requirements 

on the indoor air quality in 

manufactured homes, but understood 

indoor air quality to be outside the 

scope of the working group. (MH 

Working Group Meeting Transcript No. 

115, pp. 95–96) 

Prior to issuing the 2016 EA–RFI, 

DOE issued a request for information 

(RFI) regarding ‘‘data, studies, and other 

such materials that address the 

relationship between potential 

reductions in levels of natural air 

infiltration and both indoor air quality 

and occupant health for a manufactured 

home.’’ (June 25, 2013, 78 FR 37995). 

Specifically, DOE requested information 

on the relationship between potential 

reductions in levels of natural air 

infiltration and both indoor air quality 

and occupant health for a manufactured 

home. 78 FR 37995, 37996. With regard 

to indoor air quality, one commenter 

mentioned that reductions in air leakage 

can lead to increased formaldehyde 

concentrations and noted that increased 

mechanical ventilation also can increase 

moisture infiltration in humid climates, 

potentially leading to deleterious 

impacts such as mold growth. (MHARR, 

No. 36 at pp. 6–7) Several commenters 

suggested including measures approved 

by the MHCC at the time, including 

requirement for carbon monoxide 

alarms, vent termination separation 

from air intake and an option for 

individual manufacturers to adopt 

ASHRAE Standard 62.2. (Joint 

commenters,35 No. 38 at p. 2; NEEA, No. 

40 at p. 3) NEEA also recommended 

NFPA 501 standard for window and 

door flashing and weather resistant 

barriers to improve durability and 

reduce moisture-related indoor air 

quality problems associated with wind 

driven rain and long-term failure of the 

building envelope siding and window 

systems. (NEEA, No. 40 at p. 3) Several 

other commenters noted that there have 

been no reported issues with occupant 

health in energy efficient homes that 

have been sealed tightly to reduce air 

infiltration. (MHI, No. 39, at p. 5; Joint 

commenters, No. 38 at p. 2) Specifically, 

whole house mechanical ventilation 

systems have been incorporated into the 

HUD MHCSS for nearly 20 years. (Joint 

commenters, No. 38 at p. 2) Further, 

NEEA noted that for voluntary energy 

efficiency programs (i.e., EPA ENERGY 

STAR homes and DOE Challenge home) 

the few IAQ problems encountered were 

associated with HVAC commissioning 

and/or occupant education, not with 

building tightness. (NEEA, No. 40 at p. 

3) 

In the June 2016 NOPR, DOE again 

requested information on the 

relationship between a reduction in 

levels of natural air infiltration (through 

sealing leaks in the building thermal 

envelope) and health and safety. 81 FR 

39756, 39798. In response to the June 

2016 NOPR, DOE did not receive any 

studies or data regarding the potential 

impact on health and safety from 

reduced levels of natural air infiltration 

in a manufactured home. However, DOE 

is considering measures to mitigate 

potential adverse impacts to indoor air 

quality that could arise from this 

SNOPR proposal. See section III.E.3.d of 

this document for further details. 

The following paragraphs discuss 

comments DOE received regarding the 

building thermal envelope air leakage 

requirements proposed in the June 2016 

NOPR, and any other corresponding 

proposed changes to the June 2016 

NOPR requirements based on comments 

received, or updates to the 2021 IECC. 

WSU Energy Program commented that 

ACH rate of five can be achieved 

through the prescriptive approaches 

recommended by the MH working group 

and that to ensure it is met, specific 

direction must be provided as to the 

areas required to be sealed and further 

that DOE needs to provide education 

and training to MH manufacturers. 

(WSU Energy Program, Public Meeting 

Transcript, No. 148 at p. 57) 

As discussed, the June 2016 proposed 

envelope air leakage requirements were 

based on Table R402.4.1.1 of the 2015 

IECC with modifications. The IECC 

applies generally to residential 

buildings, including site-built and 

modular housing, and is not specific to 

manufactured housing. As stated by 

WSU Energy Program in its comments, 

the building thermal envelope air 

leakage requirements (as proposed in 

§ 460.104) are prescriptive requirements 

intended to achieve an envelope 

tightness of five ACH when 

depressurized to 50 pascals. Term 

Sheet, No. 107 at p. 5. Further, DOE 

reviewed the 2021 IECC and is 

proposing additional updates to the air 

barrier criteria, as discussed later in this 

section. 

NEEA commented that a clearer 

definition of how a proper air barrier 

should be designed was needed in order 

to make construction requirements more 

specific, and to establish a single 

meaning without ambiguity. (NEEA, No. 

190 at p. 2). NEEA did not provide a 

further explanation of how the proposed 

requirements for an air barrier were 

lacking or presented an opportunity for 

misapplication. As stated earlier in this 

section, DOE has listed many specific 

requirements for proper air barrier 

installation in Table 460.104. These 

requirements were based on Table 

R402.4.1.1 of the 2015 IECC and related 

recommendations from the MH working 

group. Further, DOE reviewed the 2021 

IECC to make any additional updates to 

the air barrier criteria. 

DOE also received a comment 

regarding installation requirements. 

VEIC stated that the rule should also 

have clear installation requirements for 

insulation, as well as for air and duct 

sealing. (VEIC, No. 187 at p. 2) DOE 

notes that its proposal would require 

that insulation and air leakage sealing 

must be done according to 

manufacturer’s instructions, and the 

requirements set forth in proposed 

§§ 460.103 and 460.104, accordingly. 

WDMA recommended that a 

provision regarding fenestration air 

leakage requirements be added. WDMA 

stated that provisions regarding 

fenestration air leakage are necessary for 

natural air infiltration limits required by 

the IECC to be met. WDMA cited section 

R402.4.3 of the 2015 IECC as an 

example. (WDMA, No. 183 at p. 3) As 

stated in the June 2016 NOPR, DOE did 

not include specifications for air leakage 

of fenestration consistent with the MH 

working group recommendation to 

reduce testing burden. In addition, as 

discussed in the following paragraphs, 

DOE is proposing air leakage 

requirements at the full building 

thermal envelope level, which will 

capture any air leakage associated with 

installed fenestration. Additionally, the 

proposed prescriptive building thermal 

envelope air leakage standards include 

requirements to seal the space between 

fenestration and framing. Therefore, 

DOE is not proposing fenestration 

specific quantitative air leakage 

requirements. 

DOE also received several comments 

on the June 2016 NOPR regarding the 

building’s air barrier. NEEA 

recommended that the standards be 

explicit that the multi-section marriage 

line air seal shall be installed at the 

factory with proper quality control 

rather than being installed in the field. 


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(NEEA, No. 190 at p. 3) All 

requirements proposed in this SNOPR 

would apply to the manufactured home 

as manufactured, i.e., the manufacturer 

of the manufactured home is 

responsible for ensuring compliance 

with the requirements proposed in this 

SNOPR. (42 U.S.C. 17071(c)) A 

manufactured home would have to 

comply with the requirements, once 

finalized, prior to being installed in the 

field. DOE proposes to clarify in § 460.1 

that the requirements apply to the 

manufactured home as manufactured, 

prior to installation. 

DOE also received a comment 

regarding the duct system register boots 

air barrier installation criteria. The June 

2016 NOPR proposed that duct system 

register boots that penetrate the building 

thermal envelope or the air barrier must 

be sealed to the air barrier or the interior 

finish materials with caulk, foam, 

gasket, or other suitable material. WECC 

recommended that boot penetration be 

sealed to the subfloor. In WECC’s 

experience with retrofit work, sealing to 

a finished vinyl flooring surface causes 

the flooring to float when the air 

handler is energized. (WECC, Public 

Meeting Transcript, No. 148 at p. 61) 

DOE reinvestigated this topic and 

acknowledges that the 2015 IECC 

requires that the duct register boots that 

penetrate building thermal envelope be 

sealed to the subfloor or drywall. The 

MH working group also voted to include 

this statement from the 2015 IECC in the 

term sheet. Term Sheet, No. 107 at p. 19. 

The 2018 and the 2021 IECC replaces 

the use of the term ‘‘drywall’’ with 

‘‘wall covering or ceiling penetrated by 

the boot.’’ In this SNOPR, DOE is 

proposing to revise its earlier proposed 

regulatory text in Table 460.104 

regarding register boots consistent with 

the language in the 2021 IECC to clarify 

that duct systems register boots may 

also be sealed to the subfloor. DOE is 

proposing the following air barrier 

criteria for duct system register boots in 

this SNOPR: ‘‘Duct system register boots 

that penetrate the building thermal 

envelope or the air barrier must be 

sealed to the subfloor, wall covering or 

ceiling penetrated by the boot, air 

barrier, or the interior finish materials 

with caulk, foam, gasket, or other 

suitable material.’’ This revision 

provides added flexibility, addresses 

WECC’s concern, and follows the 

provisions of the 2021 IECC and the 

recommendations of the MH working 

group. 

Further, DOE considered several other 

updates of the 2021 IECC in section 

R402.4 and Table R402.4.1.1 (relative to 

the 2015 IECC) for air barrier criteria 

relevant to manufactured housing—see 

Table III.14. 

TABLE III.14—THE 2021 IECC UPDATES FOR AIR BARRIER CRITERIA

Component June 2016 NOPR proposal The 2021 IECC updates; SNOPR proposal 

Ceiling or attic .......... The air barrier in any dropped ceiling or dropped soffit 

must be aligned with the insulation and any gaps in the 

air barrier must be sealed with caulk, foam, gasket, or 

other suitable material. Access hatches, panels, and 

doors, drop-down stairs, or knee wall doors to 

unconditioned attic spaces must be weather-stripped or 

equipped with a gasket to produce a continuous air barrier.

No relevant updates made from the 2015 IECC to the 2021 

IECC. Therefore, DOE proposes no changes between 

the 2016 NOPR and this SNOPR. 

Duct system register 

boots *.

Duct system register boots that penetrate the building thermal envelope or the air barrier must be sealed to the air 

barrier or the interior finish materials with caulk, foam, 

gasket, or other suitable material.

As previously discussed, DOE proposes to update this requirement consistent with the 2021 IECC. 

Electrical box or 

phone box on exterior walls.

The air barrier must be installed behind electrical or communication boxes or the air barrier must be sealed 

around the box penetration with caulk, foam, gasket, or 

other suitable material.

Relevant updates from the 2015 IECC to the 2021 IECC 

include a clarification that the air barrier shall be installed 

behind electrical ‘‘and’’ communication boxes, not ‘‘or’’. 

DOE proposes to update this requirement in this 

SNOPR. 

Floors ....................... The air barrier must be installed at any exposed edge of 

insulation. The bottom board may serve as the air barrier.

No relevant updates made from the 2015 IECC to the 2021 

IECC. Therefore, DOE proposes no changes between 

the 2016 NOPR and this SNOPR. 

Mating line surfaces Mating line surfaces must be equipped with a continuous 

and durable gasket.

No relevant updates made from the 2015 IECC to the 2021 

IECC. Therefore, DOE proposes no changes between 

the 2016 NOPR and this SNOPR. 

Recessed lighting ..... Recessed light fixtures installed in the building thermal envelope must be sealed to the drywall with caulk, foam, 

gasket, or other suitable material.

Relevant updates from the 2015 IECC to the 2021 IECC 

include requiring sealing in accordance with section 

R402.4.5, which includes specific air leakage rate requirements. 

Considering the original proposal was determined to be 

prescriptive only, DOE is not including the updates in 

this SNOPR, but is requesting comment on this. 

Rim joists .................. The air barrier must enclose the rim joists ........................... Relevant updates from the 2015 IECC to the 2021 IECC 

include updates that the junctions of the rim board to the 

sill plate and the rim board and the subfloor shall be air 

sealed. 

DOE proposes to include this update in this SNOPR as it 

provides further clarity on how the rim joists must be 

sealed. 

Shower or tub adjacent to exterior 

wall.

The air barrier must separate showers and tubs from exterior walls.No relevant updates made from the 2015 IECC to the 2021 

IECC. Therefore, DOE proposes no changes between 

the 2016 NOPR and this SNOPR. 

Walls ......................... The junction of the top plate and the exterior ceiling, and 

the junction of the bottom plate and the exterior floor, 

along exterior walls must be sealed with caulk, foam, 

gasket, or other suitable material.

No relevant updates made from the 2015 IECC to the 2021 

IECC. Therefore, DOE proposes no changes between 

the 2016 NOPR and this SNOPR. 


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TABLE III.14—THE 2021 IECC UPDATES FOR AIR BARRIER CRITERIA—Continued 

Component June 2016 NOPR proposal The 2021 IECC updates; SNOPR proposal 

Windows, skylights, 

and exterior doors.

The rough openings around windows, exterior doors, and 

skylights must be sealed with caulk or foam.

No relevant updates made from the 2015 IECC to the 2021 

IECC. Therefore, DOE proposes no changes between 

the 2016 NOPR and this SNOPR. 

Shafts, penetration ... Sealing methods between dissimilar materials must allow 

for differential expansion and contraction and must establish a continuous air barrier upon installation of all 

opaque components of the building thermal envelope.

All gaps and penetrations in the exterior ceiling, exterior 

floor, and exterior walls, including ducts, flue shafts, 

plumbing, piping, electrical wiring, utility penetrations, 

bathroom and kitchen exhaust fans, recessed lighting fixtures adjacent to unconditioned space, and light tubes 

adjacent to unconditioned space, must be sealed with 

caulk, foam, gasket or other suitable material.

Relevant updates from the 2015 IECC to the 2021 IECC 

clarifies that sealing should allow for expansion, contraction and mechanical vibration. 

DOE proposes to include the term ‘‘mechanical vibration’’ 

to provide further clarity. 

Narrow cavities ......... None ...................................................................................... Relevant updates from the 2015 IECC to the 2021 IECC 

include updates that narrow cavities of 1 inch or less that 

are not able to be insulated shall be air sealed. 

For this SNOPR, DOE is not proposing to include this update because DOE is unsure how it would affect the 

June 2016 NOPR conclusion that the proposed prescriptive air leakage sealing requirements are designed to 

achieve 5 ACH. DOE requests comment on this topic. 

Plumbing, wiring or 

other obstructions.

None ...................................................................................... Relevant updates from the 2015 IECC to the 2021 IECC 

include update that all holes created by wiring, plumbing 

or other obstructions in the air assembly must be air 

sealed. 

For this SNOPR, DOE is not proposing to include this update because DOE is unsure how it would affect the 

June 2016 NOPR conclusion that the proposed prescriptive air leakage sealing requirements are designed to 

achieve 5 ACH. DOE requests comment on this topic. 

* Updates based on comments received to the June 2016 NOPR. 

The 2021 IECC also includes air 

barrier criteria updates for basement 

crawl space and slab foundations, 

garage separation, and concealed 

sprinklers. DOE has not included these 

requirements in the proposed rule 

because they are not directly relevant to 

manufactured housing. 

DOE requests comment on the 

proposed updates to the air barrier 

criteria as it applies to manufactured 

homes construction only. Further, DOE 

requests comment whether the SNOPR 

proposal continues to be designed to 

achieve air leakage sealing requirements 

of 5 ACH. 

DOE requests comments on whether 

there are any of the 2021 IECC updates 

relevant to manufactured housing that 

should be considered as part of this 

rulemaking. Specifically, DOE requests 

comment on whether the 2021 IECC 

updates for air barrier criteria for 

recessed lighting, narrow cavities and 

plumbing are applicable to 

manufactured housing and should be 

considered in this rulemaking. If so, 

DOE requests comment on whether the 

requirements would alter the 5 ACH 

designation. 

3. Subpart C: HVAC, Service Water 

Heating, and Equipment Sizing 

Subpart C proposes requirements that 

would be applicable to manufactured 

homes related to ducts; HVAC; service 

hot water systems; mechanical 

ventilation fan efficacy; and heating and 

cooling equipment sizing. The proposed 

subpart C requirements would be 

applicable to all manufactured homes 

under either the proposed rule or the 

tiered proposed rule (i.e., under the 

tiered proposed rule the subpart C 

requirements would be applicable to 

Tier 1 and Tier 2 manufactured homes). 

The following sections provide further 

details regarding Subpart C. 

a. Proposed § 460.201 Duct System 

DOE proposes to include in 

§ 460.201(a) a requirement that 

manufactured homes equipped with a 

duct system be designed to limit total 

air leakage to less than or equal to 4 

cubic feet per minute (‘‘cfm’’) per 100 

square feet of conditioned floor area. 

DOE initially determines this proposal 

to be consistent with R403 of the 2021 

IECC. In addition, DOE also proposes to 

require that building framing cavities 

not be used as ducts or plenums under 

§ 460.201(a), consistent with the 2021 

IECC and the recommendation of the 

MH working group (Term Sheet, No. 

107 at p. 1). Building framing cavities 

are typically not tightly sealed and do 

not provide an adequate barrier to 

foreign bodies for air quality reasons. 

The use of building framing cavities as 

ducts and plenums is generally 

considered to be poor construction 

practice and is not a typical practice in 

the manufactured housing industry. 

The following paragraphs discuss 

comments DOE received regarding the 

duct system requirements proposed in 

the June 2016 NOPR, and any other 

corresponding proposed changes to the 

June 2016 NOPR requirements based on 

comments received, or updates to the 

2021 IECC. 

The majority of the comments were 

recommending more specificity on the 

proposed duct sealing requirements. 

Several commenters suggested that the 

duct leakage requirements should only 

be applicable to homes that are 

equipped with a duct system, so as not 

to prohibit use of a ductless HVAC 

system. (MHIM, No. 155 at p. 3; MHIAZ, 

No. 161 at p. 3; PMHA, No. 164 at p. 4; 

Cavco, No. 167 at p. 2; SBRA, No. 163 

at p. 4; OMHA, No. 166 at p. 3; MHI, 

No. 182 at p. 4; Clayton Homes, No. 185 

at p. 3; Palm Harbor Homes, No. 193 at 

p. 2; MHISC, No. 191 at p. 3; SBRA, 


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36 Duct losses can account for more than 30 

percent of energy consumption for space 

conditioning, so ductless heating and cooling 

systems prevent energy losses that can occur via 

ductwork (http://energy.gov/energysaver/ductlessmini-split-air-conditioners). 

Public Meeting Transcript, No. 148 at p. 

59; Commodore Corporation, No. 195 at 

p. 3; Skyline, No. 165 at p. 3; MHCC, 

No. 162 at p. 2; NEEA, No. 190 at p. 3) 

In the June 2016 NOPR, DOE 

proposed to include in section 

460.201(a) a requirement that 

manufacturers equip each manufactured 

home with a duct system designed to 

limit total air leakage to less than or 

equal to 4 cubic feet per minute (cfm) 

per 100 square feet of conditioned floor 

area. DOE agrees with the commenters 

that each manufactured home should 

not be required to have a duct system. 

An implicit requirement for including a 

duct system would prohibit usage of 

ductless HVAC systems, which could 

improve the energy performance of the 

home.36 Therefore, in this SNOPR, DOE 

proposes to require only manufactured 

homes with duct systems to limit total 

duct air leakage to less than or equal to 

4 cfm per 100 square feet of conditioned 

floor. 

DOE received other comments 

regarding the design of duct systems. 

Skyline Corporation and MHCC 

questioned the wording of proposed 

§ 460.201 Duct Systems—section (b), 

which stated, ‘‘building framing cavities 

must not be used as ducts or plenums.’’ 

They stated this is ambiguous as to 

whether it applies to return air plenums. 

They recommended that the section be 

revised to include ‘‘. . . as ducts or 

plenums when directly connected to 

mechanical systems.’’ (Skyline, No. 165 

at p. 3; MHCC, No. 162 at p. 2) Clayton 

Homes stated that proposed 

§ 460.201(a), the last sentence should be 

changed to read ‘‘Building framing 

cavities must not be used as supply 

ducts or plenums.’’ Clayton Homes 

commented that the addition of the 

word ‘‘supply’’ will enable cavities to be 

used for return air, as intended and 

allowed by the IECC. (Clayton Homes, 

No. 185 at p. 4) DOE agrees with 

commenters that return air plenums 

should not be included in the 

requirement because they are freeflowing and generally not ducted. 

Therefore, DOE is proposing to state the 

return air plenums are not included. 

DOE also received a comment on 

higher performing duct systems. WSU 

Energy Program commented that some 

manufacturers are looking toward 

higher performing duct systems than the 

minimum standards, and there is no 

incentive for manufacturers to use these 

better performing systems (e.g., ductless 

mini-split heat pumps, and other HVAC 

systems without a central duct system). 

It also commented that there could be a 

prescriptive requirement or alternative 

option for a manufacturer willing to 

redesign its manufactured homes so that 

the supply ducts would be within the 

thermal envelope. (WSU Energy 

Program, Public Meeting Transcript, No. 

148 at p. 60) As noted, DOE has based 

its proposed energy conservation 

standards for manufactured homes on 

the most recent IECC, as directed by 

EISA. (42 U.S.C. 17071(b)(1)) DOE 

emphasizes that the energy conservation 

standards proposed in this SNOPR are 

minimum standards, but this does not 

prohibit manufacturers from employing 

more efficient measures. 

NEEA recommended that the standard 

include specifics on air leakage testing 

on ducts to be performed, and that duct 

leakage be tested in the factory. (NEEA, 

No. 190 at p. 2) As discussed 

previously, DOE is not addressing a test 

procedure in this rulemaking. 

DOE also reviewed the updates to 

section R403.3.4 of the 2021 IECC 

(relative to the 2015 IECC reviewed by 

the MH Working Group) as it relates to 

duct sealing and leakage. As previously 

discussed, DOE is not proposing any 

testing provisions at this time. As it 

relates to duct leakage requirements, 

DOE notes that section R403.3.6 of the 

2021 IECC was updated to require that 

for ducts and air handlers that are 

located entirely within building thermal 

envelope, the total leakage would be 

less than or equal to 8 cfm per 100 

square feet of conditioned floor area. For 

manufactured homes, DOE notes that it 

is not always the case that ducts and air 

handlers are located entirely within the 

building thermal envelope. Accordingly, 

for this rulemaking, DOE continues to 

propose the MH Working Group 

recommendation that total air leakage of 

duct systems is to be less than or equal 

to 4 cfm per 100 square feet of 

conditioned floor area under a postconstruction test. 

DOE requests comment on the 

proposal to require that total air leakage 

of duct systems for all manufactured 

homes is to be less than or equal to 4 

cfm per 100 square feet of conditioned 

floor area. 

b. Proposed § 460.202 Thermostats and 

Controls 

Consistent with the June 2016 NOPR, 

DOE proposes including specifications 

for thermostats in § 460.202(a) of the 

regulatory test based on the IECC. 

Section R403.1 of the 2015 and 2021 

IECC specifies that at least one 

thermostat shall be provided for each 

separate heating and cooling system. 

DOE also proposes specifications for 

programmable thermostats in 

§ 460.202(b), based on section R403.1.1 

of the 2015 and 2021 IECC. Section 

R403.1.1 of the 2015 and 2021 IECC also 

specifies that the thermostat controlling 

the primary heating or cooling system 

must be capable of controlling the 

heating and cooling system on a daily 

schedule to maintain different 

temperature set points at different times 

of the day. In addition, consistent with 

the June 2016 NOPR, DOE proposes to 

include in § 460.202(c) specifications for 

heat pumps having supplementary heat, 

based on section R403.1.2 of the 2015 

and 2021 IECC. 

The following paragraphs discuss 

comments DOE received regarding the 

thermostat and controls requirements 

proposed in the June 2016 NOPR, and 

any other corresponding proposed 

changes to the June 2016 NOPR 

requirements based on comments 

received, or updates to the 2021 IECC. 

Regarding thermostat control, NEEA 

recommended that the final rule be 

explicit that the electric resistance 

lockout in central heat pump systems 

when the outdoor air temperature is 

greater than 40 °F. (NEEA, No. 190 at p. 

3). While section R403.1.2 of the 2015 

and the 2021 IECC provides 

requirements for the shutoff of heat 

pumps having supplementary electricresistance heat under certain conditions, 

the 2015 and the 2021 IECC do not 

provide any temperature specifications 

for this shutoff. Therefore, DOE did not 

consider these requirements in the 

proposed energy conservation 

standards. 

DOE also reviewed the updates to 

sections R403.1 of the 2021 IECC 

(relative to the 2015 IECC reviewed by 

the MH Working Group) as it relates to 

thermostats and controls. DOE notes 

that section R403.1 is no longer 

identified as ‘‘mandatory’’ in the 2021 

IECC. DOE’s understanding of this 

update is that no technical changes were 

intended, rather the removal of the label 

‘‘mandatory’’ was only to make the IECC 

more understandable and easier to use 

because the label ‘‘mandatory’’ was not 

used consistently in the IECC. The 2021 

IECC prescriptive compliance option 

application described in section 

R401.2.1 continues to require 

compliance with section R403.1, 

regardless of whether the label 

‘‘mandatory’’ is included in that section. 

Therefore, DOE preliminarily concludes 

this update is not a substantive change. 

In addition, DOE observed that the 

programmable thermostat requirements 

were updated to allow for maintaining 

different temperature set point at 

different days of the week in addition to 


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at different times of day. For this 

SNOPR, DOE proposes to continue to 

include thermostat and controls 

requirements, as recommended by the 

MH working group. In addition, DOE 

proposes to include the updated 

requirements of ‘‘different days of the 

week,’’ consistent with the 2021 IECC. 

DOE requests comment on DOE’s 

interpretation of R403.1 and the 

proposed updates to the thermostat and 

controls requirements. In addition, DOE 

requests comments on whether there are 

any of the 2021 IECC updates relevant 

to manufactured housing that should be 

considered as part of this rulemaking. 

c. Proposed § 460.203 Service Hot Water 

Consistent with the June 2016 NOPR, 

DOE proposes to require in § 460.203(a) 

that manufacturers install service water 

heating systems according to the service 

water heating system manufacturer’s 

installation instructions. As proposed, 

§ 460.203 would apply to any service 

water heating system installed by a 

manufacturer. In addition, § 460.203 

would require manufacturers to provide 

maintenance instructions for the service 

water heating system with the 

manufactured home. These 

requirements would promote the correct 

installation and maintenance of service 

water heating equipment and help to 

ensure that such equipment performs at 

its intended level of efficiency. 

Further, DOE proposes that 

§ 460.203(b) would require any 

automatic and manual controls, 

temperature sensors, and pumps 

associated with service water heating 

systems to be similarly accessible. This 

requirement would ensure that 

homeowners would have adequate 

control over service water heating 

equipment in order to achieve the 

intended level of efficiency 

contemplated in 10 CFR part 460. This 

proposal was consistent with the 

recommendation of the MH working 

group. Term Sheet, No. 107 at p. 1. 

DOE also proposes specifications for 

heated water circulation systems in 

§ 460.203(c) based on section R403.5.1.1 

of the 2015 and 2021 IECC. The 

specifications proposed included: (1) 

Requiring heated water circulation 

systems be provided with a circulation 

pump, and that the system return pipe 

be a dedicated return pipe or cold water 

supply pipe; (2) prohibiting gravity and 

thermosyphon circulation systems; (3) 

requiring that controls for heated water 

circulation system pumps identify a 

demand for hot water within the home 

when starting the pump; and (4) 

requiring the controls to automatically 

turn off the pump when the water in the 

circulation loop is at the desired 

temperature and when there is no 

demand for hot water. 

Finally, DOE also proposes that all 

hot water pipes outside conditioned 

space be required to be insulated to at 

least R-3, and that all hot water pipes 

from a water heater to a distribution 

manifold be required to be insulated to 

at least R-3. These requirements are 

consistent with the recommendations of 

the MH working group. Term Sheet, No. 

107 at p. 6. 

The following paragraphs discuss 

comments DOE received regarding the 

service hot water requirements 

proposed in the June 2016 NOPR, and 

any other corresponding proposed 

changes to the June 2016 NOPR 

requirements based on comments 

received, or updates to the 2021 IECC. 

NEEA recommended that pipe 

insulation be required on the hot water 

main branch and locations where the 

insulation is not in direct contact with 

the pipe or underfloor. (NEEA, No. 190 

at p. 3) WSU Energy Program 

recommended that all hot water pipes 

be insulated. (WSU Energy Program, 

Public Meeting Transcript, No. 148 at p. 

63) Taking the opposite viewpoint, 

Cavco commented that there is minimal 

to no energy savings from insulating 

pipes inside the conditioned space. 

(Cavco, Public Meeting Transcript, No. 

148 at p. 66) 

DOE’s proposal of requiring a 

minimum R-value for all hot water 

pipes outside conditioned space, and 

from a service hot water system to a 

distribution manifold, was based on the 

2015 IECC, and is consistent with the 

2021 IECC. Term Sheet, No. 107 at p. 6. 

Therefore, DOE continues to propose 

the hot water pipe insulation 

requirement from the June 2016 NOPR. 

DOE notes that its energy conservation 

standards do not prohibit manufacturers 

from employing additional insulation 

beyond DOE’s requirements. 

DOE also reviewed the updates to 

sections R403.5 of the 2021 IECC 

(relative to the 2015 IECC reviewed by 

the MH Working Group) as it relates to 

service hot water systems. DOE notes 

that section R403.5 is no longer 

identified as ‘‘mandatory’’ in the 2021 

IECC. Similar to R403.1 of the 2021 

IECC, DOE’s understanding of this 

update is that no technical changes were 

intended, rather the removal of the label 

‘‘mandatory’’ was only to make the IECC 

more understandable and easier to use 

because the label ‘‘mandatory’’ was not 

used consistently in the IECC. 

Therefore, DOE preliminarily concludes 

this update is not a substantive change. 

In addition, DOE observed the 

additional requirement that the controls 

for circulating hot water system shall 

limit the temperature of the water 

entering the cold water piping to not 

greater than 104 °F (40 °C). For this 

SNOPR, DOE proposes to continue to 

include service hot water systems 

requirements, as recommended by the 

MH working group. In addition, DOE 

understands that the temperature 

limitation is not directly applicable to 

manufactured homes and therefore DOE 

is not proposing to incorporate in this 

SNOPR. 

DOE requests comment on DOE’s 

interpretation of R403.5 and the 

proposed updates to the service hot 

water requirements. In addition, DOE 

requests comments on whether there are 

any of the 2021 IECC updates relevant 

to manufactured housing that should be 

considered as part of this rulemaking. 

Specifically, DOE requests comment on 

whether the circulating hot water 

system temperature limit should be 

included as a requirement. 

d. Proposed § 460.204 Mechanical 

Ventilation Fan Efficacy 

DOE proposes mechanical ventilation 

fan efficacy requirements in proposed 

Table 460.204 based on Table R403.6.2 

of the 2021 IECC, which provides 

requirements for mechanical ventilation 

system fan efficacy. 

DOE received one comment on the 

June 2016 NOPR regarding mechanical 

fan efficacy. NEEA commented that the 

fan efficacy requirement is not as high 

as it could be, especially with bathroom 

utility fans, but did not provide a 

suggested efficacy level. (NEEA, Public 

Meeting Transcript, No. 148 at p. 64) 

The mechanical efficacy requirements 

being proposed in this SNOPR are based 

on the 2021 IECC. However, DOE 

emphasizes that it is proposing energy 

conservation standards established as 

minimum standards. The requirements 

as proposed would not prohibit 

manufacturers from employing more 

efficient measures. 

DOE also reviewed the updates to 

section R403.6 of the 2021 IECC 

(relative to the 2015 IECC reviewed by 

the MH Working Group) as it relates to 

mechanical ventilation. The 2021 IECC 

includes new mandatory requirements 

for IECC climate zones 7 and 8, where 

dwelling units must be provided with a 

heat or energy recovery ventilation, and 

the system must be balanced with a 

minimum sensible heat recovery 

efficiency of 65 percent at 32 °F (0 °C) 

at a flow greater than or equal to the 

design flow. Further, Table R403.6.2 of 

2021 IECC updates the mechanical fan 

efficacy requirements to include new 

minimum efficacy requirements for heat 

recovery ventilators (HRV) and energy 

recovery ventilators (ERV), and air 


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37Taylor, Zachary T. Residential Heat Recovery 

Ventilation. United States. https://doi.org/10.2172/ 

1488935. 

38 ‘‘Furnace fan’’ is defined as an electricallypowered device used in a consumer product for the 

purpose of circulating air through ductwork. 10 

CFR 430.2. 

39Based on the HUD requirement for equipment 

that can provide at least 0.035 cubic feet per minute 

(cfm) per square foot of floor area (or hourly average 

equivalent) and a minimum airflow of 50 cfm, HUD 

requires airflow of at least 50 cfm for any unit up 

to 1429 square feet, i.e., for all single-wide MH, and 

55 cfm for a typical 1570 square foot double-wide 

unit. 

handlers that are integrated to tested 

and listed HVAC equipment, in addition 

to more stringent minimum efficacy 

requirements for in-line supply or 

exhaust fans, other exhaust fans (with 

separate requirements for fans having a 

minimum airflow rate of <90 CFM and 

≥90 CFM). Finally, DOE notes that the 

2021 IECC no longer includes the 

requirement that where mechanical 

ventilation fans are integral to tested 

and listed HVAC equipment, they shall 

be powered by an electronically 

commutated motor. 

As discussed in section III.E.2.b, ERV 

and HRV fans can be applicable to 

manufactured housing. DOE notes that 

per the 2021 IECC, these requirements 

would only be applicable to homes in 

IECC climate zones 7 and 8, which 

would translate to manufactured homes 

in HUD zone 3 only, and about 8 

percent shipments within the HUD 

zone. At a primary cost of $1,500 (based 

on the analysis performed in support of 

the BECP 37), the incremental cost for 

single-section manufactured homes 

would be as high as $6,159 (see Table 

I.3 for the purchase price increase). 

Mandatory requirements for ERV and 

HRV were not considered by the MH 

working group and DOE has not yet 

determined whether this requirement 

would be cost-effective in manufactured 

homes. 

Regarding the updates to minimum 

efficacy requirements, this SNOPR 

proposes to include all requirements 

except the efficacy requirements for air 

handlers that are integrated to tested 

and listed HVAC equipment. This 

SNOPR is not proposing requirements 

for appliances and equipment that are 

regulated pursuant to the statutory 

scheme in EPCA. Further, DOE proposes 

to remove the requirement that 

mechanical fans that are integral to 

HVAC equipment must be powered by 

an electronically commutated motor, in 

line with the 2021 IECC. DOE is also 

clarifying that the mechanical 

ventilation fan efficacy requirements 

would not apply to furnace fans, which 

are regulated under EPCA.38 To the 

extent that a mechanical ventilation fan 

that is integral to tested and listed 

HVAC equipment is a furnace fan as 

defined in 10 CFR 430.2, the furnace fan 

would be excluded from the proposed 

efficiency and motor requirements in 

§ 460.204. 

In this SNOPR, DOE is also 

considering energy efficiency measures 

to reduce uncontrolled air infiltration 

and air exchange associated with leaks 

in the air distribution ductwork for the 

central heating and cooling system, as 

well as measures that would reduce the 

energy consumption of mechanical 

ventilation equipment that is required 

in the HUD Code.39 The proposal 

considers a continuously-operated 

whole-house exhaust fan. Alternate 

ventilation approaches include a central 

fan integrated supply system (in which 

outdoor air is supplied into the return 

side of the central heating and cooling 

system air handler fan by negative 

pressure whenever the central fan 

operates for heating/cooling or 

ventilation); and a heat-recovery 

ventilation (HRV) system, which is 

required for certain (colder) climate 

zones in the 2021 IECC. Various 

operating schedules could be 

considered for each type of ventilation 

equipment. 

In addition, DOE is considering 

measures to mitigate potential adverse 

impacts to indoor air quality that could 

arise from the proposal. Considerations 

include signage for ventilation controls 

related to energy efficiency, informing 

the manufactured homeowner of the 

benefits to indoor air quality of using 

the system (reinforcing HUD 

encouragement to operate it whenever 

the home is occupied per 24 CFR 

3280.103(b)(6)), as well as measures that 

would mitigate indoor air quality 

impacts per other current ventilation 

standards (e.g., ASHRAE Standard 62.2, 

Ventilation and Acceptable Indoor Air 

Quality in Residential Buildings). In 

accordance with the Section 413(b)(2) of 

EISA, such measures are being 

considered to take into consideration 

the design and factory construction 

techniques of manufactured homes and 

provide for alternative practices that 

result in net estimated energy 

consumption equal to or less than the 

specified standards, and to address 

previous comments received regarding 

potential impacts to indoor air quality. 

DOE requests comment on the 

proposal to include the 2021 IECC fan 

efficacy standard requirements. DOE 

requests comment on whether any of the 

fan efficacy requirements are not 

applicable to manufactured homes. 

DOE requests comment on whether 

the HRV and ERV provisions under 

2021 IECC for site-built homes are 

applicable to manufactured homes and 

whether they would be cost-effective. 

Specifically, DOE requests comment on 

costs for the HRV and ERV requirements 

as it applies to manufactured homes in 

all climate zones. 

DOE requests comment on the above 

ventilation strategies, including (but not 

limited to) cost, performance, noise, and 

any other important attributes that DOE 

should consider, including those related 

to mitigation measures. While the 

alternate ventilation approaches are not 

integrated into the analysis presented as 

part of this proposal, DOE is giving 

serious consideration as to whether it 

should incorporate one or more of these 

options as part of its final rule based on 

any additional data and public 

comments it receives. 

e. Proposed § 460.205 Equipment Sizing 

Consistent with the June 2016 NOPR, 

DOE proposes specifications for 

equipment sizing in § 460.205 of the 

regulatory text, based on section R403.7 

of the 2015 and 2021 IECC, which sets 

forth specifications on the appropriate 

sizing of heating and cooling equipment 

within a manufactured home. This 

section of the 2015 and 2021 IECC 

requires the use of ACCA Manual S to 

select appropriately sized heating and 

cooling equipment based on building 

loads calculated using ACCA Manual J. 

The MH working group recommended 

the inclusion of this specification in the 

proposed rule. Term Sheet, No. 107 at 

p. 1. 

DOE received several comments on 

the June 2016 NOPR regarding 

equipment sizing. ACCA commented 

that while HVAC manufacturers are 

producing highly efficient products that 

exceed DOE’s regulatory demands, DOE 

does not require MH manufacturers to 

follow the minimum installation design 

standards that HVAC manufacturers 

recommend. ACCA asserted that as a 

result, HVAC systems are significantly 

less efficient and have shorter lifespans 

due to incorrect installation. (ACCA, 

No. 159 at p. 1) ACCA also commented 

that if DOE educated and incentivized 

homeowners to demand HVAC systems 

be installed to industry recommended 

standards by trained technicians, DOE 

could promote energy savings. (ACCA, 

No. 159 at p. 1) WSU Energy Program 

stated that DOE should consider 

including regulations regarding the 

installation of HVAC equipment. (WSU 

Energy Program, Public Meeting 

Transcript, No. 148 at p. 116) 

DOE acknowledges that installation 

can affect the efficiency of HVAC 


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40http://energy.gov/eere/buildings/standardsand-test-procedures. 

41https://basc.pnnl.gov/. 

equipment and that HVAC equipment 

may be installed after a home is 

manufactured (i.e., at the point of 

installation). As previously discussed, 

this rulemaking addresses energy 

efficiency standards for manufactured 

housing. To the extent that issues arise 

in the installation of HVAC equipment 

by the manufacturer related to proper 

sizing, § 460.205 addresses such 

concerns. In addition, HUD provisions 

in subpart H of 24 CFR part 3280 

provide installation requirements for 

heating, cooling, and fuel burning 

systems. 

DOE did not receive any other 

comments regarding equipment sizing. 

In addition, section R403.7 of the 2021 

IECC provides no updates to the 

equipment sizing and efficiency rating 

requirements. 

4. Remaining Comments Regarding the 

Energy Conservation Standard 

Requirements 

DOE also received numerous other 

comments that were not specific to the 

preceding sections or that could not be 

placed in only one of the preceding 

sections. Advanced Energy commented 

that, given the negative health effects of 

carbon monoxide exposure, carbon 

monoxide detection should be added to 

the proposed rule, similar to section 915 

of the 2015 International Building Code. 

(Advanced Energy, No. 189 at p. 1) EISA 

provides DOE with the authority to 

regulate energy conservation in 

manufactured housing. (42 U.S.C. 

17071(a)) Because the installation of a 

carbon monoxide detector is a health 

and safety matter as opposed to an 

energy conservation matter, DOE has 

not proposed this requirement in the 

SNOPR. 

ACC FSC stated that air-permeable 

insulation without the proper vapor 

retarder will cause condensation 

problems and that reducing air leakage 

and increasing insulation in homes will 

increase the possibility of condensation 

unless the proper materials are 

specified. (ACC FSC, No. 186 at p. 1) 

DOE is not proposing specifications for 

condensation control and vapor 

retarders because condensation control 

is not an energy conservation measure. 

The HUD Code, however, includes 

specifications for condensation control 

and installation of vapor retarders at 24 

CFR 3280.504. DOE’s proposed energy 

conservation standard would not 

prevent manufacturers from meeting the 

condensation and vapor retarder 

requirements established by HUD. This 

SNOPR, if made final, would not 

prevent or impede manufacturers from 

selecting construction materials, 

assembly methods, and designs that 

prevent the concerns raised by ACC 

FSC. 

VEIC stated that high-tier and middletier efficiency standards for HVAC, 

domestic hot water, lighting, and 

appliances should be included as 

requirements for certification. (VEIC, 

No. 187 at p. 2) NEEA commented that 

DOE should include the following 

energy savings elements in future 

revisions to the energy conservation 

standard: Lighting, appliances, domestic 

hot water efficiency, and HVAC 

efficiency. (NEEA, No. 190 at p. 4) 

ACEEE noted that section R404.1 of the 

2015 IECC requires that 75 percent of 

lighting be high-efficacy lamps. It 

commented that this yields significant 

additional cost-effective savings over 

the federal lighting standards. ACEEE 

urged DOE to include this provision in 

the standard. (ACEEE, No. 178 at p. 2) 

DOE is not proposing energy 

conservation standards for HVAC, water 

heaters, lighting, and appliances. As 

discussed, the energy efficiency of those 

products is specifically governed by the 

comprehensive Appliance Standards 

program established under EPCA. (42 

U.S.C. 6291–6317) However, 

manufacturers would not be prohibited 

from installing more efficient products 

and appliances, as long as the energy 

conservation standards are met. DOE 

also invites parties interested in energy 

conservation standards for appliances to 

comment on the rulemakings associated 

with those products.40

VEIC stated that the proposed rule 

should include requirements for 

insulation and air barrier installation 

training, quality assurance oversight, 

commissioning, and field performance 

testing. (VEIC, No. 187 at p. 2) As 

discussed, EISA directs DOE to establish 

energy conservation standards for 

manufactured housing. While DOE is 

proposing regulations, DOE’s Building 

America Solution Center 41 provides 

training materials for construction 

generally, including on topics 

applicable to manufactured homes. In 

terms of enforcement and performance 

testing, DOE will address compliance 

and enforcement provisions in a 

separate rulemaking. 

Modular Lifestyles and VEIC both 

offered comments regarding the benefits 

of zero energy homes. VEIC commented 

that an alternative to manufactured 

homes is to replace them with zero 

energy modular homes. (VEIC, No. 187 

at p. 2). Modular Lifestyle gave 

information regarding their NetZero 

manufactured home, built in Ojai, 

California. (Modular Lifestyle, No. 141 

at p. 2) DOE acknowledges that there are 

homes in the market that are already at 

the top end of energy efficiency. This 

SNOPR proposes minimum energy 

efficiency requirements applicable to all 

manufactured homes, and nothing in 

this SNOPR would prohibit 

manufacturers from producing models 

that exceed these requirements. 

WECC stated that the manufactured 

home’s crawl area temperature is 

warmer than outside ambient 

temperature during winter, and if the 

ambient air temperature is used for 

calculations, then the associated savings 

are overestimated. (WECC, No. 150 at p. 

2) The manufactured homes modeled in 

the energy simulations in the analyses 

conducted for the June 2016 NOPR and 

in this SNOPR are modeled with a 

vented crawl space below the floors. 

Thus, the floors are not exposed to 

ambient air, but to air temperatures 

within the vented crawlspace (which 

fall between the ambient outdoor air 

temperature and the conditioned indoor 

air temperature); this prevents the 

energy savings from being 

overestimated. 

F. Crosswalk of Standards With the 

HUD Code 

DOE compared the energy 

conservation standards proposed in this 

SNOPR to the construction and safety 

standards for manufactured homes 

established by HUD to confirm that 

compliance with the proposed 

requirements would not prohibit a 

manufacturer from complying with the 

HUD Code. 

Table III.15 lists the energy 

conservation standards and discusses 

their relationship to similar 

requirements contained in the HUD 

Code. 


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TABLE III.15—CROSSWALK OF SNOPR STANDARDS WITH THE HUD CODE

DOE SNOPR 

(10 CFR part 460) 

HUD Code 

(24 CFR part 3280) Notes 

Section 460.101 would establish three climate 

zones, in line with HUD, delineated by state 

boundaries. The DOE SNOPR proposes different Uo performance requirements for 

single- and multi-section homes.

Section 3280.506 establishes three zones delineated by state boundaries. The HUD 

Code establishes one standard for homes 

of all sizes within a zone.

Section 460.102(a) would establish building 

thermal envelope prescriptive and performance compliance requirements.

Section 3280.506 establishes a performance 

approach.

Both DOE and HUD performance requirements are based on maximum Uo requirement per zone for the building thermal envelope. DOE, however, would establish 

separate Uo requirements per climate zone 

for single- and multi-section homes, whereas HUD only establishes one Uo requirement, regardless of home size, per zone. 

Section 460.102(b) would set forth the prescriptive option for compliance with the building 

thermal envelope requirements.

Section 3280.506 establishes a performance 

approach only.

The Battelle method is used to determine performance standards (in terms of Uo) from 

prescriptive standards. The DOE proposed 

performance standards would be prescribed 

in § 460.102(c)(1). 

Section 460.102(b)(2) would establish a minimum truss heel height.No corresponding requirement.

Section 460.102(b)(3) would establish an acceptable batt and blanket insulation combination for compliance with the floor insulation 

requirement in climate zone 3.

No corresponding requirement.

Section 460.102(b)(4) would identify certain 

skylights not subject to SHGC requirements.

No corresponding requirements.

Section 460.102(b)(5) would establish U-factor 

alternatives for the R-value requirements 

under section 460.102(b)(1).

No corresponding requirements.

Section 460.102(c)(1) would establish maximum building thermal envelope Uo requirements.Section 3280.506(a) establishes maximum 

building thermal envelope Uo requirements 

by zone.

DOE’s proposed maximum building thermal 

envelope Uo requirements are lower than 

the corresponding maximum Uo requirements under § 3280.506(a). Compliance 

with the DOE proposed Uo requirements 

achieve compliance with the Uo requirements under the HUD Code. 

Section 460.102(c)(2) would establish maximum area-weighted vertical fenestration Ufactor requirements in climate zones 2 and 3.No corresponding requirements.

Section 460.102(c)(3) would establish maximum area-weighted average skylight U-factor requirements in climate zones 2 and 3.No corresponding requirements.

Section 460.102(c)(4) would authorize windows, 

skylights and doors containing more than 50 

percent glazing by area to satisfy the SHGC 

requirements of § 460.102(a) on the basis of 

an area-weighted average.

No corresponding requirements.

Section 460.102(e)(1) would establish a method 

of determining Uo using the Overall U-values 

and Heating/Cooling Loads—Manufactured 

Homes, or the Battelle method.

Section 3280.508(a) and (b) reference the 

Overall U-values and Heating/Cooling 

Loads—Manufactured Homes, or the 

Battelle method.

Section 460.103 would require insulating materials to be installed according to the manufacturer installation instructions and the prescriptive requirements of Table 460.103.No corresponding requirements.

Section 460.103 would establish requirements 

for the installation of batt, blanket, loose fill, 

and sprayed insulation materials.

No corresponding requirements.

Section 460.104 would require manufactured 

homes to be sealed against air leakage at all 

joints, seams, and penetrations associated 

with the building thermal envelope in accordance with the manufacturer’s installation instructions and the requirements set forth in 

Table 460.104.

Section 3280.505 establishes air sealing requirements of building thermal envelope 

penetrations and joints.


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TABLE III.15—CROSSWALK OF SNOPR STANDARDS WITH THE HUD CODE—Continued 

DOE SNOPR 

(10 CFR part 460) 

HUD Code 

(24 CFR part 3280) Notes 

Section 460.201(a) would require each manufactured home to be equipped with a duct 

system that must be sealed to limit total air 

leakage to less than or equal to 4 cfm per 

100 square feet of floor area and specify that 

building framing cavities are not to be used 

as ducts or plenums when directly connected 

to mechanical systems.

No corresponding requirements.

Section 460.202(a) would require at least one 

thermostat to be provided for each separate 

heating and cooling system installed by the 

manufacturer.

Section 3280.707(e) requires that each space 

heating, cooling, or combination heating 

and cooling system be provided with at 

least one adjustable automatic control for 

regulation of living space temperature.

Both DOE’s proposed rule and the HUD Code 

require the installation of at least one thermostat that is capable of maintaining zone 

temperatures. 

Section 460.202(b) would require that installed 

thermostats controlling the primary heating or 

cooling system be capable of maintaining different set temperatures at different times of 

day and different days of the week.

No corresponding requirements.

Section 460.202(c) would require heat pumps 

with supplementary electric resistance heat to 

be provided with controls that, except during 

defrost, prevent supplemental heat operation 

when the pump compressor can meet the 

heating load.

Section 3280.714(a)(1)(ii) requires heat 

pumps to be certified to comply with ARI 

Standard 210/240–89, heat pumps with 

supplemental electrical resistance heat to 

be sized to provide by compression at least 

60 percent of the calculated annual heating 

requirements of the manufactured home, 

and that a control be provided and set to 

prevent operation of supplemental electrical 

resistance heat at outdoor temperatures 

above 40 °F.

Both DOE’s proposed rule and the HUD Code 

require heat pumps with supplemental electric resistance heat to prevent supplemental 

heat operation when the heat pump compressor can meet the heating load of the 

manufactured home. 

Section 460.203(a) would establish requirements for the installation of service hot water 

systems.

No corresponding requirements.

Section 460.203(b) would require any automatic 

and manual controls, temperature sensors, 

pumps associated with service hot water systems to be accessible.

No corresponding requirement.

Section 460.203(c) would establish requirements for heated water circulation systems.No corresponding requirements.

Section 460.203(d) would establish requirement 

for the insulation of hot water pipes.

No corresponding requirements.

Section 460.204 would establish requirements 

for mechanical ventilation system fan efficacy.

Section 3280.103(b) establishes whole-house 

ventilation requirements.

HUD requirements at § 3280.103(b) do not 

overlap with DOE’s proposed rule. DOE’s 

proposed requirement is for fan electrical 

efficiency, while HUD requirements specify 

minimum and maximum air flow rates. 

Section 460.205 would establish requirements 

for heating and cooling equipment sizing.

No corresponding requirements.

IV. Discussion and Results of the 

Economic Impact and Energy Savings 

A. Economic Impacts on Individual 

Purchasers of Manufactured Homes 

DOE conducts LCC and PBP analyses 

to evaluate the economic impacts on 

individual consumers of energy 

conservation standards for 

manufactured housing. The effect of 

new or amended energy conservation 

standards on individual consumers 

usually involves a reduction in 

operating cost and an increase in 

purchase cost. DOE uses the following 

two metrics to measure consumer 

impacts: 

• The LCC is the total consumer 

expense of a manufactured home over 

the life of that home, consisting of total 

installed cost plus total operating costs. 

To compute the total operating costs, 

DOE discounts future operating costs to 

the time of purchase and sums them 

over the lifetime of the product (or 

another specified period). 

• The PBP is the estimated amount of 

time (in years) it takes consumers to 

recover the increased purchase cost 

(including installation) of a moreefficient manufactured home through 

lower operating costs. 

For the June 2016 NOPR, DOE used 

the LCC and PBP analyses developed 

during the MH working group 

negotiations to inform the development 

of the proposed rule based on the 

economic impacts on individual 

purchasers of manufactured homes. The 

LCC of a manufactured home refers to 

the total homeowner expense over the 

life of the manufactured home (30 

years), consisting of purchase expenses 

(e.g., loan or cash purchase) and 

operating costs (e.g., energy costs). To 

compute the operating costs, DOE 

discounted future operating costs to the 

time of purchase and summed them 

over the 30-year lifetime of the home 

used for the purpose of analysis in this 

rulemaking. A 10-year LCC was also 

calculated to reflect the cost of 

ownership over the tenure of the first 

homebuyer. DOE calculated the PBP by 

dividing the incremental increase in 

purchase cost by the reduction in 


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42 Double-section manufactured homes were used 

to represent all multi-section homes. Double-section 

manufactured homes have the largest market share 

by shipments (about 98 percent) of all multi-section 

homes. 

43Consumer Financial Protection Bureau. 

Manufactured-housing Consumer Finance in the 

United States. September 2014. 

44Foremost Insurance Group. 2012 Mobile Home 

Market Facts. 

45Manufactured Housing Institute. 2021 

Manufactured Housing Facts: Industry Overview. 

average annual operating costs that 

would result from this rule. 

In the June 2016 NOPR, the LCC 

analysis demonstrated that increased 

purchase prices due to the proposed 

energy efficiency measures (‘‘EEMs’’) 

would be offset by the benefits 

manufactured home homeowners would 

experience via operating cost savings. 

DOE evaluated these projected impacts 

on individual manufactured home 

homeowners by analyzing the potential 

impacts to LCC, energy savings, and 

purchase price of manufactured homes 

under the proposed rule. For the 

purpose of the June 2016 NOPR 

economic analysis, DOE compared the 

purchase price and LCC for 

manufactured homes built in 

accordance with the proposed rule 

relative to a baseline manufactured 

home built in compliance with the 

minimum requirements of the HUD 

Code. Specifically, DOE performed 

energy simulations on manufactured 

homes located in 19 geographically 

diverse locations across the United 

States, accounting for five common 

heating fuel/system types and two 

typical industry sizes of manufactured 

homes (single-section and doublesection manufactured homes).42 DOE 

received a number of comments 

regarding several aspects of the 

economic impacts on individual 

consumers described in the June 2016 

NOPR. DOE also received comments 

pertaining to the methodology and 

assumptions used in the economic 

analysis conducted for the June 2016 

NOPR. For this SNOPR, DOE conducted 

similar LCC and PBP analyses for the 

requirements as proposed in this 

document. The changes made from the 

analyses performed for the June 2016 

NOPR are discussed in the following 

sections, including any changes that 

DOE has made in the methodology and 

assumptions, along with a discussion of 

the submitted comments. 

1. Discussion of Comments and 

Analysis Updates 

a. Analysis Period for LCC 

In the June 2016 NOPR, DOE analyzed 

a 10-year LCC to represent the first 

ownership period and cost of the first 

homebuyer, and a 30-year LCC to 

represent the lifetime of the 

manufactured home and associated 

costs, which would represent the total 

costs and benefits for all occupants over 

the life of the manufactured home. The 

30-year lifetime was selected as a 

typical length that EEMs last in the 

aggregate. The monetary value of these 

EEMs was considered to depreciate 

linearly over the 30-year lifetime. At the 

end of this 30-year lifetime, the EEMs 

would have no monetary value. 

DOE received comments on the June 

2016 NOPR discussing the time period 

that a consumer owns a manufactured 

home. COBA commented that in its 

experience, consumers generally stay in 

their manufactured home 2 to 3 years. 

(COBA, Public Meeting Transcript, No. 

148 at p. 97) SBRA also stated that on 

average, the first homeowner of a 

manufactured home sells their home 

within 7 years of purchase and is 

unlikely to realize any incremental 

value from the EEMs. (SBRA, No. 163 at 

p. 2) MHI stated that manufactured 

homes change ownership within 7 to 10 

years. (MHI, No. 182 at p. 6) 

DOE appreciates the information 

provided by these organizations 

regarding the potential ownership 

period of manufactured homes. DOE 

researched the ownership period of 

manufactured home homeowners and 

found that a study by the Consumer 

Financial Protection Bureau (CFPB) 

indicated an average ownership period 

of 13 years. This study also found that 

based on 50,000 manufactured 

homesites in 161 communities in 2014, 

manufactured homes resided in their 

community for an average of 40 years, 

an indication of manufactured home 

lifetime.43 A 2012 study conducted by 

Foremost Insurance Group found that 40 

percent of manufactured home 

homeowners do not anticipate ever 

selling their manufactured home.44

Furthermore, a 2021 manufactured 

housing industry overview fact sheet 

developed by MHI suggests that 62 

percent of all homeowners anticipate 

living in their homes for more than 10 

years and that 38 percent of 

homeowners don’t anticipate ever 

selling their home.45 Therefore, there 

are many factors that may affect the 

duration of time that a manufactured 

home remains under a given 

homeowner. For purposes of this 

analysis, DOE continues to rely on the 

10-year time period as a reasonable 

representation of the ownership period 

of the first homebuyer for the overall 

manufactured housing market as it is 

between the values suggested COBA and 

SBRA and the high value reported by 

the CFPB, and consistent with the value 

reported by MHI. 

Additionally, due to concerns about 

incremental cost for low-income 

families, DOE is proposing the Tier 1 

standard for manufactured homes with 

manufacturer’s retail list price of 

$55,000 or less. As discussed below, 

manufactured homes complying with 

the Tier 1 standard would have an 

average PBP of 3.7 and 3.5 years for 

single-section and multi-section homes, 

respectively, while achieving a positive 

cash flow in the first year of occupancy. 

Further discussion of these concerns is 

addressed in section IV.A.1.i. 

MHARR commented that the PBP 

found in the analysis will be longer 

once the costs of compliance are 

included and passed onto the consumer 

(MHARR, No. 154 at p. 27). As 

discussed above, DOE is not addressing 

a compliance, certification, and 

enforcement program in this 

rulemaking, but may do so in the future. 

However, DOE will consider comments 

and information on compliance and 

enforcement matters provided by 

stakeholders, including costs. 

DOE also received comments 

regarding the longer term LCC period 

(i.e., 30 years). MHI expressed concern 

with using a 30-year time period to 

justify energy efficiency investments 

because most manufactured homes 

change ownership within 7 to 10 years 

and may not see the savings from the 

increased upfront cost. (MHI, No. 182 at 

p. 6) GWU stated that the 10-year LCC 

analysis represents a much more 

accurate reflection of the manufactured 

housing consumers’ benefits rather than 

the 30-year LCC analysis because the 30- 

year analysis is not representative of the 

timespan that owners live in 

manufactured homes. (GWU, No. 175 at 

pp. 3–4) Conversely, VEIC commented 

that the 30-year LCC should be used 

instead of the 10-year LCC analysis 

because the 30 years is more 

representative of the timespan in which 

the manufactured home will be in 

service. (VEIC, No. 187 at p. 2) 

EISA directs DOE to base the 

standards on the most recent version of 

the IECC considering, among other 

things, the total life-cycle construction 

and operating costs. (42 U.S.C. 

17071(b)(1)) As such, DOE is 

considering the total life-cycle costs and 

operating costs of the standards 

proposed in this document. 

As discussed previously, DOE 

determined that the average tenure of a 

manufactured homeowner is 13 years, 

and the lifetime of a home can average 

40 years. However, DOE understands 

that there are constraints in the 

secondary market for manufactured 


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47792 Federal Register / Vol. 86, No. 163 / Thursday, August 26, 2021 / Proposed Rules 

46Consumer Financial Protection Bureau. 

Manufactured-housing Consumer Finance in the 

United States. September 2014. Available at: 

https://www.consumerfinance.gov/data-research/ 

research-reports/manufactured-housing-consumeRfinance-in-the-U-s/. 

47For Tier 1 standards, all cities (except for 

Miami in the 10-year analysis) indicate positive 

LCC savings. For Tier 2 standards, all cities in HUD 

climate zones 1 and 2 indicate positive LCC savings 

for 30-year and 10-year analyses. Certain cities in 

HUD climate zone 3, however, do not indicate 

positive LCC savings. Details can be found in 

chapter 8 and 9 of the SNOPR TSD. 

homes, as outlined in the 2014 CFPB 

report. Accordingly, DOE performed the 

10-year analysis to determine the 

economic impacts of the proposed rule 

on the first homeowner. DOE also 

performed the 30-year analysis to 

determine the economic impacts, as 

well as the cumulative benefits over the 

lifetime of the manufactured home. In 

this SNOPR, DOE continues to use both 

the 10-year and 30-year LCC analyses 

from the June 2016 NOPR. 

DOE received several comments 

regarding PBP results relating to the 

LCC and homeownership periods. In the 

June 2016 NOPR, DOE reported national 

average PBP values of 7.1 years for 

single-section homes and 6.9 for multisection homes. MHARR stated that the 

projected consumer PBP is longer than 

consumers live in a particular 

manufactured home. (MHARR, No. 154 

at p. 27) AGA and APGA commented 

that the PBP should be less than 5 years 

for the resident to truly gain a benefit. 

(AGA & APGA, No. 172 at p. 1) 

As previously stated, a study by the 

CFPB indicated that the average 

ownership period of 13 years. DOE 

assumes a 10-year ownership period for 

the first owner of the manufactured 

home in its 10-year LCC analysis. Table 

IV.17, Table IV.10, and Table IV.11 

provide the results for DOE’s simple 

PBP analysis for the rule as proposed in 

this SNOPR, broken out by tiers and 

climate zone for single-section and 

multi-section homes. These resulting 

simple PBPs indicate that the first 

owner of a Tier 1 manufactured home 

would gain a net benefit and would 

realize positive net savings from the 

proposed energy standards. The simple 

PBP of a Tier 1 standard manufactured 

home is 3.7 years for single-section and 

3.5 years for multi-section homes, and 

the simple PBP of a Tier 2 standard 

manufactured home is 10.9 years for 

single-section and 10.6 years for multisection. Although the simple PBPs for 

Tier 2 homes exceed the 10-year 

ownership period for the first owner, 

they still fall within the 13-year average 

ownership period. In addition, DOE 

considered a sensitivity analysis for an 

alternative insulation requirement for 

Tier 2 homes, R–21, wherein the PBP is 

8.5 for single-section and 8.9 years for 

multi-section homes. 

b. Interest Rate 

In the June 2016 NOPR LCC analysis, 

DOE estimated an interest rate of 5 

percent for consumers using real estate 

loans, 9 percent for consumers using 

chattel (personal property) loans, and 5 

percent for consumers paying for the 

manufactured home outright with cash. 

These were conservative figures based 

on ranges provided by the MH working 

group. According to data provided by 

the MH working group, real estate loans 

typically have interest rates ranging 

from approximately 4.0 to 4.3 percent 

and chattel loans typically have interest 

rates ranging from 6.3 percent to 9.5 

percent. EERE–2009–BT–BC–0021– 

0074. In the June 2016 NOPR analysis, 

DOE used a 5-percent real estate loan 

interest rate and a 9-percent chattel loan 

interest rate as a conservative estimate. 

Regarding the different interest rates 

used for the LCC analysis, GWU 

commented that interest rates on chattel 

loans range from 7 percent to 13 percent 

and that DOE’s use of 9 percent may be 

too low. (GWU, No. 175 at p. 5) DOE 

conducted research on interest rates for 

real estate and chattel loans to confirm 

the discount rates determined by the 

MH working group. DOE’s research 

showed that chattel loans often range 

from 0.5 to 5 percent more than real 

estate loans according to a CFPB study 

released in September 2014.46 This 

difference between real estate loan and 

chattel loan rates supports DOE’s 

assumptions from the June 2016 NOPR, 

which used a chattel loan rate of 9 

percent, which is 4 percent higher than 

the real estate loan interest rate of 5 

percent. DOE did not find a more recent 

CFPB study of the same. For the SNOPR 

LCC analysis, DOE maintains the 

interest rate values used in the June 

2016 NOPR. 

c. Discount Rate for LCC 

In the June 2016 NOPR LCC analysis, 

DOE used a discount rate of 5 percent 

for consumers using real estate loans, 9 

percent for consumers using chattel 

(personal property) loans, and 5 percent 

for consumers paying for the 

manufactured home outright with cash. 

The discount rate was set equal to the 

loan interest rate because this rate 

represents a primary ‘‘investment’’ 

available to a homeowner (that is, the 

homeowner can pay down the loan 

early, avoiding interest payments at the 

rate associated with the loan). 

Therefore, DOE discounted cash flows 

in the LCC analysis using a discount 

rate equal to this alternative investment 

rate (the loan interest rate). 

Regarding the discount rates used in 

the June 2016 NOPR LCC analysis, 

ACEEE supported the June 2016 NOPR, 

stating that an LCC analysis using a 

discount rate similar to the rate lowincome homeowners would pay for a 

mortgage should be reasonable. (ACEEE, 

No. 178 at p. 3) Alternatively, GWU 

stated it also conducted its own LCC 

analysis based on discount rates of 5, 9, 

and 13 percent. GWU’s LCC results 

using these inputs found that consumers 

in certain cities are anticipated to bear 

net costs and summing the percentage of 

national shipments of each of these 

cities would result in 28.5 percent of all 

shipments of single-section 

manufactured homes and 35.1 percent 

of all shipments of multi-section 

manufactured homes anticipated to bear 

net costs. GWU stated that these studies 

indicate that DOE’s proposed rule does 

not fit the statutory cost-effectiveness 

requirement given in EISA. (GWU, No. 

175 at p. 6) 

DOE appreciates ACEEE’s comment 

supporting the June 2016 NOPR LCC 

discount rates. Regarding the LCC 

analysis conducted by GWU, DOE’s 

understanding is that the results were 

based on a discount rate of 13 percent, 

which was the upper bound of the 7- 

percent to 13-percent range of chattel 

rates GWU presented and is higher than 

DOE’s estimate of 9 percent. In addition, 

it is not clear what analysis period GWU 

relied on (DOE uses 10 and 30 years). 

However, the discount rate values used 

by GWU diminish the value of the 

benefits of reduced energy use relative 

to the values used in the June 2016 

NOPR. As described previously, the 

June 2016 NOPR analysis was based on 

the real estate and chattel loan rates of 

5 percent and 9 percent, respectively, as 

well as a 30-year analysis period 

reflecting the lifespan of a manufactured 

home. For the reasons already 

discussed, for this SNOPR, DOE 

continues to find these values more 

appropriate than those used by GWU. 

Using the discount rates equal to the 

corresponding interest rate, in this 

SNOPR, DOE’s 30-year and 10-year 

analyses indicate that the national 

average results show positive LCC 

savings compared to the baseline.47

d. Down Payment and Loan Term 

In the June 2016 NOPR, DOE assumed 

a down payment of 20 percent for both 

real estate and chattel loans. DOE 

received several comments on the June 

2016 NOPR suggesting alternatives to 

the down payment assumptions used in 

the NOPR. 


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48Manufactured Housing Institute, Trends and 

Information about the Manufactured Housing 

Industry 2016. https://

www.manufacturedhousing.org/wp-content/ 

uploads/2016/11/1836temp.pdf. 

49U.S. Census Bureau, American Housing 

Survey, 2013 http://www.census.gov/programssurveys/ahs/data.2013.html. 

MHI and COBA indicated that DOE 

may be overestimating the LCC savings 

by using a down payment assumption of 

20 percent for chattel loans. According 

to MHI and COBA, chattel loan down 

payments are rarely 20 percent, and a 

more common range representative of 

the industry is 5–10 percent. (MHI, No. 

182 at p. 6; COBA, Public Meeting 

Transcript, No. 148 at p. 92) After 

researching the matter, DOE tentatively 

agrees that a lower down payment 

assumption (relative to the June 2016 

NOPR) is appropriate. MHI’s ‘‘Trends 

and Information About the 

Manufactured Housing Industry 2016’’ 

indicates that down payments for all 

loans used for manufactured homes 

range from 10 to 20 percent.48 Although 

some commenters stated that a 5 percent 

down payment can occur, a 5 percent 

down payment is below the lower 

boundary of what lenders accept for a 

chattel loan, as reported by MHI. DOE 

also notes that the impact of down 

payment percentage is limited in an 

LCC calculation because reductions in 

upfront down payment costs are mostly 

offset by increases in monthly principal 

and interest payments (and vice versa). 

Based on the comments and new 

information on typical down payments 

for chattel loans, for the SNOPR, DOE 

assumes a down payment of 10 percent 

for chattel loans and maintained a down 

payment of 20 percent for real estate 

loans. 

Regarding the loan term for chattel 

loans, MHI recommended that DOE use 

an estimate of 10 to 15 years. (MHI, 

Public Meeting Transcript, No. 148 at p. 

91; MHI, No. 182 at p. 7) In the June 

2016 NOPR, DOE used a 15-year loan 

term for chattel loans for the LCC 

analysis based on suggestions from the 

MH working group. DOE’s NOPR 

estimate of 15 years falls within the 

range recommended by MHI. No 

comments were received suggesting that 

the 15-year assumption was 

inappropriate. For the SNOPR, DOE 

maintains the chattel loan term of 15 

years. 

e. Resale Value of Manufactured Homes 

DOE received several comments on 

the June 2016 NOPR regarding the resale 

value of manufactured homes and how 

that may affect the LCC analysis. GWU 

commented that DOE’s LCC analysis did 

not take into account the difficulty in 

recouping high upfront costs via resale. 

It stated that secondhand buyers have 

difficulty obtaining adequate financing 

for resold manufactured homes because 

lenders often charge higher interest rates 

on used manufactured homes. (GWU, 

No. 175 at p. 3) Lippert Components 

and MHI also expressed concern that it 

will be unlikely that first-time 

homeowners will be able to recapture 

the cost of EEMs in the event of a resale. 

(Lippert Components, No. 152 at p. 1; 

MHI, No. 182 at p. 6) Conversely, WSU 

Energy Program commented that resale 

values of manufactured homes with 

energy efficiency measures are often 

higher than those without these 

measures. (WSU Energy Program, Public 

Meeting Transcript, No. 148 at p. 93) 

Further, WSU Energy Program stated 

that this higher resale value of the 

manufactured home must be considered 

when calculating payback period. (WSU 

Energy Program, Public Meeting 

Transcript, No. 148 at p. 93) 

For the SNOPR, as with the June 2016 

NOPR, DOE conducted the LCC analysis 

based on the total homeowner expense 

over the life of the manufactured home 

and operating costs. A 30-year lifetime 

was selected as a typical length that 

energy efficiency measures last in a 

manufactured home. In addition, DOE 

also performed a 10-year LCC analysis, 

which represents the cost of ownership 

over the tenure of the first homeowner. 

Both analyses assume that the 

incremental cost of the DOE-compliant 

home depreciates on a linear basis over 

the 30-year lifetime. Therefore, DOE’s 

analysis assumes that not all of the 

incremental cost of EEMs is recouped at 

resale. 

Increases in resale value can offset 

upfront costs when considering life 

cycle costs over a period of time. 

However, the PBP metric is a ‘‘simple 

PBP’’ based on dividing the incremental 

increase in purchase cost by the average 

annual savings in operating costs that 

would result from the rule. Therefore, 

resale value is not included in the PBP 

calculation. DOE maintains this 

methodology in the SNOPR, as the 

resale value of the home does not have 

any direct input into the calculation of 

a simple PBP. 

f. Tax Rate 

Property taxes vary widely within and 

among states. In the June 2016 NOPR, 

DOE assumed a property tax rate of 0.9 

percent, which was agreed upon by the 

MH working group. DOE also separately 

determined the median tax rate and 

found that the 2013 American Housing 

(AHS) Survey for manufactured homes 

reported a $10 per $1,000 in home 

value, indicating a 1-percent tax rate.49

The later AHS reports (2015, 2017 or 

2019) did not provide an updated 

estimate; thus, DOE continues to 

consider the estimate from the 2013 

AHS Survey. The reported AHS 

estimate substantiated the MH working 

group recommendation. 

DOE received one comment regarding 

the property tax rate used in the June 

2016 NOPR. COBA commented that the 

property tax rate data used in the June 

2016 NOPR analysis for the LCC was 

incorrect, without further elaborating on 

a better estimate. (COBA, No. 158 at p. 

3) As no alternative estimates were 

offered, for this SNOPR, DOE continues 

to assume a property tax rate of 0.9 

percent based on the MH working group 

recommendation and the AHS Survey. 

g. Incremental Cost 

In the June 2016 NOPR, DOE arrived 

at the incremental cost to the consumer 

by calculating the difference in the EEM 

costs of DOE-compliant and minimally 

compliant HUD homes. These 

incremental costs correspond to the 

purchase prices seen by the homeowner, 

and thus account for manufacturer and 

retail markups. DOE used incremental 

component costs (retail costs) provided 

and agreed to by the MH working group. 

ASRAC Cost Analysis Data, EERE– 

2009–BT–BC–0021–0091. 

Regarding the incremental costs, 

MHARR stated that the cost figures used 

for the June 2016 NOPR analysis were 

obtained primarily from large 

manufacturers, and therefore the cost is 

understated for smaller manufacturers 

who do not benefit from large volume 

supply orders. MHARR conducted a 

study based on higher supply costs 

associated with small manufacturers 

and concluded that the price increase 

will be $4,600 and $5,825 above the 

HUD Code for single- and multi-section 

manufactured homes, respectively. 

(MHARR, No. 154 at p. 30; MHARR, No. 

143 at p. 4) 

Conversely, NEEA and VEIC stated 

that the incremental costs found and 

used in DOE’s analysis may be 

overstating the cost increases. NEEA 

commented that the real-world 

incremental costs would be lower than 

DOE estimates. NEEA cited data (from 

the Pacific Northwest region) that shows 

current incremental purchase prices for 

ENERGY STAR homes (which NEEA 

stated are more stringent than the 

proposed rule) are between $2,000 and 

$3,000 more than a manufactured home 

minimally compliant with the HUD 


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47794 Federal Register / Vol. 86, No. 163 / Thursday, August 26, 2021 / Proposed Rules 

Code. NEEA indicated that DOE’s 

incremental costs do not incorporate 

economies of scale, good engineering 

practice, and improved technology, 

which would result (once all MH 

manufacturers meet the DOE standard) 

in much lower realized incremental 

costs. (NEEA, No. 190 at p. 4; NEEA, 

Public Meeting Transcript, No. 148 at 

p.72) VEIC commented that the 

estimated incremental costs are inflated. 

(VEIC, No. 187 at p. 2) 

In the June 2016 NOPR, DOE used 

incremental component costs provided 

and agreed to by the MH working group. 

MHI stated that these costs represent 

small, medium, and large 

manufacturers, commenting that for the 

cost analysis conducted by MHI and 

SBRA, small, medium, and large 

manufacturers were all consulted during 

the MH working group process. (MHI, 

Public Meeting Transcript, No. 148 at p. 

85) DOE analyzed MHARR’s 

incremental costs and identified a 

number of differences in the inputs 

between DOE’s and MHARR’s 

calculations. Specifically, DOE found 

that for certain components, such as 

exterior floor insulation, MHARR’s 

incremental costs were based on 

baseline thermal requirements that were 

different than what was used by the MH 

Working Group. In another case, 

MHARR’s calculations also included 

costs for exterior doors. However, DOE 

expects no incremental cost associated 

with doors because the insulation level 

(U-factor) for a baseline home was 

assumed to already meet the U-factor 

requirement in the proposed rule. In 

addition, MHARR did not provide the 

sources for the costs identified. In 

summary, MHARR’s comment provided 

insufficient detail to verify that the 

incremental costs corresponded to the 

same home construction parameters and 

the same EEMs as DOE used in its 

analysis. As a result of these 

inconsistencies, DOE did not revise the 

component incremental costs from the 

June 2016 NOPR based on the data 

provided by MHARR. Furthermore, DOE 

reviewed the 2020 RSMeans 

construction cost estimating software to 

corroborate the cost data used in the 

June 2016 NOPR and concluded that the 

estimates provided by the MH working 

group continues to remain mostly 

relevant. Therefore, for the SNOPR, DOE 

proposes to maintain the component 

incremental costs used in the June 2016 

NOPR and established by the MH 

working group, as these values are 

representative of manufacturers of all 

sizes. 

Regarding incremental cost impacts 

on retailers, MHARR stated that smaller 

retailers will feel the full brunt of the 

increased costs. (MHARR, No. 143 at p. 

4) DOE notes that retailers will 

experience increased costs. However, 

DOE’s analysis anticipates that the full 

incremental cost of the EEMs necessary 

to comply with the SNOPR will be 

passed through to the consumer, 

bypassing the manufacturer and retailer. 

While DOE agrees retailers (both large 

and small) will see higher prices when 

purchasing manufactured homes from 

MH manufacturers, these same 

manufactured homes will be sold at a 

correspondingly higher price to the 

consumer. 

For this SNOPR, DOE updated the 

total incremental costs for the tiered 

standards—i.e., Tier 1 energy efficiency 

requirements based on the set of energy 

efficiency measures that provide energy 

savings under at a set upfront 

incremental purchase price (i.e., 

approximately $750) and Tier 2 energy 

efficiency requirements that specify 

more stringent building thermal 

envelope requirements. The proposed 

tiered approach addresses concerns 

regarding potential impacts of first-cost 

increases on price-sensitive, low-income 

purchasers of manufactured homes. 

Table I.1 and Table I.2 provide the 

updated total incremental costs, 

depending on the tiered standard being 

analyzed. Table I.3 provides the 

updated total incremental costs under 

the proposed untiered standard. 

h. Reliability of the LCC 

DOE received a comment regarding 

the overall reliability of the LCC 

analysis to capture potential savings 

related to the rulemaking. MHI stated 

that the LCC analysis is too uncertain to 

justify the projected upfront purchase 

price, and specifically stated that small 

errors in energy cost escalation rates can 

turn a long-term benefit into a long-term 

loss. (MHI, No. 182 at p. 6) 

DOE understands that there may be 

uncertainties regarding the future prices 

of energy. In the June 2016 NOPR, the 

energy cost inputs used in the LCC 

analysis, including energy prices and 

their escalation rates, were based on the 

Annual Energy Outlook 2015 (AEO 

2015) and Short-Term Energy Outlook 

studies, prepared by the U.S. Energy 

Information Administration (‘‘EIA’’). 

The AEO presents long-term annual 

projections of energy supply, demand, 

and prices. The projections, focused on 

U.S. energy markets, are based on 

results from EIA’s National Energy 

Modeling System (‘‘NEMS’’). NEMS 

enables EIA to make projections under 

internally consistent sets of 

assumptions. DOE believes these studies 

are the best current and future estimates 

of energy prices and escalation rates and 

uses these studies in support of all of its 

energy conservation standard 

rulemakings. In the SNOPR, DOE 

proposes to maintain the same source 

for establishing energy prices and 

escalation rates and updated the AEO 

source to the latest version at the time 

of the SNOPR analysis, which was AEO 

2020. 

Lastly, EISA requires that DOE 

establish energy conservation standards 

for manufactured housing with 

consideration of the cost-effectiveness 

as related to the purchase price and total 

life-cycle construction and operating 

costs generally. (42 U.S.C. 17071(b)(1)) 

As such, the LCC analysis in this 

SNOPR addresses this requirement by 

incorporating the total homeowner 

expense over the life of the 

manufactured home, consisting of 

purchase expenses (e.g., loan or cash 

purchase) and operating costs (e.g., 

energy costs). 

i. Affordability 

Consistent with concerns raised in 

DOE’s consultation with HUD, 

commenters raised concerns regarding 

the impact of energy conservation 

standards on the affordability of 

manufactured homes. DOE received 

comments from organizations that stated 

that manufactured homes are an 

important aspect of unsubsidized 

affordable housing across the country 

and that the average income of a 

manufactured homeowner is half the 

national average. Commenters indicated 

that any changes in the cost of 

manufactured homes will price some 

consumers out of homeownership and 

expressed concern that the proposed 

rule did not offer any assistance to offset 

the predicted cost increase and resulting 

decrease in manufactured home 

production. (Pleasant Valley Homes, No. 

153 at p. 1; Skyline Corporation, No. 

165 at p. 1; Clayton Homes, No. 185 at 

p. 2; MHIM, No. 155 at p. 1; NMMHA, 

No. 157 at p. 1; MHIA, No. 161 at p. 1; 

MHISC, No. 191 at p. 1; OMHA, No. 166 

at p. 1; MMHA, No. 170 at p. 2; AMHA, 

No. 173 at p. 2; PMHA, No. 164 at p. 1; 

Commodore Corporation, No. 195 at p. 

1) Cavco commented that the industry 

must maintain affordability in order to 

increase home ownership and stated 

that if the cost to produce a home 

increases, the costs will be passed onto 

the consumer. They also expressed 

concern that the manufactured housing 

market has extended too much credit to 

homeowners. (Cavco, Public Meeting 

Transcript, No. 148 at p. 87) SBRA 

suggested that DOE analyze how this 

standard affects home ownership 

affordability for consumers once the 


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rule is implemented. (SBRA, Public 

Meeting Transcript, No. 148 at p. 19) 

DOE recognizes the role of 

manufactured homes in the U.S. 

housing market and their ability to 

provide affordable housing. As already 

discussed in section II.B.4 and in 

several other sections in this document, 

concern over the initial first-cost 

impacts that the June 2016 NOPR energy 

efficiency requirements would have on 

low-income buyers led DOE to 

contemplate cost-effective approaches 

that would also mitigate first-cost 

impacts for purchasers at the lower end 

of the manufactured home price range, 

and to examine and propose the tieredapproach presented in this SNOPR. In 

consideration of the first-cost impacts 

and cost-effectiveness for low-income 

purchasers, the tiered approach would 

subject those manufactured homes with 

a manufacturer’s retail list price of 

$55,000 or less (i.e., Tier 1) to a set of 

energy efficiency measures that have an 

upfront incremental purchase price of 

approximately $750 (for a single-section 

home). Table I.1 provides the updated 

total incremental costs. Under the 

proposed tiered approach, 

manufactured homes with a 

manufacturer’s retail list price greater 

than $55,000 (in real 2019$) (i.e., Tier 2) 

would generally be subject to the same 

set of requirements as applicable to Tier 

1 manufactured homes, but with more 

stringent U-factor and R-value 

requirements. The Tier 2 energy 

conservation standards are the same as 

those that would apply to all 

manufactured homes under the 

proposed untiered standard. 

While both proposals presented in the 

SNOPR (i.e., the tiered approach and the 

single set of standards) would result in 

incremental cost increases for 

manufactured homes that may be passed 

to the consumer, the full incremental 

cost is not paid by the consumer on the 

purchase date because consumers 

(particularly low-income consumers) 

purchase manufactured homes with a 

down payment and other financing 

(either through a personal property loan, 

often referred to as a ‘‘chattel loan,’’ or 

a real estate loan). A consumer would 

typically only pay a 10-percent down 

payment for a chattel loan, and the 

remainder of the incremental cost 

increase passed to the consumer would 

be spread through increases in 

payments throughout the loan term (15 

to 30 years). DOE’s current LCC analysis 

tentatively finds that these loan 

payment increases would be offset by 

the energy cost savings for all cities 

except one (with San Francisco being 

the only exception) in the tiered 

standards, providing a net benefit and 

cost-effectiveness to the consumer. San 

Francisco represents 1.2 percent of all 

single-section home shipments (Tier 1 + 

Tier 2) analyzed. Further, DOE notes 

that Tier 2 single-section homes would 

be a portion (approximately 0.5 percent) 

of the all single-section homes 

shipments. While increases in purchase 

price as a result of either proposed 

standard are tentatively projected to be 

offset by the benefits derived from the 

projected energy cost savings, DOE 

requests comment regarding the costeffectiveness of both options to inform 

its final decision. 

Relating to the general affordability of 

manufactured homes, SBRA 

recommended that DOE work with the 

industry in establishing an economic 

basis for energy efficiency standard 

development that would serve as the 

benchmark for setting requirements that 

improve home affordability. (SBRA, No. 

163 at p. 2) DOE used the LCC and PBP 

analyses developed during the MH 

working group negotiations to inform 

the development of the proposed rule 

based on the economic impacts on 

individual purchasers of manufactured 

homes. As such, DOE has initially 

concluded that the national economic 

benefits outweigh the increased 

purchase price, indicating that under 

both proposals the applicable energy 

conservation standards would improve 

the economic status of consumers in 

most regions relative to the status quo. 

DOE also received comments 

regarding affordability and the costeffective provision of EISA. MHARR 

stated that the cost-effective provision of 

EISA must be applied to ensure that 

energy standards do not result in 

purchase price increases that would 

impair manufactured housing 

affordability, availability, or 

accessibility. (MHARR, No. 154 at p. 24) 

DOE performed an LCC analysis in this 

SNOPR that calculated the total 

homeowner expense over a period of 30 

years, consisting of purchase expenses 

(e.g., chattel loan, conventional 

mortgage or cash purchase) and 

operating costs (e.g., energy costs). The 

national average results of the LCC 

analysis show positive LCC savings for 

a 30-year analysis period and annual 

energy cost savings for the homeowner 

in each climate zone (see section 

IV.A.2). The cost-benefit analysis shows 

that the increased purchase cost to the 

consumer would be offset by energy cost 

savings. In addition to these results, 

DOE presents a sensitivity analysis for 

an alternative insulation requirement for 

Tier 2 homes in zones 2 and 3, which 

would increase life-cycle cost savings 

and decrease the simple PBP for affected 

homes relative to the R–20+5 insulation 

requirement based on the 2021 IECC. 

Regarding the availability of 

manufactured homes, for this SNOPR 

(and in the June 2016 NOPR), DOE 

addressed the reduction of shipments 

based on the projected increase in home 

upfront costs using a price elasticity of 

demand (price elasticity) calculation. 

Price elasticity is an economic concept 

that describes the change of the quantity 

demanded in response to a change in 

price. Price elasticity is typically 

represented as a ratio of the percentage 

change in quantity relative to a 

percentage change in price. Sections 

IV.C.1.a and IV.C.1.b provide more 

details on how DOE incorporated price 

elasticity in the shipments analysis and 

the magnitude of people who do not buy 

because they are price-sensitive. 

DOE also received many comments 

from groups concerned with a potential 

3–10 percent increase in purchase price 

of manufactured home as a result of the 

proposed standards. Because of the 

affordable housing crisis in the U.S., 

they stated that the final rule should 

avoid any increases in cost for 

consumers by providing programs for 

consumers to obtain financing or aid in 

purchasing their homes. These 

commenters urged DOE to improve 

energy efficiency while preserving 

affordability and to work with lenders, 

federal regulators, and HUD to mitigate 

the upfront costs of these regulations 

before the rule is finalized. (Pleasant 

Valley Homes, No. 153 at p. 1; Skyline 

Corporation, No. 165 at p. 1; Clayton 

Homes, No. 185 at p. 2; MHIM, No. 155 

at p. 2; NMMHA, No. 157 at p. 2; MHIA, 

No. 161 at p. 2; MHISC, No. 191 at p. 

1; OMHA, No. 166 at p. 1; MMHA, No. 

10 at p. 2; AMHA, No. 173 at p. 2; 

PMHA, No. 164 at p. 2; Form Letter, No. 

192 at p. 1; COBA, No. 158 at p. 5; 

Commodore Corporation, No. 195 at p. 

2) 

Specifically, several commenters 

recommended that DOE also consult 

with the CFPB and Federal Housing 

Finance Agency (‘‘FHFA’’) to ensure 

that there is enough flexibility in 

qualified mortgage regulations to permit 

an increase in debt-to-income ratios 

when paired with reductions in energy 

costs. (Better Homes, No. 168 at p. 1, 

Next Step, No. 174 at p. 2, MHI, No. 182 

at p. 7) Next Step also commented that 

DOE should collaborate with HUD, 

FHFA, and the U. S. Department of 

Agriculture (‘‘USDA’’) to ensure 

flexibility in underwriting guidelines. 

(Next Step, No. 174 p. 2) WECC 

recommended the use of low-income 

weatherization funds, Property Assessed 

Clean Energy (PACE) financing, carbon 

offsets, and Environmental Protection 


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50E.g., https://www.energy.gov/energysaver/ 

types-homes/energy-efficient-manufactured-homes. 

Agency’s (EPA) Home Performance with 

ENERGY STAR program to help offset 

the increased price. (WECC, No. 150 at 

p. 3) Lastly, MHI recommended that 

DOE work with HUD, USDA, U.S. 

Department of Veterans Affairs (VA), 

and the U.S. Department of the Treasury 

to explore whether manufactured homes 

that meet DOE’s standard would be 

eligible for ENERGY STAR tax credits, 

thereby providing more incentive and 

relief to the consumers despite the 

increase in purchase price. (MHI, No. 

182 at p. 7) 

DOE appreciates these comments and 

understands that affordability and costeffectiveness for low-income purchasers 

is an important issue when discussing 

manufactured housing. However, DOE’s 

authority for this rulemaking is limited 

to energy conservation standards for 

manufactured housing. While DOE has 

considered the cost-effectiveness and 

affordability concerns described 

throughout this document, matters 

related to financing, tax credits, or other 

financial incentives or assistance for 

manufactured housing are outside the 

scope of this rulemaking, which is being 

conducted only to establish an energy 

conservation standard for manufactured 

housing. As already discussed, to help 

mitigate the potential impacts of a price 

increase, DOE is proposing a tiered 

proposal in this SNOPR that would 

establish a pricing tier to address those 

manufactured homes likely to be 

purchased by more price-sensitive 

consumers, and by limiting the impact 

to the first-cost for Tier 1 manufactured 

homes. The Tier 1 energy conservation 

standards, as proposed, are estimated to 

result in a 0.7–1.4 percent increase in 

first cost, depending on climate zone. 

These incremental costs would be offset 

by the energy savings provided from the 

energy efficiency measures and the 

incremental increase in upfront costs 

and monthly loan payments is recouped 

in less than one year. Furthermore, the 

PBP associated with the Tier 1 standard 

is only 3.7 years for single-section 

homes and 3.5 years for multi-section 

homes. 

Along with consumer financing, Next 

Step and Lippert Components both 

recommended the implementation of 

consumer education for potential 

homeowners, to properly inform them 

of the benefits and paybacks of more 

efficient homes. (Next Step, No. 174 at 

p. 3; Lippert Components, No. 152 at p. 

1) Next Step also commented that it 

currently has a system called 

Manufactured Housing Done Right, 

which connects comprehensive 

homebuyer education with responsible 

financing so potential buyers can 

purchase ENERGY STAR compliant, 

factory-built homes. (Next Step, No. 174 

at p. 1) DOE agrees that consumer 

education is important aspect to 

ensuring the effectiveness of any 

standards that may be adopted. To this 

end, DOE has described this proposed 

regulation in detail in this document 

and can respond to questions from the 

public. While a consumer education 

program is not an element of the 

statutory mandate of EISA, DOE 

provides a number of resources to 

educate homeowners on the energy 

efficiency, including those applicable to 

manufactured housing.50

MHI also commented that DOE must 

engage with HUD to revisit the 

economic assumptions and revise 

consumer impact estimates. MHI stated 

that any new regulation must avoid 

reducing the availability of affordable 

homeownership options. (MHI, No. 182 

at p. 1) GWU stated that DOE should 

revisit the effect of the proposed 

standards on the Federal Government’s 

goal to increase the availability of 

affordable housing. (GWU, No. 175 at p. 

12) In this SNOPR, DOE has reviewed 

the economic assumptions relied upon 

in the June 2016 NOPR and made 

changes where appropriate. As 

explained, DOE is proposing a tiered 

approach in this SNOPR in response to 

concerns raised regarding affordability 

and cost-effectiveness. In addition, DOE 

changed the down payment 

assumptions from 20 percent to 10 

percent for chattel loans (see section 

IV.A.1.d). Furthermore, DOE made 

updates to energy costs, energy 

escalation rates, and inflation rates 

based on the updates to AEO 2020. DOE 

also updated the distribution of heating 

type in the 19 cities analyzed in the LCC 

analysis based on the 2019 MHI 

shipments. DOE discusses its price 

elasticity calculation in the shipment 

analysis (see section IV.C.1.a). 

j. Priced-Out Consumers 

DOE received comments on the June 

2016 NOPR indicating concern that the 

proposed rule’s incremental cost 

relative to the existing HUD Code would 

eliminate the ability of some lowincome consumers to obtain the 

financing necessary to purchase a new 

home, resulting in consumers being 

priced out of the manufactured housing 

market. (Advocacy, No. 177 at p. 3; 

GWU, No. 175 at p. 8; Form Letter, No. 

192 at p. 1; Pleasant Valley Homes, No. 

153 at p. 1; Skyline Corporation, No. 

165 at p. 1; Clayton Homes, No. 185 at 

p. 2; MHIM, No. 155 at p. 1; NMMHA, 

No. 157 at p. 1; MHIA, No. 161 at p. 1; 

MHISC, No. 191 at p. 1; OMHA, No. 166 

at p. 1; MMHA, No. 170 at p. 2; AMHA, 

No. 173 at p. 2; PMHA, No. 164 at p. 1; 

MHI, No. 182 at p. 1, SBRA, No. 163 at 

p. 2; MHARR, No. 143 at p. 4) 

Specifically, MHARR cited a 2014 

National Association of Home Builders 

(‘‘NAHB’’) study that MHARR asserted 

indicates that more than 1 million 

households would be priced out of the 

market for a single-unit manufactured 

home and over an additional one 

million households would be priced out 

of the multi-section market as a result of 

DOE’s proposed standards. (MHARR, 

No. 154 at p. 25) Similarly, AMHA 

stated a recent NAHB study indicated 

each $1,000 increase over the medianhome price results in 200,000 

prospective households being excluded 

from the market. (AMHA, No. 173 at p. 

1) 

As discussed in section IV.A.1.i, DOE 

is proposing a tiered approach for which 

energy conservation standards for 

manufactured home with a 

manufacturer’s retail list price of 

$55,000 or less would be established, in 

part, on a defined upfront 

manufacturer’s retail list price increase 

(i.e., $750). DOE is proposing this 

approach in consideration of concerns 

related to potential adverse impacts on 

price-sensitive, low-income purchasers 

of manufactured homes from the 

imposition of energy conservation 

standards. Under the tiered proposal, 

incremental cost increases for Tier 1 

manufactured homes would be 0.7–1.4 

percent. 

DOE reviewed the 2014 NAHB study 

referenced by MHARR and AMHA and 

found the values cited by MHARR and 

AMHA from that study are not 

representative of the manufactured 

housing market’s prospective buyers. 

The NAHB study estimates the 

reduction in buyers assuming all 

American households intend to buy a 

home. The NAHB study stated that an 

increase of $1,000 would exclude 

approximately 350,000 households from 

purchasing a single-section home, and 

the same $1,000 would exclude 315,000 

households from purchasing a multisection home. MHARR extrapolated that 

the incremental costs of the standards 

would exclude more than 1 million 

households from each of the single- and 

multi-unit markets. 

Rather than analyzing all American 

households, DOE’s estimate in this 

SNOPR calculates the number of 

households no longer able to purchase 

a manufactured home from the pool of 

households planning to purchase a 

manufactured home (which is much 

smaller than the total number of 

American households). As a result of 


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51See Marshall, M.I. & Marsh, T.L. Consumer and 

investment demand for manufactured housing 

units. J. Hous. Econ. 16, 59–71 (2007). 

52See Marshall, M.I. & Marsh, T.L. Consumer and 

investment demand for manufactured housing 

units. J. Hous. Econ. 16, 59–71 (2007). 

53Manufactured Housing Institute. 2021 

Manufactured Housing Facts: Industry Overview. 

the tiered standards, first, DOE 

considered that a percentage of 

manufactured homes placed/sold would 

shift to less stringent standards, i.e., a 

percentage of homes from Tier 2 would 

shift to Tier 1. The inclusion of this shift 

in the market is to more accurately 

estimate energy savings (and other 

downstream results) if the proposed 

tiered standard approach is finalized. 

Second, with the inclusion of this shift, 

DOE estimates the SNOPR would result 

in a loss in demand and availability 

because of the increase in upfront home 

price for each tier. Therefore, DOE 

includes in the analysis a price 

elasticity of demand, which is typically 

represented as a ratio of the percentage 

change in quantity relative to a 

percentage change in price. DOE 

considered a price elasticity of ¥0.48 

based on a study by Marshall and 

Marsh.51 Further discussion on the 

substitution effect is provided in section 

IV.C.1.a and price elasticity is provided 

in section IV.A.1.j. 

Accordingly, DOE estimates the 

SNOPR would result in a loss in 

demand and availability of about 53,329 

homes (single section and multi-section 

combined) for the tiered standard using 

a price elasticity of demand of ¥0.48 for 

the analysis period (2023–2052). Out of 

the 53,329 homes in the tiered standard, 

the majority of the reduction is in Tier 

2 (93 percent) vs. Tier 1 (7 percent). 

Within Tier 1, DOE estimates a 0.52 

percent reduction (essentially no 

reduction) in availability due to Tier 1 

standards for low income purchasers. 

Given that low-income consumers 

generally purchase lower priced 

manufactured homes, DOE concludes 

that low-income consumers would not 

be priced out by the Tier 1 standards 

proposed in this SNOPR. 

As a sensitivity, DOE also considered 

a price elasticity of demand of ¥2.4 

instead of ¥0.48. Further discussion on 

this sensitivity is provided in Section 

10.4 of Chapter 10 of the TSD. Table 

IV.1 provides a summary of the change 

in shipments from baseline for the 

tiered standards for a price elasticity of 

¥0.48 and ¥2.4. 

TABLE IV.1—CHANGE IN SHIPMENTS COMPARED TO BASELINE, ¥0.48 AND ¥2.4 PRICE ELASTICITY

Change in shipments, ¥0.48 price elasticity Change in shipments, ¥2.4 price elasticity 

Tier 1 Tier 2 Total Tier 1 Tier 2 Total 

30-year analysis ....................................... (3,693) (49,636) (53,329) (18,375) (247,692) (266,067) 

Annual ...................................................... (123) (1,655) (1,778) (613) (8,256) (8,869) 

In the study published in the Journal 

of Housing Economics by Marshall and 

Marsh, the authors conclude that 

national and local programs that cause 

small price increases in manufactured 

housing units (e.g., increasing energy 

efficiency) will not necessarily deter 

thousands of low-income families from 

purchasing manufactured homes and 

that such consumers are likely to be 

willing to accept incrementally higher 

prices from improvements in energy use 

and cost efficiency. Specifically, the 

study states that these consumers are 

not nearly as price-sensitive because 

‘‘the cost of a manufactured home still 

ranges from 21% to 65% of the cost of 

a site built home and low- and 

moderate-income families have few lowcost choices for home ownership.’’ 52

Costs provided by a 2021 manufactured 

housing industry overview fact sheet 

developed by MHI suggests that in 2019, 

on average, the average sales price of a 

manufactured home compared to a new 

single-family site built home is about 27 

percent (without land).53 There is 

additional discussion in section IV.c.1.b 

on the decrease in manufactured 

housing shipments that results from 

people who do not buy because they are 

price-sensitive. 

DOE requests comment on the price 

elasticity values used in DOE’s analysis 

and in the sensitivity analysis as well as 

any data or research available with 

respect to the demand sensitivity in the 

manufactured housing market. 

DOE also received comments stating 

that it was necessary to capture the costs 

and economic impact associated with 

the exclusion of some consumers from 

the manufactured housing market as a 

result of this standard. (MHARR, Public 

Meeting Transcript, No. 148 at p. 80; 

MHARR, No. 154 at p. 29) COBA 

commented that if a consumer is priced 

out of the market for manufactured 

homes, there are no energy savings that 

the consumer can encounter. (COBA, 

Public Meeting Transcript, No. 148 at p. 

82) Lippert Components stated that it 

doubted that the benefits of the 

increases in energy efficiency will 

outweigh the negative impacts caused 

by the elimination of choice and 

reduction of affordability of 

manufactured homes due to the 

proposed standards. (Lippert 

Components, No. 152 at p. 1) 

The cost savings estimates for the 

proposals in this SNOPR are based on 

manufactured housing sales in response 

to the incremental increase in housing 

costs. A discussion of the projected 

future shipments is provided at section 

III.C.1.a of this docment. 

DOE also received comments 

regarding the issue of consumers being 

priced out of the manufactured housing 

market within specific regions. GWU 

suggested that DOE specifically consider 

the distributive economic impact on 

climate zones 1 and 2, as they account 

for roughly 40 percent of all 

manufactured housing shipments. GWU 

stated that under the standard as 

proposed in the June 2016 NOPR, 

climate zones 1 and 2 will bear higher 

costs from the increased standards, 

which is especially problematic as these 

zones have higher poverty rates. GWU 

recommended that DOE analyze the 

impact of the proposed rule on lowincome consumers in high-poverty 

regions. (GWU, No. 175 at p. 8) 

The energy standards in the proposals 

presented in this SNOPR would provide 

benefits in energy savings to the 

consumer (including those in climate 

zones 1 and 2) which, over the span of 

the PBP, would offset the increase in 

purchase price. Under the tiered 

proposal, manufactured homes that 

would be subject to the Tier 1 standards 

would have a PBP less than 10 years for 

all climate zones and recoup any 

additional upfront and monthly 

payments in less than one year. 

k. Other Comments 

DOE also received numerous other 

comments that were not specific to the 

above sections or could not be placed in 

only one of the above sections. WECC 

stated that consumers’ trust and 

confidence must be secured if these 

higher costs are to be received favorably. 


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WECC stated that the environment 

associated with manufactured housing 

is found to be fraught with deceptive 

loan practices, which is an issue that 

needs to be addressed. (WECC, No. 150 

at p. 1) NCJC commented that the 

industry has been noted for predatory 

sales and lending practices. NCJC 

commented that DOE’s analysis of the 

rule’s economic impact and energy 

savings demonstrates the benefits of the 

rule to homebuyers, especially lowincome ones. (NCJC, No. 184 at p. 2) 

DOE appreciates these comments. As 

noted, EISA directs DOE to establish 

energy conservation standards for 

manufactured housing while accounting 

for certain criteria and considerations. 

(42 U.S.C. 17071(a)–(b)) Comments 

regarding loan practices are beyond the 

scope of this rulemaking. 

2. Results 

This section provides the tentative 

results for the projected economic 

impacts on individuals, including the 

LCC and PBP. In this SNOPR, DOE has 

included two options: A two-tiered set 

of standards and a single untiered 

standard, as described in section 

III.E.2.b. DOE also updated all inputs to 

the LCC and PBP based on the updated 

AEO 2020. This includes updates to the 

inflation rates, energy prices, and energy 

pricing growth rates. DOE adjusted the 

down payment percentage for personal 

property (chattel) loans to 10 percent 

based on comments received on the 

June 2016 NOPR and maintained a 20 

percent down payment for real estate 

loans. Lastly, the analyses include 

updates to the fuel type distributions 

based on 2019 MHI shipments. 

Further, as discussed in section I.A, 

DOE also used different loan parameters 

for the analysis for the untiered 

standard and the alternate tiered 

standard. This is because the Tier 1 and 

Tier 2 standards each would apply to a 

portion of all manufactured homes, 

whereas the untiered standard would 

apply to all manufactured homes. 

Specifically, the Tier 1 standard would 

apply to manufactured homes with a 

manufacturer’s retail list price of 

$55,000 or less, and would be 

applicable to price-sensitive, lowincome purchasers. Therefore, DOE 

considered only personal property loans 

for the Tier 1 standard analysis. For the 

Tier 2 standard, DOE recalculated the 

loan percentages such that the salesweighted Tier 1 and Tier 2 standard 

loan percentages would equate to the 

overall loan percentages for the untiered 

standard. See Table IV.2 for details on 

the loan parameter percentages used for 

the analyses. 

TABLE IV.2—LOAN PARAMETER PERCENTAGES

Personal 

property 

(%) 

Real estate 

(%) 

Cash 

(%) 

Tier 1 Standard ............................................................................................................................ 100.0 0.0 0.0 

Tier 2 Standard ............................................................................................................................ 39.5 20.5 40.0 

Untiered Standard ........................................................................................................................ 54.6 15.4 30.0 

The LCC analysis allowed DOE to 

analyze the effects of the energy 

conservation standard on both the 

individual consumer, as well as the 

aggregate benefits at the national level. 

Table IV.3, Table IV.4, and Table IV.5 

provide the average purchase price 

increases to manufactured homes 

associated with the HUD climate zones, 

under the proposals. These costs are 

based on estimates for the increased 

costs associated with more energy 

efficient components, as provided by 

the MH working group. ASRAC Cost 

Analysis Data, EERE–2009–BT–BC– 

0021–0091. These costs are discussed in 

further detail in chapter 5 and chapter 

9 of the SNOPR TSD. 

TABLE IV.3—NATIONAL AVERAGE MANUFACTURED HOUSING PURCHASE PRICE (AND PERCENTAGE) INCREASES UNDER

THE TIER 1 STANDARD

[2020$] 

Single-section Multi-section 

$ % $ % 

Climate Zone 1 ................................................................................................ $629 1.2 $900 0.9

Climate Zone 2 ................................................................................................ 629 1.2 900 0.9 

Climate Zone 3 ................................................................................................ 721 1.4 702 0.7 

National Average ............................................................................................. 663 1.2 839 0.8 

TABLE IV.4—NATIONAL AVERAGE MANUFACTURED HOUSING PURCHASE PRICE (AND PERCENTAGE) INCREASES UNDER

TIER 2 STANDARD

[2020$] 

Single-section Multi-section 

$ % $ % 

Climate Zone 1 ................................................................................................ $2,574 4.8 $4,143 4.0 

Climate Zone 2 ................................................................................................ 4,820 9.1 6,167 5.9 

Climate Zone 3 ................................................................................................ 4,659 8.8 5,839 5.6 

National Average ............................................................................................. 3,914 7.4 5,289 5.1 


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TABLE IV.5—NATIONAL AVERAGE MANUFACTURED HOUSING PURCHASE PRICE (AND PERCENTAGE) INCREASES UNDER

UNTIERED STANDARD

[2020$] 

Single-section Multi-section 

$ % $ % 

Climate Zone 1 ................................................................................................ $2,574 4.8 $4,143 4.0 

Climate Zone 2 ................................................................................................ 4,820 9.1 6,167 5.9 

Climate Zone 3 ................................................................................................ 4,659 8.8 5,839 5.6 

National Average ............................................................................................. 3,914 7.4 5,289 5.1 

Figure IV.1, Figure IV.2, and Figure 

IV.3 illustrate the average annual energy 

cost savings for space heating and air 

conditioning for the first year of 

occupation by geographic location 

under the proposed tiered approach 

based on the estimated fuel costs 

provided in chapter 8 of the SNOPR 

TSD. 

BILLING CODE 6450–01–P 


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800 

700 11 Single Section 

"Multi Section 

Figure IV.1: Annual Energy Cost Savings under the Tier 1 Standard 

1200 

1000 

a 400 

g 

1 

11 Single Section 

., Multi Section 

Figure IV.2: Annual Energy Cost Savings under the Tier 2 Standards 
47800 Federal Register / Vol. 86, No. 163 / Thursday, August 26, 2021 / Proposed Rules 

BILLING CODE 6450–01–C 

Table IV.6 through Table IV.8 and 

Figure IV.4 through Figure IV.6 

illustrate the average 30-year LCC 

savings by geographic location 

(averaged across the five different 

heating fuel/system types) associated 

with the proposals for both singlesection and multi-section manufactured 

homes. As discussed in detail in chapter 

8 of the SNOPR TSD, the results 

presented account for LCC savings and 

impacts over a 30-year period of 

analysis, including energy cost savings 

and chattel loans or conventional 

mortgage payment increases discounted 

to a present value using the discount 

rates discussed in chapter 4 of the 

SNOPR TSD. These tentative results 

also are based on the costs associated 

with the proposed energy conservation 

improvements, as discussed in chapter 

5 of the SNOPR TSD. 

TABLE IV.6—AVERAGE MANUFACTURED HOME LCC SAVINGS (30 YEARS) UNDER THE TIER 1 STANDARD

BY CLIMATE ZONE

[2020$] 

Single-section Multi-section 

Climate Zone 1 ........................................................................................................................................................ $988 $1,505 

Climate Zone 2 ........................................................................................................................................................ 1,114 1,612 

Climate Zone 3 ........................................................................................................................................................ 2,691 3,763 

National Average ..................................................................................................................................................... 1,643 2,235 

TABLE IV.7—AVERAGE MANUFACTURED HOME LCC SAVINGS (30 YEARS) UNDER THE TIER 2 STANDARDS

BY CLIMATE ZONE

[2020$] 

Single-section Multi-section 

Climate Zone 1 ........................................................................................................................................................ $2,351 $3,686 

Climate Zone 2 ........................................................................................................................................................ 1,073 1,808 

Climate Zone 3 ........................................................................................................................................................ 2,579 3,444 

National Average ..................................................................................................................................................... 2,105 3,033 

TABLE IV.8—AVERAGE MANUFACTURED HOME LCC SAVINGS (30 YEARS) UNDER THE UNTIERED STANDARDS

BY CLIMATE ZONE

[2020$] 

Single-section Multi-section 

Climate Zone 1 ........................................................................................................................................................ $2,043 $3,196 

Climate Zone 2 ........................................................................................................................................................ 711 1,314 

Climate Zone 3 ........................................................................................................................................................ 2,117 2,851 

National Average ..................................................................................................................................................... 1,727 2,511 

BILLING CODE 6450–01–P 


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1200 

■ Single Section 

1000 

■ Multi Section 

I .,. .. 

Figure IV.3: Annual Energy Cost Savings under the U ntiered Standards 
Federal Register / Vol. 86, No. 163 / Thursday, August 26, 2021 / Proposed Rules 47801 


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10,000 

r;;- 9,000 1111 Single Section 

<:> 

N 8,000 <:> 111 Multi Section 

e 7,000 ., 

J 6,000 > 

ill " 5,000 

u 

u 4,000 ... 

~ 3,000 

<:> 

ti') 2,000 

1,000 

Figure IV.4: Thirty-Year Lifecycle Cost Savings under the Tier 1 Standard 

16,000 

r;;- 14,000 • Single Section 

<:> 

N 12,000 1111 Multi Section <:> 

e 

.. 10,000 J 

~ 8,000 il! 

8 6,000 

... 4,000 

~ <:> 2,000 ti') 

Figure IV.5: Thirty-Year Lif ecycle Cost Savings under the Tier 2 Standards 

14,000 

a;- 12,000 11 Single Section 

C) 

N 10,000 liill Multi Section C) 

e 

., 

J 8,000 

> OIi 

(I.I 6,000 

Q 

Q 

~ 4,000 

$: 2,000 C) 

f'l 

Figure IV.6: Thirty-Year Lifecycle Cost Savings under the Untiered Standards 
47802 Federal Register / Vol. 86, No. 163 / Thursday, August 26, 2021 / Proposed Rules 

BILLING CODE 6450–01–C 

As shown, the national average 

savings for the untiered standard and 

the tiered standards (i.e., Tier 1 and Tier 

2) are net positive, though not every 

geographic region experiences a net 

savings in the proposed standards (i.e., 

San Francisco in Climate Zone 2). DOE 

notes that for the prescriptive method, 

Tier 2 and Untiered manufactured 

homes in climate zone 2 (including San 

Francisco) and climate zone 3 would 

require a R–20+5 exterior wall 

insulation to be consistent with the 

2021 IECC without modification. The 

‘‘+5’’ involves using ‘‘continuous 

insulation,’’ which is insulation that 

runs continuously over structural 

members and is free of significant 

thermal bridging. As a sensitivity 

analysis, DOE considered the impacts 

on the LCC savings of instead requiring 

less stringent exterior wall insulation (at 

R–21 instead of R–20+5) to remove the 

continuous insulation requirement if 

complying with the prescriptive 

requirements presented in Table III.8. At 

R–20+5, the incremental cost per unit 

relative to the baseline is $2,500, versus 

$850 for R–21. DOE considered this 

alternative insulation requirement for 

zones 2 and 3 to address potential 

equity impacts in the regional 

distribution of benefits and costs and to 

ensure that each metro area analyzed 

could experience a positive LCC at Tier 

2. Table IV.9 through Table IV.12 

present the LCC savings results and 

Table IV.13 presents the simple payback 

periods for the sensitivity analysis. 

Chapter 8 of the TSD presents the same 

results per city. With this update, all 

cities, including San Francisco, show 

positive LCC savings for the 30-year 

analysis for both the tiered and untiered 

standards. Prior to the final rule stage, 

DOE is considering additional analysis 

to further explore the impacts of R–21 

for homes in zones 2 and 3 under Tier 

2 and the untiered proposal. 

TABLE IV.9—AVERAGE MANUFACTURED HOME LCC SAVINGS (30 YEARS) UNDER THE TIER 2 STANDARDS

BY CLIMATE ZONE

[2020$] 

With R–20+5 wall insulation for 

climate zones 2 and 3 

With R–21 wall insulation for 

climate zones 2 and 3 

Single-section Multi-section Single-section Multi-section 

Climate Zone 1 ................................................................................................ $2,351 $3,686 $2,351 $3,686 

Climate Zone 2 ................................................................................................ 1,073 1,808 2,373 3,124 

Climate Zone 3 ................................................................................................ 2,579 3,444 3,618 4,511 

National Average ............................................................................................. 2,105 3,033 2,820 3,768 

TABLE IV.10—AVERAGE MANUFACTURED HOME LCC SAVINGS (30 YEARS) UNDER THE UNTIERED STANDARDS

BY CLIMATE ZONE

[2020$] 

With R–20+5 wall insulation for 

climate zones 2 and 3 

With R–21 wall insulation for 

climate zones 2 and 3 

Single-section Multi-section Single-section Multi-section 

Climate Zone 1 ................................................................................................ $2,043 $3,196 $2,043 $3,196 

Climate Zone 2 ................................................................................................ 711 1,314 2,031 2,648 

Climate Zone 3 ................................................................................................ 2,117 2,851 3,194 3,954 

National Average ............................................................................................. 1,727 2,511 2,461 3,262 

TABLE IV.11—AVERAGE MANUFACTURED HOME LCC SAVINGS (10 YEARS) UNDER THE TIER 2 STANDARDS

BY CLIMATE ZONE

[2020$] 

With R–20+5 wall insulation for 

climate zones 2 and 3 

With R–21 wall insulation for 

climate zones 2 and 3 

Single-section Multi-section Single-section Multi-section 

Climate Zone 1 ................................................................................................ $563 $862 $563 $862 

Climate Zone 2 ................................................................................................ (496) (454) 452 501 

Climate Zone 3 ................................................................................................ 108 235 949 1,086

National Average ............................................................................................. 124 264 675 820 

TABLE IV.12—AVERAGE MANUFACTURED HOME LCC SAVINGS (10 YEARS) UNDER THE UNTIERED STANDARDS

BY CLIMATE ZONE

[2020$] 

With R–20+5 wall insulation for 

climate zones 2 and 3 

With R–21 wall insulation for 

climate zones 2 and 3 

Single-section Multi-section Single-section Multi-section 

Climate Zone 1 ................................................................................................ $460 $698 $460 $698 


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I I 
Federal Register / Vol. 86, No. 163 / Thursday, August 26, 2021 / Proposed Rules 47803 

TABLE IV.12—AVERAGE MANUFACTURED HOME LCC SAVINGS (10 YEARS) UNDER THE UNTIERED STANDARDS— 

Continued 

BY CLIMATE ZONE

[2020$] 

With R–20+5 wall insulation for 

climate zones 2 and 3 

With R–21 wall insulation for 

climate zones 2 and 3 

Single-section Multi-section Single-section Multi-section 

Climate Zone 2 ................................................................................................ (645) (650) 334 337 

Climate Zone 3 ................................................................................................ (53) 30 822 915 

National Average ............................................................................................. (12) 77 560 654 

TABLE IV.13—AVERAGE MANUFACTURED HOME SIMPLE PAYBACK PERIOD UNDER THE TIER 2/UNTIERED STANDARDS

With R–20+5 wall insulation for 

climate zones 2 and 3 

With R–21 wall insulation for 

climate zones 2 and 3 

Single-section Multi-section Single-section Multi-section 

Climate Zone 1 ................................................................................................ 8.6 8.7 8.6 8.7 

Climate Zone 2 ................................................................................................ 13.3 12.7 9.3 9.7

Climate Zone 3 ................................................................................................ 11.1 10.9 7.8 8.3

National Average ............................................................................................. 10.9 10.6 8.5 8.9 

DOE requests comment on the costeffectiveness and feasibility of requiring 

R–20+5 for the exterior wall insulation 

for climate zone 2 and 3 Tier 2/Untiered 

manufactured homes. DOE also requests 

comment on the sensitivity analysis for 

R–21 that would result in positive LCC 

savings for all cities. 

The estimated LCC impacts under 

Figure IV.4, Figure IV.5, and Figure IV.6 

vary by location for three primary 

reasons. First, each geographic location 

analyzed is situated in one of three 

climate zones and therefore would be 

subject to different energy conservation 

requirements. Second, geographic 

locations within the same climate zone 

would experience different levels of 

energy savings. Finally, the level of 

energy cost savings depends on the type 

of heating system installed and fuel type 

used in a manufactured home. As 

discussed in chapter 8 of the SNOPR 

TSD, DOE has accounted for regional 

differences in heating systems and fuel 

types commonly installed in 

manufactured housing. 

Table IV.14 provides the national 

average LCC savings and annual energy 

cost savings associated with the 

proposals in the SNOPR for space 

heating and air conditioning (and 

percent reduction in space heating and 

cooling costs), both of which are 

measured against a baseline 

manufactured home constructed in 

accordance with the HUD Code. As 

discussed in further detail in chapter 9 

of the SNOPR TSD, each geographic 

location has been determined to result 

in LCC savings and energy savings, on 

average. 

TABLE IV.14—NATIONAL AVERAGE PER-HOME COST SAVINGS UNDER THE SNOPR 

Single-section Multi-section 

Tiered Standards 

Lifecycle Cost Savings (30 Years) .......................................................................................................................... $1,852 $3,033 

Annual Energy Cost Savings (2020$) ..................................................................................................................... 261 499 

Untiered Standard 

Lifecycle Cost Savings (30 Years) .......................................................................................................................... 1,727 2,511 

Annual Energy Cost Savings (2020$) ..................................................................................................................... 359 499 

Table IV.15 through Table IV.17 and 

Figure IV.7 through Figure IV.9 

illustrate the nationwide average simple 

payback period (purchase price increase 

divided by first year energy cost 

savings) under the SNOPR. The 

estimated simple payback periods vary 

by geographic location based on the 

different climate zone requirements for 

manufactured housing, geographic 

climatic differences within climate 

zones, type of heating system installed, 

and fuel type used in a manufactured 

home. 

TABLE IV.15—AVERAGE MANUFACTURED HOME SIMPLE PAYBACK PERIOD UNDER THE TIER 1 STANDARD

BY CLIMATE ZONE

Single-section Multi-section 

Climate Zone 1 ........................................................................................................................................................ 4.8 4.6 

Climate Zone 2 ........................................................................................................................................................ 4.5 4.5 


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TABLE IV.15—AVERAGE MANUFACTURED HOME SIMPLE PAYBACK PERIOD UNDER THE TIER 1 STANDARD—Continued 

BY CLIMATE ZONE

Single-section Multi-section 

Climate Zone 3 ........................................................................................................................................................ 2.8 2.1 

National Average ..................................................................................................................................................... 3.7 3.5 

TABLE IV.16—AVERAGE MANUFACTURED HOME SIMPLE PAYBACK PERIOD UNDER TIER 2 STANDARD BY CLIMATE ZONE

Single-section Multi-section 

Climate Zone 1 ........................................................................................................................................................ 8.6 8.7 

Climate Zone 2 ........................................................................................................................................................ 13.3 12.7 

Climate Zone 3 ........................................................................................................................................................ 11.1 10.9 

National Average ..................................................................................................................................................... 10.9 10.6 

TABLE IV.17—AVERAGE MANUFACTURED HOME SIMPLE PAYBACK PERIOD UNDER UNTIERED STANDARD BY CLIMATE

ZONE

Single-section Multi-section 

Climate Zone 1 ........................................................................................................................................................ 8.6 8.7 

Climate Zone 2 ........................................................................................................................................................ 13.3 12.7 

Climate Zone 3 ........................................................................................................................................................ 11.1 10.9 

National Average ..................................................................................................................................................... 10.9 10.6 

BILLING CODE 6450–01–P 


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6 

4 

• Single Section ., Multi Section 

Figure IV.7: Simple Payback Period Under the Tier 1 Standard 

20 

18 

16 

'jl' 14 I 12 

! 10 

:: I 6 

Single Section mMulti Section 

Figure IV.8: Simple Payback Period Under the Tier 2 Standards 
Federal Register / Vol. 86, No. 163 / Thursday, August 26, 2021 / Proposed Rules 47805 

BILLING CODE 6450–01–C 

B. Manufacturer Impacts 

DOE performed a manufacturer 

impact analysis (‘‘MIA’’) to estimate the 

potential financial impact of energy 

conservation standards on 

manufacturers of manufactured homes. 

The MIA relied on the Government 

Regulatory Impact Model (‘‘GRIM’’), an 

industry cash-flow model used to 

estimate changes in industry value as a 

result of energy conservation standards. 

The key GRIM inputs are: Industry 

financial metrics, manufacturer 

production cost estimates, shipments 

forecasts, conversion costs, and 

manufacturer markups. The primary 

output of the GRIM is industry net 

present value (‘‘INPV’’), which is the 

sum of industry annual cash flows over 

the analysis period (2021–2052), 

discounted using the industry average 

discount rate. The GRIM has a slightly 

different analysis period than the NIA 

and LCC since it accounts for the 

conversion period, the time between the 

announcement of the standard and the 

compliance date of the standard, 

because manufacturers may need to 

make upfront investments to bring their 

manufactured homes into compliance 

ahead of the standard going into effect. 

The GRIM estimates the impacts of 

more-stringent energy conservation 

standards on a given industry by 

comparing changes in INPV between the 

no-standards case and the standards 

cases. The GRIM estimates a range of 

possible impacts under different 

manufacturer markup scenarios to 

capture the uncertainty relating to 

manufacturer pricing strategy following 

new standards. Additional detail on the 

GRIM can be found in chapter 12 of the 

SNOPR TSD. 

1. Conversion Costs 

DOE analyzed the upfront 

investments manufacturers would need 

to make to bring their products into 

compliance with the proposed energy 

conservation standards. These upfront 

investments include product conversion 

costs and capital conversion costs. 

Product conversion costs are one-time 

expenses in research, development, 

engineering time, and other costs 

necessary to make product designs 

comply with energy conservation 

standards. Capital conversion costs are 

one-time investments in property, plant, 

and equipment to adapt or change 

existing production lines to fabricate 

and assemble new product designs that 

comply with the energy conservation 

standards. 

DOE received comments regarding the 

conversion costs used for the costbenefit analysis. MHARR commented 

that the June 2016 NOPR cost-benefit 

analysis failed to include costs for 

testing, certification, inspections, and 

other compliance related activities, 

including new testing that is not 

currently included in the HUD Code. It 

stated that there are enforcement costs 

as well as ongoing regulatory 

compliance costs. MHARR expressed 

concern that these costs were not 

included in calculating the 

manufacturer impact as well as 

incremental cost increases since 

compliance costs will inevitably be 

passed onto the consumer (MHARR, No. 

154 at p. 27; MHARR, No. 143 at p. 4). 

MHCC also commented that the cost 

analysis does not include compliance 

costs and stated that the enforcement of 

the proposed rule significantly affects 

the costs, planning, and implementation 

(MHCC, No. 162 at p. 2). 

As stated in the November 2016 test 

procedure NOPR, for the R-value of 

insulation, U-factor and SHGC of 

fenestration, and mechanical ventilation 

fan efficacy, DOE anticipates that MH 

manufacturers will not incur testing 

costs because they would be able to use 

values currently provided by 

component manufacturers as part of the 

component specification sheets. 81 FR 

78733, 78742. As discussed in section 

II.B.3, DOE is not proposing any testing, 

compliance or enforcement provisions 

at this time. Therefore, DOE has not 

included any potential associated costs 

of testing, compliance or enforcement in 

this SNOPR. 

RECA, Next Step Network, and 

Modular Lifestyles commented that 

many manufacturers produce higher 

efficiency homes that already meet the 

proposed standards, and thus the 

impacts for those manufacturers will be 

significantly reduced. (RECA, No. 188 at 

p. 2; Next Step, No. 174 at p. 1; Modular 

Lifestyles, No. 141 at p. 2). 

DOE recognizes that some 

manufacturers already produce higher 

efficiency homes that meet the proposed 

standard level. DOE received data on 

the number of ENERGY STAR 

manufactured homes but lacked 

information on the number of 

manufactured homes that already meet 

or exceed the standard levels proposed 

in this SNOPR. Therefore, DOE 

conservatively assumed that all 

shipments are minimally compliant 

with the current HUD level and all 

models for which standards would be 

applicable would need design updates 

as a result of this proposed rule for the 

purposes of the MIA analysis. This 

prevents underestimation of negative 

impacts on manufacturers. As such, 

DOE’s conversion costs are the same for 

the tiered and untiered proposals, as 

DOE models the maximum potential 

conversion costs. 

In contrast, the NIA assumes 

conservatively that all ENERGY STAR 

manufactured homes would not provide 

additional national benefits as a result 

of this proposed rule, if made final. 

More information about the shipments 

analysis used for the NIA can be found 

in section IV.C.1.a of this document. 

DOE estimated conversion costs to be 

$52,000 per manufacturer. This figure 

included approximately $49,000 per 

manufacturer for product conversion 


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Figure IV.9: Simple Payback Period Under the Untiered Standards 
47806 Federal Register / Vol. 86, No. 163 / Thursday, August 26, 2021 / Proposed Rules 

54https://www2.census.gov/programs-surveys/ 

mhs/tables/2017/stavg17.xls. 55U.S. Securities and Exchange Commission. 

Annual 10–K Reports. Various Years. http://sec.gov. 56Cook. State Board of Equalization, Staff 

Legislation Bill Analysis, Assembly Bill 1474 

(2009). 57SIC 6515 Operators of Residential Mobile 

Home Site. Encyclopedia of Business. 58Highbeam Business. Operators of Residential 

Mobile Homes Sites. 

59http://aceee.org/files/proceedings/2004/data/ 

papers/SS04_Panel1_Paper05.pdf. 

costs, and approximately $3,000 per 

manufacturer for capital conversion 

costs for investments in equipment. The 

difference in product conversion costs 

from the June 2016 NOPR to the SNOPR 

are due to increased wage rates for 

mechanical engineers and taking into 

account fully burdened wages. DOE 

based its product conversion costs on 

the engineering time required to update 

model plans. DOE calculates industry 

conversion costs to be approximately 

$1.8 million. Those costs consist of $0.1 

million in capital conversion costs and 

$1.7 million in product conversion 

costs. 

DOE requests comment on the inputs 

to the conversion cost estimates. 

2. Manufacturer Production Costs and 

Markups 

DOE analyzed the effect the proposed 

standards would have on manufacturer 

production costs. DOE derived these 

costs from purchase price information 

and the markup factor, which is the 

product of the manufacturer markup, 

the retail markup, and sales tax. DOE 

used census data to obtain HUD 

minimum purchase price data by state 

for single-section and multi-section 

manufactured homes in 2019.54 DOE 

used a shipment-weighted average to 

convert the average purchase price by 

state to an average purchase price for 

each of 19 representative cities. 

DOE added incremental purchase 

prices to the HUD minimum purchase 

prices to calculate the purchase price for 

manufactured homes built in 

compliance with the proposed standard 

levels. The incremental purchase prices 

were negotiated during MH working 

group meetings and discussed further in 

section IV.A.1.g. 

To calculate MPCs from purchase 

prices for homes at the baseline level 

and at the proposed standard levels, 

DOE divided the purchase prices by the 

markup factor. The markup factor is the 

product of the manufacturer markup, 

retail markup and the sales tax factor. In 

the June 2016 NOPR, DOE used public 

sources, including company SEC 10–K 

filings 55 and corporate annual reports, 

to estimate a manufacturer markup of 

1.25. DOE used legislative analysis,56

research reports from the Encyclopedia 

of Business,57 and Highbeam Business 58

to estimate a retail markup of 1.30, and 

a sales tax of 1.03. This resulted in a 

combined cost markup factor of 1.67. 

MHCC recommended that an industry 

projected cost markup factor of 2.30 be 

used, as opposed to the factor of 1.67 

used by DOE in the June 2016 NOPR 

analysis (MHCC, No. 162 at p. 2). MHI 

expressed concern that the DOE markup 

factor of 1.67 is too low. It stated that 

HUD typically uses a markup factor of 

2.30 and MHI’s own study found a cost 

markup factor of 2.23. By using a lower 

markup factor, it expressed concern that 

DOE may be underestimating the impact 

of price increases passed onto the 

consumer (MHI, No. 182 at p. 5). 

DOE investigated the research quoted 

by MHI and MHCC regarding the 

markup factor and found a supporting 

paper developed by Pacific Northwest 

National Laboratory (‘‘PNNL’’) on behalf 

of National Fire Protection Association, 

MHCC, and HUD that referenced their 

methodology for the distribution chain 

markups. The research paper indicates 

that DOE’s estimated retail markup in 

the June 2016 NOPR of 1.30 is 

representative of the MH industry, 

whereas DOE’s estimated manufacturer 

markup of 1.25 is too low.59 Based on 

the comments received and the PNNL 

research, DOE increased the 

manufacturer markup from 1.25 to 1.72 

in this SNOPR. Applying a 

manufacturer markup of 1.72, a retail 

markup of 1.30, and a sales tax factor of 

1.03 results in a markup factor of 2.30, 

which is in-line with stakeholder 

comments. 

COBA commented that the retail 

markup varies greatly depending on the 

nature of the distribution process. 

Independent MH retailers, who sell on 

a deal-by-deal and commission-only 

basis, will seek to maximize 

profitability. COBA said Land-LeaseLifestyle Communities (LLL) 

Community operators will minimize the 

retail markup for HUD Code homes to 

get homeowners or site lessees to sign 

a rental agreement (COBA, No. 158 at p. 

5). COBA stated that this change in the 

manufactured home distribution system 

leads to several different scenarios for 

markup. (COBA, Public Meeting 

Transcript, No. 148 at p. 124). DOE 

acknowledges that retail markups can 

vary based on the distribution channel. 

However, based on public information 

and comments received from interested 

parties, a retail markup of 1.30 is the 

industry average. 

COBA also commented on the topic of 

sales tax assumptions used in DOE’s 

MIA. COBA stated that sales tax is a 

state matter that varies depending on 

whether a manufactured home is new or 

used (COBA, No. 158 at p. 5). DOE 

agrees that sales taxes vary by state. To 

account for variations in sales taxes, 

DOE took the shipment-weighted 

average sales tax by state to estimate a 

national average sales tax of three 

percent. The MH working group 

reviewed the sales tax assumptions used 

in the DOE’s analysis during the 

negotiated consensus process. The MH 

working group agreed to a national 

average sales tax of three percent for the 

purposes of DOE’s analyses. This is 

consistent across the June 2016 NOPR 

and the SNOPR analyses. Additional 

information can be found in section 

8.2.6 of the SNOPR TSD. 

3. Manufacturer Markup Scenarios 

DOE modeled two standard case 

manufacturer markup scenarios that 

reflect changes in the manufacturer’s 

ability to pass on their upfront 

investments and increases in production 

costs to the consumer. The 

manufacturer markup scenarios 

represent the uncertainty regarding 

prices and profitability for 

manufactured home manufacturers 

following the implementation of the 

rule. DOE modeled a high and a low 

scenario for manufacturers’ ability to 

pass on their increased costs to the 

consumer: (1) A preservation of gross 

margin percentage markup scenario; and 

(2) a preservation of operating profit 

markup scenario. These scenarios lead 

to different manufacturer markup values 

that result in varying revenue and cash 

flow impacts to the manufacturer when 

applied to the inputted manufacturer 

production costs. 

Under the preservation of gross 

margin scenario, manufacturers 

maintain their current average markup 

of 1.72 even as production costs 

increase. Manufacturers are able to 

maintain the same amount of profit as 

a percentage of revenues, suggesting that 

they are able to recover conversion costs 

and pass the costs of compliance to their 

consumers. DOE considers this scenario 

the upper bound to industry 

profitability. 

In the preservation of per-unit 

operating profit scenario, manufacturer 

markups are set so that the per-unit 

operating profit in the standards case 

equals the per-unit operating profit in 

the no-standards case one year after the 

compliance date of the new energy 

conservation standard. Under this 

scenario, as the costs of production 

increase under a standards case, 

manufacturers are required to reduce 

their markups. The implicit assumption 

behind this markup scenario is that the 


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industry can only maintain its existing 

per-unit operating profit in absolute 

dollars after compliance with the new 

standard is required. Therefore, the 

operating margin is reduced between 

the no-standards case and standards 

case. Under this scenario, manufacturers 

are not able to recover the conversion 

period investments made to comply 

with the standard. This manufacturer 

markup scenario represents a lower 

bound to industry profitability under a 

new energy conservation standard. 

4. Cash-Flow and INPV Results 

DOE calculated an industry average 

discount rate of 9.2 percent based on 

SEC filings for public manufacturers of 

manufactured homes. The INPV is the 

sum of the discounted cash flows over 

the analysis period, which begins in 

2021 and ends in 2052, using the 

industry average discount rate. DOE 

compares the INPV of the no-standards 

case to that of the standard level. The 

difference between INPV in the nostandards case and INPV in the 

standards case is an estimate of the 

economic impacts on the industry. 

TABLE IV.18—INPV RESULTS: PRESERVATION OF GROSS MARGIN PERCENTAGE SCENARIO * 

Tiered proposal Untiered proposal 

Single-section Multi-section Single-section Multi-section 

No-standards case INPV (billion 2020$) ......................................................... 4.87 11.36 4.87 11.36 

Standards Case INPV (billion 2020$) ............................................................. 4.98 11.58 5.02 11.61 

Change in INPV (billion 2020$) ....................................................................... 0.10 0.22 0.15 0.25 

Change in INPV (%) ........................................................................................ 2.1 1.9 3.0 2.2 

Total Conversion Costs (billion 2020$) ........................................................... 0.0005 .0012 0.0005 .0012 

* Values in parentheses are negative values. 

TABLE IV.19—INPV RESULTS: PRESERVATION OF OPERATING PROFIT MARKUP SCENARIO * 

Tiered proposal Untiered proposal 

Single-section Multi-section Single-section Multi-section 

No-standards case INPV (billion 2020$) ......................................................... 4.87 11.36 4.87 11.36 

Standards Case INP (billion 2020$) ................................................................ 4.80 11.16 4.74 11.15 

Change in INPV (billion 2020$) ....................................................................... (0.07) (0.20) (0.13) (0.21) 

Change in INPV (%) ........................................................................................ (1.5) (1.8) (2.7) (1.8) 

Total Conversion Costs (billion 2020$) ........................................................... 0.0005 0.0012 0.0005 .0012 

* Values in parentheses are negative values. 

For single-section units, the nostandards case INPV is $4.87 billion. 

The tiered proposal standard level could 

result in a change of industry value 

ranging from ¥1.5 percent to 2.1 

percent, or a change of ¥$0.07 billion 

to $0.10 billion, for single-section units. 

For multi-section units, the nostandards case INPV is $11.36 billion. 

The tiered proposal standard level could 

result in a change of industry value 

ranging from ¥1.8 percent to 1.9 

percent, or a change of ¥$0.20 billion 

to $0.22 billion. For the entire industry, 

the no-standards case INPV is $16.23 

billion. The tiered proposal standard 

level could result in a change in INPV 

of ¥1.7 percent to 2.0 percent, or a 

change of ¥$0.28 billion to $0.32 

billion. Industry conversion costs total 

$0.0018 billion. 

For single-section units, the nostandards case INPV is $4.87 billion. 

The untiered proposal’s standard level 

could result in a change of industry 

value ranging from ¥2.7 percent to 3.0 

percent, or a change of ¥$0.13 billion 

to $0.15 billion for single-section units. 

For multi-section units, the nostandards case INPV is $11.36 billion. 

The untiered proposal’s standard level 

could result in a change of industry 

value ranging from ¥1.8 percent to 2.2 

percent, or a change of ¥$0.21 billion 

to $0.25 billion. For the entire industry, 

the no-standards case INPV is $16.23 

billion. The untiered proposal’s 

standard level could result in a change 

in INPV of ¥2.1 percent to 2.4 percent, 

or a change of ¥$0.34 billion to $0.39 

billion. Industry conversion costs total 

$0.0018 billion. 

5. Impact of Any Lessening of 

Competition 

DOE also received comments 

regarding competition within the 

manufactured housing industry. GWU 

stated that DOE should pay particular 

attention to the prospective effects of 

the proposed rule on competition 

within the MH market. It commented 

that it was unable to find any analyses 

by the DOJ on market competition 

regarding the rule (GWU, No. 175 at p. 

11). MHARR also asserted that the June 

2016 NOPR would have anticompetitive effects and result in highly 

negative impacts on the industry’s small 

manufacturers. MHARR stated that the 

June 2016 NOPR would lead to further 

consolidation in the industry. (MHARR, 

No. 154 at p. 33, 34) 

The authority for the rule proposed in 

this document is section 413 of EISA (42 

U.S.C. 17071), which is a separate 

authority from that governing appliance 

standards, i.e., EPCA, as amended (42 

U.S.C. 6291¥6317). Section 413 of EISA 

does not require consultation with the 

DOJ regarding potential anticompetitive 

effects of the rule, as would be required 

for an appliance standard rulemaking. 

As such, DOE did not consult with the 

DOJ regarding potential anticompetitive 

impacts of this proposed rule. 

DOE considered the impacts of this 

rulemaking on small manufacturers. In 

response to concerns related to potential 

adverse impacts on price-sensitive, lowincome purchasers of manufactured 

homes, DOE is proposing updated 

standard levels that are different from 

the June 2016 NOPR levels, upon which 

MHARR’s comment are based. In the 

updated proposed standards, described 

in detail in section III.A.2, DOE 

structured the tiered standard to address 

affordability concerns for low-income 

home buyers and for the small 

manufacturers that serve that segment of 

the market. Furthermore, DOE 

conducted additional analysis, found in 

section V.B.4, to understand the 

magnitude of upfront cost impacts of 


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60See Manufactured Home Shipments by Product 

Mix (1990–2013), Manufactured Housing Institute 

(2014). 

61See Marshall, M. I. & Marsh, T. L. Consumer 

and investment demand for manufactured housing 

units. J. Hous. Econ. 16, 59–71 (2007). 

62ENERGY STAR version 2 requirements for 

manufactured homes can be found at: https://

www.energystar.gov/partner_resources/residential_

new/homes_prog_reqs/national_page. 

small manufacturers. DOE expects 

conversion costs to be less than 0.1 

percent of average small manufacturer 

annual revenue. DOE finds this level of 

investment unlikely to be the driver of 

industry consolidation or to affect 

market concentration. 

C. Nationwide Impacts 

The national impact analysis (NIA) 

assesses the national energy savings 

(NES) and the national net present value 

(NPV) from a national perspective of 

total consumer costs and savings that 

would be expected to result from new 

or amended standards. ‘‘Consumer’’ in 

this context refers to consumers of the 

product being regulated. DOE calculates 

the NES and NPV based on projections 

of annual product shipments, along 

with the annual energy consumption 

and total incremental cost data from the 

LCC analyses. 

In the June 2016 NOPR, DOE’s NIA 

projected a net benefit to the nation as 

a whole as a result of the proposed rule 

in terms of NES and the NPV of total 

consumer costs and savings that would 

be expected as a result of the proposed 

rule in comparison with the minimum 

requirements of the HUD Code. DOE 

calculated the NES and NPV based on 

annual energy consumption and total 

construction and lifecycle cost data 

from the LCC analysis (developed 

during the MH working group 

negotiation process), and shipment 

projections. DOE projected the energy 

savings, operating cost savings, 

equipment costs, and NPV of consumer 

benefits sold in a 30-year period from 

2017 through 2046. The analysis also 

accounted for costs and savings for a 

manufactured home lifetime of 30 years. 

In addition, for the June 2016 NOPR, 

DOE developed a shipments model to 

forecast the shipments of manufactured 

homes during the analysis period. DOE 

first gathered historical shipments 

spanning 1990–2013 from a report 

developed and written by the Institute 

for Building Technology and Safety and 

published by the Manufactured Housing 

Institute.60 Then, using the growth rate 

(1.8 percent) in new residential housing 

starts from the AEO 2015, DOE 

projected the number of manufactured 

housing shipments from 2014 through 

2046 in the no-standards case (no new 

standards adopted by DOE). For the 

standards case shipments, DOE used 

this same growth rate estimate (1.8 

percent), but also applied an estimate 

for price elasticity of demand. Price 

elasticity of demand (price elasticity) is 

an economic concept that describes the 

change of the quantity demanded in 

response to a change in price. DOE used 

the price elasticity value of ¥0.48 (a 10- 

percent price increase would translate 

to a 4.8-percent reduction in 

manufactured home shipments) based 

on a study published in the Journal of 

Housing Economics by Marshall and 

Marsh for estimating standards case 

shipments.61

DOE conducted sensitivity analyses in 

order to account for the ranges of 

estimates available for shipment 

assumptions. The analysis focused on 

changes to two parameters: The 

shipment growth rate and the price 

elasticity of demand. In the first 

sensitivity analysis, the shipment 

growth rate was changed to 6.5 percent 

instead of 1.8 percent based on the trend 

in actual manufactured home shipments 

from 2011 to 2014. This growth rate 

applies to both the no-standards case 

and standards case shipments. In a 

second sensitivity analysis, DOE 

considered a standards case shipment 

scenario in which the price elasticity is 

¥2.4 (instead of ¥0.48). This would 

project a 2.4 percent reduction in 

shipments based on the projected cost 

increases in the June 2016 NOPR. DOE 

based this sensitivity case on previous 

HUD estimates of ¥2.4 price elasticity 

based on a 1992 paper written by Carol 

Meeks.11 This would translate to a 12 

percent reduction in shipments based 

on a 5 percent increase in price. 

DOE received a number of comments 

regarding several aspects of the 

nationwide impacts described in the 

June 2016 NOPR. The following sections 

provide a discussion of each of the 

submitted comments as well as updates 

to the NIA conducted for this SNOPR. 

1. Discussion of Comments and 

Analysis Updates 

a. Shipments Analysis 

DOE received numerous comments on 

the June 2016 NOPR regarding the 

methodology and assumptions used in 

the shipments analysis. In the June 2016 

NOPR, for the no-standards case 

shipments, DOE assumed that all 

current manufactured home shipments 

reported by MHI are for manufactured 

homes that are minimally compliant 

with the HUD Code. NEEA commented 

that 54 percent of the manufactured 

homes built in the Pacific Northwest are 

built to the EPA’s ENERGY STAR 

program specifications (NEEA, No. 190 

at p. 4). 

Because ENERGY STAR-certified 

manufactured homes are more efficient 

than minimally HUD Code-compliant 

homes, DOE agrees that ENERGY STAR 

homes should not be accounted for in 

the no-standard shipments and national 

impact analyses, so as to avoid 

overestimating energy savings and NPV 

benefits to the consumer. In this 

SNOPR, DOE’s NIA analysis is based on 

the assumption that ENERGY STARcertified manufactured homes would 

not provide additional national benefits 

as a result of this proposed rule, if made 

final.62 As a result, the national savings 

in the SNOPR only accrue to projected 

no-standards case shipments that are 

not ENERGY STAR-certified. Further 

details on this shipment update is 

discussed in chapter 10 of the SNOPR 

TSD. 

DOE also received comments 

regarding the volume of manufactured 

housing shipments in the future. NEEA 

commented that the manufactured 

housing market has risen in recent years 

and it predicts the volume of homes 

built will be 20–40 percent higher than 

estimates used in DOE’s NOPR analysis. 

(NEEA, No. 190 at p. 4) Southern 

Company commented that it believes 

that the shipment analysis should 

include a ‘‘spike’’ or large increase in 

shipments in the 2030s to serve as 

replacements for homes built in the late 

1990s and early 2000s, during which 

time a similar large spike in shipments 

was observed. (Southern Company, 

Public Meeting Transcript, No. 148 at p. 

104) 

DOE acknowledges that there are a 

variety of factors that could affect future 

manufactured home shipments. For the 

June 2016 NOPR, DOE determined the 

shipment growth rate from the AEO 

2015 projections of new housing starts. 

The AEO projections, focused on U.S. 

energy markets, are based on results 

from NEMS, which enables EIA to make 

projections under internally consistent 

sets of assumptions. Since the June 2016 

NOPR, DOE reviewed the new AEO 

2020 projections, and determined an 

updated housing start growth rate of 0.3 

percent. DOE continues to use the 

housing start growth rate from AEO 

2020 in the absence of any growth rate 

information specific to manufactured 

housing. In addition, DOE has updated 

the shipment analysis to include the 

2015–2019 shipment data provided 

through MHI, which was the latest data 

available at the time of the SNOPR 

analysis. Furthermore, DOE also 


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63See Manufactured Home Shipments by Product 

Mix, Manufactured Housing Institute (2019). 

64Manufactured Housing Survey, Public Use File 

(PUF) 2019. https://www.census.gov/data/datasets/ 

2019/econ/mhs/puf.html. 

performed a sensitivity analysis where 

the shipment growth rate was changed 

to 6.5 percent based on the trend in 

actual manufactured home shipments 

from 2011 to 2014. The results of this 

analysis are provided in section IV.C.2 

of this document. 

DOE also recognizes that 

manufactured homes that reach the end 

of their useful life may eventually need 

to be replaced, and DOE agrees with 

Southern Company that replacement of 

old manufactured homes does indeed 

occur in the market and can cause an 

upshift in shipments. However, the 

ownership period of a manufactured 

home may vary drastically between 

different consumers and different 

manufactured homes. Furthermore, 

there may be homeowners who do not 

purchase a second manufactured home. 

Therefore, DOE bases future shipments 

on historical trends and residential 

housing start growth rates rather than 

replacements. 

Regarding the source of the 

manufactured housing shipment data, 

COBA commented that the Institute for 

Building Technology and Safety 

(‘‘IBTS’’) is the primary source for HUD 

Code housing data and suggested that 

DOE contact IBTS directly to guarantee 

the most accurate data. (COBA, No. 158 

at p. 5) DOE determined shipments from 

the annual production and shipment 

data provided by MHI.63 The data 

source for the shipments provided by 

MHI is IBTS. Since the June 2016 

NOPR, DOE has updated the shipment 

analysis to include the 2015–2019 

shipment data provided through MHI, 

which was the latest data available at 

the time of the SNOPR analysis. 

DOE also received comments on the 

June 2016 NOPR regarding the changes 

currently taking place within the 

manufactured housing market. COBA 

commented that the overall distribution 

of manufactured homes has undergone 

a paradigm change, where roughly 500 

portfolio operators of LLL Communities 

own the majority of new HUD Code 

homes. It said this change was not 

addressed by the MH working group 

and will greatly affect the cost of 

implementing the new DOE energy 

conservation standards. (COBA, No. 158 

at p. 3) COBA commented that the sales 

of HUD Code homes through traditional 

distribution (via independent MH 

retailers and other manufacturers) have 

plummeted in the 21st century with loss 

of easy access to chattel capital. 

However, portfolio LLL Community 

operators have since realized that 

selling new homes on-site is the best 

method for success. COBA stated that in 

2009, 25 percent of new HUD Code 

homes were shipped to LLL 

Communities; in 2015, it was closer to 

40 percent, and is predicted to be 75 

percent of new homes by 2020. (COBA, 

No. 158 at p. 7) COBA also stated that 

these newer large portfolios are very 

susceptible to price adjustments and are 

going to be hurt by the increase in price. 

(COBA, Public Meeting Transcript, No. 

148 at p. 14, 27) 

DOE appreciates the information 

regarding shipment distribution 

provided by COBA. However, DOE’s 

LCC analysis focuses primarily on the 

effects of the rule on the individual 

consumers of manufactured homes. This 

proposed standard provides for a 

balanced approach regarding increased 

purchase price of the manufactured 

home in view of energy cost savings 

over time for a consumer. DOE’s LCC 

analysis tentative results are provided in 

section IV.A.2. The LCC analysis applies 

to all consumers, regardless of whether 

they purchase the home from a 

commercial retailer or an onsite 

community operator. 

In addition, DOE’s shipment analysis 

studies the effect of the incremental 

price increases of the energy 

conservation standard on the total 

amount of manufacturer shipments in 

the United States and does not 

differentiate on who actually sells the 

home to consumers. The no-standards 

case shipments include shipments that 

are minimally compliant to the HUD 

Code. Furthermore, DOE’s analysis for 

the standards-case shipments includes a 

price elasticity factor describing the 

change in future shipments in response 

to the energy conservation standards. 

Section IV.C.1.b provides more details 

regarding the price elasticity used in the 

analysis. 

In this SNOPR, DOE also had to 

determine the percentage of the total 

shipments that would be applicable to 

each of the tiers analyzed based on HUD 

zone under the tiered proposal. 

Accordingly, DOE developed shipments 

for each of the tiers using the MHS 2019 

PUF data discussed in III.A.2.64 First, 

DOE estimated that manufactured 

homes in Census regions (the U.S. 

Census Bureau divides the country into 

four census regions) 1, 2 and 4 

combined were representative of HUD 

zone 3 and manufactured homes in 

Census region 3 were representative of 

HUD zones 1 and 2. Second, DOE 

considered that a percentage of 

manufactured homes placed/sold would 

shift to less stringent standards, i.e., a 

percentage of homes from Tier 2 would 

shift to Tier 1. The inclusion of this shift 

in the market is to more accurately 

estimate energy savings (and other 

downstream results) if the proposed 

tiered standard approach is finalized. 

For this analysis, DOE applied a 

‘‘substitution effect’’ of 20 percent to 

homes within $1000 of the price 

threshold ($55,001–$56,000). For 

example, 20 percent of homes placed/ 

sold in the $55,001–$56,000 range (as 

provided by the MHS 2019 PUF dataset) 

would move to Tier 1 and would be 

subject to less stringent thermal 

envelope standards. DOE chose a 

higher-end estimate of 20 percent based 

on reports that were reviewed for the 

energy conservation standards 

rulemaking for residential furnaces. 81 

FR 65720, 65772. The reports reviewed 

included estimates for direct rebound 

effects of household heating as it relates 

to more efficient products used more 

intensively. While the concept of 

‘‘rebound effect’’ for the residential 

furnaces rulemaking is different than 

the ‘‘substitution effect’’ that is being 

considered in this rulemaking, with the 

lack of any data specific to the rebound 

effect for manufactured homes, DOE 

determined that 20 percent is a 

reasonable proxy for the substitution 

effect analysis being performed in this 

SNOPR. 

As a result, Table IV.23 provides the 

corresponding percentage of total 

manufactured homes placed/sold 

applicable to each tier based on HUD 

zone and size. These percentages were 

applied to the total shipments to 

determine the shipments for each tier. 

Further discussion on this analysis is 

provided in the Chapter 10 of the 

SNOPR TSD. Without the substitution 

effect applied, there would be more 

shipments in the Tier 2 standard for all 

climate zones, which would increase 

the national energy savings from the 

tiered standard. 


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65See Marshall, M.I. & Marsh, T.L. Consumer and 

investment demand for manufactured housing 

units. J. Hous. Econ. 16, 59–71 (2007). 

66See Meeks, C., 1992, Price Elasticity of Demand 

for Manufactured Homes: 1961–1989. 

67See Gates, H., 1984. Price Elasticity of Demand 

for Manufactured Homes. Manufactured Housing 

Institute. 

68See Kavanaugh, DC, Anderson, D.M., Marsh, 

T.L., Lee, A.D., Onisko, S., 1994. Key Elements 

Affecting Manufactured Home Household 

Investments in Energy-Efficiency: An Empirical 

Analysis. 

TABLE IV.20—SHIPMENT BREAKDOWN BASED ON TIER AND PROPOSED CLIMATE ZONE

Climate zone 1 or 2 Climate zone 3 

SS (%) MS (%) SS (%) MS (%) 

Tier 1 Standard ................................................................................................ 53.58 0 57.32 0 

Tier 2 Standard ................................................................................................ 46.42 100.00 42.68 100.00 

Total .......................................................................................................... 100.00 100.00 100.00 100.00 

DOE requests comment on the 

shipment breakdown per tier and using 

a substitution effect of 20 percent on 

shipments to account for the shift in 

homes sold to the lower tiered standard. 

DOE requests comment on whether it 

should use a different substitution effect 

value for this analysis—and if so, why. 

(Please provide data in support of an 

alternative substitution effect value.) 

b. Price Elasticity of Demand 

Price elasticity of demand (price 

elasticity) is an economic concept that 

describes the change of the quantity 

demanded in response to a change in 

price. Price elasticity is typically 

represented as a ratio of the percentage 

change in quantity relative to a 

percentage change in price. It allows 

DOE to assess the extent to which 

consumers and retailers are unable or 

unwilling to purchase new homes as a 

result of the increased costs. In the June 

2016 NOPR, DOE used a price elasticity 

value of ¥0.48 to estimate the effect of 

the proposed rule on manufactured 

home shipments. This value was 

sourced from a study by Marshall and 

Marsh.65

DOE received several comments on 

the June 2016 NOPR regarding the price 

elasticity that was used in the NOPR. 

MHARR stated that the ¥0.48 value was 

published in 2007 prior to the collapse 

of the housing market in 2008–2009. 

(MHARR, Public Meeting Transcript, 

No. 148 at p. 112) Southern Company 

and MHI expressed that the elasticity 

value of ¥0.48 seemed too low, 

particularly considering that a large part 

of the manufactured housing market is 

low-income households. Southern 

Company indicated that an elasticity 

value of –1 would be more intuitive. 

(Southern Company, Public Meeting 

Transcript, No. 148 at p. 110) MHI 

stated that HUD uses an elasticity value 

of ¥2.4 instead, which would yield a 

much greater decrease in production as 

a result of this standard. MHI indicated 

that both values are outdated, and that 

DOE may be underestimating the impact 

of the proposed rule. MHI suggested that 

DOE and HUD develop a new elasticity 

measure that is more up to date and 

accurately measures price sensitivity 

from manufacturers and retailers. (MHI, 

No. 182 at p. 5) MHCC also stated that 

the June 2016 NOPR analysis 

underestimates the reduction in 

production levels due to the proposed 

rule by using ¥0.48, which they 

deemed too low. (MHCC, No. 162 at p. 

2) 

DOE reviewed the Meeks study cited 

by HUD, as well as various others, and 

concluded that the Marshall and Marsh 

elasticity value of ¥0.48 was the most 

reliable figure. The Meeks study was 

published in 1993 and is based on 

manufactured housing shipments as a 

proxy for consumer demand.66 The data 

from the study ranges from 1961 to 1989 

and found an overall price elasticity of 

¥2.4. The Meeks study used a one-stage 

regression model, similar to a study by 

Gates in 1984 which found elasticities 

from ¥3.0 to ¥2.5.67 A study in 1994 

by Kavanaugh re-evaluated the methods 

behind the Gates study, using a twostage regression instead of one stage. 

Using shipment data from 1972 to 1989, 

the Kavanaugh study reported a price 

elasticity estimate of ¥0.7.68

Marshall and Marsh used the number 

of new manufactured homes placed for 

residential use as a proxy for consumer 

demand and also separated short-term 

consumer behavior from long-term 

influences. As part of their paper, 

Marshall and Marsh reviewed all the 

aforementioned studies (including 

Meeks’, Gates’, and Kavanaugh’s 

studies) to determine the inputs into 

their model. They used national level 

data from similar sources to the Meeks, 

Gates, and Kavanaugh studies for their 

consumer demand model. Marshall and 

Marsh estimated the price elasticity of 

demand for manufactured homes at 

¥0.48 using a two-stage regression 

model and concluded that consumers in 

general are not so price sensitive and are 

likely willing to accept incremental 

higher prices for improvements in cost 

efficiency. For the NIA, DOE 

determined the Marshall and Marsh 

study is still the most recent estimate of 

consumer demand based on price 

changes for manufactured housing and 

maintains the proposed usage of the 

¥0.48 elasticity value. In recognition of 

the range of estimates in the housing 

literature, DOE also retained ¥2.4 as a 

sensitivity analysis. As discussed 

previously, DOE is proposing Tier 1 of 

the tiered standard to address concerns 

about affordability for low-income 

consumers. DOE estimates that based on 

a price elasticity of ¥0.48, the SNOPR 

would result in a loss in demand and 

availability of about 53,329 homes 

(single section and multi-section 

combined) for the tiered standard. Out 

of the 53,329 homes in the tiered 

standard, the majority of the reduction 

is in Tier 2 (93 percent) vs. Tier 1 (7 

percent). Within Tier 1, DOE estimates 

a 0.52 percent reduction (essentially no 

reduction) in availability due to Tier 1 

standards for low income purchasers. 

As a sensitivity, DOE also considered a 

price elasticity of demand of ¥2.4 

instead of ¥0.48. Further discussion on 

this sensitivity is provided in Section 

10.4 of Chapter 10 of the TSD. Table 

IV.1 provides a summary of the change 

in shipments from baseline for the 

tiered standards for a price elasticity of 

¥0.48 and ¥2.4 to reflect the people 

who do not buy a manufactured home 

under the standards case because they 

are price-sensitive. 

c. Net Present Value 

DOE received a comment concerning 

the discount rates used to calculate the 

NPV. GWU commented that it has 

concerns regarding the 3-percent and 7- 

percent discount rate used by DOE in 

the annualized benefits and costs 

calculation in the June 2016 NOPR. 

GWU stated that DOE’s 3-percent and 7- 

percent discount rates were too low and 

that a more realistic discount rate, such 

as chattel loan rates, would reflect a 

much lower benefit to consumers. 

(GWU, No. 175 at p. 5) 


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69 DOE relies on a range of discount rates in 

monetizing emission reductions as discussed in 

section IV.D.2 of this document. 

70https://www.whitehouse.gov/sites/ 

whitehouse.gov/files/omb/circulars/A4/a-4.pdf. 

71Office of Management and Budget, Circular A– 

4, September 2003. 

DOE generally uses real discount rates 

of 3 percent and 7 percent to discount 

future costs and savings to present 

values.69 The 3- and 7-percent discount 

rates are based on Circular A–4 issued 

by the Office of Management and 

Budget (OMB) as guidance on the 

development of regulatory analysis as 

required by Executive Order (E.O.) 

12866.70 The 7-percent rate is the 

established estimate of the average rate 

of return, before tax, to private capital 

in the U.S. economy. The 3-percent rate 

is called the ‘‘social rate of time 

preference,’’ which is the rate at which 

society discounts future consumption 

flows to their present value.71 These real 

discount rates are used to calculate 

annualized benefits and costs in DOE 

rulemakings in order to perform crossindustry comparisons in a standardized 

manner. In the SNOPR, DOE maintains 

discount rates of 3 percent and 7 

percent for the NPV and the annualized 

benefits and costs. Additionally, as 

discussed in section IV.A.1.c, DOE uses 

a discount rate based on the chattel loan 

interest rate in the LCC analysis. 

d. Other Comments 

DOE also received another comment 

that was not specific to any of the 

previous topics regarding nationwide 

impacts. NPGA commented that it 

appreciated DOE’s use of full-fuel cycle 

analysis. It also supported the estimated 

reduction of pollutants and greenhouse 

gases for both site and upstream 

emissions. (NPGA, No. 171 at p.1) DOE 

appreciates NPGA’s comment, and 

continues to use the full-fuel cycle 

analysis in this SNOPR. 

2. Results 

This section provides the tentative 

results for the projected nationwide 

impact analyses, including the NES and 

NPV. In this SNOPR, DOE updated the 

energy efficiency measures analyzed as 

described in section III.E.2.b. DOE also 

updated all inputs to the NES and NPV 

based on the updated AEO 2020. This 

includes updates to the housing starts 

growth rate, inflation rates, energy 

prices, energy prices growth rates, and 

full-fuel cycle energy factors. In 

addition, DOE also updated the 

shipment analysis to include the 2015– 

2019 MHI shipments and exclude any 

ENERGY STAR shipments to avoid 

overestimating energy savings. 

Furthermore, for the tiered proposal, 

DOE had to determine shipments per 

tier, as described in section IV.C.1.a, by 

implementing a substitution effect of 

shifting Tier 2 shipments to Tier 1 for 

the tiered proposal. Lastly, the analyses 

include updates to the average price of 

a manufactured home, and fuel type 

distributions. Further details on the 

updated inputs are discussed in 

chapters 8, 10, and 11 of the SNOPR 

TSD. 

DOE notes that the NES does not 

account for the energy savings for the 

people who do not buy a manufactured 

home under the standards case because 

they are price-sensitive. As such, NES 

only accounts for savings for those that 

are able to purchase a manufactured 

home. The NES is calculated based on 

the same number of homes purchased 

under both the standards and no 

standards case such that there are no 

energy savings attributed to less homes 

purchased. 

Table IV. reflects the NES results over 

a 30-year analysis period under the 

SNOPR on a primary energy savings 

basis. Primary energy savings apply a 

factor to account for losses associated 

with generation, transmission, and 

distribution of electricity. Primary 

energy savings differ among the 

different climate zones because of 

differing energy conservation 

requirements in each climate zone and 

different shipment projections in each 

climate zone. 

TABLE IV.20—CUMULATIVE NATIONAL ENERGY SAVINGS OF MANUFACTURED HOMES PURCHASED 2023–2052 WITH A

30-YEAR LIFETIME

Tiered standards Untiered standard 

Single-section 

(quads) 

Multi-section 

(quads) 

Single-section 

(quads) 

Multi-section 

(quads) 

Climate Zone 1 ................................................................................................ 0.213 0.591 0.303 0.591 

Climate Zone 2 ................................................................................................ 0.164 0.467 0.243 0.467 

Climate Zone 3 ................................................................................................ 0.300 0.463 0.376 0.463 

Total .......................................................................................................... 0.677 1.521 0.921 1.521 

Table IV.21 illustrates the cumulative 

NES over the 30-year analysis period for 

the tiered proposals on an FFC energy 

savings basis. FFC energy savings apply 

a factor to account for losses associated 

with generation, transmission, and 

distribution of electricity, and the 

energy consumed in extracting, 

processing, and transporting or 

distributing primary fuels. NES values 

differ among the different climate zones 

because of differing energy efficiency 

requirements in each climate zone and 

different shipment projections in each 

climate zone. 

TABLE IV.21—CUMULATIVE NATIONAL ENERGY SAVINGS, INCLUDING FULL-FUEL-CYCLE OF MANUFACTURED HOMES

PURCHASED 2023–2052 WITH A 30-YEAR LIFETIME

Tiered standards Untiered standard 

Single-section 

(quads) 

Multi-section 

(quads) 

Single-section 

(quads) 

Multi-section 

(quads) 

Climate Zone 1 ................................................................................................ 0.222 0.616 0.316 0.616 

Climate Zone 2 ................................................................................................ 0.172 0.491 0.254 0.491 

Climate Zone 3 ................................................................................................ 0.324 0.499 0.405 0.499 


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47812 Federal Register / Vol. 86, No. 163 / Thursday, August 26, 2021 / Proposed Rules 

TABLE IV.21—CUMULATIVE NATIONAL ENERGY SAVINGS, INCLUDING FULL-FUEL-CYCLE OF MANUFACTURED HOMES

PURCHASED 2023–2052 WITH A 30-YEAR LIFETIME—Continued 

Tiered standards Untiered standard 

Single-section 

(quads) 

Multi-section 

(quads) 

Single-section 

(quads) 

Multi-section 

(quads) 

Total .......................................................................................................... 0.718 1.606 0.976 1.606 

Without the substitution effect 

applied, the total cumulative FFC 

energy savings for the tiered standards 

would increase by 0.2 percent. 

Table IV.22 and Table IV.23 illustrate 

the NPV of consumer benefits over the 

30-year analysis period under the tiered 

proposals for a discount rate of 7 

percent and 3 percent, respectively. The 

NPV of manufactured homeowner 

benefits differ among the different 

climate zones because there are different 

upfront costs and operating cost savings 

associated with each climate zone and 

different shipment projections in each 

climate zone. For the primary tiered 

proposal, all climate zones have a 

positive NPV for both discount rates 

under this SNOPR. 

TABLE IV.22—NET PRESENT VALUE OF MANUFACTURED HOMES PURCHASED 2023–2052 WITH A 30-YEAR LIFETIME AT A

7% DISCOUNT RATE

Tiered standards Untiered standard 

Single-section 

(billion 2020$) 

Multi-section 

(billion 2020$) 

Single-section 

(billion 2020$) 

Multi-section 

(billion 2020$) 

Climate Zone 1 ................................................................................................ $0.22 $0.47 $0.24 $0.46 

Climate Zone 2 ................................................................................................ 0.08 0.08 0.00 0.06 

Climate Zone 3 ................................................................................................ 0.42 0.36 0.26 0.35 

Total .......................................................................................................... 0.72 0.90 0.49 0.87 

TABLE IV.23—NET PRESENT VALUE OF MANUFACTURED HOMES PURCHASED 2023–2052 WITH A 30-YEAR LIFETIME AT A

3% DISCOUNT RATE

Tiered standards Untiered standard 

Single-section 

(billion 2020$) 

Multi-section 

(billion 2020$) 

Single-section 

(billion 2020$) 

Multi-section 

(billion 2020$) 

Climate Zone 1 ................................................................................................ $0.70 $1.69 $0.85 $1.63 

Climate Zone 2 ................................................................................................ 0.38 0.79 0.29 0.73 

Climate Zone 3 ................................................................................................ 1.34 1.50 1.12 1.44 

Total .......................................................................................................... 2.42 3.98 2.26 3.80 

Table IV.24 shows the tentative 

projected benefits and costs to the 

manufactured homeowner associated 

with the SNOPR, expressed in terms of 

annualized values. 

TABLE IV.24—ANNUALIZED BENEFITS AND COSTS TO MANUFACTURED HOME HOMEOWNERS UNDER THE SNOPR 

Discount rate 

(%) 

Monetized 

(million 2020$/year) 

Primary 

estimate ** 

Low 

estimate ** 

High 

estimate ** 

Tiered Standards 

Benefits * 

Operating (Energy) Cost Savings ............................................................. 7 $509 $471 $554 

3 774 701 858 

Costs * 

Incremental Purchase Price Increase ...................................................... 7 359 352 385 

3 427 407 464 

Net Benefits/Costs * 

7 150 119 169 

3 347 294 394 


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Federal Register / Vol. 86, No. 163 / Thursday, August 26, 2021 / Proposed Rules 47813 

TABLE IV.24—ANNUALIZED BENEFITS AND COSTS TO MANUFACTURED HOME HOMEOWNERS UNDER THE SNOPR— 

Continued 

Discount rate 

(%) 

Monetized 

(million 2020$/year) 

Primary 

estimate ** 

Low 

estimate ** 

High 

estimate ** 

Untiered Standard 

Benefits * 

Operating (Energy) Cost Savings ............................................................. 7 565 523 615 

3 859 778 951 

Costs * 

Incremental Purchase Price Increase ...................................................... 7 440 429 471 

3 530 503 576 

Net Benefits/Costs * 

7 125 94 144 

3 329 275 375 

* The benefits and costs are calculated for homes shipped in 2023–2052. 

** The Primary, Low, and High Estimates utilize forecasts of energy prices from the AEO 2020 Reference case, Low Economic Growth case, 

and High Economic Growth case, respectively. 

DOE also estimated the deadweight 

loss associated with the proposed rule 

stemming from the reduced shipments 

in the standards case scenario. 

Deadweight loss is a cost to society as 

a whole generated by shifting the market 

away from the no-standards case 

equilibrium. If the supply curve is 

perfectly elastic, then the deadweight 

loss of an energy conservation standard 

is entirely borne by consumers and not 

producers. The deadweight loss is 

equivalent to one-half the incremental 

price multiplied by the reduction in 

total shipments, discounted over the 30- 

year analysis. If, however, the supply 

curve’s slope near equilibrium is similar 

in magnitude to the demand curve, then 

the deadweight loss is equivalent to the 

incremental price multiplied by the 

reduction in total shipments, 

discounted over the 30-year analysis. 

DOE does not have data on the supply 

curve elasticity, therefore DOE 

estimated the deadweight loss for the 

proposed standards using a price 

elasticity of ¥0.48. 

DOE tentatively estimates that the 

discounted total deadweight loss for the 

standards based on Tier 1 range from 

$0.8 to $1.5 million (2020$, discounted 

at 3 percent) and $0.4 to $0.9 million 

(2020$, discounted at 7 percent). DOE 

tentatively estimates that the discounted 

total deadweight loss for the standards 

based on Tier 2 from $75.4 to $150.9 

million (2020$, discounted at 3 percent) 

and $43.9 to $87.8 million (2020$, 

discounted at 7 percent). DOE 

tentatively estimates that the discounted 

total deadweight loss for the untiered 

standard range from $103.1 to $206.2 

million (2020$, discounted at 3 percent) 

and $60 to $120 million (2020$, 

discounted at 7 percent). 

DOE requests comment on the 

calculation of deadweight loss 

presented above and the extent to which 

there are market failures in the nostandards case. 

DOE considered two sensitivity 

analyses relating to shipments. First, 

DOE considered a shipment scenario in 

which the growth rate is 6.5 percent 

(instead of 0.3 percent) based on the 

trend in actual manufactured home 

shipments from 2011 to 2014. This 

growth rate applies to both the nostandards case and standards case 

shipments. DOE’s primary scenario is 

based on the residential housing start 

data from AEO 2020. The sensitivity 

analysis calculates the increase in NES 

and NPV associated with a much larger 

future market for manufactured homes. 

Table IV.25 summarizes the results of 

the sensitivity analysis. A detailed 

description of the sensitivity analysis is 

provided in appendix 11A of the 

SNOPR TSD. 

TABLE IV.25—SHIPMENTS GROWTH RATE SENSITIVITY ANALYSIS NES AND NPV RESULTS

National 

energy 

savings 

(full fuel cycle 

quads) 

Net present 

value 3% 

discount rate 

(billion 2020$) 

Net present 

value 7% 

discount rate 

(billion 2020$) 

Tiered Standard 

0.3% Shipment Growth (primary scenario) ................................................................................. 2.32 $6.40 $1.62 

6.5% Shipment Growth ................................................................................................................ 8.13 20.12 4.35 

Untiered Standards 

0.3% Shipment Growth (primary scenario) ................................................................................. 2.58 6.07 1.36 

6.5% Shipment Growth ................................................................................................................ 9.04 19.10 3.66 


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47814 Federal Register / Vol. 86, No. 163 / Thursday, August 26, 2021 / Proposed Rules 

72For example, see http://www.regulations.gov/ 

#!documentDetail;D=HUD-2014-0033-0001. 

73Meeks, C., 1992, Price Elasticity of Demand for 

Manufactured Homes: 1961 to 1989. 

74See Energy Information Administration, 

Annual Energy Outlook 2019 with Projections to 

2050 (2019), available at https://www.eia.gov/ 

outlooks/aeo/pdf/AEO2019.pdf. 

75U.S. Environmental Protection Agency. 

External Combustion Sources. In Compilation of Air 

Pollutant Emission Factors. AP–42. Fifth Edition. 

Volume I: Stationary Point and Area Sources. 

Chapter 1. Available at https://www.epa.gov/aiRemissions-factors-and-quantification/ap-42- 

compilation-aiR-emissions-factors. 

In a second sensitivity analysis, DOE 

considered a standards case shipment 

scenario in which the price elasticity is 

¥2.4 (instead of ¥0.48). HUD has used 

an estimate of ¥2.4 in analyses of 

revisions to its regulations 72

promulgated at 24 CFR part 3282 based 

on a 1992 paper written by Carol 

Meeks.73 DOE’s primary scenario is 

based on a study published in 2007 in 

the Journal of Housing Economics. The 

sensitivity analysis calculates the 

decrease in NES and NPV associated 

with a larger decrease in shipments 

resulting from the more negative price 

elasticity value. See Table IV.26 for 

results of the sensitivity analysis. A 

detailed description of the sensitivity 

analysis is provided in appendix 11A of 

the SNOPR TSD. 

TABLE IV.26—PRICE ELASTICITY OF DEMAND SENSITIVITY ANALYSIS NES AND NPV RESULTS

National energy savings 

(full-fuel cycle 

quads) 

Net present 

value 3% discount rate 

(billion 2020$) 

Net present 

value 7% discount rate 

(billion 2020$) 

Tiered Standards 

¥0.48 Price Elasticity (primary scenario) ................................................................................... 2.32 $6.40 $1.62 

¥2.4 Price Elasticity .................................................................................................................... 2.12 5.90 1.51 

Untiered Standard 

¥0.48 Price Elasticity (primary scenario) ................................................................................... 2.58 6.07 1.36 

¥2.4 Price Elasticity .................................................................................................................... 2.31 5.46 1.23 

D. Nationwide Energy Savings and 

Emissions Benefits 

1. Emissions Analysis 

DOE estimates environmental benefits 

in the form of reduced emissions of air 

pollutants and greenhouse gases 

associated with electricity production. 

DOE bases these estimates on a 30-year 

analysis period of manufactured home 

shipments, accounting for a 30-year 

home lifetime. DOE’s analysis estimates 

reductions in emissions of six pollutants 

associated with energy savings: Carbon 

dioxide (CO2), mercury (Hg), nitric 

oxide and nitrogen dioxide (NOX), 

sulfur dioxide (SO2), methane (CH4), 

and nitrous oxide (N2O). These 

reductions are referred to as ‘‘site’’ 

emissions reductions. Furthermore, 

DOE estimates reductions due to 

‘‘upstream’’ activities in the fuel 

production chain. These upstream 

activities comprise extraction, 

processing, and transporting fuels to the 

site of combustion. Together, site 

emissions reductions and upstream 

emissions reductions account for the 

FFC. 

As in the June 2016 NOPR, DOE 

estimated emissions reductions based 

on emission factors for each pollutant, 

which depend on the type of fuel 

associated with energy savings 

(electricity, natural gas, liquefied 

petroleum gas, fuel oil). The analysis of 

power sector emissions of CO2, NOX, 

SO2, and Hg uses marginal emissions 

factors that were derived from data in 

AEO 2020.74 Full details of this 

methodology are described in chapter 

13 of the SNOPR TSD. 

Because the onsite operation of 

manufactured homes may require 

combustion of fossil fuels and results in 

emissions of CO2, NOX, and SO2 at the 

manufactured home sites where this 

combustion occurs, DOE also accounted 

for the reduction in these site emissions 

and the associated upstream emissions 

due to the standards. Site emissions of 

the above gases were estimated using 

emissions intensity factors from an EPA 

publication.75 The emissions intensity 

factors are expressed in terms of 

physical units per MWh or MMBtu of 

site energy savings. Total emissions 

reductions are estimated using the 

energy savings calculated in the 

national impact analysis. As discussed 

previously in section IV.C.2, the energy 

savings calculated does not account for 

the energy savings for the people who 

do not buy a manufactured home under 

the standards case because they are 

price-sensitive, but only accounts for 

savings for those that are able to 

purchase a manufactured home. The 

energy savings is calculated based on 

the same number of homes purchased 

under both the standards and no 

standards case such that there are no 

energy savings attributed to less homes 

purchased. After calculating the total 

reduction of emissions, DOE estimated 

the monetized value associated with the 

reduction of these emissions, as 

discussed in section IV.D.2 of this 

document. 

2. Monetizing Emissions Impacts 

As part of the analysis of the impacts 

of this proposed rule, DOE considered 

the estimated monetary benefits from 

the reduced emissions of CO2, CH4, N2O, 

NOX and SO2 that are expected to result 

from the proposed energy standards. In 

order to make this calculation analogous 

to the calculation of the NPV of 

consumer benefit, DOE considered the 

reduced emissions expected to result 

over the lifetime of products shipped in 

the projection period for the standards. 

This section summarizes the basis for 

the values used for monetizing the 

emissions benefits in this SNOPR. 

a. Monetization of Greenhouse Gas 

Emissions 

DOE estimates the monetized benefits 

of the reductions in emissions of CO2, 

CH4, and N2O by using a measure of the 

social cost (‘‘SC’’) of each pollutant (e.g., 

SC-CO2). These estimates represent the 

monetary value of the net harm to 

society associated with a marginal 

increase in emissions of these pollutants 

in a given year, or the benefit of 

avoiding that increase. These estimates 

are intended to include (but are not 

limited to) climate-change-related 

changes in net agricultural productivity, 

human health, property damages from 

increased flood risk, disruption of 

energy systems, risk of conflict, 


jbell on DSKJLSW7X2PROD with PROPOSALS2
Federal Register / Vol. 86, No. 163 / Thursday, August 26, 2021 / Proposed Rules 47815 

76See Interagency Working Group on Social Cost 

of Greenhouse Gases, Technical Support Document: 

Social Cost of Carbon, Methane, and Nitrous Oxide. 

Interim Estimates Under Executive Order 13990, 

Washington, DC, February 2021. (https://

www.whitehouse.gov/wp-content/uploads/2021/02/ 

TechnicalSupportDocument_

SocialCostofCarbonMethane

NitrousOxide.pdf?source=email). 

77For example, the TSD discusses how the 

understanding of discounting approaches suggests 

that discount rates appropriate for intergenerational 

analysis in the context of climate change may be 

lower than 3 percent. 

environmental migration, and the value 

of ecosystem services. 

DOE used the estimates for the social 

cost of greenhouse gases (‘‘SC-GHG’’) 

from the most recent update of the 

Interagency Working Group on Social 

Cost of Greenhouse Gases, United States 

Government (IWG) working group, from 

‘‘Technical Support Document: Social 

Cost of Carbon, Methane, and Nitrous 

Oxide Interim Estimates under 

Executive Order 13990.’’ (February 2021 

TSD). DOE has determined that the 

estimates from the February 2021 TSD, 

as described more below, are based 

upon sound analysis and provide well 

founded estimates for DOE’s analysis of 

the impacts of the reductions of 

emissions anticipated from the 

proposed rule. 

The SC-GHG estimates in the 

February 2021 TSD are interim values 

developed under Executive Order (E.O.) 

13990 for use until an improved 

estimate of the impacts of climate 

change can be developed based on the 

best available science and economics. 

The SC-GHG estimates used in this 

analysis were developed over many 

years, using a transparent process, peerreviewed methodologies, the best 

science available at the time of that 

process, and with input from the public. 

Specifically, an interagency working 

group (IWG) that included DOE, the 

EPA and other executive branch 

agencies and offices used three 

integrated assessment models (IAMs) to 

develop the SC-CO2 estimates and 

recommended four global values for use 

in regulatory analyses. Those estimates 

were subject to public comment in the 

context of dozens of proposed 

rulemakings as well as in a dedicated 

public comment period in 2013. 

The SC-CO2 estimates were first 

released in February 2010 and updated 

in 2013 using new versions of each 

IAM. In 2015, as part of the response to 

public comments received to a 2013 

solicitation for comments on the SC-CO2

estimates, the IWG announced a 

National Academies of Sciences, 

Engineering, and Medicine review of the 

SC-CO2 estimates to offer advice on how 

to approach future updates to ensure 

that the estimates continue to reflect the 

best available science and 

methodologies. In January 2017, the 

National Academies released their final 

report, Valuing Climate Damages: 

Updating Estimation of the Social Cost 

of Carbon Dioxide, and recommended 

specific criteria for future updates to the 

SC-CO2 estimates, a modeling 

framework to satisfy the specified 

criteria, and both near-term updates and 

longer-term research needs pertaining to 

various components of the estimation 

process (National Academies 2017). On 

January 20, 2021, President Biden 

issued Executive Order 13990, which 

directed the IWG to ensure that the U.S. 

Government’s (USG) estimates of the 

social cost of carbon and other 

greenhouse gases reflect the best 

available science and the 

recommendations of the National 

Academies (2017). The IWG was tasked 

with first reviewing the estimates 

currently used by the USG and 

publishing interim estimates within 30 

days of E.O. 13990 that reflect the full 

impact of GHG emissions, including 

taking global damages into account, 

which resulted in the issuance of the 

February 2021 TSD. More information 

on the basis for the IWG’s interim values 

may be found in the IWG’s Technical 

Support Document.76

DOE’s derivations of the SC-CO2, SCN2O, and SC-CH4 values used for this 

SNOPR are discussed in the following 

sections, and the results of DOE’s 

analyses estimating the benefits of the 

reductions in emissions of these 

pollutants are presented in section 

IV.3.b of this document. 

Social Cost of Carbon 

The SC-CO2 values used for this 

NOPR were generated using the values 

presented in the 2021 update from the 

IWG. Table IV.27 shows the updated 

sets of SC-CO2 estimates from the latest 

interagency update in 5-year increments 

from 2020 to 2050. The full set of 

annual values used is presented in 

Appendix 14–A of the SNOPR TSD. For 

purposes of capturing the uncertainties 

involved in regulatory impact analysis, 

DOE has determined it is appropriate to 

include all four sets of SC-CO2 values, 

as recommended by the IWG.77 These 

SC-CO2 estimates are the same as those 

used in the June 2016 NOPR except 

adjusted for inflation to 2020 dollars. 

The June 2016 NOPR provides further 

detail of DOE’s SC-CO2 analysis for the 

June 2016 NOPR. See 81 FR 39791. 

TABLE IV.27—ANNUAL SC-CO2 VALUES FROM 2021 INTERAGENCY UPDATE, 2020–2050 

[2020$ per Metric Ton CO2] 

Year 

Discount rate 

5% 

(average) 

3% 

(average) 

2.5% 

(average) 

3% 

(95th percentile) 

2020 ......................................................................................... 14 51 76 152 

2025 ......................................................................................... 17 56 83 169 

2030 ......................................................................................... 19 62 89 187 

2035 ......................................................................................... 22 67 96 206 

2040 ......................................................................................... 25 73 103 225 

2045 ......................................................................................... 28 79 110 242 

2050 ......................................................................................... 32 85 116 260 

In calculating the potential global 

benefits resulting from reduced CO2

emissions, DOE used the values from 

the 2021 interagency report, adjusted to 

2020$ using the implicit price deflator 

for gross domestic product (GDP) from 

the Bureau of Economic Analysis. For 

each of the four sets of SC-CO2 cases 

specified, the values for emissions in 

2020 were $14, $51, $76, and $152 per 

metric ton avoided (values expressed in 

2020$). DOE derived values after 2050 

based on the trend in 2010–2050 in each 

of the four cases in the IWG update. 

DOE multiplied the CO2 emissions 

reduction estimated for each year by the 

SC-CO2 value for that year in each of the 

four cases. To calculate a present value 


jbell on DSKJLSW7X2PROD with PROPOSALS2
47816 Federal Register / Vol. 86, No. 163 / Thursday, August 26, 2021 / Proposed Rules 

78See Interagency Working Group on Social Cost 

of Greenhouse Gases, Technical Support Document: 

Social Cost of Carbon, Methane, and Nitrous Oxide. 

Interim Estimates Under Executive Order 13990, 

Washington, DC, February 2021. https://

www.whitehouse.gov/wp-content/uploads/2021/02/ 

TechnicalSupportDocument_

SocialCostofCarbonMethaneNitrousOxide.pdf. 

of the stream of monetary values, DOE 

discounted the values in each of the 

four cases using the specific discount 

rate that had been used to obtain the SCCO2 values in each case. 

Social Cost of Methane and Nitrous 

Oxide 

The SC-CH4 and SC-N2O values used 

for this SNOPR were generated using 

the values presented in the 2021 update 

from the IWG.78 Table IV.28 shows the 

updated sets of SC-CH4 and SC-N2O 

estimates from the latest interagency 

update in 5-year increments from 2020 

to 2050. The full set of annual values 

used is presented in Appendix 14–A of 

the SNOPR TSD. To capture the 

uncertainties involved in regulatory 

impact analysis, DOE has determined it 

is appropriate to include all four sets of 

SC-CH4 and SC-N2O values, as 

recommended by the IWG. 

TABLE IV.28—ANNUAL SC-CH4 AND SC-N2O VALUES FROM 2021 INTERAGENCY UPDATE, 2020–2050 

[2020$ per metric ton] 

Year 

SC-CH4

(discount rate and statistic) 

SC-N2O 

(discount rate and statistic) 

5% 

(Average) 

3% 

(Average) 

2.5% 

(Average) 

3% 

(95th 

percentile) 

5% 

(Average) 

3% 

(Average) 

2.5% 

(Average) 

3% 

(95th 

percentile) 

2020 ......................... 670 1500 2000 3900 5800 18000 27000 48000 

2025 ......................... 800 1700 2200 4500 6800 21000 30000 54000 

2030 ......................... 940 2000 2500 5200 7800 23000 33000 60000 

2035 ......................... 1100 2200 2800 6000 9000 25000 36000 67000 

2040 ......................... 1300 2500 3100 6700 10000 28000 39000 74000 

2045 ......................... 1500 2800 3500 7500 12000 30000 42000 81000 

2050 ......................... 1700 3100 3800 8200 13000 33000 45000 88000 

DOE multiplied the CH4 and N2O 

emissions reduction estimated for each 

year by the SC-CH4 and SC-N2O 

estimates for that year in each of the 

cases. To calculate a present value of the 

stream of monetary values, DOE 

discounted the values in each of the 

cases using the specific discount rate 

that had been used to obtain the SC-CH4

and SC-N2O estimates in each case. 

b. Monetization of Other Air Pollutants 

For the SNOPR, DOE estimated the 

monetized value of NOX and SO2

emissions reductions from electricity 

generation using benefit per ton 

estimates based on air quality modeling 

and concentration-response functions 

conducted for the Clean Power Plan 

final rule. EPA reported values for NOX

(as PM2.5) and SO2 for 2020, 2025, and 

2030 using discount rates of 3 percent 

and 7 percent. DOE developed values 

specific to the sector for manufactured 

housing using a method described in 

appendix 14B of the SNOPR TSD. For 

this analysis DOE used linear 

interpolation to define values for the 

years between 2020 and 2025 and 

between 2025 and 2030; for years 

beyond 2030 the value is held constant. 

DOE estimated the monetized value of 

NOX and SO2 emissions reductions from 

site use of gas in manufactured homes 

using benefit per ton estimates from the 

EPA’s ‘‘Technical Support Document 

Estimating the Benefit per Ton of 

Reducing PM2.5 Precursors from 17 

Sectors’’ (‘‘EPA TSD’’). Although none 

of the sectors refers specifically to 

residential and commercial buildings, 

the sector called ‘‘area sources’’ would 

be a reasonable proxy for residential and 

commercial buildings. ‘‘Area sources’’ 

represents all emission sources for 

which states do not have exact (point) 

locations in their emissions inventories. 

Because exact locations would tend to 

be associated with larger sources, ‘‘area 

sources’’ would be fairly representative 

of small dispersed sources like homes 

and businesses. The EPA TSD provides 

high and low estimates for 2016, 2020, 

2025, and 2030 at 3- and 7-percent 

discount rates. DOE primarily relied on 

the low estimates to be conservative. 

DOE multiplied the emissions 

reduction (in tons) in each year by the 

associated $/ton values, and then 

discounted each series using discount 

rates of 3 percent and 7 percent as 

appropriate. 

3. Discussion of Comments 

DOE received a number of comments 

regarding several aspects of the 

nationwide environmental benefits 

described in the June 2016 NOPR. The 

following sections provide a discussion 

of each of the submitted comments, 

including the changes that DOE has 

made in the methodology and 

assumptions. 

a. Social Cost of Carbon 

DOE received several comments on 

the development of, and the use of the 

SC-CO2 values in DOE’s analysis in the 

June 2016 NOPR. A group of trade 

associations led by the U.S. Chamber of 

Commerce objected to DOE’s continued 

use of the SC-CO2 in the cost-benefit 

analysis and stated that the SC-CO2

calculation should not be used in any 

rulemaking until it undergoes a more 

rigorous notice, review, and comment 

process. (U.S. Chamber of Commerce., 

No. 181 at p. 4) The Cato Institute also 

criticized DOE’s use of SC-CO2

estimates on the basis that they are 

subject to considerable uncertainty. The 

Cato Institute criticized several aspects 

of the determination of the SC-CO2

values by the IWG as being discordant 

with the best climate science, highly 

sensitive to input parameters and scope 

of the models, and not reflective of 

climate change impacts. The Cato 

Institute stated that until integrated 

assessment models (IAMs) are made 

consistent with what it stated is 

mainstream climate science, the SC-CO2

should be barred from use in this and 

all other Federal rulemakings. (Cato 

Institute, No. 180 at pp. 1–4, 15–16). 

MHARR stated that the global benefits 

calculated via the SC-CO2 in the 

analysis are not only unreliable and 

arbitrary, but also compare the monetary 

benefits to the world to a rule affecting 

less than 10 percent of the domestic 


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housing market. (MHARR, No. 154 at p. 

32). 

In contrast, the Joint Advocates stated 

that only a partial accounting of the 

costs of climate change (those most 

easily monetized) can be provided, 

which inevitably involves incorporating 

elements of uncertainty. The Joint 

Advocates commented that accounting 

for the economic harms caused by 

climate change is a critical component 

of sound cost—benefit analyses of 

regulations that directly or indirectly 

limit greenhouse gases. The Joint 

Advocates stated that several executive 

orders direct Federal agencies to 

consider non-economic costs and 

benefits, such as environmental and 

public health impacts. (Joint Advocates, 

No. 147 at pp. 2–3) Furthermore, the 

Joint Advocates argued that without an 

SC-CO2 estimate, regulators would by 

default be using a value of zero for the 

benefits of reducing carbon pollution, 

thereby implying that carbon pollution 

has no costs. The Joint Advocates stated 

that it would be arbitrary for a Federal 

agency to weigh the societal benefits 

and costs of a rule with significant 

carbon pollution effects but to assign no 

value at all to the considerable benefits 

of reducing carbon pollution. (Joint 

Advocates, No. 147 at p. 3). 

The Joint Advocates stated that 

assessment and use of the IAMs in 

developing the SC-CO2 values has been 

transparent. The Joint Advocates further 

noted that the Government 

Accountability Office found that the 

IWG’s processes and methods used 

consensus-based decision making, 

relied on existing academic literature 

and models, and took steps to disclose 

limitations and incorporate new 

information. The Joint Advocates stated 

that repeated opportunities for public 

comment demonstrate that the IWG’s 

SC-CO2 estimates were developed and 

are being used transparently. (Joint 

Advocates, No. 147 at p. 4) The Joint 

Advocates stated that (1) the IAMs used 

reflect the best available, peeR-reviewed 

science to quantify the benefits of 

carbon emission reductions; (2) 

uncertainty is not a valid reason for 

rejecting the SC-CO2 analysis, and (3) 

the IWG was rigorous in addressing 

uncertainty inherent in estimating the 

economic cost of pollution. (Joint 

Advocates, No. 147 at pp. 5, 17–18, 18– 

19) The Joint Advocates added that the 

increase in the SC-CO2 estimate in the 

2013 update reflects the growing 

scientific and economic research on the 

risks and costs of climate change, but is 

still very likely an underestimate of the 

SC-CO2. (Joint Advocates, No. 147 at p. 

4) The Joint Advocates stated that recent 

research suggests that CO2 fertilization 

is overestimated and may be canceled 

out by negative impacts on agriculture. 

(Joint Advocates, No. 147 at p. 16). 

DOE emphasizes that the SC-GHG 

analysis presented in this SNOPR and 

TSD was performed in support of the 

cost-benefit analyses required by 

Executive Order 12866, and is provided 

to inform the public of the impacts of 

emissions reductions resulting from this 

proposed rule. The SC-GHG estimates 

were not factored into DOE’s 

determination of whether the proposed 

rule could be cost-effective under 

section 413 of EISA 2007. 

As noted previously, DOE has 

updated the SC-CO2 analysis in this 

SNOPR using interim estimated values 

issued by the IWG established under 

Executive Order 13990. DOE has 

determined that the estimates from the 

February 2021 TSD are based upon 

sound analysis and provide well 

founded estimates for DOE’s analysis of 

the impacts of CO2 related to the 

reductions of emissions resulting from 

this proposed rule. The SC-CO2

estimates used in this analysis were 

developed over many years, using a 

transparent process, peer-reviewed 

methodologies, the best science 

available at the time of that process, and 

with input from the public. Specifically, 

in 2009, an interagency working group 

(IWG) that included DOE and other 

executive branch agencies and offices 

was established to ensure that agencies 

were using the best available science 

and to promote consistency in the SCCO2 values used across agencies. The 

February 2021 TSD provides a complete 

discussion of the IWG’s initial review 

conducted under E.O. 13990. 

First, as the IWG affirmed, a global 

perspective is essential for social cost of 

greenhouse gases (SC-GHG) estimates 

because climate impacts occurring 

outside U.S. borders can directly and 

indirectly affect the welfare of U.S. 

citizens and residents. Thus, U.S. 

interests are affected by the climate 

impacts that occur outside U.S. borders. 

Examples of affected interests include: 

Direct effects on U.S. citizens and assets 

located abroad, international trade, 

tourism, and spillover pathways such as 

economic and political destabilization 

and global migration. In addition, 

assessing the benefits of U.S. GHG 

emissions reductions requires 

consideration of how those actions may 

affect emissions reductions by other 

countries, as those international actions 

will provide a benefit to U.S. citizens 

and residents by mitigating climate 

impacts that affect U.S. citizens and 

residents. Therefore, in analyzing the 

potential impacts of this proposed rule 

DOE focuses on a global measure of SCGHG. As noted in the February 2021 

TSD, the IWG will continue to review 

developments in the literature, 

including more robust methodologies 

for estimating SC-GHG values based on 

purely domestic damages, and explore 

ways to better inform the public of the 

full range of carbon impacts, both global 

and domestic. As a member of the IWG, 

DOE will likewise continue to follow 

developments in the literature 

pertaining to this issue. 

Second, as the IWG found, the use of 

the social rate of return on capital (7 

percent under current OMB Circular A– 

4 guidance) to discount the future 

benefits of reducing GHG emissions 

inappropriately underestimates the 

impacts of climate change for the 

purposes of estimating the SC-GHG. 

Consistent with the findings of the 

National Academies (2017) and the 

economic literature, the IWG continued 

to conclude that the consumption rate of 

interest is the theoretically appropriate 

discount rate in an intergenerational 

context (IWG 2010, 2013, 2016a, 2016b), 

and recommended that discount rate 

uncertainty and relevant aspects of 

intergenerational ethical considerations 

be accounted for in selecting future 

discount rates. 

While the IWG works to assess how 

best to incorporate the latest, peer 

reviewed science to develop an updated 

set of SC-GHG estimates, it set the 

interim estimates to be the most recent 

estimates developed by the IWG prior to 

the group being disbanded in 2017. The 

estimates rely on the same models and 

harmonized inputs and are calculated 

using a range of discount rates. As 

explained in the February 2021 TSD, the 

IWG has determined that it is 

appropriate to revert to the same set of 

four values drawn from the SC-GHG 

distributions based on three discount 

rates as were used in regulatory analyses 

between 2010 and 2016 and subject to 

public comment. As explained in the 

February 2021 TSD, this update reflects 

the immediate need to have an 

operational SC-GHG for use in 

regulatory benefit-cost analyses and 

other applications that was developed 

using a transparent process, peerreviewed methodologies, and the 

science available at the time of that 

process. Those estimates were subject to 

public comment in the context of 

dozens of proposed rulemakings as well 

as in a dedicated public comment 

period in 2013. 

DOE acknowledges that there are a 

number of challenges in attempting to 

assess the incremental economic 

impacts of CO2 emissions. Some 

uncertainties are captured within the 

analysis, while other areas of 


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79Marten, A.L., Kopits, E.A., Griffiths, C.W., 

Newbold, S.C., and A. Wolverton. 2015. 

Incremental CH4 and N2O Mitigation Benefits 

Consistent with the U.S. Government’s SC-CO2 

Estimates. Climate Policy. 15(2): 272–298 

(published online, 2014). 

80See Interagency Working Group on Social Cost 

of Greenhouse Gases, Technical Support Document: 

Social Cost of Carbon, Methane, and Nitrous Oxide. 

Interim Estimates Under Executive Order 13990, 

Washington, DC, February 2021. https://

www.whitehouse.gov/wp-content/uploads/2021/02/ 

TechnicalSupportDocument_

SocialCostofCarbonMethaneNitrousOxide.pdf. 

81See Energy Information Administration, 

Annual Energy Outlook 2020 with Projections to 

2050 (2020), available at https://www.eia.gov/ 

outlooks/aeo/pdf/AEO2020%20Full%20Report.pdf. 

82For further information, see the Assumptions to 

AEO2020 report that sets forth the major 

assumptions used to generate the projections in the 

Annual Energy Outlook. Available at https://

www.eia.gov/outlooks/aeo/assumptions/ (last 

accessed July 6, 2020). 

uncertainty have not yet been quantified 

in a way that can be modeled. The 

February 2021 TSD presents the 

quantified sources of uncertainty in the 

form of frequency distributions, and 

discusses the sources of uncertainty that 

have not yet been quantified and are 

thus not reflected in these estimates. 

The modeling limitations do not all 

work in the same direction in terms of 

their influence on the SC-CO2 estimates. 

However, the IWG has recommended 

that, taken together, the limitations 

suggest that the interim SC-CO2

estimates used in this proposed rule 

likely underestimate the damages from 

CO2 emissions. DOE agrees with the 

IWG’s approach. Despite the limits of 

both quantification and monetization, 

SC-CO2 estimates can be useful in 

estimating the social benefits of 

reducing CO2 emissions. Although any 

numerical estimate of the benefits of 

reducing carbon dioxide emissions is 

subject to some uncertainty, that does 

not relieve DOE of its obligation under 

E.O. 12866 to attempt to factor those 

benefits into its cost-benefit analysis. 

Moreover, the IWG’s SC-CO2 estimates 

are well supported by the existing 

scientific and economic literature. As a 

result, DOE used the IWG’s SC-CO2

estimates in quantifying the social 

benefits of reducing CO2 emissions. 

Specifically, DOE estimated the benefits 

from reduced (or costs from increased) 

emissions in any future year by 

multiplying the change in emissions in 

that year by the SC-CO2 values 

appropriate for that year. The NPV of 

the benefits can then be calculated by 

multiplying each of these future benefits 

by an appropriate discount factor and 

summing across all affected years. 

b. Monetization of Methane and Nitrous 

Oxide 

In the June 2016 NOPR, DOE also 

estimated monetary benefits for NOX

emissions under the proposed rule. 

Estimates of the monetary value of 

reducing NOX from stationary sources 

ranged from $489 to $5,023 per metric 

ton (2015$). DOE calculated monetary 

benefits using an intermediate value for 

NOX emissions of $2,755 per metric ton 

(in 2015$), and real discount rates of 3 

and 7 percent. DOE received several 

comments on emissions monetization. 

The Joint Advocates commented that 

DOE acknowledges that its proposed 

standards will reduce significant 

quantities of non-carbon dioxide 

greenhouse gases, including methane, 

and has estimated monetary benefits for 

NOX emissions under the proposed rule. 

The Joint Advocates commented that 

DOE should include the Social Cost of 

Methane in the estimated monetary 

benefits. (Joint Advocates, No. 147 at 

pp. 19–21) The Joint Advocates stated 

that the EPA and other agencies have 

begun using a methodology developed 

to specifically measure the Social Cost 

of Methane—namely, the Marten et al. 

approach 79—in recent proposed 

rulemakings. This approach builds on 

the methodology and assumptions used 

by the IWG to develop the SC-CO2, but 

also accounts for other factors that are 

unique to methane. Overall, the Joint 

Advocates commented that the Marten 

et al. methodology provides reasonable, 

direct estimates that reflect updated 

evidence and provide consistency with 

the Government’s accepted 

methodology for estimating the SC-CO2. 

The Joint Advocates commented that 

DOE should use the Social Cost of 

Methane to more accurately reflect the 

true benefits of the standards and to 

enhance the rigor and defensibility of 

the final rule. 

As noted previously, DOE has 

updated its analysis to account for the 

social cost of methane and nitrous oxide 

consistent with the SC-CH4 and SC-N2O 

estimates presented in the February 

2021 TSD. DOE has determined that the 

estimates from the February 2021 TSD 

are based upon sound analysis and 

provide well founded estimates for 

DOE’s analysis of the impacts of CH4

and NO2 related to the reductions of 

emissions resulting from this proposed 

rule.. The SC-CH4 and SC-N2O values 

used for this SNOPR are presented in 

Table IV.28.80 DOE multiplied the CH4

and N2O emissions reduction estimated 

for each year by the SC-CH4 and SC-N2O 

estimates for that year in each of the 

cases. To calculate a present value of the 

stream of monetary values, DOE 

discounted the values in each of the 

cases using the specific discount rate 

that had been used to obtain the SC-CH4

and SC-N2O estimates in each case. See 

chapter 14 of the TSD for further 

discussion. 

4. Results 

a. Emissions Analysis 

In this SNOPR DOE updated its 

analysis from the 2016 NOPR based on 

the results of the national energy 

savings discussed in section IV.C.2. 

DOE also updated its analysis to utilize 

emission factors derived from data in 

the AEO 2020.81 The AEO incorporates 

the projected impacts of existing air 

quality regulations on emissions. AEO 

2020 generally represents current 

legislation and environmental 

regulations, including recent 

government actions, for which 

implementing regulations were 

available at the time of preparation of 

AEO 2020, including the emissions 

control programs discussed in the 

following paragraphs.82

SO2 emissions from affected electric 

generating units (‘‘EGUs’’) are subject to 

nationwide and regional emissions capand-trade programs. Title IV of the 

Clean Air Act sets an annual emissions 

cap on SO2 for affected EGUs in the 48 

contiguous States and the District of 

Columbia (DC). (42 U.S.C. 7651 et seq.) 

SO2 emissions from numerous eastern 

States and DC are also limited under the 

Cross-State Air Pollution Rule 

(‘‘CSAPR’’), which created an 

allowance-based trading program that 

operates along with the Title IV program 

in those States and DC. 76 FR 48208 

(Aug. 8, 2011). CSAPR requires these 

States to reduce certain emissions, 

including annual SO2 emissions, and 

went into effect as of January 1, 2015. 

AEO 2020 incorporates implementation 

of CSAPR, including the update to the 

CSAPR ozone season program emission 

budgets and target dates issued in 2016, 

81 FR 74504 (Oct. 26, 2016). 

Compliance with CSAPR is flexible 

among EGUs and is enforced through 

the use of tradable emissions 

allowances. Under existing EPA 

regulations, any excess SO2 emissions 

allowances resulting from the lower 

electricity demand caused by the 

adoption of an efficiency standard could 

be used to permit offsetting increases in 

SO2 emissions by another regulated 

EGU. 

However, beginning in 2016, SO2

emissions began to fall as a result of 

implementation of the Mercury and Air 

Toxics Standards (‘‘MATS’’) for power 

plants. 77 FR 9304 (Feb. 16, 2012). In 

the MATS final rule, EPA established a 

standard for hydrogen chloride as a 

surrogate for acid gas hazardous air 

pollutants (‘‘HAP’’), and also 


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83Available at www2.epa.gov/climateleadership/ 

centeR-corporate-climate-leadership-ghg-emissionfactors-hub. 

established a standard for SO2 (a nonHAP acid gas) as an alternative 

equivalent surrogate standard for acid 

gas HAP. The same controls are used to 

reduce HAP and non-HAP acid gas; 

thus, SO2 emissions are being reduced 

as a result of the control technologies 

installed on coal-fired power plants to 

comply with the MATS requirements 

for acid gas. To continue operating, coal 

plants must have either flue gas 

desulfurization or dry sorbent injection 

systems installed. Both technologies, 

which are used to reduce acid gas 

emissions, also reduce SO2 emissions. 

Because of the emissions reductions 

under the MATS, it is unlikely that 

excess SO2 emissions allowances 

resulting from the lower electricity 

demand would be needed or used to 

permit offsetting increases in SO2

emissions by another regulated EGU. 

Therefore, energy conservation 

standards that decrease electricity 

generation will generally reduce SO2

emissions. 

CSAPR also established limits on NOX

emissions for numerous States in the 

eastern half of the United States. Energy 

conservation standards would have 

little effect on NOX emissions in those 

States covered by CSAPR emissions 

limits if excess NOX emissions 

allowances resulting from the lower 

electricity demand could be used to 

permit offsetting increases in NOX

emissions from other EGUs. In such a 

case, NOX emissions would remain near 

the limit even if electricity generation 

goes down. A different case could 

possibly result, depending on the 

configuration of the power sector in the 

different regions and the need for 

allowances, such that NOX emissions 

might not remain at the limit in the case 

of lower electricity demand. In this case, 

energy conservation standards might 

reduce NOX emissions in covered 

States. Despite this possibility, DOE has 

chosen to be conservative in its analysis 

and has maintained the assumption that 

energy conservation standards will not 

reduce NOX emissions in States covered 

by CSAPR. Energy conservation 

standards would be expected to reduce 

NOX emissions in the States not covered 

by CSAPR. DOE used AEO 2020 data to 

derive NOX emissions factors for the 

group of States not covered by CSAPR. 

The MATS limit mercury emissions 

from power plants, but they do not 

include emissions caps and as such, 

DOE’s energy conservation standards 

would be expected to slightly reduce Hg 

emissions. DOE estimated mercury 

emissions reduction using emissions 

factors based on AEO 2020, which 

incorporates the MATS. 

Combustion emissions of CH4 and 

N2O are estimated using emissions 

intensity factors published by the 

EPA.83 The FFC upstream emissions are 

estimated based on the methodology 

described in chapter 13 of the SNOPR 

TSD. The upstream emissions include 

both emissions from fuel combustion 

during extraction, processing, and 

transportation of fuel, and ‘‘fugitive’’ 

emissions (direct leakage to the 

atmosphere) of CH4 and CO2. 

Table IV.29 reflects the emissions 

reductions for both single-section and 

multi-section manufactured homes. 

TABLE IV.29—EMISSIONS REDUCTIONS AS A RESULT OF THE SNOPR 

Pollutant Single-section Multi-section 

Tiered Standards 

Site Emissions Reductions 

CO2 (million metric tons) ......................................................................................................................................... 31.7 67.7 

Hg (metric tons) ....................................................................................................................................................... 0.063 0.146 

NOX (thousand metric tons) .................................................................................................................................... 18.3 37.3 

SO2 (thousand metric tons) ..................................................................................................................................... 12.8 27.7 

CH4 (thousand metric tons) ..................................................................................................................................... 1.86 4.14 

N2O (thousand metric tons) ..................................................................................................................................... 0.35 0.74 

Upstream Emissions Reductions 

CO2 (million metric tons) ......................................................................................................................................... 3.1 6.32 

Hg (metric tons) ....................................................................................................................................................... 3.42E–4 7.67E–04 

NOX (thousand metric tons) .................................................................................................................................... 39.7 81.7 

SO2 (thousand metric tons) ..................................................................................................................................... 0.32 0.64 

CH4 (thousand metric tons) ..................................................................................................................................... 221 463 

N2O (thousand metric tons) ..................................................................................................................................... 0.016 0.033 

Total Emissions Reductions 

CO2 (million metric tons) ......................................................................................................................................... 34.8 74.0 

Hg (metric tons) ....................................................................................................................................................... 0.064 0.147 

NOX (thousand metric tons) .................................................................................................................................... 58 119 

SO2 (thousand metric tons) ..................................................................................................................................... 13.1 28.3 

CH4 (thousand metric tons) ..................................................................................................................................... 223 467 

N2O (thousand metric tons) ..................................................................................................................................... 0.37 0.78 

Untiered Standard 

Site Emissions Reductions 

CO2 (million metric tons) ......................................................................................................................................... 42.4 67.7 

Hg (metric tons) ....................................................................................................................................................... 0.087 0.146 

NOX (thousand metric tons) .................................................................................................................................... 24.0 37.3 

SO2 (thousand metric tons) ..................................................................................................................................... 17.2 27.7 

CH4 (thousand metric tons) ..................................................................................................................................... 2.51 4.14 


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TABLE IV.29—EMISSIONS REDUCTIONS AS A RESULT OF THE SNOPR—Continued 

Pollutant Single-section Multi-section 

N2O (thousand metric tons) ..................................................................................................................................... 0.47 0.74 

Upstream Emissions Reductions 

CO2 (million metric tons) ......................................................................................................................................... 4.09 6.32 

Hg (metric tons) ....................................................................................................................................................... 4.65E–04 7.67E–04 

NOX (thousand metric tons) .................................................................................................................................... 52.5 81.7 

SO2 (thousand metric tons) ..................................................................................................................................... 0.42 0.64 

CH4 (thousand metric tons) ..................................................................................................................................... 293 463 

N2O (thousand metric tons) ..................................................................................................................................... 0.021 0.033 

Total Emissions Reductions 

CO2 (million metric tons) ......................................................................................................................................... 46.4 74.0 

Hg (metric tons) ....................................................................................................................................................... 0.087 0.147 

NOX (thousand metric tons) .................................................................................................................................... 76.5 119 

SO2 (thousand metric tons) ..................................................................................................................................... 17.6 28.3 

CH4 (thousand metric tons) ..................................................................................................................................... 296 467 

N2O (thousand metric tons) ..................................................................................................................................... 0.49 0.78 

b. Monetization of Emissions 

DOE estimated the global social 

benefits of GHG emission reductions 

expected from this final rule using the 

SC-GHG estimates presented in the 

Technical Support Document: Social 

Cost of Carbon, Methane, and Nitrous 

Oxide Interim Estimates under 

Executive Order 13990 (IWG 2021) that 

would be expected to result from the 

SNOPR as discussed in IV.D.2 DOE has 

determined that the estimates from the 

February 2021 TSD are based upon 

sound analysis and provide well 

founded estimates for DOE’s analysis of 

the impacts of GHG related to the 

reductions of emissions resulting from 

this proposed rule. These SC-GHG 

estimates are the same as those used in 

the June 2016 NOPR except adjusted for 

inflation to 2020 dollars. Table IV. 

presents the global values of the CO2

emissions reduction. 

TABLE IV.30—PRESENT VALUE OF CO2 EMISSIONS REDUCTION FOR MANUFACTURED HOMES PURCHASED 2023–2052 

WITH A 30-YEAR LIFETIME

SC-CO2 Case (million 2020$) 

5% discount rate, 

average 

3% discount rate, 

average 

2.5% discount 

rate, average 

3% discount rate, 

95th percentile 

Tiered Standards 

Single Section .......................................................................... $259.8 $1,173.3 $1,963.4 $3,614.2 

Multi Section ............................................................................ 553.6 2,498.8 4,180.3 7,696.9 

Total .................................................................................. 813.4 3,672.1 6,143.6 11,311.1 

Untiered Standard 

Single Section .......................................................................... $347.1 $1,567.0 $2,621.9 $4,826.8 

Multi Section ............................................................................ 553.6 2,498.8 4,180.3 7,696.9 

Total .................................................................................. 900.7 4,065.8 6,802.1 12,523.7 

Similarly, DOE has updated the 

quantified total climate benefits to 

estimate monetary benefits likely to 

result from the reduced emissions of 

CH4 and N2O, consistent with the 

interim estimates in the February 2021 

TSD. DOE multiplied the CH4 and N2O 

emissions reduction estimated for each 

year by the SC-CH4 and SC-N2O 

estimates for that year in each of the two 

cases. Table IV.30 presents the value of 

the CH4 emissions reduction, and Table 

IV.31 presents the value of the N2O 

emissions reduction. 


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TABLE IV.30—PRESENT VALUE OF METHANE EMISSIONS REDUCTION FOR MANUFACTURED HOMES PURCHASED

2023–2052 WITH A 30-YEAR LIFETIME

[Million 2020$] 

SC-CH4 case 

5% discount rate, 

average 

3% discount rate, 

average 

2.5% discount 

rate, average 

3% discount rate, 

95th percentile 

Tiered Standards 

Single Section .......................................................................... $83.4 $270.4 $401.4 $720.2 

Multi Section ............................................................................ 175.1 567.3 842.0 1,511.0 

Total .................................................................................. 258.5 837.7 1,243.4 2,231.2 

Untiered Standard 

Single Section .......................................................................... 110.9 359.4 533.5 957.4 

Multi Section ............................................................................ 175.1 567.3 842.0 1,511.0 

Total .................................................................................. 286.0 926.7 1,375.6 2,468.4 

TABLE IV.31—PRESENT VALUE OF NITROUS OXIDE EMISSIONS REDUCTION FOR MANUFACTURED HOMES PURCHASED

2023–2052 WITH A 30-YEAR LIFETIME

[Million 2020$] 

SC-N2O case 

5% discount rate, 

average 

3% discount rate, 

average 

2.5% discount 

rate, average 

3% discount rate, 

95th percentile 

Tiered Standards 

Single Section .......................................................................... $1.12 $4.94 $8.15 $13.16 

Multi Section ............................................................................ 2.35 10.33 17.04 27.52 

Total .................................................................................. 3.48 15.27 25.19 40.68 

Untiered Standard 

Single Section .......................................................................... 1.49 6.55 10.81 17.45 

Multi Section ............................................................................ 2.35 10.33 17.04 27.52 

Total .................................................................................. 3.85 16.88 27.85 44.97 

In this SNOPR, DOE also updated the 

monetization of NOX and SO2 emissions 

reductions from both electricity 

generation and direct use from 

manufactured homes. For this analysis, 

DOE used linear interpolation to define 

values for the years between 2020 and 

2025 and between 2025 and 2030; for 

years beyond 2030 the value is held 

constant. Full details of this 

methodology are described in chapter 

14 of the SNOPR TSD. DOE multiplied 

the NOX and SO2 emissions reduction 

(in tons) in each year by the associated 

$/ton values, and then discounted each 

series using discount rates of 3 percent 

and 7 percent as appropriate. Table 

IV.32 and Table IV.33 presents the 

results. 

TABLE IV.32—PRESENT VALUE OF NOX EMISSIONS REDUCTION FOR MANUFACTURED HOMES PURCHASED 2023–2052 

WITH A 30-YEAR LIFETIME

[Million 2020$] 

3% discount rate 

(high) 

7% discount rate 

(high) 

3% discount rate 

(low) 

7% discount rate 

(low) 

Tiered Standards 

Single Section .......................................................................... $338.9 $117.9 $149.0 $52.4 

Multi Section ............................................................................ 676.5 235.6 297.1 104.8 

Total .................................................................................. 1,015.4 353.4 446.0 157.2 

Untiered Standard 

Single Section .......................................................................... 442.9 154.1 194.6 68.6 


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84 DOE used a two-step calculation process to 

convert the time-series of costs and benefits into 

annualized values. First, DOE calculated a present 

value in 2016, the year used for discounting the net 

present value of total consumer costs and savings, 

for the time-series of costs and benefits using 

discount rates of three and seven percent for all 

costs and benefits except for the value of CO2

reductions. From the present value, DOE then 

calculated the fixed annual payment over a 30-year 

period, starting in 2020 that yields the same present 

value. The fixed annual payment is the annualized 

value. Although DOE calculated annualized values, 

this does not imply that the time-series of cost and 

benefits from which the annualized values were 

determined would be a steady stream of payments. 

TABLE IV.32—PRESENT VALUE OF NOX EMISSIONS REDUCTION FOR MANUFACTURED HOMES PURCHASED 2023–2052 

WITH A 30-YEAR LIFETIME—Continued 

[Million 2020$] 

3% discount rate 

(high) 

7% discount rate 

(high) 

3% discount rate 

(low) 

7% discount rate 

(low) 

Multi Section ............................................................................ 676.5 235.6 297.1 104.8 

Total .................................................................................. 1,119.4 389.7 491.7 173.3 

TABLE IV.33—PRESENT VALUE OF SO2 EMISSIONS REDUCTION FOR MANUFACTURED HOMES PURCHASED 2023–2052 

WITH A 30-YEAR LIFETIME

[Million 2020$] 

3% discount rate 

(high) 

7% discount rate 

(high) 

3% discount rate 

(low) 

7% discount rate 

(low) 

Tiered Standards 

Single Section .......................................................................... $549.3 $189.3 $240.9 $84.8 

Multi Section ............................................................................ 1,128.6 387.8 493.8 174.5 

Total .................................................................................. 1,677.9 577.0 734.7 259.3 

Untiered Standard 

Single Section .......................................................................... 723.9 249.2 317.2 111.8 

Multi Section ............................................................................ 1,128.6 387.8 493.8 174.5 

Total .................................................................................. 1,852.5 637.0 811.0 286.3 

DOE has not considered the monetary 

benefits of the reduction of Hg for this 

SNOPR. 

E. Total Benefits and Costs 

DOE has tentatively determined that 

under either proposal the benefits to the 

Nation of the standards (energy savings, 

consumer LCC savings, positive NPV of 

consumer benefit, and emission 

reductions) outweigh the burdens (loss 

of INPV, LCC increases for some 

homeowners of manufactured housing, 

and price-sensitive consumers who do 

not purchase manufactured homes). The 

tentative projected total benefits and 

costs (from the manufactured 

homeowner’s perspective) associated 

with the SNOPR, expressed in terms of 

annualized values, is presented in Table 

I.9 (See Section I.E), and is explained in 

greater detail in section IV and in 

chapter 15 of the SNOPR TSD.84

V. Procedural Issues and Regulatory 

Review 

A. Review Under Executive Orders 

12866 and 13563 

Section 1(b)(1) of Executive Order 

(E.O.) 12866, ‘‘Regulatory Planning and 

Review,’’ 58 FR 51735 (Oct. 4, 1993), 

requires each agency to identify the 

problem that it intends to address, 

including, where applicable, the failures 

of private markets or public institutions 

that warrant new agency action, as well 

as to assess the significance of that 

problem. The problems that the 

proposed standards for manufactured 

housing are intended to address are as 

follows: 

(1) Under current federal standards, 

manufactured homes typically conserve 

less energy than comparably built sitebuilt and modular homes, 

(2) Insufficient information and the 

high costs of gathering and analyzing 

relevant information leads some 

consumers to miss opportunities to 

make cost-effective investments in 

energy efficiency. 

(3) In some cases, the benefits of more 

efficient equipment are not realized due 

to misaligned incentives between 

purchasers and users. An example of 

such a case is when a product or design 

decision is made by a building 

contractor or building owner who does 

not pay the energy costs. 

(4) There are external benefits 

resulting from improved energy 

efficiency of products or equipment that 

are not captured by the users of such 

equipment. These benefits include 

externalities related to public health, 

environmental protection and national 

energy security that are not reflected in 

energy prices, such as reduced 

emissions of air pollutants and 

greenhouse gases that impact human 

health and global warming. 

The Administrator of the Office of 

Information and Regulatory Affairs 

(‘‘OIRA’’) in the OMB has determined 

that the regulatory action in this 

document is a significant regulatory 

action under section (3)(f) of E.O. 12866. 

Accordingly, pursuant to section 

6(a)(3)(B) of the E.O., DOE has provided 

to OIRA: (1) The text of the draft 

regulatory action, together with a 

reasonably detailed description of the 

need for the regulatory action and an 

explanation of how the regulatory action 

will meet that need; and (2) an 

assessment of the potential costs and 

benefits of the regulatory action, 

including an explanation of the manner 

in which the regulatory action is 

consistent with a statutory mandate. 

DOE has included these documents in 

the rulemaking record. 

In addition, the Administrator of 

OIRA has determined that the regulatory 

action is an ‘‘economically’’ significant 


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regulatory action under section (3)(f)(1) 

of E.O. 12866. Accordingly, pursuant to 

section 6(a)(3)(C) of the E.O., DOE has 

provided to OIRA an assessment, 

including the underlying analysis, of 

benefits and costs anticipated from the 

regulatory action, together with, to the 

extent feasible, a quantification of those 

costs; and an assessment, including the 

underlying analysis, of costs and 

benefits of potentially effective and 

reasonably feasible alternatives to the 

planned regulation, and an explanation 

why the planned regulatory action is 

preferable to the identified potential 

alternatives. These assessments can be 

found in the technical support 

document for this rulemaking and are 

summarized in the tables below. 

TABLE V.1—SUMMARY OF ECONOMIC BENEFITS AND COSTS TO MANUFACTURED HOME HOMEOWNERS UNDER THE

PROPOSED STANDARDS

Benefits 

Net present value 

(billion 2020$) Discount rate 

(%) 

Tiered Untiered 

Consumer Operating Cost Savings .................................................................... $5.5 ........................ $6.1 ........................ 7. 

14.3 ........................ 15.9 ........................ 3. 

GHG Reduction (using avg. social costs at 5% discount rate) * ........................ 1.1 .......................... 1.2 .......................... 5. 

GHG Reduction (using avg. social costs at 3% discount rate) * ........................ 4.5 .......................... 5.0 .......................... 3. 

GHG Reduction (using avg. social costs at 2.5% discount rate) * ..................... 7.4 .......................... 8.2 .......................... 2.5. 

GHG Reduction (using 95th percentile social costs at 3% discount rate) * ....... 13.6 ........................ 15.0 ........................ 3. 

NOX Reduction ................................................................................................... 0.2 .......................... 0.2 .......................... 7. 

0.4 .......................... 0.5 .......................... 3. 

SO2 Reduction .................................................................................................... 0.3 .......................... 0.3 .......................... 7. 

0.7 .......................... 0.8 .......................... 3. 

Total Benefits ...................................................................................................... 7 to 19.5 ................ 7.8 to 21.6 ............. 7 plus GHG range. 

10.5 ........................ 11.6 ........................ 7. 

20.0 ........................ 22.2 ........................ 3. 

16.6 to 29.1 ........... 18.4 to 32.2 ........... 3 plus GHG range. 

Costs 

Consumer Incremental Product Costs † ............................................................. 3.9 .......................... 4.7 .......................... 7.3 

7.9 .......................... 9.6 .......................... 3. 

Total Net Benefits 

Including GHG and Emissions Reduction Monetized Value .............................. 3.1 to 15.6 ............. 3 to 16.9 ................ 7 plus GHG range. 

6.6 .......................... 6.9 .......................... 7. 

12.1 ........................ 12.6 ........................ 3. 

8.7 to 21.2 ............. 8.7 to 22.6 ............. 3 plus GHG range. 

Note: This table presents the costs and benefits associated with manufactured homes shipped in 2023–2052. 

* The benefits from GHG reduction were calculated using global benefit-per-ton values. See section IV.D.2 of this document for more details. 

** Total Benefits for both the 3-percent and 7-percent cases are presented using the average GHG social costs with 3-percent discount rate. In 

the rows labeled ‘‘7% plus GHG range’’ and ‘‘3% plus GHG range,’’ the consumer benefits and NOX and SO2 benefits are calculated using the 

labeled discount rate, and those values are added to the GHG reduction using each of the four GHG social cost cases. 

† The incremental costs include incremental costs associated with principal and interest, mortgage and property tax for the analyzed loan 

types. 

TABLE V.2—ANNUALIZED BENEFITS AND COSTS TO MANUFACTURED HOME HOMEOWNERS UNDER THE PROPOSED

STANDARDS

Benefits 

Net present value 

(billion 2020$) Discount rate 

(%) 

Tiered Untiered 

Consumer Operating Cost Savings .................................................................... 509 ......................... 565 ......................... 7. 

774 ......................... 859 ......................... 3. 

GHG Reduction (using avg. social costs at 5% discount rate)* ........................ 70 ........................... 77 ........................... 5. 

GHG Reduction (using avg. social costs at 3% discount rate)* ........................ 231 ......................... 256 ......................... 3. 

GHG Reduction (using avg. social costs at 2.5% discount rate)* ..................... 354 ......................... 392 ......................... 2.5. 

GHG Reduction (using 95th percentile social costs at 3% discount rate)* ....... 693 ......................... 767 ......................... 3. 

NOX Reduction ................................................................................................... 13 ........................... 14 ........................... 7. 

23 ........................... 25 ........................... 3. 

SO2 Reduction .................................................................................................... 21 ........................... 23 ........................... 7. 

37 ........................... 41 ........................... 3. 

Total Benefits ...................................................................................................... 613 to 1,236 .......... 679 to 1,369 .......... 7 plus GHG range. 

773 ......................... 858 ......................... 7. 

1,065 ...................... 1,181 ...................... 3. 

904 to 1,527 .......... 1,003 to 1,693 ....... 3 plus GHG range. 

Costs 

Consumer Incremental Product Costs † ............................................................. 359 ......................... 440 ......................... 7. 


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TABLE V.2—ANNUALIZED BENEFITS AND COSTS TO MANUFACTURED HOME HOMEOWNERS UNDER THE PROPOSED

STANDARDS—Continued 

Benefits 

Net present value 

(billion 2020$) Discount rate 

(%) 

Tiered Untiered 

427 ......................... 530 ......................... 3. 

Total Net Benefits 

Including GHG and Emissions Reduction Monetized Value .............................. 254 to 877 ............. 239 to 929 ............. 7 plus GHG range. 

414 ......................... 418 ......................... 7. 

638 ......................... 651 ......................... 3. 

477 to 1,100 .......... 473 to 1,163 .......... 3 plus GHG range. 

Note: This table presents the costs and benefits associated with manufactured homes shipped in 2023–2052. 

* The benefits from GHG reduction were calculated using global benefit-per-ton values. See section IV.D of this document for more details. 

** Total Benefits for both the 3-percent and 7-percent cases are presented using the average GHG social costs with 3-percent discount rate. In 

the rows labeled ‘‘7% plus GHG range’’ and ‘‘3% plus GHG range,’’ the consumer benefits and NOX and SO2 benefits are calculated using the 

labeled discount rate, and those values are added to the GHG reduction using each of the four GHG social cost cases. 

† The incremental costs include incremental costs associated with principal and interest, mortgage and property tax for the analyzed loan 

types. 

DOE has also reviewed this proposed 

regulation pursuant to E.O. 13563, 

issued on January 18, 2011. 76 FR 3281 

(Jan. 21, 2011). E.O. 13563 is 

supplemental to and explicitly reaffirms 

the principles, structures, and 

definitions governing regulatory review 

established in E.O. 12866. To the extent 

permitted by law, agencies are required 

by E.O. 13563 to: (1) Propose or adopt 

a regulation only upon a reasoned 

determination that its benefits justify its 

costs (recognizing that some benefits 

and costs are difficult to quantify); (2) 

tailor regulations to impose the least 

burden on society, consistent with 

obtaining regulatory objectives, taking 

into account, among other things, and to 

the extent practicable, the costs of 

cumulative regulations; (3) select, in 

choosing among alternative regulatory 

approaches, those approaches that 

maximize net benefits (including 

potential economic, environmental, 

public health and safety, and other 

advantages; distributive impacts; and 

equity); (4) to the extent feasible, specify 

performance objectives, rather than 

specifying the behavior or manner of 

compliance that regulated entities must 

adopt; and (5) identify and assess 

available alternatives to direct 

regulation, including providing 

economic incentives to encourage the 

desired behavior, such as user fees or 

marketable permits, or providing 

information upon which choices can be 

made by the public. 

DOE emphasizes as well that E.O. 

13563 requires agencies to use the best 

available techniques to quantify 

anticipated present and future benefits 

and costs as accurately as possible. In its 

guidance, OIRA has emphasized that 

such techniques may include 

identifying changing future compliance 

costs that might result from 

technological innovation or anticipated 

behavioral changes. For the reasons 

stated in the preamble, this proposed 

rule is consistent with these principles, 

including the requirement that, to the 

extent permitted by law, benefits justify 

costs and that net benefits are 

maximized. 

B. Review Under the Regulatory 

Flexibility Act 

The Regulatory Flexibility Act (5 

U.S.C. 601 et seq.) requires preparation 

of an initial regulatory flexibility 

analysis (‘‘IRFA’’) and a final regulatory 

flexibility analysis (‘‘FRFA’’) for any 

rule that by law must be proposed for 

public comment, unless the agency 

certifies that the rule, if promulgated, 

will not have a significant economic 

impact on a substantial number of small 

entities. As required by E.O. 13272, 

‘‘Proper Consideration of Small Entities 

in Agency Rulemaking,’’ 67 FR 53461 

(Aug. 16, 2002), DOE published 

procedures and policies on February 19, 

2003, to ensure that the potential 

impacts of its rules on small entities are 

properly considered during the 

rulemaking process. 68 FR 7990 (Feb. 9, 

2003) DOE has made its procedures and 

policies available on the Office of the 

General Counsel’s website (https://

energy.gov/gc/office-general-counsel). 

DOE has prepared the following 

updated IRFA for the products that are 

the subject of this rulemaking. 

1. Need for, and Objectives of, the Rule 

EISA requires DOE to regulate energy 

conservation in manufactured housing, 

an area of the building construction 

industry traditionally regulated by HUD. 

HUD has regulated the manufactured 

housing industry since 1976, when it 

first promulgated the HUD Code. 

Among other provisions, EISA directs 

DOE to consult with the Secretary of 

HUD, who may seek further counsel 

from the Manufactured Housing 

Consensus Committee (MHCC); and to 

base the energy conservation standards 

on the most recent version of the IECC, 

except where DOE finds that the IECC 

is not cost effective or where a more 

stringent standard would be more cost 

effective, based on the impact of the 

IECC on the purchase price of 

manufactured housing and on total 

lifecycle construction and operating 

costs. (42 U.S.C. 17071). 

2. Significant Issues Raised in Response 

to the IRFA 

DOE received comments from the 

Office of Advocacy at the U.S. Small 

Business Administration (‘‘Advocacy’’) 

and other interested parties on the 

manufactured housing June 2016 NOPR 

regarding small businesses. These 

comments are addressed in this section. 

Advocacy stated that DOE published 

an IRFA that did not comply with the 

RFA’s requirement to quantify or 

describe the economic impact that the 

proposed regulation might have on 

small entities. (Advocacy, No. 177 at p. 

2) Advocacy stated that DOE failed to 

include large costs such as conversion 

costs and test procedure compliance 

costs. Advocacy also stated that 

compliance and enforcement costs 

(redesign costs, plant modifications, recosting and sourcing new materials, 

inspections, approvals, consulting fees, 

and employee training) are major costs 

to small businesses and should be 

included and analyzed in the proposed 

rule (Advocacy, No. 177 at p. 3). 

In the June 2016 NOPR IRFA DOE 

estimated the impacts on small 


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85MHI Manufacturer Members. https://

www.manufacturedhousing.org/find-amanufacturer/. 

manufacturers based on the general 

industry analysis. In this updated IRFA, 

DOE expands its analysis to include a 

more detailed review of the burdens and 

compares costs to small manufacturer 

revenue to determine whether those 

costs are significant. DOE included 

product conversion costs, based on the 

expected number of model plans that 

need to be redesigned as a result of this 

proposed rule, and capital conversion 

costs, based on the cost of additional 

equipment needed to produce 

compliant homes. In the June 2016 

NOPR, DOE estimated costs 

manufacturers would incur from test 

procedures as proposed in a separate 

rulemaking. As discussed, this SNOPR 

does not include cost estimates related 

to test procedures, as any such costs 

will be addressed separately. The test 

procedure NOPR for manufactured 

housing was published on November 9, 

2016. 81 FR 78733. 

Advocacy requested that DOE present 

and analyze significant alternatives, and 

adopt a regulatory alternative to the 

proposed standard that will minimize 

the economic impact to small 

manufacturers (Advocacy, No. 177 at 

pp. 2–4). Further, Advocacy expressed 

concern that the proposed rule would 

have a significant impact on small 

manufacturers. Advocacy stated it takes 

longer for small manufacturers to 

recover investments, because they must 

spread similar redesign investments 

over a lower volume of units than larger 

competitors. (Advocacy, No. 177 at p. 2) 

Additionally, MHARR commented that 

the proposed rule will have a 

particularly negative impact on the 

smaller producers in terms of regulatory 

cost burdens. (MHARR, Public Meeting 

Transcript, No. 148 at p. 13) The MHCC 

commented that DOE has not 

adequately addressed the impact of the 

proposed rule on small manufacturers, 

stating that small manufacturers may 

not be able to compete in the 

marketplace due to economies of scale 

afforded to large manufacturers that are 

able to purchase materials in volume at 

discounted rates not available to smaller 

manufacturers. The MHCC noted that 

DOE did not certify that the proposed 

rule would not have a significant impact 

on small manufacturers. (MHCC, No. 

162 at p. 2). 

In the June 2016 NOPR, DOE 

quantified the number of small 

businesses that have a direct 

compliance burden and estimated the 

magnitude of the compliance burden 

based on industry average conversion 

costs. In this updated IRFA, DOE 

expands its analysis to include a more 

detailed review of the burdens, an 

analysis of the costs specific to small 

manufacturers, and a comparison of 

these costs to small manufacturer 

revenue to determine whether those 

costs are significant. This analysis can 

be found in section V.B.4 of the updated 

IRFA. Additionally, DOE includes a 

review of alternatives to this proposal in 

section V.B.5 of the IRFA. DOE 

recognizes that new standards can 

create cost uncertainty for small 

businesses, but the updated analysis 

finds that the expected investments are 

less than 0.1 percent of revenues for 

small manufacturers (see section V.C.4). 

While small manufacturers may need to 

spread these costs over a lower volume 

of shipments than larger competitors, 

DOE finds this level of investment 

unlikely to change the level of industry 

competition or be a driver of industry 

consolidation. 

Advocacy commented that DOE’s 

estimate of $2,423 and $3,745 price 

increases for single- and multi-section 

manufactured homes is extremely low 

and does not accurately reflect the 

baseline cost, nor the dealer and retail 

markups. Advocacy expressed that even 

a modest increase in the price of 

manufactured housing will prevent 

many potential consumers from 

obtaining financing, which would 

severely impact small manufacturers’ 

consumer base. Further, Advocacy 

stated that dominant businesses in the 

manufactured home industry can sell 

manufactured homes at cost or offer 

energy rebates to their consumers to 

offset the increased price of energy 

efficient homes. Advocacy stated that 

small businesses cannot absorb the 

added cost to comply with the proposed 

regulation. (Advocacy, No. 177 at p. 3). 

In response to the June 2016 NOPR, 

certain parties commented that DOE’s 

estimated incremental cost to the 

consumer were too low, whereas other 

interested parties stated that the 

estimates were too high (see section 

IV.A.1.g for a full discussion). During 

the June 2016 NOPR public meeting, 

MHI stated that it represents small 

manufacturers and that the cost analysis 

used by the MH working group included 

small, medium, and large 

manufacturers. (MHI, Public Meeting 

Transcript, No. 148 at pp. 85–86). DOE 

confirmed MHI represented multiple 

small manufacturers through its 

publicly-available manufacturer 

membership list.85 Additionally, as 

described in section IV.A.1.g of the 

SNOPR, DOE took steps to validate 

incremental costs of production 

materials through published data. As a 

result, the incremental cost figures 

provided by the MH working group in 

the course of the negotiated consensus 

process are understood to be 

representative for manufacturers of all 

sizes. 

MHARR stated that DOE’s analysis 

contains financial information from 10– 

K filings that are likely from larger 

industry corporations. (MHARR, No. 

154 at p. 33) Table 12.1 of the SNOPR 

Technical Support Document (TSD) 

summarizes the financial parameters 

DOE used in its analysis of 

manufacturer impacts. The Department 

makes uses of all public and private 

financial information made available. 

DOE invites stakeholders to provide 

additional financial data to be 

considered in the analysis. 

MHARR referenced a SBA report to 

make the case that federal regulation 

generally has a disproportionately 

negative impact on smaller businesses 

in any industry. (MHARR, No. 154 at 

pp. 33). As noted in the NOPR, DOE 

recognizes that the rulemaking will have 

costs to small manufacturers. In this 

SNOPR, DOE includes a tiered proposal 

which is based on a tiered structure that 

would minimize impacts on the most 

cost-sensitive segment of manufactured 

home buyers and on the small 

manufacturers that serve that market 

segment. In the updated IRFA (see the 

‘‘Description and Estimate of 

Compliance Requirements’’ section 

below), DOE estimates conversion costs 

of the updated proposed standard level 

to be $43,000 per small manufacturer, 

an amount that is less than 0.1% of 

average annual revenues. 

Lastly, Advocacy recommended that 

DOE adopt delayed compliance 

schedules for small manufacturers, 

stating that more time to comply will 

allow them to spread costs and manage 

their limited resources in a way that 

will minimize the economic impact on 

their business. (Advocacy, No. 177 at p. 

4) In this SNOPR, DOE has proposed a 

one-year lead time for compliance. As 

discussed in previous sections, a oneyear lead time would allow for 

coordination of compliance with the 

DOE requirements and the HUD Code 

and provide manufacturers flexibility in 

allocating and managing the resources 

needed to bring their manufactured 

homes into compliance. Additionally, a 

one-year lead-time would allow for the 

evaluation of industry compliance 

under the DOE standards before DOE is 

required to evaluate potential updates 

based on the next version of the IECC. 


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86https://www.manufacturedhousing.org/admin/ 

template/brochures/949temp.pdf. 

87Hoovers. https://www.hoovers.com/. 

88https://www.glassdoor.com/index.htm. 

89https://www.linkedin.com/. 

90https://www.bls.gov/oes/current/ 

oes172141.htm. 

91Selected member of the MH working group 

were: Bert Kessler, Palm Harbor Homes, Inc.; David 

Tompos, NTA, Inc.; Emanuel Levy, Systems 

Building Research Alliance; Eric Lacey, Responsible 

Energy Codes Alliance; Ishbel Dickens, National 

Manufactured Home Owners Association 

(NMHOA); Keith Dennis, National Rural Electric 

Cooperative Association; Lois Starkey, 

Manufactured Housing Institute; Lowell Ungar, 

American Council for an Energy-Efficient Economy; 

Manuel Santana, Cavco Industries; Mark Ezzo, 

Clayton Homes, Inc.; Mark Weiss, Manufactured 

Housing Association for Regulatory Reform; 

Michael Lubliner, Washington State University 

Extension Energy Program; Michael Wade, Cavalier 

Home Builders; Peter Schneider, Efficiency 

Vermont; Richard Hanger, Housing Technology and 

Standards; Richard Potts, Virginia Department of 

Housing and Community Development; Rob Luter, 

Lippert Components, Inc.; Robin Roy, Natural 

Resources Defense Council; Scott Drake, East 

Kentucky Power Cooperative; Stacey Epperson, 

Next Step Network. DOE and ASRAC members 

were: Joseph Hagerman (DOE); and John Caskey 

(ASRAC, National Electrical Manufacturers 

Association). 

3. Description and Estimate of the 

Number of Small Entities Affected 

The SBA has set a size threshold for 

manufacturers of manufactured homes, 

which defines those entities classified 

as ‘‘small businesses’’ for the purposes 

of the statute. DOE used the SBA’s small 

business size standards to determine 

whether any small entities would be 

subject to the requirements of the rule. 

(13 CFR part 121) The size standards are 

listed by North American Industry 

Classification System (NAICS) code and 

industry description and are available 

at https://www.sba.gov/document/ 

support--table-size-standards. 

Manufacturing of manufactured housing 

is classified under NAICS 321991, 

‘‘Manufactured Home (Mobile Home) 

Manufacturing.’’ The SBA sets a 

threshold of 1,250 employees or fewer 

for an entity to be considered as a small 

business for this category. DOE notes 

that the initial regulatory flexibility 

analysis (IRFA) in the 2016 NOPR was 

based on an employee threshold of 500 

employees. 81 FR 42576. The updated 

IRFA threshold of 1,250 employee 

reflects the SBA’s most recent guidance 

on the employee threshold for small 

businesses. 

To estimate the number of companies 

that manufacture manufactured housing 

covered by this rulemaking, DOE 

conducted a market survey using 

publicly available information. DOE 

first attempted to identify all 

manufactured housing manufacturers by 

researching industry trade associations 

(e.g., MHI 86) and individual company 

websites. DOE used market research 

tools such as Hoovers reports,87

Glassdoor,88 and LinkedIn 89 to gather 

information about the number of 

employees and manufacturing locations. 

DOE also asked stakeholders and 

industry representatives if they were 

aware of any other small manufacturers. 

After a comprehensive list of businesses 

was created, DOE screened out 

companies that do not offer 

manufactured homes affected by this 

proposed rule, do not meet the 

definition of a ‘‘small business,’’ are 

foreign owned and operated, or do not 

manufacture manufactured homes in the 

United States. 

DOE identified 34 manufacturers of 

manufactured housing affected by this 

rulemaking. Of these, DOE identified 29 

as domestic small businesses. 

DOE requests comment on the 

number of manufacturers of 

manufactured housing producing home 

covered by this rulemaking. 

4. Description and Estimate of 

Compliance Requirements 

To evaluate impacts facing 

manufacturers of manufactured housing, 

DOE estimated both the capital 

conversion costs (e.g., investments in 

property, plant, and equipment) and 

product conversion costs (e.g., 

expenditures on R&D, testing, 

marketing, and other non-depreciable 

expenses) manufacturers would incur to 

bring their manufacturing facilities and 

product designs into compliance with 

the standards as proposed. 

To calculate product conversion costs, 

DOE estimated the number of modelplans manufacturers would need to 

redesign. Based on input from subject 

matter experts in the industry, 

manufacturers would need to update 

between 200 and 250 plans as a result 

of the standard. Consulting with subject 

matter experts in the industry, DOE 

estimated that each plan would require 

3 hours of engineering time to update. 

Based on data from the Bureau of Labor 

Statistics, DOE calculated a fully 

burdened mean hourly wage for a 

mechanical engineer at $65.63/hour in 

2020.90 Based on these inputs, DOE 

estimated product conversion costs of 

approximately $49,000 per 

manufacturer. 

While DOE understands most 

manufacturers have the necessary 

equipment to produce manufactured 

homes that are compliant with the 

standards as proposed in this document, 

DOE incorporated capital conversion 

costs of approximately $3,000 per 

manufacturer to cover additional work 

stations, equipment, and tooling that 

may be needed to support compliance 

with the standard. 

In aggregate, DOE estimates the 

average small manufacturer would incur 

$52,000 in conversion costs. Based on 

data from business databases (i.e., Dunn 

& Bradstreet and Manta), DOE estimated 

that small manufacturers of 

manufactured housing have an average 

annual revenue of $43.3 million. Per 

manufacturer conversion costs are less 

than 0.1 percent of average small 

business annual revenue. While the 

proposed standards would require 

investments on the part of small 

manufacturers, DOE’s calculations show 

that the conversion costs are small 

relative to the size of the average small 

manufacturer. 

DOE requests comment on the cost to 

update model plans and the number of 

model plans to update as a result of the 

proposed rule; on the types of 

equipment and capital expenditures that 

would be necessitated by the proposal; 

and the total cost of updating product 

offerings and manufacturing facilities. 

DOE requests comment on how these 

values would differ for small 

manufacturers. DOE requests comment 

on its estimate of average annual 

revenues for small manufacturers of 

manufactured housing. 

5. Significant Alternatives Considered 

and Steps Taken To Minimize 

Significant Economic Impacts on Small 

Entities 

In reviewing alternatives to the 

proposed standards, DOE examined 

energy conservation standards proposed 

in the June 2016 NOPR. The June 2016 

NOPR was adopted by the MH working 

group, which consisted of 22 

representatives of stakeholders,91

including representatives of 

manufacturer trade groups that included 

small manufacturers. However, in 

response to concerns related to potential 

adverse impacts on price-sensitive, lowincome purchasers of manufactured 

homes from the imposition of energy 

conservation standards on 

manufactured housing, in this SNOPR 

DOE is proposing the tiered standard. In 

the alternative, DOE is also proposing 

the untiered standard. 

DOE evaluated the alternative of 

adopting a single, untiered standard for 

manufactured homes that focuses on the 

building thermal envelope, duct and air 

sealing, insulation installation, HVAC 

specifications, service hot water 

systems, mechanical ventilation fan 

efficacy, and heating and cooling 

equipment sizing provisions, based on 

the 2021 IECC. The untiered standard 

would apply all manufactured homes, 


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regardless of manufacturer retail price. 

The untiered proposal is expected to 

result in 2.58 quads of energy savings 

over the 30-year analysis period. 

However, DOE’s primary proposal in 

this SNOPR is the tiered standard. DOE 

structured this proposal to minimize 

impacts on the most price-sensitive 

consumers and manufacturers that sell 

to those consumers. In the proposal, 

Tier 1 would apply to manufactured 

homes with a manufacturer’s retail list 

price of $55,000 or less, and would 

incorporate building thermal envelope 

measures based on certain thermal 

envelope components subject to the 

2021 IECC but would limit the 

incremental purchase price increase to 

$750 or less. The proposal also sets up 

a Tier 2 that would apply to 

manufactured homes with a 

manufacturer’s retail list price greater 

than $55,000. The Tier 2 standards 

would be set to stringencies based on 

the 2021 IECC and likely increase 

purchase prices by more than $750. The 

tiered proposal is expected to result in 

2.32 quads of energy savings over the 

30-year analysis period. The tiered 

proposal balances the benefits of the 

energy savings with the potential 

burdens placed on low-income 

consumers and on manufacturers that 

serve those consumers. 

C. Review Under the Paperwork 

Reduction Act 

This rulemaking would not include 

any information collection requirements 

subject to the Paperwork Reduction Act 

of 1995 (44 U.S.C. 3501 et seq.). 

D. Review Under the National 

Environmental Policy Act of 1969 

DOE is preparing a draft 

Environmental Impact Statement (EIS) 

(DOE/EIS–0550) entitled, 

‘‘Environmental Impact Statement: 

Energy Conservation Standards for 

Manufactured Housing’’, pursuant to the 

National Environmental Policy Act of 

1969 (NEPA), the Council on 

Environmental Quality’s Regulations for 

implementing the procedural provisions 

of the National Environmental Policy 

Act (40 CFR parts 1500–1508), and 

DOE’s NEPA Implementing Procedures 

(10 CFR part 1021). 

E. Review Under Executive Order 13132 

Executive Order 13132, ‘‘Federalism,’’ 

64 FR 43255 (Aug. 10, 1999) imposes 

certain requirements on Federal 

agencies formulating and implementing 

policies or regulations that preempt 

State law or that have federalism 

implications. The Executive order 

requires agencies to examine the 

constitutional and statutory authority 

supporting any action that would limit 

the policymaking discretion of the 

States and to carefully assess the 

necessity for such actions. The 

Executive order also requires agencies to 

have an accountable process to ensure 

meaningful and timely input by State 

and local officials in the development of 

regulatory policies that have federalism 

implications. On March 14, 2000, DOE 

published a statement of policy 

describing the intergovernmental 

consultation process it will follow in the 

development of such regulations. 65 FR 

13735. DOE has examined this proposed 

rule and has determined that it would 

not have a substantial direct effect on 

the States, on the relationship between 

the national government and the States, 

or on the distribution of power and 

responsibilities among the various 

levels of government. 

DOE has examined this action and has 

determined that it will not pre-empt 

State law. This action impacts energy 

efficiency requirements for 

manufacturers of manufactured homes. 

Therefore, no further action is required 

by E.O. 13132. 

F. Review Under Executive Order 12988 

With respect to the review of existing 

regulations and the promulgation of 

new regulations, section 3(a) of E.O. 

12988, ‘‘Civil Justice Reform,’’ imposes 

on Federal agencies the general duty to 

adhere to the following requirements: 

(1) Eliminate drafting errors and 

ambiguity; (2) write regulations to 

minimize litigation; (3) provide a clear 

legal standard for affected conduct 

rather than a general standard; and (4) 

promote simplification and burden 

reduction. 61 FR 4729 (Feb. 7, 1996). 

Regarding the review required by 

section 3(a), section 3(b) of E.O. 12988 

specifically requires that Executive 

agencies make every reasonable effort to 

ensure that the regulation: (1) Clearly 

specifies the preemptive effect, if any; 

(2) clearly specifies any effect on 

existing Federal law or regulation; (3) 

provides a clear legal standard for 

affected conduct while promoting 

simplification and burden reduction; (4) 

specifies the retroactive effect, if any; (5) 

adequately defines key terms; and (6) 

addresses other important issues 

affecting clarity and general 

draftsmanship under any guidelines 

issued by the Attorney General. Section 

3(c) of E.O. 12988 requires Executive 

agencies to review regulations in light of 

applicable standards in section 3(a) and 

section 3(b) to determine whether they 

are met, or it is unreasonable to meet 

one or more of them. DOE has 

completed the required review and 

determined that, to the extent permitted 

by law, this proposed rule meets the 

relevant standards of E.O. 12988. 

G. Review Under the Unfunded 

Mandates Reform Act of 1995 

Title II of the Unfunded Mandates 

Reform Act of 1995 (‘‘UMRA’’) requires 

each Federal agency to assess the effects 

of Federal regulatory actions on State, 

local, and Tribal governments and the 

private sector. Public Law 104–4, 

section 201 (codified at 2 U.S.C. 1531). 

For a regulatory action likely to result in 

a rule that may cause the expenditure by 

State, local, and Tribal governments, in 

the aggregate, or by the private sector of 

$100 million or more in any one year 

(adjusted annually for inflation), section 

202 of UMRA requires a Federal agency 

to publish a written statement that 

estimates the resulting costs, benefits, 

and other effects on the national 

economy. (2 U.S.C. 1532(a), (b)) The 

UMRA also requires a Federal agency to 

develop an effective process to permit 

timely input by elected officers of State, 

local, and Tribal governments on a 

‘‘significant intergovernmental 

mandate,’’ and requires an agency plan 

for giving notice and opportunity for 

timely input to potentially affected 

small governments before establishing 

any requirements that might 

significantly or uniquely affect them. On 

March 18, 1997, DOE published a 

statement of policy on its process for 

intergovernmental consultation under 

UMRA. 62 FR 12820. DOE’s policy 

statement is also available at https://

energy.gov/sites/prod/files/gcprod/ 

documents/umra_97.pdf. 

DOE has tentatively concluded that 

this proposed rule may require 

expenditures of $100 million or more in 

one year by the private sector. Such 

expenditures may include: (1) Updates 

to product plans and investment in 

capital expenditures by manufactured 

home manufacturers in the years 

between the final rule and the 

compliance date of the new standards, 

and (2) incremental additional 

expenditures by consumers to purchase 

higher-efficiency manufactured homes, 

starting at the compliance date for the 

standards. 

Section 202 of UMRA authorizes a 

Federal agency to respond to the content 

requirements of UMRA in any other 

statement or analysis that accompanies 

the rule. (2 U.S.C. 1532(c)) The content 

requirements of section 202(b) of UMRA 

relevant to a private sector mandate 

substantially overlap the economic 

analysis requirements that apply under 

E.O. 12866. The SUPPLEMENTARY

INFORMATION section of this document 

and chapter 15 of the TSD for this 

SNOPR respond to those requirements. 


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92The 2007 ‘‘Energy Conservation Standards 

Rulemaking Peer Review Report’’ is available at the 

following website: https://energy.gov/eere/ 

buildings/downloads/energy-conservationstandards-rulemaking-peeR-review-report-0. 

Under section 205 of UMRA, the 

Department is obligated to identify and 

consider a reasonable number of 

regulatory alternatives before 

promulgating a rule for which a written 

statement under section 202 is required. 

(2 U.S.C. 1535(a)) DOE is required to 

select from those alternatives the most 

cost-effective and least burdensome 

alternative that achieves the objectives 

of the rule unless DOE publishes an 

explanation for doing otherwise, or the 

selection of such an alternative is 

inconsistent with law. 

In accordance with the statutory 

provisions discussed in this document, 

this proposed rule would establish 

energy conservation standards for 

manufactured homes based on the most 

recent IECC, except in cases in which 

DOE finds that the IECC is not costeffective, or a more stringent standard 

would be more cost-effective, based on 

the impact of the code on the purchase 

price of manufactured housing and on 

total life-cycle construction and 

operating costs, and taking into 

consideration the design and factory 

construction techniques of 

manufactured homes. (42 U.S.C. 

17071(b)(1) and 42 U.S.C. 

17071(b)(2)(A)) A discussion of the 

alternatives considered by DOE is 

presented in chapter 15 of the TSD for 

this SNOPR. 

H. Review Under the Treasury and 

General Government Appropriations 

Act, 1999 

Section 654 of the Treasury and 

General Government Appropriations 

Act, 1999 (Pub. L. 105–277) requires 

Federal agencies to issue a Family 

Policymaking Assessment for any rule 

that may affect family well-being. This 

proposal, if finalized as proposed, 

would not have any impact on the 

autonomy or integrity of the family as 

an institution. Accordingly, DOE has 

concluded that it is not necessary to 

prepare a Family Policymaking 

Assessment. 

I. Review Under Executive Order 12630 

Pursuant to E.O. 12630, 

‘‘Governmental Actions and Interference 

with Constitutionally Protected Property 

Rights,’’ 53 FR 8859 (Mar. 18, 1988), 

DOE has determined that this proposal, 

if finalized as proposed, would not 

result in any takings that might require 

compensation under the Fifth 

Amendment to the U.S. Constitution. 

J. Review Under the Treasury and 

General Government Appropriations 

Act, 2001 

Section 515 of the Treasury and 

General Government Appropriations 

Act, 2001 (44 U.S.C. 3516, note) 

provides for Federal agencies to review 

most disseminations of information to 

the public under information quality 

guidelines established by each agency 

pursuant to general guidelines issued by 

OMB. OMB’s guidelines were published 

at 67 FR 8452 (Feb. 22, 2002), and 

DOE’s guidelines were published at 67 

FR 62446 (Oct. 7, 2002). Pursuant to 

OMB Memorandum M–19–15, 

Improving Implementation of the 

Information Quality Act (April 24, 

2019), DOE published updated 

guidelines which are available at 

https://www.energy.gov/sites/prod/files/

2019/12/f70/DOE%20Final%20

Updated%20IQA%20

Guidelines%20Dec%202019.pdf. DOE 

has reviewed this proposed rule under 

the OMB and DOE guidelines and has 

concluded that it is consistent with 

applicable policies in those guidelines. 

K. Review Under Executive Order 13211 

Executive Order 13211, ‘‘Actions 

Concerning Regulations That 

Significantly Affect Energy Supply, 

Distribution, or Use,’’ 66 FR 28355 (May 

22, 2001), requires Federal agencies to 

prepare and submit to OIRA at OMB, a 

Statement of Energy Effects for any 

significant energy action. A ‘‘significant 

energy action’’ is defined as any action 

by an agency that promulgates or is 

expected to lead to promulgation of a 

final rule, and that: (1) Is a significant 

regulatory action under E.O. 12866, or 

any successor order; and (2) is likely to 

have a significant adverse effect on the 

supply, distribution, or use of energy; or 

(3) is designated by the Administrator of 

OIRA as a significant energy action. For 

any significant energy action, the agency 

must give a detailed statement of any 

adverse effects on energy supply, 

distribution, or use should the proposal 

be implemented, and of reasonable 

alternatives to the action and their 

expected benefits on energy supply, 

distribution, and use. 

DOE has tentatively concluded that 

this regulatory action, which proposes 

new energy conservation standards for 

manufactured housing, is not a 

significant energy action because the 

standards are not likely to have a 

significant adverse effect on the supply, 

distribution, or use of energy, nor has it 

been designated as such by the 

Administrator at OIRA. Accordingly, 

DOE has not prepared a Statement of 

Energy Effects on this proposed rule. 

L. Information Quality 

On December 16, 2004, OMB, in 

consultation with the Office of Science 

and Technology Policy (OSTP), issued 

its Final Information Quality Bulletin 

for Peer Review (the Bulletin). 70 FR 

2664 (Jan. 14, 2005). The Bulletin 

establishes that certain scientific 

information shall be peer-reviewed by 

qualified specialists before it is 

disseminated by the Federal 

Government, including influential 

scientific information related to agency 

regulatory actions. The purpose of the 

Bulletin is to enhance the quality and 

credibility of the Government’s 

scientific information. Under the 

Bulletin, the energy conservation 

standards rulemaking analyses are 

‘‘influential scientific information,’’ 

which the Bulletin defines as ‘‘scientific 

information the agency reasonably can 

determine will have, or does have, a 

clear and substantial impact on 

important public policies or private 

sector decisions.’’ 70 FR 2664, 2667. 

In response to OMB’s Bulletin, DOE 

conducted formal peer reviews of the 

energy conservation standards 

development process for consumer 

products and industrial equipment 

under EPCA and the analyses that are 

typically used and prepared a report 

describing that peer review.92

Generation of this report involved a 

rigorous, formal, and documented 

evaluation using objective criteria and 

qualified and independent reviewers to 

make a judgment as to the technical, 

scientific, and business merit; the actual 

or anticipated results; and the 

productivity and management 

effectiveness of programs and/or 

projects. While the energy conservation 

standards for manufactured housing in 

this document have been proposed 

pursuant to section 413 of EISA (42 

U.S.C. 17071) as compared to the 

appliance standards authority in EPCA 

(42 U.S.C. 6291–6317), DOE relied on 

the general analytical process developed 

and peer-reviewed for the appliance 

standards. DOE conducted formal inprogress peer reviews of the energy 

conservation standards development 

process and analyses under the 

Appliance Standards Program and has 

prepared a Peer Review Report 

pertaining to the energy conservation 

standards rulemaking analyses. 

Generation of this report involved a 

rigorous, formal, and documented 

evaluation using objective criteria and 

qualified and independent reviewers to 

make a judgment as to the technical/ 

scientific/business merit, the actual or 

anticipated results, and the productivity 

and management effectiveness of 


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programs and/or projects. The ‘‘Energy 

Conservation Standards Rulemaking 

Peer Review Report’’ dated February 

2007 has been disseminated and is 

available at the following website: 

https://www.energy.gov/eere/buildings/ 

peer-review. DOE also has a peer review 

in process with the National Academy 

of Sciences and will review any 

recommendations made therein when 

the report is available. 

M. Materials Incorporated by Reference 

Under section 301 of the Department 

of Energy Organization Act (Pub. L. 95– 

91; 42 U.S.C. 7101), DOE must comply 

with section 32 of the Federal Energy 

Administration Act of 1974, as amended 

by the Federal Energy Administration 

Authorization Act of 1977. (15 U.S.C. 

788; FEAA) Section 32 essentially 

provides in relevant part that, where a 

proposed rule authorizes or requires use 

of commercial standards, the notice of 

proposed rulemaking must inform the 

public of the use and background of 

such standards. In addition, section 

32(c) requires DOE to consult with the 

Attorney General and the FTC Chairman 

concerning the impact of the 

commercial or industry standards on 

competition. 

DOE is proposing to incorporate by 

reference the industry standard 

published by ACCA, titled Manual J— 

Residential Load Calculation (8th 

Edition). ACCA Manual J is an industry 

accepted standard for calculating the 

heating and cooling load associated 

with a building. DOE is proposing to 

require building heating and cooling 

loads to be calculated (for purposes of 

equipment sizing) in accordance with 

ACCA Manual J. ACCA Manual J is 

readily available on ACCA’s website at 

www.acca.org/. 

DOE is proposing to incorporate by 

reference the industry standard 

published by ACCA, titled Manual S— 

Residential Equipment Selection (2nd 

Edition). ACCA Manual S is an industry 

accepted standard for calculating the 

appropriate heating and cooling 

equipment size for a building. DOE is 

proposing to require building heating 

and cooling equipment to be sized in 

accordance with ACCA Manual S. 

ACCA Manual S is readily available on 

ACCA’s website at www.acca.org/. 

DOE is proposing to incorporate by 

reference the industry standard written 

by C.C Conner and Z.T. Taylor of Pacific 

Northwest Laboratory, titled Overall UValues and Heating/Cooling Loads— 

Manufactured Homes. This industry 

standard (referred to as the ‘‘Battelle 

Method’’) is an industry accepted 

method for calculating the overall 

thermal transmittance of a 

manufactured home. In instances in 

which manufacturers demonstrate 

compliance with the overall thermal 

transmittance requirement, DOE is 

proposing to require manufactured 

housing manufacturers to calculate the 

overall thermal transmittance of a 

manufactured home in accordance with 

this industry standard. This standard is 

readily available on the U.S. Department 

of Housing and Urban Development’s 

website at www.huduser.org/portal/ 

publications/manufhsg/uvalue.html. 

DOE has evaluated these standards 

and was unable to conclude whether 

they fully comply with the requirements 

of section 32(b) of the FEAA (i.e., 

whether they were developed in a 

manner that fully provides for public 

participation, comment, and review). 

DOE will consult with both the Attorney 

General and the Chairman of the FTC 

concerning the impact of these 

standards on competition, prior to 

prescribing a final rule. 

VI. Public Participation 

A. Participation in the Webinar 

The time and date of the webinar 

meeting are listed in the DATES section 

at the beginning of this document. 

Webinar registration information, 

participant instructions, and 

information about the capabilities 

available to webinar participants will be 

published on DOE’s website: https://

www1.eere.energy.gov/buildings/ 

appliance_standards/ 

standards.aspx?productid=64. 

Participants are responsible for ensuring 

their systems are compatible with the 

webinar software. 

B. Procedure for Submitting Prepared 

General Statements for Distribution 

Any person who has an interest in the 

topics addressed in this SNOPR, or who 

is representative of a group or class of 

persons that has an interest in these 

issues, may request an opportunity to 

make an oral presentation at the 

webinar. Requests should be sent by 

email to: 

ApplianceStandardsQuestions@

ee.doe.gov. Persons who wish to speak 

should include with their request a 

computer file in WordPerfect, Microsoft 

Word, PDF, or text (ASCII) file format 

that briefly describes the nature of their 

interest in this rulemaking and the 

topics they wish to discuss. Such 

persons should also provide a daytime 

telephone number where they can be 

reached. 

Persons requesting to speak should 

briefly describe the nature of their 

interest in this rulemaking and provide 

a telephone number for contact. DOE 

requests persons selected to make an 

oral presentation to submit an advance 

copy of their statements at least two 

weeks before the webinar. At its 

discretion, DOE may permit persons 

who cannot supply an advance copy of 

their statement to participate, if those 

persons have made advance alternative 

arrangements with the Building 

Technologies Office. As necessary, 

requests to give an oral presentation 

should ask for such alternative 

arrangements. 

C. Conduct of the Webinar 

DOE will designate a DOE official to 

preside at the webinar and may also use 

a professional facilitator to aid 

discussion. The meeting will not be a 

judicial or evidentiary-type public 

hearing, but DOE will conduct it in 

accordance with section 336 of EPCA 

(42 U.S.C. 6306). A court reporter will 

be present to record the proceedings and 

prepare a transcript. DOE reserves the 

right to schedule the order of 

presentations and to establish the 

procedures governing the conduct of the 

webinar. There shall not be discussion 

of proprietary information, costs or 

prices, market share, or other 

commercial matters regulated by U.S. 

anti-trust laws. After the webinar and 

until the end of the comment period, 

interested parties may submit further 

comments on the proceedings and any 

aspect of the rulemaking. 

The webinar will be conducted in an 

informal, conference style. DOE will 

present summaries of comments 

received before the webinar, allow time 

for prepared general statements by 

participants, and encourage all 

interested parties to share their views on 

issues affecting this rulemaking. Each 

participant will be allowed to make a 

general statement (within time limits 

determined by DOE), before the 

discussion of specific topics. DOE will 

permit, as time permits, other 

participants to comment briefly on any 

general statements. 

At the end of all prepared statements 

on a topic, DOE will permit participants 

to clarify their statements briefly. 

Participants should be prepared to 

answer questions by DOE and by other 

participants concerning these issues. 

DOE representatives may also ask 

questions of participants concerning 

other matters relevant to this 

rulemaking. The official conducting the 

webinar will accept additional 

comments or questions from those 

attending, as time permits. The 

presiding official will announce any 

further procedural rules or modification 

of the above procedures that may be 


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needed for the proper conduct of the 

webinar. 

A transcript of the webinar will be 

included in the docket, which can be 

viewed as described in the Docket 

section at the beginning of this SNOPR. 

In addition, any person may buy a copy 

of the transcript from the transcribing 

reporter. 

D. Submission of Comments 

DOE will accept comments, data, and 

information regarding this proposed 

rule no later than the date provided in 

the DATES section at the beginning of 

this proposed rule. Interested parties 

may submit comments, data, and other 

information using any of the methods 

described in the ADDRESSES section at 

the beginning of this document. 

Submitting comments via https://

www.regulations.gov. The https://

www.regulations.gov web page will 

require you to provide your name and 

contact information. Your contact 

information will be viewable to DOE 

Building Technologies staff only. Your 

contact information will not be publicly 

viewable except for your first and last 

names, organization name (if any), and 

submitter representative name (if any). 

If your comment is not processed 

properly because of technical 

difficulties, DOE will use this 

information to contact you. If DOE 

cannot read your comment due to 

technical difficulties and cannot contact 

you for clarification, DOE may not be 

able to consider your comment. 

However, your contact information 

will be publicly viewable if you include 

it in the comment itself or in any 

documents attached to your comment. 

Any information that you do not want 

to be publicly viewable should not be 

included in your comment, nor in any 

document attached to your comment. 

Otherwise, persons viewing comments 

will see only first and last names, 

organization names, correspondence 

containing comments, and any 

documents submitted with the 

comments. 

Do not submit to https://

www.regulations.gov information for 

which disclosure is restricted by statute, 

such as trade secrets and commercial or 

financial information (hereinafter 

referred to as Confidential Business 

Information (CBI)). Comments 

submitted through https://

www.regulations.gov cannot be claimed 

as CBI. Comments received through the 

website will waive any CBI claims for 

the information submitted. For 

information on submitting CBI, see the 

Confidential Business Information 

section. 

DOE processes submissions made 

through https://www.regulations.gov 

before posting. Normally, comments 

will be posted within a few days of 

being submitted. However, if large 

volumes of comments are being 

processed simultaneously, your 

comment may not be viewable for up to 

several weeks. Please keep the comment 

tracking number that https://

www.regulations.gov provides after you 

have successfully uploaded your 

comment. 

Submitting comments via email. 

Comments and documents submitted 

via email also will be posted to https:// 

www.regulations.gov. If you do not want 

your personal contact information to be 

publicly viewable, do not include it in 

your comment or any accompanying 

documents. Instead, provide your 

contact information in a cover letter. 

Include your first and last names, email 

address, telephone number, and 

optional mailing address. The cover 

letter will not be publicly viewable as 

long as it does not include any 

comments. 

Include contact information each time 

you submit comments, data, documents, 

and other information to DOE. No 

telefacsimiles (faxes) will be accepted. 

Comments, data, and other 

information submitted to DOE 

electronically should be provided in 

PDF (preferred), Microsoft Word or 

Excel, WordPerfect, or text (ASCII) file 

format. Provide documents that are not 

secured, that are written in English, and 

that are free of any defects or viruses. 

Documents should not contain special 

characters or any form of encryption 

and, if possible, they should carry the 

electronic signature of the author. 

Campaign form letters. Please submit 

campaign form letters by the originating 

organization in batches of between 50 to 

500 form letters per PDF or as one form 

letter with a list of supporters’ names 

compiled into one or more PDFs. This 

reduces comment processing and 

posting time. 

Confidential Business Information. 

Pursuant to 10 CFR 1004.11, any person 

submitting information that he or she 

believes to be confidential and exempt 

by law from public disclosure should 

submit via email two well-marked 

copies: One copy of the document 

marked ‘‘confidential’’ including all the 

information believed to be confidential, 

and one copy of the document marked 

‘‘non-confidential’’ with the information 

believed to be confidential deleted. DOE 

will make its own determination about 

the confidential status of the 

information and treat it according to its 

determination. 

It is DOE’s policy that all comments 

may be included in the public docket, 

without change and as received, 

including any personal information 

provided in the comments (except 

information deemed to be exempt from 

public disclosure). 

E. Issues on Which DOE Requests 

Comment 

Although DOE welcomes comments 

on any aspect of this proposal, DOE is 

particularly interested in receiving 

comments and views of interested 

parties concerning the following issues: 

1. DOE invites comment on whether 

(1) the manufacturer’s retail list price 

threshold for Tier 1 under the tiered 

proposal is appropriate, (2) the untiered 

proposal in this SNOPR is cost-effective, 

generally, and (3) the untiered proposal 

is cost-effective for low-income 

consumers. 

2. DOE welcomes comment on 

approaches for testing, compliance and 

enforcement provisions for the proposed 

standards and alternative proposal. DOE 

also welcomes comments and 

information related to potential testing, 

compliance and enforcement under the 

current HUD inspection and 

enforcement process, and potential costs 

of testing, compliance and enforcement 

of the proposed standards and 

alternative proposal in this document. 

3. DOE requests comment on the use 

of a tiered approach to address 

affordability and PBP concerns from 

HUD, other stakeholders, and the 

policies outlined in Executive Order 

13985. DOE also requests comment 

regarding whether the price point 

boundary between the proposed tiers is 

appropriate, and if not, at what price 

point should it be set and the basis for 

any alternative price points. DOE also 

requests comment on its assumptions 

regarding the use of high-priced loans 

(e.g., chattel loans) by low-income 

purchasers, or other purchasers, of 

manufactured housing. 

4. DOE also requests comment on 

alternate thresholds (besides price 

point) to consider for the tiered 

approach, including a size-based 

threshold (e.g., square footage or 

whether a home is single- or multisection). DOE requests comment on the 

square footage and region versus sales 

price data provided in the notice (from 

MHS PUF 2019) and how that data (or 

more recent versions of that data) could 

be used to create either a size-based or 

region-based threshold instead. DOE 

further requests input on whether there 

should be single national threshold as 

proposed, or whether it should vary 

based on geography or other factors, and 

if so, what factors should be considered. 


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5. DOE requests comment on using 

the AEO GDP deflator series to adjust 

the manufacturer’s retail list price 

threshold for inflation. DOE requests 

comment on whether other time series, 

including those that account for regional 

variability, should be used to adjust 

manufacturer’s retail list price. 

6. DOE requests comment on whether 

a one-year lead time would be sufficient 

given potential constraints that 

compliance with the DOE standards 

may initially place on the HUD 

certification process, and whether a 

longer lead time (e.g., a three-year lead 

time) or some other alternative leadtime for this first set of standards (e.g., 

phased-in over three years, with oneyear lead-times thereafter) should be 

provided. 

7. DOE requests comment on its 

understanding of the definitional 

changes in the 2018 IECC and the 2021 

IECC. DOE also requests comments on 

its changes to the proposed definitions 

as compared to those proposed in the 

June 2016 NOPR. 

8. DOE requests comment on 

incorporating by reference ACCA 

Manual J, ACCA Manual S, and 

‘‘Overall U-Values and Heating/Cooling 

Loads—Manufactured Homes’’ by 

Conner and Taylor. 

9. DOE requests comment on basing 

the climate zones on the three HUD 

zones instead of the June 2016 NOPRproposed four climate zones, or other 

configuration of climate zones. DOE 

further requests input on whether 

energy efficiency requirements should 

be based on smaller geographic areas 

than provided with the 3 or 4 zone 

model. 

10. DOE requests comment on the 

Tier 1 energy conservation standards, 

which would be applicable to 

manufactured homes with a 

manufacturer’s retail list price of 

$55,000 or less. DOE also requests 

comment on the proposed energy 

conservation standards based on the 

most recent version of the IECC for the 

Tier 2 and untiered standards and the 

consideration of R–21 sensitivity for 

exterior wall insulation for climate 

zones 2 and 3. 

11. DOE requests comment on the 

additional energy efficiency 

requirements from the 2021 IECC and 

whether they should apply to 

manufactured homes, including those 

that DOE has initially considered as not 

applicable to manufactured homes. If so, 

DOE requests comment on how these 

requirements would apply and the costs 

and savings associated with these 

requirements. 

12. DOE requests comment on the 

proposal to not require that exterior 

ceiling insulation must have uniform 

thickness or a uniform density. 

13. DOE requests comment on the 

proposal not to limit the total area of 

glazed fenestration. 

14. DOE requests comment on 

removing the proposed requirement that 

exterior floor insulation installed must 

maintain permanent contact with the 

underside of the rough floor decking. 

15. DOE requests comment on the 

proposed updates to the installation of 

insulation criteria as it applies to 

manufactured homes construction only. 

16. DOE requests comments on 

whether there are any of the 2021 IECC 

updates relevant to manufactured 

housing that should be considered as 

part of this rulemaking. Specifically, 

DOE requests comment on whether the 

2021 IECC updates for installation 

criteria for access hatches and doors, 

baffles and shafts are applicable to 

manufactured housing and should be 

considered in this rulemaking. 

17. DOE requests comment on the 

proposed updates to the air barrier 

criteria as it applies to manufactured 

homes construction only. Further, DOE 

requests comment whether the SNOPR 

proposal continues to be designed to 

achieve air leakage sealing requirements 

of 5 ACH. 

18. DOE requests comments on 

whether there are any of the 2021 IECC 

updates relevant to manufactured 

housing that should be considered as 

part of this rulemaking. Specifically, 

DOE requests comment on whether the 

2021 IECC updates for air barrier criteria 

for recessed lighting, narrow cavities 

and plumbing are applicable to 

manufactured housing and should be 

considered in this rulemaking. If so, 

DOE requests comment on whether the 

requirements would alter the 5 ACH 

designation. 

19. DOE requests comment on the 

proposal to require that total air leakage 

of duct systems for all manufactured 

homes is to be less than or equal to 4 

cfm per 100 square feet of conditioned 

floor area. 

20. DOE requests comment on DOE’s 

interpretation of R403.1 and the 

proposed updates to the thermostat and 

controls requirements. In addition, DOE 

requests comments on whether there are 

any of the 2021 IECC updates relevant 

to manufactured housing that should be 

considered as part of this rulemaking. 

21. DOE requests comment on DOE’s 

interpretation of R403.5 and the 

proposed updates to the service hot 

water requirements. In addition, DOE 

requests comments on whether there are 

any of the 2021 IECC updates relevant 

to manufactured housing that should be 

considered as part of this rulemaking. 

Specifically, DOE requests comment on 

whether the circulating hot water 

system temperature limit should be 

included as a requirement. 

22. DOE requests comment on the 

proposal to include the 2021 IECC fan 

efficacy standard requirements. DOE 

requests comment on whether any of the 

fan efficacy requirements are not 

applicable to manufactured homes. 

23. DOE requests comment on 

whether the HRV and ERV provisions 

under 2021 IECC for site-built homes are 

applicable to manufactured homes and 

whether they would be cost-effective. 

Specifically, DOE requests comment on 

costs for the HRV and ERV requirements 

as it applies to manufactured homes in 

all climate zones. 

24. DOE requests comment on the 

above ventilation strategies, including 

(but not limited to) cost, performance, 

noise, and any other important 

attributes that DOE should consider, 

including those related to mitigation 

measures. While the alternate 

ventilation approaches are not 

integrated into the analysis presented as 

part of this proposal, DOE is giving 

serious consideration as to whether it 

should incorporate one or more of these 

options as part of its final rule based on 

any additional data and public 

comments it receives. 

25. DOE requests comment on the 

cost-effectiveness and feasibility of 

requiring R–20+5 for the exterior wall 

insulation for climate zone 2 and 3 Tier 

2/Untiered manufactured homes. DOE 

also requests comment on the sensitivity 

analysis for R–21 that would result in 

positive LCC savings for all cities. 

26. DOE requests comment on the 

inputs to the conversion cost estimates. 

27. DOE requests comment on the 

shipment breakdown per tier and using 

a substitution effect of 20 percent on 

shipments to account for the shift in 

homes sold to the lower tiered standard. 

DOE requests comment on whether it 

should use a different substitution effect 

value for this analysis—and if so, why. 

(Please provide data in support of an 

alternative substitution effect value.) 

28. DOE requests comment on the 

calculation of deadweight loss 

presented above and the extent to which 

there are market failures in the nostandards case. 

29. DOE requests comment on the 

number of manufacturers of 

manufactured housing producing home 

covered by this rulemaking. 

30. DOE requests comment on the cost 

to update model plans and the number 

of model plans to update as a result of 

the proposed rule; on the types of 

equipment and capital expenditures that 

would be necessitated by the proposal; 


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and the total cost of updating product 

offerings and manufacturing facilities. 

DOE requests comment on how these 

values would differ for small 

manufacturers. DOE requests comment 

on its estimate of average annual 

revenues for small manufacturers of 

manufactured housing. 

VII. Approval of the Office of the 

Secretary 

The Secretary of Energy has approved 

publication of this notice of proposed 

rulemaking. 

List of Subjects in 10 CFR Part 460 

Administrative practice and 

procedure, Buildings and facilities, 

Energy conservation, Housing 

standards, Incorporation by reference, 

Reporting and recordkeeping 

requirements. 

Signing Authority 

This document of the Department of 

Energy was signed on August 12, 2021, 

by Kelly Speakes-Backman, Principal 

Deputy Assistant Secretary and Acting 

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 August 13, 

2021. 

Treena V. Garrett, 

Federal Register Liaison Officer, U.S. 

Department of Energy. 

For the reasons stated in the 

preamble, DOE proposes to add part 460 

of chapter II of title 10, Code of Federal 

Regulations as set forth below: 

PART 460—ENERGY CONSERVATION 

STANDARDS FOR MANUFACTURED 

HOMES 

Subpart A—General 

Sec. 

460.1 Scope. 

460.2 Definitions. 

460.3 Materials incorporated by reference. 

460.4 Energy conservation standards. 

Subpart B—Building Thermal Envelope 

460.101 Climate zones. 

460.102 Building thermal envelope 

requirements. 

460.103 Installation of insulation. 

460.104 Building thermal envelope air 

leakage. 

Subpart C—HVAC, Service Hot Water, and 

Equipment Sizing 

460.201 Duct systems. 

460.202 Thermostats and controls. 

460.203 Service hot water. 

460.204 Mechanical ventilation fan 

efficacy. 

460.205 Equipment sizing. 

Authority: 42 U.S.C. 17071; 42 U.S.C. 7101 

et seq. 

Subpart A—General 

§ 460.1 Scope. 

This subpart establishes energy 

conservation standards for 

manufactured homes as manufactured at 

the factory, prior to distribution in 

commerce for sale or installation in the 

field. A manufactured home that is 

manufactured on or after (date 1 year 

after the publication date of the final 

rule amending standards for 

manufactured homes) must comply with 

all applicable requirements of this part. 

§ 460.2 Definitions. 

Adapted from Section R202 of the 

2021 IECC and as used in this part— 

Access (to) means that which enables 

a device, appliance or equipment to be 

reached by ready access or by a means 

that first requires the removal or 

movement of a panel or similar 

obstruction. 

Air barrier means one or more 

materials joined together in a 

continuous manner to restrict or prevent 

the passage of air through the building 

thermal envelope and its assemblies. 

Automatic means self-acting or 

operating by its own mechanism when 

actuated by some impersonal influence. 

Building thermal envelope means 

exterior walls, exterior floors, exterior 

ceiling, or roofs, and any other building 

element assemblies that enclose 

conditioned space or provide a 

boundary between conditioned space 

and unconditioned space. 

Ceiling means an assembly that 

supports and forms the overhead 

interior surface of a building or room 

that covers its upper limit and is 

horizontal or tilted at an angle less than 

60 degrees (1.05 rad) from horizontal. 

Climate zone means a geographical 

region identified in § 460.101. 

Conditioned space means an area, 

room, or space that is enclosed within 

the building thermal envelope and that 

is directly or indirectly heated or 

cooled. Spaces are indirectly heated or 

cooled where they communicate 

through openings with conditioned 

space, where they are separated from 

conditioned spaces by uninsulated 

walls, floors or ceilings, or where they 

contain uninsulated ducts, piping, or 

other sources of heating or cooling. 

Continuous air barrier means a 

combination of materials and assemblies 

that restrict or prevent the passage of air 

from conditioned space to 

unconditioned space. 

Door means an operable barrier used 

to block or allow access to an entrance 

of a manufactured home. 

Dropped ceiling means a secondary 

nonstructural ceiling, hung below the 

exterior ceiling. 

Dropped soffit means a secondary 

nonstructural ceiling that is hung below 

the exterior ceiling and that covers only 

a portion of the ceiling. 

Duct means a tube or conduit, except 

an air passage within a self-contained 

system, utilized for conveying air to or 

from heating, cooling, or ventilating 

equipment. 

Duct system means a continuous 

passageway for the transmission of air 

that, in addition to ducts, includes duct 

fittings, dampers, plenums, fans, and 

accessory air-handling equipment and 

appliances. 

Eave means the edge of the roof that 

overhangs the face of an exterior wall 

and normally projects beyond the side 

of the manufactured home. 

Equipment includes material, devices, 

fixtures, fittings, or accessories both in 

the construction of, and in the 

plumbing, heating, cooling, and 

electrical systems of a manufactured 

home. 

Exterior ceiling means a ceiling that 

separates conditioned space from 

unconditioned space. 

Exterior floor means a floor that 

separates conditioned space from 

unconditioned space. 

Exterior wall means a wall, including 

a skylight well, that separates 

conditioned space from unconditioned 

space. 

Fenestration means vertical 

fenestration and skylights. 

Floor means a horizontal assembly 

that supports and forms the lower 

interior surface of a building or room 

upon which occupants can walk. 

Glazed or glazing means an infill 

material, including glass, plastic, or 

other transparent or translucent material 

used in fenestration. 

Heated water circulation system 

means a water distribution system in 

which one or more pumps are operated 

in the service hot water piping to 

circulate heated water from the water 

heating equipment to fixtures and back 

to the water heating equipment. 

2021 IECC means the 2021 version of 

the International Energy Conservation 


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Code, issued by the International Code 

Council. 

Insulation means material deemed to 

be insulation under 16 CFR 460.2. 

Manufactured home means a 

structure, transportable in one or more 

sections, which in the traveling mode is 

8 body feet or more in width or 40 body 

feet or more in length or which when 

erected onsite is 320 or more square 

feet, and which is built on a permanent 

chassis and designed to be used as a 

dwelling with or without a permanent 

foundation when connected to the 

required utilities, and includes the 

plumbing, heating, air conditioning, and 

electrical systems contained in the 

structure. This term includes all 

structures that meet the above 

requirements except the size 

requirements and with respect to which 

the manufacturer voluntarily files a 

certification pursuant to 24 CFR 3282.13 

and complies with the construction and 

safety standards set forth in 24 CFR part 

3280. The term does not include any 

self-propelled recreational vehicle. 

Calculations used to determine the 

number of square feet in a structure will 

be based on the structure’s exterior 

dimensions, measured at the largest 

horizontal projections when erected on 

site. These dimensions will include all 

expandable rooms, cabinets, and other 

projections containing interior space, 

but do not include bay windows. 

Nothing in this definition should be 

interpreted to mean that a manufactured 

home necessarily meets the 

requirements of the U.S. Department of 

Housing and Urban Development 

Minimum Property Standards (HUD 

Handbook 4900.1) or that it is 

automatically eligible for financing 

under 12 U.S.C. 1709(b). 

Manufacturer means any person 

engaged in the factory construction or 

assembly of a manufactured home, 

including any person engaged in 

importing manufactured homes for 

resale. 

Manual means capable of being 

operated by personal intervention. 

Opaque door means a door that is not 

less than 50 percent opaque in surface 

area. 

R-value (thermal resistance) means 

the inverse of the time rate of heat flow 

through a body from one of its bounding 

surfaces to the other surface for a unit 

temperature difference between the two 

surfaces, under steady state conditions, 

per unit area (h × ft2 × °F/Btu). 

Rough opening means an opening in 

the exterior wall or roof, sized for 

installation of fenestration. 

Service hot water means supply of hot 

water for purposes other than comfort 

heating. 

Skylight means glass or other 

transparent or translucent glazing 

material, including framing materials, 

installed at an angle less than 60 degrees 

(1.05 rad) from horizontal, including 

unit skylights, tubular daylighting 

devices, and glazing materials in 

solariums, sunrooms, roofs and sloped 

walls. 

Skylight well means the exterior walls 

underneath a skylight that extend from 

the interior finished surface of the 

exterior ceiling to the exterior surface of 

the location to which the skylight is 

attached. 

Solar heat gain coefficient (SHGC) 

means the ratio of the solar heat gain 

entering a space through a fenestration 

assembly to the incident solar radiation. 

Solar heat gain includes directly 

transmitted solar heat and absorbed 

solar radiation that is then reradiated, 

conducted, or convected into the space. 

State means each of the 50 states, the 

District of Columbia, the 

Commonwealth of Puerto Rico, Guam, 

the U.S. Virgin Islands, and American 

Samoa. 

Thermostat means an automatic 

control device used to maintain 

temperature at a fixed or adjustable set 

point. 

U-factor (thermal transmittance) 

means the coefficient of heat 

transmission (air to air) through a 

building component or assembly, equal 

to the time rate of heat flow per unit 

area and unit temperature difference 

between the warm side and cold side air 

films (Btu/h × ft2 × °F). 

Uo (overall thermal transmittance) 

means the coefficient of heat 

transmission (air to air) through the 

building thermal envelope, equal to the 

time rate of heat flow per unit area and 

unit temperature difference between the 

warm side and cold side air films (Btu/ 

h × ft2 × °F). 

Ventilation means the natural or 

mechanical process of supplying 

conditioned or unconditioned air to, or 

removing such air from, any space. 

Vertical fenestration means windows 

(fixed or moveable), opaque doors, 

glazed doors, glazed block and 

combination opaque and glazed doors 

composed of glass or other transparent 

or translucent glazing materials and 

installed at a slope of greater than or 

equal to 60 degrees (1.05 rad) from 

horizontal. 

Wall means an assembly that is 

vertical or tilted at an angle equal to 

greater than 60 degrees (1.05 rad) from 

horizontal that encloses or divides an 

area of a building or room. 

Whole-house mechanical ventilation 

system means an exhaust system, 

supply system, or combination thereof 

that is designed to mechanically 

exchange indoor air with outdoor air 

when operating continuously or through 

a programmed intermittent schedule. 

Window means glass or other 

transparent or translucent glazing 

material, including framing materials, 

installed at an angle greater than 60 

degrees (1.05 rad) from horizontal. 

Zone means a space or group of 

spaces within a manufactured home 

with heating or cooling requirements 

that are sufficiently similar so that 

desired conditions can be maintained 

using a single controlling device. 

§ 460.3 Materials incorporated by 

reference. 

Certain material is incorporated by 

reference into this subpart with the 

approval of the Director of the Federal 

Register in accordance with 5 U.S.C. 

552(a) and 1 CFR part 51. To enforce 

any edition other than that specified in 

this section, DOE must publish a 

document in the Federal Register and 

the material must be available to the 

public. All approved material is 

available for inspection at the U.S. 

Department of Energy, Office of Energy 

Efficiency and Renewable Energy, 

Building Technologies Program, Sixth 

Floor, 950 L’Enfant Plaza SW, 

Washington, DC 20024, (202) 586–2945, 

https://www.energy.gov/eere/buildings/ 

appliance-and-equipment-standardsprogram, and may be obtained from the 

other sources in this section. It is also 

available for inspection at the National 

Archives and Records Administration 

(NARA). For information on the 

availability of this material at NARA, 

email: fr.inspection@nara.gov, or go to: 

www.archives.gov/federal-register/cfr/ 

ibr-locations.html. 

(a) ACCA. Air Conditioning 

Contractors of America, Inc., 2800 S. 

Shirlington Road, Suite 300, Arlington, 

VA 22206, 703–575–4477, 

www.acca.org/. 

(1) ANSI/ACCA 2 Manual J–2016 

(‘‘ACCA Manual J’’), Manual J– 

Residential Load Calculation (8th 

edition), Copyright 2016. IBR approved 

for § 460.205. 

(2) ANSI/ACCA 3 Manual S–2014 

(‘‘ACCA Manual S’’), Manual S– 

Residential Equipment Selection (2nd 

Edition), Copyright 2014. IBR approved 

for § 460.205. 

(b) PNL. Pacific Northwest Laboratory, 

Richland, WA 99352, 800–245–2691, 

www.huduser.org/portal/publications/ 

manufhsg/uvalue.html. 

(1) PNL–8006, (‘‘Overall U-values and 

Heating/Cooling Loads—Manufactured 

Homes’’), Overall U-Values and 

Heating/Cooling Loads—Manufactured 

Homes, C.C. Conner and Z.T. Taylor, 


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47834 Federal Register / Vol. 86, No. 163 / Thursday, August 26, 2021 / Proposed Rules 

February 1, 1992. IBR approved for 

§ 460.102(d)(1). 

(2) [Reserved]. 

§ 460.4 Energy conservation standards. 

(a) General. Energy conservation 

standard tier thresholds presented in 

paragraphs (b) and (c) of this section 

must be adjusted to the most recently 

available Annual Energy Outlook (AEO) 

gross domestic product (GDP) time 

series. 

(b) Tier 1. A manufactured home for 

which the manufacturer’s retail list 

price is $55,000 or less in real 2019$ 

(i.e., a Tier 1 manufactured home) must 

comply with all applicable requirements 

in subparts B and C of this part. 

(c) Tier 2. A manufactured home for 

which the manufacturer retail list price 

is greater than $55,000 in real 2019$ 

(i.e., a Tier 2 manufactured home) must 

comply with all applicable requirements 

in subparts B and C of this part. 

Subpart B—Building Thermal Envelope 

§ 460.101 Climate zones. 

Manufactured homes subject to the 

requirements of this subpart must 

comply with the requirements 

applicable to one or more of the climate 

zones set forth in Figure 460.101 and 

Table 460.101 of this section. 

TABLE 460.101—U.S. STATES AND TERRITORIES PER CLIMATE ZONE

Zone 1 Zone 2 Zone 3 

Alabama Arkansas Alaska 

American Samoa Arizona Colorado 

Florida California Connecticut 

Georgia Kansas Delaware 

Guam Kentucky District of Columbia 

Hawaii Missouri Idaho 

Louisiana New Mexico Illinois 

Mississippi North Carolina Indiana 

South Carolina Oklahoma Iowa 

Texas Tennessee Maine 

The Commonwealth of Maryland 

Puerto Rico Massachusetts 

U.S. Virgin Islands Michigan 

Minnesota 

Montana 

Nebraska 

Nevada 

New Hampshire 

New Jersey 

New York 

North Dakota 

Ohio 

Oregon 

Pennsylvania 

Rhode Island 

South Dakota 

Utah 

Vermont 

Virginia 

Washington 

West Virginia 


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Figure 460.101 Climate Zones 
Federal Register / Vol. 86, No. 163 / Thursday, August 26, 2021 / Proposed Rules 47835 

TABLE 460.101—U.S. STATES AND TERRITORIES PER CLIMATE ZONE—Continued 

Zone 1 Zone 2 Zone 3 

Wisconsin 

Wyoming 

§ 460.102 Building thermal envelope 

requirements. 

(a) Compliance options. The building 

thermal envelope must meet either the 

prescriptive requirements of paragraph 

(b) of this section or the performance 

requirements of paragraph (c) of this 

section. 

(b) Prescriptive requirements. (1) The 

building thermal envelope must meet 

the applicable minimum R-value, and 

the maximum U-factor and SHGC, 

requirements set forth in Tables 

460.102–1 and 460.102–2 of this 

section. 

TABLE 460.102–1—TIER 1 BUILDING THERMAL ENVELOPE PRESCRIPTIVE REQUIREMENTS

Climate zone 

Exterior wall 

insulation 

R-value 

Exterior ceiling 

insulation 

R-value 

Exterior floor 

insulation 

R-value 

Window 

U-factor 

Skylight 

U-factor DoorU-factor 

Glazed 

fenestration 

SHGC 

1 ................................... 13 22 22 1.08 0.75 0.40 0.7 

2 ................................... 13 22 19 0.5 0.55 0.40 0.6 

3 ................................... 19 22 22 0.35 0.55 0.40 Not applicable. 

TABLE 460.102–2—TIER 2 BUILDING THERMAL ENVELOPE PRESCRIPTIVE REQUIREMENTS

Climate zone 

Exterior wall 

insulation 

R-value 

Exterior ceiling 

insulation 

R-value 

Exterior floor 

insulation 

R-value 

Window 

U-factor 

Skylight 

U-factor Door U-factor 

Glazed 

fenestration 

SHGC 

1 ................................... 13 30 13 0.32 0.75 0.40 0.33 

2 ................................... 20+5 30 19 0.30 0.55 0.40 0.25 

3 ................................... 20+5 38 30 0.30 0.55 0.40 Not applicable. 

(2) For the purpose of compliance 

with the exterior ceiling insulation Rvalue requirement of paragraph (b)(1) of 

this section, the truss heel height must 

be a minimum of 5.5 inches at the 

outside face of each exterior wall. 

(3) A combination of R-21 batt 

insulation and R-14 blanket insulation 

may be used for the purpose of 

compliance with the floor insulation Rvalue requirement of Table 460.102–2, 

climate zone 3. 

(4) An individual skylight that has an 

SHGC that is less than or equal to 0.30 

is not subject to the glazed fenestration 

SHGC requirements established in 

paragraph (b)(1) of this section. Adapted 

from section R402 of the 2021 IECC. 

(5) U-factor alternatives to R-value 

requirements. Compliance with the 

applicable requirements in paragraph 

(b)(1) of this section may be determined 

using the maximum U-factor values set 

forth in Tables 460.102–3 and 460.102– 

4, which reflect the thermal 

transmittance of the component, 

excluding fenestration, and not just the 

insulation of that component, as an 

alternative to the minimum R-value 

requirements set forth in Tables 

460.102–1 and 460.102–2, respectively. 

TABLE 460.102–3—U-FACTOR ALTERNATIVES TO TIER 1 R-VALUE REQUIREMENTS

Climate zone 

Exterior ceiling U-factor Exterior wall 

U-factor 

Exterior floor 

U-factor Single-section Multi-section 

1 ....................................................................................................................... 0.061 0.057 0.094 0.049 

2 ....................................................................................................................... 0.061 0.057 0.094 0.056 

3 ....................................................................................................................... 0.061 0.057 0.068 0.049 

TABLE 460.102–4—U-FACTOR ALTERNATIVES TO TIER 2 R-VALUE REQUIREMENTS

Climate zone 

Exterior ceiling U-factor Exterior wall 

U-factor 

Exterior floor 

U-factor Single-section Multi-section 

1 ....................................................................................................................... 0.045 0.043 0.094 0.078 

2 ....................................................................................................................... 0.045 0.043 0.047 0.056 

3 ....................................................................................................................... 0.038 0.037 0.047 0.032 


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(c) Performance requirements. (1) The 

building thermal envelope must have a 

Uo that is less than or equal to the 

applicable value specified in Tables 

460.102–5 and 460.102–6 of this 

section. 

TABLE 460.102–5—TIER 1 BUILDING

THERMAL ENVELOPE PERFORMANCE

REQUIREMENTS

Climate 

zone 

Single-section 

Uo

Multi-section 

Uo

1 ................ 0.110 0.109 

2 ................ 0.091 0.087 

3 ................ 0.074 0.072 

TABLE 460.102–6—TIER 2 BUILDING

THERMAL ENVELOPE PERFORMANCE

REQUIREMENTS

Climate 

zone 

Single-section 

Uo

Multi-section 

Uo

1 ................ 0.086 0.082 

2 ................ 0.062 0.063 

3 ................ 0.053 0.052 

(2) Area-weighted average vertical 

fenestration U-factor must not exceed 

0.48 in climate zone 2 or 0.40 in climate 

zone 3. Adapted from section R402 of 

the 2021 IECC. 

(3) Area-weighted average skylight Ufactor must not exceed 0.75 in climate 

zone 2 and climate zone 3. Adapted 

from section R402 of the 2021 IECC. 

(4) Windows, skylights and doors 

containing more than 50 percent glazing 

by area must satisfy the SHGC 

requirements established in paragraph 

(b)(1) of this section on the basis of an 

area-weighted average. Adapted from 

section R402 of the 2021 IECC. 

(d) Determination of compliance with 

paragraph (c) of this section. (1) Uo must 

be determined in accordance with 

Overall U-Values and Heating/Cooling 

Loads—Manufactured Homes 

(incorporated by reference; see § 460.3) 

(2) [Reserved] 

§ 460.103 Installation of insulation. 

Insulating materials must be installed 

according to the insulation 

manufacturer’s installation instructions 

and the requirements set forth in Table 

460.103 of this section, which is 

adapted from section R402 of the 2021 

IECC. 

TABLE 460.103—INSTALLATION OF INSULATION

Component Installation requirements 

General ............................................................... Air-permeable insulation must not be used as a material to establish the air barrier. 

Access hatches, panels, and doors ................... Access hatches, panels, and doors between conditioned space and unconditioned space must 

be insulated to a level equivalent to the insulation of the surrounding surface, must provide 

access to all equipment that prevents damaging or compressing the insulation, and must 

provide a wood-framed or equivalent baffle or retainer when loose fill insulation is installed 

within an exterior ceiling assembly to retain the insulation both on the access hatch, panel, 

or door and within the building thermal envelope. 

Baffles ................................................................. Baffles must be constructed using a solid material, maintain an opening equal or greater than 

the size of the vents, and extend over the top of the attic insulation. 

Ceiling or attic ..................................................... The insulation in any dropped ceiling or dropped soffit must be aligned with the air barrier. 

Eave vents .......................................................... Air-permeable insulations in vented attics within the building thermal envelope must be installed adjacent to eave vents. 

Narrow cavities ................................................... Batts to be installed in narrow cavities must be cut to fit or narrow cavities must be filled with 

insulation that upon installation readily conforms to the available cavity space. 

Rim joists ............................................................ Rim joists must be insulated such that the insulation maintain permanent contact with the exterior rim board. 

Shower or tub adjacent to exterior wall .............. Exterior walls adjacent to showers and tubs must be insulated. 

Walls ................................................................... Air permeable exterior building thermal envelope insulation for framed exterior walls must completely fill the cavity, including within stud bays caused by blocking lay flats or headers. 

§ 460.104 Building thermal envelope air 

leakage. 

Manufactured homes must be sealed 

against air leakage at all joints, seams, 

and penetrations associated with the 

building thermal envelope in 

accordance with the component 

manufacturer’s installation instructions 

and the requirements set forth in Table 

460.104 of this section. Sealing methods 

between dissimilar materials must allow 

for differential expansion, contraction 

and mechanical vibration, and must 

establish a continuous air barrier upon 

installation of all opaque components of 

the building thermal envelope. All gaps 

and penetrations in the exterior ceiling, 

exterior floor, and exterior walls, 

including ducts, flue shafts, plumbing, 

piping, electrical wiring, utility 

penetrations, bathroom and kitchen 

exhaust fans, recessed lighting fixtures 

adjacent to unconditioned space, and 

light tubes adjacent to unconditioned 

space, must be sealed with caulk, foam, 

gasket or other suitable material. The air 

barrier installation criteria is adapted 

from section R402 of the 2021 IECC. 

TABLE 460.104—AIR BARRIER INSTALLATION CRITERIA

Component Air barrier criteria 

Ceiling or attic ..................................................... The air barrier in any dropped ceiling or dropped soffit must be aligned with the insulation and 

any gaps in the air barrier must be sealed with caulk, foam, gasket, or other suitable material. Access hatches, panels, and doors, drop-down stairs, or knee wall doors to 

unconditioned attic spaces must be weather-stripped or equipped with a gasket to produce a 

continuous air barrier. 

Duct system register boots ................................. Duct system register boots that penetrate the building thermal envelope or the air barrier must 

be sealed to the subfloor, wall covering or ceiling penetrated by the boot, air barrier, or the 

interior finish materials with caulk, foam, gasket, or other suitable material. 


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Federal Register / Vol. 86, No. 163 / Thursday, August 26, 2021 / Proposed Rules 47837 

TABLE 460.104—AIR BARRIER INSTALLATION CRITERIA—Continued 

Component Air barrier criteria 

Electrical box or phone box on exterior walls .... The air barrier must be installed behind electrical and communication boxes or the air barrier 

must be sealed around the box penetration with caulk, foam, gasket, or other suitable material. 

Floors .................................................................. The air barrier must be installed at any exposed edge of insulation. The bottom board may 

serve as the air barrier. 

Mating line surfaces ............................................ Mating line surfaces must be equipped with a continuous and durable gasket. 

Recessed lighting ............................................... Recessed light fixtures installed in the building thermal envelope must be sealed to the drywall 

with caulk, foam, gasket, or other suitable material. 

Rim joists ............................................................ The air barrier must enclose the rim joists. The junctions of the rim board to the sill plate and 

the rim board and the subfloor must be air sealed. 

Shower or tub adjacent to exterior wall .............. The air barrier must separate showers and tubs from exterior walls. 

Walls ................................................................... The junction of the top plate and the exterior ceiling, and the junction of the bottom plate and 

the exterior floor, along exterior walls must be sealed with caulk, foam, gasket, or other suitable material. 

Windows, skylights, and exterior doors .............. The rough openings around windows, exterior doors, and skylights must be sealed with caulk 

or foam. 

Subpart C—HVAC, Service Hot Water, 

and Equipment Sizing 

§ 460.201 Duct systems. 

Each manufactured home equipped 

with a duct system, which may include 

air handlers and filter boxes, must be 

sealed to limit total air leakage to less 

than or equal to four (4) cubic feet per 

minute per 100 square feet of 

conditioned floor area. Building framing 

cavities must not be used as ducts or 

plenums when directly connected to 

mechanical systems. The duct total air 

leakage requirements are adapted from 

section R403 of the 2021 IECC. 

§ 460.202 Thermostats and controls. 

(a) At least one thermostat must be 

provided for each separate heating and 

cooling system installed by the 

manufacturer. The thermostat and 

controls requirements are adapted from 

section R403 of the 2021 IECC. 

(b) Programmable thermostat. Any 

thermostat installed by the 

manufacturer that controls the heating 

or cooling system must— 

(1) Be capable of controlling the 

heating and cooling system on a daily 

schedule to maintain different 

temperature set points at different times 

of the day and different days of the 

week; 

(2) Include the capability to set back 

or temporarily operate the system to 

maintain zone temperatures down to 55 

°F (13 °C) or up to 85 °F (29 °C); and 

(3) Initially be programmed with a 

heating temperature set point no higher 

than 70 °F (21 °C) and a cooling 

temperature set point no lower than 78 

°F (26 °C). 

(c) Heat pumps with supplementary 

electric-resistance heat must be 

provided with controls that, except 

during defrost, prevent supplemental 

heat operation when the heat pump 

compressor can meet the heating load. 

§ 460.203 Service hot water. 

(a) Service hot water systems installed 

by the manufacturer must be installed 

according to the service hot water 

manufacturer’s installation instructions. 

Where service hot water systems are 

installed by the manufacturer, the 

manufacturer must ensure that any 

maintenance instructions received from 

the service hot water system 

manufacturer are provided with the 

manufactured home. The service hot 

water requirements are adapted from 

section R403 of the 2021 IECC. 

(b) Any automatic and manual 

controls, temperature sensors, pumps 

associated with service hot water 

systems must provide access. 

(c) Heated water circulation systems 

must— 

(1) Be provided with a circulation 

pump; 

(2) Ensure that the system return pipe 

is a dedicated return pipe or a cold 

water supply pipe; 

(3) Not include any gravity or 

thermosyphon circulation systems; 

(4) Ensure that controls for circulating 

heated water circulation pumps start the 

pump based on the identification of a 

demand for hot water within the 

occupancy; and 

(5) Ensure that the controls 

automatically turn off the pump when 

the water in the circulation loop is at 

the desired temperature and when there 

is no demand for hot water. 

(d) All hot water pipes— 

(1) Outside conditioned space must be 

insulated to a minimum R-value of R-3; 

and 

(2) From a service hot water system to 

a distribution manifold must be 

insulated to a minimum R-value of R-3. 

§ 460.204 Mechanical ventilation fan 

efficacy. 

(a) Whole-house mechanical 

ventilation system fans must meet the 

minimum efficacy requirements set 

forth in Table 460.204 of this section, 

except as provided in paragraph (b) of 

this section. The mechanical ventilation 

fan efficacy requirements are adapted 

from section R403 of the 2021 IECC. 

TABLE 460.204—MECHANICAL VENTILATION SYSTEM FAN EFFICACY

Fan type description 

Airflow rate 

minimum 

(cfm) 

Minimum 

efficacy 

(cfm/watt) 

Heat recovery ventilator or energy recovery ventilator ........................................................................................... Any 1.2 

In-line supply or exhaust fans ................................................................................................................................. Any 3.8 

Other exhaust fan .................................................................................................................................................... <90 2.8 

Other exhaust fan .................................................................................................................................................... ≥90 3.5 


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47838 Federal Register / Vol. 86, No. 163 / Thursday, August 26, 2021 / Proposed Rules 

(b) Mechanical ventilation fans that 

are integral to heating, ventilating, and 

air conditioning equipment, including 

furnace fans as defined in § 430.2 of this 

title, are not subject to the efficiency 

requirements in paragraph (a) of this 

section. 

§ 460.205 Equipment sizing. 

Sizing of heating and cooling 

equipment installed by the 

manufacturer must be determined in 

accordance with ACCA Manual S 

(incorporated by reference; see § 460.3) 

based on building loads calculated in 

accordance with ACCA Manual J 

(incorporated by reference; see § 460.3). 

The equipment sizing criteria are 

adapted from section R403 of the 2021 

IECC. 

[FR Doc. 2021–17684 Filed 8–25–21; 8:45 am] 

BILLING CODE 6450–01–P 


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