[Federal Register Volume 86, Number 104 (Wednesday, June 2, 2021)]
[Proposed Rules]
[Pages 29533-29541]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-11498]


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FEDERAL TRADE COMMISSION

16 CFR Part 305

[3084-AB15]


Energy Labeling Rule

AGENCY: Federal Trade Commission.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Federal Trade Commission (``FTC'' or ``Commission'') 
proposes updates to comparability ranges and sample labels for central 
air conditioners in the Energy Labeling Rule (``Rule'').

DATES: Comments must be received on or before August 2, 2021.

ADDRESSES: Interested parties may file a comment online or on paper, by 
following the instructions in the Comment Submissions part of the 
SUPPLEMENTARY INFORMATION section below. Write ``CAC Range Updates (16 
CFR part 305) (Matter No. R611004)'' on your comment, and file it 
online at https://www.regulations.gov, by following the instructions on 
the web-based form. If you prefer to file your comment on paper, mail 
it to: Federal Trade Commission, Office of the Secretary, Suite CC-5610 
(Annex J), 600 Pennsylvania Avenue NW, Washington, DC 20580; or deliver 
your comment to: Federal Trade Commission, Office of the Secretary, 
Constitution Center, 400 7th Street SW, 5th Floor, Suite 5610 (Annex 
J), Washington, DC 20024.

FOR FURTHER INFORMATION CONTACT: Hampton Newsome (202-326-2889), 
Attorney, Division of Enforcement, Bureau of Consumer Protection, 
Federal Trade Commission, 600 Pennsylvania Avenue NW, Washington, DC 
20580.

SUPPLEMENTARY INFORMATION:

I. Energy Labeling Rule

    The Commission issued the Energy Labeling Rule (``Rule'') in 
1979,\1\ pursuant to the Energy Policy and Conservation Act of 1975 
(``EPCA'').\2\ The Rule requires energy labeling for major home 
appliances and other consumer products to help consumers compare the 
energy usage and costs of competing models. It also contains labeling 
requirements for refrigerators, refrigerator-freezers, freezers, 
dishwashers, water heaters, clothes washers, room and portable air 
conditioners, furnaces, central air conditioners, heat pumps, plumbing 
products, lighting products, ceiling fans, and televisions.
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    \1\ 44 FR 66466 (Nov. 19, 1979).
    \2\ 42 U.S.C. 6294. EPCA also requires the Department of Energy 
(``DOE'') to develop test procedures that measure how much energy 
appliances use, and to determine the representative average cost a 
consumer pays for different types of energy.
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    The Rule requires manufacturers to attach yellow EnergyGuide labels 
to many of the covered products and prohibits retailers from removing 
these labels or rendering them illegible. In addition, it directs 
sellers, including retailers, to post label information on websites and 
in paper catalogs from which consumers can order products. EnergyGuide 
labels for most covered products contain three main disclosures: 
Estimated annual energy cost, a product's energy consumption or energy 
efficiency rating as determined by Department of Energy (``DOE'') test 
procedures, and a comparability range displaying the highest and lowest 
energy costs or efficiency ratings for all similar models. Under the 
Rule, the Commission periodically updates comparability range and 
annual energy cost information based on manufacturer data submitted 
pursuant to the Rule's reporting requirements.\3\
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    \3\ 16 CFR 305.10.
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II. Proposed Updated Ranges for Central Air Conditioners

    The Commission proposes to update the comparability ranges for 
central air conditioners to ensure manufacturers have information 
available for the upcoming transition to new efficiency descriptors 
required by DOE. On February 12, 2021 (86 FR 9274), the Commission 
published conforming Rule amendments reflecting new DOE efficiency 
descriptors on central air conditioner labels to ensure the Rule's 
consistency with DOE requirements, which become effective on January 1, 
2023.\4\ In the February Rule, the Commission stated it would update 
ranges in appendices H and I, and the sample labels in appendix L, once 
new efficiency numbers became available. The Commission now proposes to 
amend the range tables (appendices H and I) and sample labels in the 
Rule (appendix L) using new information from the Air-Conditioning, 
Heating, & Refrigeration Institute (AHRI) and DOE staff input.\5\ As 
the Commission stated in its February 2021 Rule (86 FR at 9279), 
manufacturers may begin using the new range information prior to 
January 1, 2023, in a manner consistent with DOE guidance once the FTC 
issues the final updates to appendices H and I.
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    \4\ In 2017, DOE announced changes to the rating methods and 
associated efficiency descriptors for central air conditioners 
(e.g., from ``Seasonal Energy Efficiency Ratio (SEER)'' to 
``Seasonal Energy Efficiency Ratio 2 (SEER2)''). 82 FR 1786 (Jan. 6, 
2017); and 82 FR 24211 (May 26, 2017).
    \5\ AHRI is a trade association representing central air 
conditioner manufacturers.
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III. Paperwork Reduction Act

    The current Rule contains recordkeeping, disclosure, testing, and 
reporting requirements that constitute information collection 
requirements as defined by 5 CFR 1320.3(c), the definitional provision 
within the Office of Management and Budget (OMB) regulations that 
implement the Paperwork Reduction Act (PRA). OMB has approved the 
Rule's existing information collection requirements through December 
31, 2022 (OMB Control No. 3084-0069). The proposed amendments do not 
change the substance or frequency of the recordkeeping, disclosure, or 
reporting requirements and, therefore, do not require further OMB 
clearance.

IV. Regulatory Flexibility Act

    The Regulatory Flexibility Act (``RFA''), 5 U.S.C. 601-612, 
requires that the Commission conduct an analysis of the anticipated 
economic impact of the proposed amendment on small entities. The RFA 
requires that the Commission provide an Initial Regulatory Flexibility 
Analysis (``IRFA'') with a proposed rule unless the Commission 
certifies that the rule will not have a significant economic impact on 
a substantial number of small entities. 5 U.S.C. 605. As explained 
elsewhere in this document, the proposed amendments merely update the 
Rule's appendices to include revised comparability ranges and sample 
labels for central air conditioners based on more recent data. The 
proposed amendments do not significantly change the substance or 
frequency of the recordkeeping, disclosure, or reporting requirements. 
Thus, the amendments will not have a ``significant economic impact on a 
substantial number of small entities.'' 5 U.S.C. 605. The Commission 
has concluded, therefore, that a regulatory flexibility analysis is not 
necessary, and certifies, under Section 605 of the RFA (5 U.S.C. 
605(b)), that the proposed amendments will not have a significant 
economic impact on a substantial number of small entities.

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V. Communications by Outside Parties to the Commissioners or Their 
Advisors

    Written communications and summaries or transcripts of oral 
communications respecting the merits of this proceeding, from any 
outside party to any Commissioner or Commissioner's advisor, will be 
placed on the public record. See 16 CFR 1.26(b)(5).

VI. Comment Submissions

    You can file a comment online or on paper. For the FTC to consider 
your comment, we must receive it on or before August 2, 2021. Write 
``CAC Range Updates (16 CFR part 305) (Matter No. R611004)'' on your 
comment. Your comment, including your name and your state, will be 
placed on the public record of this proceeding, including, to the 
extent practicable, on the https://www.regulations.gov website.
    Because of the public health emergency in response to the COVID-19 
outbreak and the agency's heightened security screening, postal mail 
addressed to the Commission will be subject to delay. We strongly 
encourage you to submit your comment online through the https://www.regulations.gov website. To ensure the Commission considers your 
online comment, please follow the instructions on the web-based form.
    If you file your comment on paper, write ``CAC Range Updates (16 
CFR part 305) (Matter No. R611004)'' on your comment and on the 
envelope, and mail your comment to the following address: Federal Trade 
Commission, Office of the Secretary, 600 Pennsylvania Avenue NW, Suite 
CC-5610 (Annex J), Washington, DC 20580, or deliver your comment to the 
following address: Federal Trade Commission, Office of the Secretary, 
Constitution Center, 400 7th Street SW, 5th Floor, Suite 5610 (Annex 
J), Washington, DC 20024. If possible, please submit your paper comment 
to the Commission by courier or overnight service.
    Because your comment will be placed on the publicly accessible 
website at https://www.regulations.gov, you are solely responsible for 
making sure that your comment does not include any sensitive or 
confidential information. In particular, your comment should not 
include any sensitive personal information, such as your or anyone 
else's Social Security number; date of birth; driver's license number 
or other state identification number, or foreign country equivalent; 
passport number; financial account number; or credit or debit card 
number. You are also solely responsible for making sure your comment 
does not include any sensitive health information, such as medical 
records or other individually identifiable health information. In 
addition, your comment should not include any ``[t]rade secret or any 
commercial or financial information which . . . is privileged or 
confidential''--as provided in Section 6(f) of the FTC Act, 15 U.S.C. 
46(f), and FTC Rule 4.10(a)(2), 16 CFR 4.10(a)(2)--including in 
particular competitively sensitive information such as costs, sales 
statistics, inventories, formulas, patterns, devices, manufacturing 
processes, or customer names.
    Comments containing material for which confidential treatment is 
requested must be filed in paper form, must be clearly labeled 
``Confidential,'' and must comply with FTC Rule Sec.  4.9(c). In 
particular, the written request for confidential treatment that 
accompanies the comment must include the factual and legal basis for 
the request, and must identify the specific portions of the comment to 
be withheld from the public record. See FTC Rule Sec.  4.9(c). Your 
comment will be kept confidential only if the General Counsel grants 
your request in accordance with the law and the public interest. Once 
your comment has been posted publicly at www.regulations.gov, we cannot 
redact or remove it unless you submit a confidentiality request that 
meets the requirements for such treatment under FTC Rule Sec.  4.9(c), 
and the General Counsel grants that request.
    The FTC Act and other laws the Commission administers permit the 
collection of public comments to consider and use in this proceeding as 
appropriate. The Commission will consider all timely and responsive 
public comments it receives on or before August 2, 2021. For 
information on the Commission's privacy policy, including routine uses 
permitted by the Privacy Act, see https://www.ftc.gov/site-information/privacy-policy.

VII. Other Matters

    Pursuant to the Congressional Review Act (5 U.S.C. 801 et seq.), 
the Office of Information and Regulatory Affairs designated this rule 
as not a ``major rule,'' as defined by 5 U.S.C. 804(2).

Proposed Rule Language

List of Subjects in 16 CFR Part 305

    Advertising, Energy conservation, Household appliances, Labeling, 
Reporting and recordkeeping requirements.


    For the reasons stated above, the Commission proposes to amend part 
305 of title 16 of the Code of Federal Regulations as follows:

PART 305--ENERGY AND WATER USE LABELING FOR CONSUMER PRODUCTS UNDER 
THE ENERGY POLICY AND CONSERVATION ACT (``ENERGY LABELING RULE'')

0
1. The authority citation for part 305 continues to read as follows:

    Authority: 42 U.S.C. 6294.

0
2. Revise appendix H to part 305 to read as follows:

Appendix H to Part 305--Cooling Performance for Central Air 
Conditioners

------------------------------------------------------------------------
                                                 Range of SEER2's
  Manufacturer's rated cooling capacity  -------------------------------
               (btu's/hr)                       Low            High
------------------------------------------------------------------------
                          Single Package Units
------------------------------------------------------------------------
Central Air Conditioners (Cooling Only):            13.4              19
 All capacities.........................
Heat Pumps (Cooling Function): All                  13.4              19
 capacities.............................
------------------------------------------------------------------------
                           Split System Units
------------------------------------------------------------------------
Central Air Conditioner models allowed              13.4              27
 only in northern states (listed in Sec.
   305.20(g)(13)) (Cooling Only): All
 capacities.............................
Central Air Conditioner models allowed
 in all states (Cooling Only):
    All capacities......................            13.8              27
    Heat Pumps (Cooling Function): All              14.3              42
     capacities.........................
Small-duct, high-velocity Systems.......              12              15
------------------------------------------------------------------------

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                       Space-Constrained Products
------------------------------------------------------------------------
Central Air Conditioners (Cooling Only):            11.7            13.7
 All capacities.........................
Heat Pumps (Cooling Function): All                  11.9            13.8
 capacities.............................
------------------------------------------------------------------------

0
3. Revise appendix I to part 305 to read as follows:

Appendix I to Part 305--Heating Performance and Cost for Central Air 
Conditioners

------------------------------------------------------------------------
                                                 Range of HSPF2's
  Manufacturer's rated heating capacity  -------------------------------
               (btu's/hr.)                      Low            High
------------------------------------------------------------------------
                          Single Package Units
------------------------------------------------------------------------
Heat Pumps (Heating Function): All                   6.7             8.4
 capacities.............................
------------------------------------------------------------------------
                           Split System Units
------------------------------------------------------------------------
Heat Pumps (Heating Function): All                   7.5            14.6
 capacities.............................
Small-duct, high-velocity Systems.......             6.1             7.5
------------------------------------------------------------------------
                       Space-Constrained Products
------------------------------------------------------------------------
Heat Pumps (Heating Function): All                   6.3             6.5
 capacities.............................
------------------------------------------------------------------------

0
4. Amend appendix L to part 305 by revising Prototype Label 3, 
Prototype Label 4, Sample Label 7, and Sample Label 8 to read as 
follows:

Appendix L to Part 305--Sample Labels

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    By direction of the Commission.
April J. Tabor,
Secretary.

    Note: The following statement will not appear in the Code of 
Federal Regulations.

Dissenting Statement of Commissioner Christine S. Wilson

    Today the Commission announces required changes to the Energy 
Labeling Rule but makes no other changes to the Rule. Since 2015, 
the Commission has sought comment on provisions of this Rule at 
least three times, and has made numerous amendments.\1\ This 
piecemeal approach has clarified the Rule's requirements--and I 
appreciate FTC staff's efforts to keep this Rule clear and current--
but the Commission can and should do more. For the reasons described 
below, I dissent.
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    \1\ See 81 FR 62861 (Sept. 12, 2016) (seeking comment on 
proposed amendments regarding portable air conditioners, ceiling 
fans, and electric water heaters); 84 FR 9261 (Mar. 14, 2019) 
(proposing amendments to organize the Rule's product descriptions); 
85 FR 20218 (Apr. 10, 2020) (seeking comment on proposed amendments 
regarding central and portable air conditioners).

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    I have repeatedly urged the Commission \2\ to seek comment on 
the more prescriptive aspects of this Rule. As I have noted in prior 
statements, the Rule includes highly prescriptive requirements 
detailing the trim size dimensions for labels, including the precise 
width (between 5\1/4\'' to 5\1/2\'') and length (between 7\3/8\'' 
and 7\5/8\''); the number of picas for the copy set (between 27 and 
29); the type style (Arial) and setting; the weight of the paper 
stock on which the labels are printed (not less than 58 pounds per 
500 sheets or equivalent); and a suggested minimum peel adhesive 
capacity of 12 ounces per square inch.\3\ For example, the label 
example attached to the Rule specifies not only the categories of 
information to be displayed, but also the precise font and point 
size in which that information is to be printed. For example, the 
cooling efficiency number must appear in 38 pt. Arial Narrow Bold. 
And while the phrase ``US Government'' at the top must be printed in 
10 pt. Arial Narrow, the text next to it that reads ``Federal law 
prohibits removal of this label before consumer purchase'' must be 
printed in 9 pt. Arial Narrow. See Attachment 1 (Labeling 
Requirements).
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    \2\ See Dissenting Statement of Commissioner Christine S. Wilson 
on the Notice of Proposed Rulemaking: Energy Labeling Rule (Dec. 10, 
2018) (expressing my view that the Commission should seek comment on 
the prescriptive labeling requirements), https://www.ftc.gov/public-statements/2018/12/dissenting-statement-commissioner-christine-s-wilson-notice-proposed; See Dissenting Statement of Commissioner 
Christine S. Wilson on the Notice of Proposed Rulemaking: Energy 
Labeling Rule (Oct. 22, 2019) (urging the Commission to seek comment 
on the labeling requirements), https://www.ftc.gov/system/files/documents/public_statements/1551786/r611004_wilson_dissent_energy_labeling_rule.pdf.
    \3\ See 16 CFR 305.13 and 305.20.
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    The Energy Labeling Rule exemplifies the era in which it was 
created. The FTC promulgated the Rule in the 1970s, an era when the 
agency was engaged in prolific and highly prescriptive 
rulemaking.\4\ As I have noted previously,\5\ no area of commerce 
was too straightforward or mundane to escape the Commission's 
notice:
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    \4\ See, e.g., Timothy J. Muris, Paper: Will the FTC's Success 
Continue?, George Mason Law & Economics No. 18 (Sept. 24, 2018) 
(discussing the successes and failures of the FTC's enforcement 
efforts including the aggressive rulemaking activities in the 
1970s), available at: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3254294; Timothy J. Muris, Rules Without 
Reason, AEI J. on Gov't and Society (Sept/Oct. 1982) (describing 
failed FTC rulemaking proceedings), available at: https://www.cato.org/sites/cato.org/files/serials/files/regulation/1982/9/v6n5-4.pdf; Teresa Schwartz, Regulating Unfair Practices Under The 
FTC Act: The Need For a Legal Standard of Unfairness, 11 Akron Law 
Rev. 1 (1978) (explaining that the judicial reversals of FTC 
regulations resulted from a failure to establish an adequate legal 
basis for the regulations), available at: https://ideaexchange.uakron.edu/akronlawreview/vol11/iss1/1/.
    \5\ See Concurring Statement of Commissioner Christine S. 
Wilson, Amplifier Rule (Dec. 17, 2020), https://www.ftc.gov/system/files/documents/public_statements/1585038/csw_amplifier_rule_stmt_11192020.pdf; Dissenting Statement of 
Commissioner Christine S. Wilson on the Notice of Proposed 
Rulemaking: Energy Labeling Rule (Dec. 10, 2018), https://www.ftc.gov/public-statements/2018/12/dissenting-statement-commissioner-christine-s-wilson-notice-proposed.
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    <bullet> The Trade Regulation Rule concerning Deception as to 
Non-Prismatic and Partially Prismatic Instruments Being Prismatic 
Binoculars \6\ addressed failures to disclose ``instruments having 
bulges on the tubes which simulate prismatic instruments are not 
prismatic instruments or do not contain complete prism systems'' and 
provided detailed definitions of six types of binoculars and field 
glasses.
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    \6\ 16 CFR 402, https://www.ftc.gov/sites/default/files/documents/federal_register_notices/trade-regulation-rule-concerning-deception-non-prismatic-and-partially-prismatic-instruments-being/950523non-prismatic.pdf.
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    <bullet> The Trade Regulation Rule concerning Failure to 
Disclose that Skin Irritation May Result from Washing or Handling 
Glass Fiber Curtains and Draperies included a Commission conclusion 
that ``the failure to disclose that skin irritation may result from 
body contact with glass fiber drapery and curtain fabrics, and 
clothing or other articles which have been washed with such glass 
fiber products or in containers previously used for washing such 
products when that container has not been cleansed of glass 
particles, has the capacity and tendency to mislead and deceive 
purchasers and prospective purchasers and to divert business from 
competitors whose products may be washed or handled without the 
resulting irritation.'' \7\
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    \7\ 16 CFR 413.3(c), https://www.ftc.gov/sites/default/files/documents/federal_register_notices/trade-regulation-rule-deceptive-advertising-and-labeling-size-tablecloths-and-related-products-16/950523advertisingandlabelingasto.pdf.
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    <bullet> The Guides for the Ladies' Handbag Industry addressed 
the use of the terms ``scuffproof,'' ``scratchproof,'' ``scuff 
resistant,'' and ``scratch resistant;'' representations that a 
product is colored, finished or dyed with aniline dye or otherwise 
dyed, embossed, grained, processed, finished or stitched in a 
certain manner; and required disclosures to be made with respect to 
a product's composition.\8\
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    \8\ 16 CFR 247, https://www.ftc.gov/sites/default/files/documents/federal_register_notices/guides-luggage-and-related-products-industry-guides-shoe-content-labeling-and-advertising-and-guides/950918luggageandrelatedproducts.pdf.
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    In March 2020, we sought comment on some of the more 
prescriptive provisions of the Energy Labeling Rule \9\ and received 
many interesting and thoughtful comments.\10\ Rather than act on 
these comments or proposals, though, the Commission chose to 
finalize only proposals necessary to conform to Department of Energy 
changes.\11\ Again today, the Commission chooses to make minor 
changes necessary for conformity but fails to conduct a full review 
of the Rule to consider removing all dated and prescriptive 
provisions, and to consider the recent comments suggesting changes.
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    \9\ See Concurring Statement of Commissioner Christine S. Wilson 
on the Notice of Proposed Rulemaking: Energy Labeling Rule (Mar. 20, 
2020), https://www.ftc.gov/system/files/documents/public_statements/1569815/r611004_wilson_statement_energy_labeling.pdf.
    \10\ See, e.g., Air-Conditioning, Heating and Refrigeration 
Institute (AHRI) Comment (#33-09), available at: https://www.regulations.gov/document?D=FTC-2020-0033-0009; Association of 
Home Appliance Manufacturers (AHAM) Comment (#33-04), available at: 
https://www.regulations.gov/document?D=FTC-2020-0033-0004; Goodman 
Manufacturing Comment (#33-08), available at: https://www.regulations.gov/document?D=FTC-2020-0033-0008.
    \11\ See Dissenting Statement of Commissioner Christine S. 
Wilson on Notice of Proposed Rulemaking: Energy Labeling Rule (Dec. 
22, 2020), https://www.ftc.gov/system/files/documents/public_statements/1585242/commission_wilson_dissenting_statement_energy_labeling_rule_final12-22-2020revd2.pdf.
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    The Commission last conducted a full review of the Energy 
Labeling Rule in 2015. Under our 10-year regulatory review schedule, 
the next review is scheduled for 2025. Nothing, however, prevents 
the Commission from conducting this review now. I again urge the 
Commission to act on the comments we received last year, eliminate 
the more prescriptive aspects of the Rule, and maximize the positive 
impact of this Rule for consumers. If we are statutorily mandated to 
maintain this Rule, we should endeavor to make it beneficial for 
consumers and competition.

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[FR Doc. 2021-11498 Filed 6-1-21; 8:45 a.m.]
BILLING CODE 6750-01-P