To modify the efficiency standards for grid-enabled water heaters.

To modify the efficiency standards for grid-enabled water heaters. 1. Grid-enabled water heaters Part B of title III of the Energy Policy and Conservation Act ( 42 U.S.C. 6291 et seq. (1) in section 325(e) ( 42 U.S.C. 6295(e) (6) Additional standards for grid-enabled water heaters (A) Definitions In this paragraph: (i) Activation lock The term activation lock (ii) Grid-enabled water heater The term grid-enabled water heater (I) has a rated storage tank volume of more than 75 gallons; (II) is manufactured on or after April 16, 2015; (III) has— (aa) an energy factor of not less than 1.061 minus the product obtained by multiplying— (AA) the rated storage volume of the tank, expressed in gallons; and (BB) 0.00168; or (bb) an equivalent alternative standard prescribed by the Secretary and developed pursuant to paragraph (5)(E); (IV) is equipped at the point of manufacture with an activation lock; and (V) bears a permanent label applied by the manufacturer that— (aa) is made of material not adversely affected by water; (bb) is attached by means of non-water-soluble adhesive; and (cc) advises purchasers and end-users of the intended and appropriate use of the product with the following notice printed in 16.5 point Arial Narrow Bold font: IMPORTANT INFORMATION: This water heater is intended only for use as part of an electric thermal storage or demand response program. It will not provide adequate hot water unless enrolled in such a program and activated by your utility company or another program operator. Confirm the availability of a program in your local area before purchasing or installing this product. (B) Requirement The manufacturer or private labeler shall provide the activation key for a grid-enabled water heater only to a utility or other company that operates an electric thermal storage or demand response program that uses such a grid-enabled water heater. (C) Reports (i) Manufacturers The Secretary shall require each manufacturer of grid-enabled water heaters to report to the Secretary annually the quantity of grid-enabled water heaters that the manufacturer ships each year. (ii) Operators The Secretary shall require utilities and other demand response and thermal storage program operators to report annually the quantity of grid-enabled water heaters activated for their programs using forms of the Energy Information Agency or using such other mechanism that the Secretary determines appropriate after an opportunity for notice and comment. (iii) Confidentiality requirements The Secretary shall treat shipment data reported by manufacturers as confidential business information. (D) Publication of information (i) In general In 2017 and 2019, the Secretary shall publish an analysis of the data collected under subparagraph (C) to assess the extent to which shipped products are put into use in demand response and thermal storage programs. (ii) Prevention of product diversion If the Secretary determines that sales of grid-enabled water heaters exceed by 15 percent or greater the quantity of such products activated for use in demand response and thermal storage programs annually, the Secretary shall, after opportunity for notice and comment, establish procedures to prevent product diversion for non-program purposes. (E) Compliance (i) In general Subparagraphs (A) through (D) shall remain in effect until the Secretary determines under this section that— (I) grid-enabled water heaters do not require a separate efficiency requirement; or (II) sales of grid-enabled water heaters exceed by 15 percent or greater the quantity of such products activated for use in demand response and thermal storage programs annually and procedures to prevent product diversion for non-program purposes would not be adequate to prevent such product diversion. (ii) Effective date If the Secretary exercises the authority described in clause (i) or amends the efficiency requirement for grid-enabled water heaters, that action will take effect on the date described in subsection (m)(4)(A)(ii). (iii) Consideration In carrying out this section with respect to electric water heaters, the Secretary shall consider the impact on thermal storage and demand response programs, including any impact on energy savings, electric bills, peak load reduction, electric reliability, integration of renewable resources, and the environment. (iv) Requirements In carrying out this paragraph, the Secretary shall require that grid-enabled water heaters be equipped with communication capability to enable the grid-enabled water heaters to participate in ancillary services programs if the Secretary determines that the technology is available, practical, and cost-effective. ; (2) in section 332(a) ( 42 U.S.C. 6302(a) (A) in paragraph (5), by striking or (B) in the first paragraph (6), by striking the period at the end and inserting a semicolon; (C) by redesignating the second paragraph (6) as paragraph (7); (D) in subparagraph (B) of paragraph (7) (as so redesignated), by striking the period at the end and inserting ; or (E) by adding at the end the following: (8) for any person to— (A) activate an activation lock for a grid-enabled water heater with knowledge that such water heater is not used as part of an electric thermal storage or demand response program; (B) distribute an activation key for a grid-enabled water heater with knowledge that such activation key will be used to activate a grid-enabled water heater that is not used as part of an electric thermal storage or demand response program; (C) otherwise enable a grid-enabled water heater to operate at its designed specification and capabilities with knowledge that such water heater is not used as part of an electric thermal storage or demand response program; or (D) knowingly remove or render illegible the label of a grid-enabled water heater described in section 325(e)(6)(A)(ii)(V). ; (3) in section 333(a) ( 42 U.S.C. 6303(a) (A) by striking section 332(a)(5) paragraph (5), (6), (7), or (8) of section 332(a) (B) by striking paragraph (1), (2), or (5) of section 332(a) paragraph (1), (2), (5), (6), (7), or (8) of section 332(a) (4) in section 334 ( 42 U.S.C. 6304 (A) by striking section 332(a)(5) paragraph (5), (6), (7), or (8) of section 332(a) (B) by striking section 332(a)(6) section 332(a)(7) June 9, 2015 Reported with an amendment, committed to the Committee of the Whole House on the State of the Union, and ordered to be printed

Summary: (Sec. 1) Amends the Energy Policy and Conservation Act (EPCA) to provide additional energy conservation standards applicable to grid-enabled water heaters for use as part of an electric thermal storage or demand response program (a program that enables customers to reduce or shift their power use during peak demand periods). Requires annual reports from: (1) manufacturers of such water heaters regarding the quantity of the products shipped each year, and (2) utilities and other demand response and thermal storage program operators regarding the quantity of products activated for their programs. Requires the Department of Energy (DOE) to publish analyses of data collected from such reports and to establish procedures to prevent product diversion if sales of the products exceed by at least 15% the quantity activated for use in the demand response and thermal storage programs annually. Maintains the standards and publication procedures established by this Act until the Secretary determines that: (1) such water heaters do not require a separate efficiency requirement, or (2) procedures to prevent product diversion for non-program purposes would not be adequate to prevent such product diversion. Requires DOE to consider the impact of EPCA electric water heater standards on thermal storage and demand response programs, including on energy savings, electric bills, peak load reduction, electric reliability, integration of renewable resources, and the environment. Directs DOE to require the water heaters be equipped with communication capability to enable the grid-enabled water heaters to participate in ancillary services programs if the technology is available, practical, and cost-effective. Makes it unlawful for any person to: activate an activation lock for a grid-enabled water heater with knowledge that it is not used as part of such program, distribute an activation key for such a water heater with knowledge that it will be used to activate a heater that is not used as part of the program, enable such water heater to operate at its designed specification and capabilities with knowledge that it is not used as part of the program, or knowingly remove or render illegible the label of a such water heater.