Table of contents 1.Introduction: Political and legal context 2.Problem definition 3.Why should the EU act? 4.Objectives: What is to be achieved? 5.What are the available policy options? 6.What are the impacts of the policy options? 7.How do the options compare? 8.Preferred option 9.How will actual impacts be monitored and evaluated? Annex 1: Procedural information Annex 2: Stakeholder consultation Annex 3: Who is affected and how? Annex 4: Analytical methods: inputs, outputs, calculations Annex 5a: Minutes of the Consultation Forum (6 May 2014) Annex 5b: Minutes of the Consultation Forum (25 October 2017) Annex 6: Existing Policies, Legislation and Standards affecting welding equipment Annex 7: The Ecodesign and Energy Labelling Framework Annex 8: Standards

Annex 9: Who is affected by the measure and how Annex 10: List of figures ANNEX 11. List of Tables Annex 12: Results of the OPC Annex 13. Technology change description: transformer vs inverter welding equipment Annex 14: Glossary Annex 15. Definitions Annex 16: PROPOSED ECODESIGN REQUIREMENTS This report commits only the Commission’s services involved in its preparation and does not prejudge the final form of any decision to be taken by the Commission. Note to the reader: The text in italics is common to the IAs on ecodesign submitted in the spring 2018 and aiming at adoption in a package in 2018/19. This streamlining has been introduced in agreement with the RSB to facilitate the reading and discussions of the IAs. 1.Introduction: Political and legal context This impact assessment relates to the proposal of a Commission Regulation on ecodesign requirements for welding equipment. The requirements are presented in Annex 16. The Ecodesign Directive 2009/125/EC establishes a framework for setting eco-design requirements for energy-related products. In its Article 1(1) the Ecodesign Directive defines its primary aim: “ensuring the free movement of products within the internal market”. Article 1(2) adds that “it contributes to sustainable development by increasing energy efficiency and the level of protection of the environment”. Since its initial adoption in 2005, the Ecodesign Directive has significantly contributed to the achievement of the EU's Energy and Climate 20/20/20 targets, and it is expected to also be fundamental for energy savings to 2030. For about half of the products covered to date, the Ecodesign Directive works in close coordination with the Energy Labelling Directive, this synergy allowing a maximisation of their impacts in terms of market transformation, through a combined 'push' and 'pull' effect. For business-to-business (B2B) products, given that users normally have a higher technical understanding of the products, the 'pull' effect of the extra information provided by the energy label is not that fundamental to generate energy savings. Welding equipment is a B2B product for which Ecodesign requirements are proposed, but no Energy Labelling proposals are made. Ecodesign requirements will introduce mandatory minimum environmental performance levels to any welding equipment sold in the EU, and will thus exclude the least performing products from the market. Additional information will be made available via the technical fiche for each product as required via Ecodesign provisions. The proposal on welding equipment is intended to be part of a 2018 package of Ecodesign and Energy labelling regulation proposals on twelve product groups, including refrigerators, electric motors, washing machines, dishwashers, lighting, electronic displays, external power supplies, commercial refrigeration, power transformers, enterprise servers, industrial fans, and welding equipment. Impact assessments have been prepared for the respective product groups. 1.1.Benefits of Ecodesign and Energy Labelling Ecodesign and energy labelling are recognised globally as one of the most effective policy tools in the area of energy efficiency. They are central to making Europe more energy efficient, contributing in particular to the ‘Energy Union Framework Strategy’, and to the priority of a ‘Deeper and fairer internal market with a strengthened industrial base’. Firstly, this legislative framework pushes industry to improve the energy efficiency of products and removes the worst-performing ones from the market. Secondly, it helps consumers and companies to reduce their energy bills. In the industrial and services sectors, this results in support to competitiveness and innovation. Thirdly, it ensures that manufacturers and importers responsible for placing products on the European Union (EU) market only have to comply with a single EU-wide set of rules. It is estimated that from 2005 to 2020, ecodesign and energy labelling regulations will have delivered around 175 Mtoe (i.e. about 2035 TWh) of energy savings per year in primary energy in comparison to if there were no measures in place. This is roughly equivalent to Italy's energy consumption in 2010, close to half the EU 20 % energy efficiency target by 2020 and about 11 % of the expected EU primary energy consumption in 2020.

The end user of the products will have to invest in more expensive and efficient products, but the investment will be paid back over the lifetime. On average, a European household will have saved about € 500 annually on its energy bills by 2020. Although the initial cost for industry, service and wholesale and retail sectors also increases, it is expected that by 2020 it will result in EUR 55 billion of extra revenue per year. This legislative framework benefits from broad support from European industries, consumers, environmental non-governmental organisations (NGOs) and Member States (MSs), because of its positive effects on innovation, increased information for consumers and lower costs, as well as environmental benefits. 1.2.Legal framework In the EU, the Ecodesign Framework Directive sets a framework requiring manufacturers of energy-related products to improve the environmental performance of their products by meeting minimum energy efficiency requirements, as well as other environmental criteria such as water consumption, emission levels or minimum durability of certain components before they can place their products on the market. About half of the product groups currently covered by Ecodesign requirements also meet Energy Labelling requirements. The Energy Labelling Framework Regulation complements the Ecodesign Framework Directive by enabling end-consumers to identify the better-performing energy-related products, via an A-G/green-to-red scale.. The energy labelling is mostly used in household and business-to-consumer (B2C) products, rather than business-to-business (B2B) products. The Ecodesign framework Directive and the Energy Labelling framework Regulation are implemented through product-specific implementing and delegated regulations. To be covered, the energy-related products must (i) represent a significant volume of sales (more than 200000 units a year), (ii) have a significant environmental impact within the EU and (iii) represent a significant energy improvement potential without increasing the cost excessively, see also Article 15.2 of the Ecodesign Framework Directive. As an alternative to the mandatory ecodesign requirements, voluntary agreements or other self-regulation measures can be presented by the industry. If certain criteria are met, the Commission formally recognises these voluntary agreements. The benefits are a quicker and more cost-effective implementation, which can be more flexible and easier to adapt to technological developments and market sensitivities. However such voluntary agreements tend to be less ambitious in terms of energy saving and suffer from compliance issues. The latest Ecodesign working plan 2016-2019 includes the commitment not to deal only with energy efficiency, but also examine how aspects relevant to the circular economy (e.g. requirements to make a product more durable, easier to repair, reuse or recycle) can be assessed and taken on board the proposed Ecodesign requirements. This is in line with the Circular Economy Initiative, which concluded that product design is key in achieving the goals, as it can have significant impacts across the life cycle of products. More details about the legal framework, and procedural issues, are presented in Annex 1. 1.3.Legal context of the proposed measures Currently, there is no EU-wide legislation in place addressing the energy and environmental efficiency of machine tools or welding equipment. However, under the framework of Ecodesign presented above, the Ecodesign Working Plans 2009-2011 and 2016-2019 identified machine tools and welding equipment as priority groups for which the European Commission should consider ecodesign requirements. Following this, a preparatory study including technical, economic and environmental analyses for machine tools and related machinery was carried out in 2009-2012. It was complemented with an Impact Assessment background study in 2013-2015. Both documents, together with updates and in-house modelling carried out during 2017-2018, are the main basis for the present Impact Assessment report. 1.4.Scope of this Impact assessment One of the outcomes of the preparatory studies was the difficulty to define minimum efficiency requirements for machine tools. This was due to the complexity and wide variety of machine categories, often tailor-made to specific user needs. To handle this diversity, the machine tool industry suggested in 2014 to develop a self-regulatory initiative (SRI) on machine tools. Following the recommendations of Better Regulation guidelines, the Commission and the stakeholders of the Consultation Forum showed support to this alternative and provided the machine tool industry with the necessary time to prepare it. However, the industry abandoned the initiative at the end of 2016 due to insufficient market coverage (an ecodesign SRI is required to represent 80% of the EU market, which was not reached). Furthermore, the industry concerned could not agree on how the control mechanisms of the SRI should work. The options of not regulating at all the machine tools by means of ecodesign, or of introducing mandatory information requirements but not efficiency requirements have been thoroughly discussed with member States and stakeholders. Most opinions confirm the difficulty of defining minimum efficiency requirements by means of ecodesign for machine tools, and additionally point at the low value-added of ecodesign if it only contains information requirements. Furthermore, an open public consultation (OPC) on welding equipment and machine tools took place between 16 April 2018 and 10 July 2018. The collected opinions further confirm the inappropriateness of ecodesign as a mechanism to address the energy and material efficiency of machine tools, see Annex 12. As a result of the above, machine tools have been excluded from the scope of the proposed Ecodesign Regulation. The scope of the products covered by the measure is therefore reduced significantly compared to the original conception. Regarding welding equipment, which is a relatively homogeneous, non-tailored product group, the OPC results confirm the support of a regulatory approach with ecodesign measuresexpressed during the preparatory phase,. 1.5.Political Context Several recent policy initiatives provide the background to the proposed measures. The main elements include the Energy Union Framework Strategy, which calls for a sustainable, low-carbon and climate-friendly economy, the Paris Agreement, which calls for a renewed effort in carbon emission abatement, the Circular Economy Initiative , which amongst others stresses the need to include reparability, recyclability and durability in ecodesign, and the Emissions Trading Scheme (ETS), aiming at cost-effective greenhouse gas (GHG) emissions reductions. 2.Problem definition 2.1.What is welding equipment– product and market characteristics

Welding equipment are products that deliver energy in the form of electricity to join or cut two or more metals by heating (often >6000°C), with or without the use of ancillary materials such as filler sticks, wire, or gases that shield the welding area from the surrounding air. Welding equipment takes energy from the power supply, and transforms it, by means of electric and electronic components, into the combination of voltage and intensity needed to melt the metals. Welding equipment can be manual, automated or semi-automated, stationary or transportable. When in operation, welding devices are large energy consumers. A small arc welding device of ca. 5 kW consumes the power equivalent to 12 vacuum cleaners, or 6 powerful microwave ovens. It is noteworthy that welding devices operate in general discontinuously, from 2 to 8 hours per day, depending on the technology and use conditions. Welding equipment is gradually becoming more and more efficient, but also steadily more complex, and able to perform different operations and weld types. Note that the actual annual operation time for each product increases if the product is capable of performing a larger variety of welding types. This development is taking place in the last years thanks to the technology change from transformer-based equipment to inverter-based equipment. Typical arc welding products, representing over 90% of the products in scope, are depicted in Figure 1 . Welding equipment products within the scope of the proposed regulation are professional "business-to-business" products, used in industry in a horizontal manner for a wide variety of sectors. They are used most intensively in aerospace and shipbuilding, energy, construction, automotive, heavy machinery, and in general for repair and maintenance operations. Light duty welding units (so-called "hobby" or business-to-consumer (B2C) products) are excluded from the scope of the proposed measures, due to their low levels of use (counted in net hours per year), and subsequent small share of the total use of energy by welding equipment in the EU (4GWh/yr, equivalent to less than 1%). Three specific technology types of professional welding units are also excluded, on the grounds that they contribute each with less 5% and altogether less than 10% to the total use of energy by welding equipment in the EU energy consumption. These are: submerged arc, resistance, and stud welding devices. The typical arc welding equipment within scope has a mass of 15 to 150 kg (stationary units are often heavier), and consists essentially of a power source that transforms the incoming commercial current to the current of low voltage and high intensity needed for welding. This is achieved by means of electronic circuitry. Complementing this, the welding unit has typically a torch that delivers the power close to the welding spot, and depending on the type of welding, it has also feeding mechanisms for a welding filler, and/or a shielding gas. Welding equipment within the scope of this proposal can be divided into two categories: (1) large industrial welding devices and (2) smaller mobile, manually operated welding devices. The former are often stationary machines and are installed in production lines of medium and large manufacturing companies, especially in the energy and transport sectors. Their use constitutes a relatively small market share of the overall use of welding equipment (<35%) and is to some extent integrated in fairly automatized production lines, which means a weld operator is not needed, the duty cycles are constant and the equipment is subject to a scrutiny and if applicable optimisation in terms of energy and material use. Smaller mobile, manually operated welding devices on the other hand account for a larger share of the overall use of welding equipment (>65% market share). These machines are used both by manufacturing companies and by other sectors (construction, repair and maintenance services), in particular by SMEs (>80% of cases). What is typical for this category is that one and the same welding equipment can perform several different welds. This type of equipment is characterised by non-constant duty operation in terms of hours-per-day of use. Manual welding costs are labour-intensive average labour cost representing >75% (usually 85-90%) of the life cycle costs of a manual electric arc weld. Professional welding equipment is replaced on average every 7-15 years. Rather than product senescence or malfunction, the replacement philosophy is more dependent on users wishing to replace slightly outdated machinery by the latest technologies in order to reduce welding times, improve the quality of welds, or be able to perform several welding types with the same device. This replacement rate may increase slightly in the future, as the new equipment has increasing functionality and therefore larger workload, and has on average a shorter lifetime (closer to 7 years than to 15 years) due to the larger presence of electronic components, which have lower longevity than purely electric components. In the EU, over 5 million professional welding units are in operation, of which approximately 0.5 million are stationary industrial duty stations, 3 million professional mobile units, and 1.5 million are lighter, semi-professional units. 2.2.What is the issue or problem that may require action? There are three main problems in the current markets of welding equipment: (1)The manufacturers of the welding equipment are unaware of design demands to improve efficiency of these devices in terms of (a) energy and (b) materials; (2)There are no incentives to improve the efficiency design of welding equipment in terms of (a) energy and (b) materials; (3)Communication of energy and material consumption of the welding equipment in the supply chain between downstream actors (end-users, and recyclers) and product designers and manufacturers is poor. Technical development in the last two decades has taken place on welding equipment, resulting in high, and readily-available saving potentials for both energy and materials, which however still remain untapped. The drivers of the problems mentioned above are described in detail in the next section. 2.3.What are the underlying drivers of the problem?

The main driver behind the problems listed above is imperfect communication in the supply chain about product energy and environmental information, both from downstream actors (end-users and recyclers) up to product designers, and from product manufacturers downstreams to end-users and recyclers. More in detail, the observed market failure in terms of sound economic purchasing decision is due to the following reasons: ·Lack of information for end-users on energy and material efficiency of welding equipment; ·Lack of incentives to base purchase decision on other factors than welding performance (“suboptimal economic behaviour” of the users); ·Miopia of cost calculation, i.e., not assessing the Total Cost of Ownership (TCO)and instead solely relying on purchase price, especially in the case of SMEs; ·Split incentives within companies due to the separate budgets for purchasing and running costs (typically part of an administrative budget), and between the welding equipment owner and the client being the supplier of the electricity consumed (the case of off-site welding); ·Lack of communication between the welding equipment designers and the actors in the supply chain involved in repair, refurbishment and end-of-life treatment. Other drivers which are of marginal importance and have not been elaborated further include user preferences for selecting specific brands of equipment and ancillary materials (e.g. tradition). It has been found that there can be multiple reasons why economic actors do not rationally choose the products which are the most cost-effective over the product's lifetime. In several cases companies (as well as some public services sectors) are less likely to undertake energy saving measures, even if they would have the same economic viability as other investments,. Problem driver 1: Lack of information on energy and material efficiency For end-users of welding equipment, one source of market failure is a lack of reliable, standardised information on energy and material efficiency (and related environmental) performance of welding equipment. The lack of such information implies the lack of a reliable parameter to measure the energy and material efficiency of the products. The problem is complex, since energy and material consumption depends not only on the welding equipment characteristics, but also on the welding process, including amongst others two highly variable parameters: (1) the type of weld performed (which material, which thickness, which angle, which position, etc) by the welding tool, and (2) the skills of the welder. In automated operations in production lines (normally in large manufacturing companies, e.g. automotive) the second factor is absent, the human operators being replaced by robot machines. There are several performance tests and a wide range of information for welding equipment. Many manufacturers have product sizing and configuration tools but in terms of energy, they often only provide the maximum power. Sometimes efficiency benchmark data can be found for certain models, but it cannot be used for comparison with products from other brands. Since there is no standardisation, all vendors tend to heavily optimise and select the tests which lets them show their own products in the best possible light. This makes totally accurate and unbiased comparisons impossible for end-users, when making purchase decisions. In the 2018 open public consultation carried out for this impact assessment, one of the questions was intended to understand how the respondents judged the information made available by manufacturers to users in terms of energy and material consumption. The results obtained point at the absence of structured and comparable information in the market. Problem driver 2: Lack of incentives to base the purchase decision on other factors than welding performance (“suboptimal economic behaviour” of the users) Efficient welding equipment products are already available on the EU market today. However, many customers, especially SMEs and larger users of manual equipment, do not purchase efficient products. The majority of users prioritise performance and low purchasing cost over reducing electricity costs and obtaining environmental savings during the use phase. Welders are very much aware that equipment and its operational costs are small compared to labour costs (see Figure 2 ). Therefore to most welding professionals, the energy or material efficiency of this equipment is of a marginal concern. When users of welding equipment currently purchase the equipment they do not prioritise the energy or material efficiency, but rather aspects such as performance, and reliability. Suppliers of materials and manufacturers of ancillary equipment (welding gas, welding wire) have also little or no interest in reducing material consumption, and their profits. When welding is not in a workshop but on e.g. a construction site, the energy for welding is not a cost for the welding equipment owner, and there are no incentives to use efficient equipment. All of the above generates a vicious loop: the lack of interest from majority of customers perpetuates a lack of functional information. These factors together result in an environment that does not stimulate investments and efforts towards designing more efficient products. Problem driver 3: Miopia of cost calculation - assessing the Total Cost of Ownership (TCO)

Without up-to-date energy and material efficiency requirements, economic operators (both business and private) will not easily be able to choose the product that is the most cost-effective over that product's life-time. This is because the information they are provided with is limited. This prevents business customers from transparently and independently evaluating - via universally-accepted energy measurement standards - different welding products, and integrate this information in their purchase decisions. Even for well-informed businesses and when efficient equipment exists, which is at least at the same level of reliability as the less efficient equipment, many welding equipment owners still neglect this information when taking purchasing decisions. In some cases, it is because of budgetary constraints that they opt for a less efficient instead of more efficient (and frequently more expensive) equipment. Other reasons include that it requires less resources to continue with the same choice of solutions, product brands and suppliers that to switch to other solutions, brands and suppliers. This is a known phaenomenon seen not only in welding equipment, but also in many other B2B markets. When acquiring new equipment, SMEs do not usually have resources to incorporate life-cycle cost (LCC) considerations for energy aspects. The choice of equipment is mostly driven by the performance of welding. This is the parameter that operators identify with business continuity and evaluation. Additionally, welding companies are aware that equipment and operational costs are small compared to labour costs. When labour costs are set aside, electricity, welding gases and welding wire can represent significant share of the total operation costs (respectively 1.7, 5 and 10 times the cost of equipment purchase, cf. Figure 2 ). This distribution of costs and the high contribution of labour and materials are well known to welding companies. However, even if welding companies were interested in applying an LCC approach to purchase, there is currently no actor in the supply chain that generates comparable data on energy and material efficiency. Problem driver 4: Split incentives Without clear, up to date energy efficiency requirements including information provision, the evidence that the products will be cost-effective over their life-time is lost. This is typical for landlord-tenant situations, in which the owner of the equipment does not pay for the energy consumption. For welding equipment, this is typically found in mobile units that operate off-site (e.g. repairs of wind turbines, pipelines, construction sites). Furthermore, welding SMEs operate often off-site, welding being done at the customer's premises. In this case, there is an additional split incentive for energy consumption, as welding power is consumed by the client, and not by the owner of the welding equipment. Split incentives exist also due to organisational company differences. Company energy specialists, or production line specialists, are aware of the possible differences in efficiency when new equipment is purchased. However, industry stakeholders report that the priorities of the purchase, technical performance and environmental departments of companies are often not aligned. Firstly, this is a result of the aforementioned absence of harmonised metrics for representation of the energy consumption of welding makes it difficult to compare and present to other colleagues life-cycle costs (LCC) of different equipment. Secondly, because priorities of different actors in a company are different: welding technicians prioritise performance, environmental managers prioritise efficiency, and the purchase department prioritises costs and short investment payback. Problem driver 5: Lack of communication between the welding equipment designers and the actors in the supply chain involved in repair, refurbishment and end-of-life treatment. In very general economic terms, this driver can be interpreted as an issue of price: the price of the products does not reflect the real environmental costs to society (externalities) in terms of circular economy aspects, most notably material efficiency (use of wire and shielding gas), but also increasing the useful lifetime, reparability and recyclability of devices. Hence, without setting requirements or market mechanisms that improve circular economy aspects of the product, the different actors in the life cycle of the appliance will not be incentivised to improve material efficiency. The current lack of requirements on material efficiency aspects means that end-users do not benefit from more material-efficient, better reparable, and more durable appliances. This happens despite the existence of cost-effective improvements to the reparability and reusability of these products, and of measures to improve communication to end-users, for instance indicating the relative (more/less than average) use of shielding gas and welding wire. Materials and components of welding equipment age with time, and especially mobile welding equipment, suffer intensive wear and tear during operation. The availability of spare parts or the ease of repair vary widely from brand to brand and product to product. Repair information is especially missing for entry-level, low price, simpler equipment. The identified market failures for welding products mainly concern incomplete information when customers and downstream operators (repairers, recyclers) do not have sufficient information for their purchase, reuse, disposal or recycling. Being an electric and electronic device, in the EU welding equipment has to be handled at the end of its life according to the provisions of the WEEE Directive (Waste of electric and electronic equipment). However, due to the lower sales compared to household equipment (TVs, computers, washing machines, etc.), WEEE treatment plants seldom receive and have to treat welding equipment. Consequently, WEEE operators are often not familiar with the presence of hazardous or valuable components in welding equipment. Additionally, the present state-of-play of welding equipment design does not facilitate the recycling process. Barriers to disassembly are related to different aspects, such as the use of permanently fixed (soldered, welded or glued) components, the use of several different fastening techniques (e.g. the used of several different screws and snap fits), the use of proprietary fastening systems (e.g. special screws that necessitate of special tools); and in general poor visibility or accessibility of certain fastening (e.g. screws that are covered by labels). For these reasons welding equipment is not (easily) disassembled. For recyclers, this poses a problem as they cannot (easily) fulfil of some of the prescriptions of the WEEE Directive . Article 8(2) and Annex VII of this Directive include a list of components (e.g. large condensers) which need to be collected separately during the recycling process. These difficulties have also been observed when the disassembly is performed by reuse operators, independent from manufacturer's aftersales services, who do not know the exact architecture of the device and the required disassembly procedures. Modern welding equipment, especially if based on inverter power sources, has considerable amounts of electronic components, which are characterised by a significant content of critical raw materials (CRM) e.g. Neodymium. As they are often contained in components that are boxed inside a casing, the lack of information on both the presence and mass of critical raw materials provides little incentive for recyclers to disassemble difficult casings for extraction. Finally regarding the repair, refurbishment and reuse of high-end welding equipment, before the equipment is re-sold reuse operators should readily be able to delete in the equipment's software any personal data or company-specific welding profiles. However, this functionality is currently not available. 2.4.What is the scale of the problem?

Estimated yearly sales of welding equipment products within the scope of this study are ca. 0.5 million units. The stock in the EU27 is ca. 3 million units. These products consume yearly about 7 TWh of electricity (equivalent to 65 PJ of primary energy), to which one has to add the primary energy consumed for the manufacturing of welding equipment, shielding gas, and welding wire (respectively 4, 3.5 and 20 PJ). This is altogether a rather modest consumption contribution (0.4%) to the aggregate energy consumption of the 25 products subject to ecodesign implementing regulations (23850 PJ). However, the ecodesign preparatory study (referred to as 'the preparatory study' in the remainder of the text), highlighted that welding equipment can readily be more energy efficient in its overall operation, and that it can also use fewer resources. According to the preparatory study, the primary environmental impact of welding equipment is related to the energy (electricity) consumption in the 'use phase' of the equipment. On average, 70-75% of this energy is required by the welding equipment in the use phase of the product, the remainder comprising the "embedded energy" contained in the raw materials used: materials for manufacturing the welding machine (ca.3% of the total primary energy utilised over the product's lifetime), materials for the shielding gas (3-4% of total primary energy), and for the welding wire (15-20%). According to the preparatory study estimations, about 1.1 TWh of final electricity savings could be saved every year if ecodesign requirements were introduced, equivalent to the consumption of about 300.000 households, and 0.075% of the Commission’s 2030 target for final energy consumption savings. Although this is a modest saving figure, the preparatory study and subsequent impact assessment background study indicated that an ecodesign regulation on these products would be feasible due to (1) the availability of technology that enable the transformation, (2) the reported readiness of the industry sector to invest and adapt to the changes, and (3) the increasing presence on the EU market of low efficiency products, especially originating from Asia. Due to the important role of material consumption during the use phase in the overall energy and resources footprint of welding, especially the use of welding wire, requirements of material consumption have also been analysed in depth. Additionally, during the period 2015-2018 material efficiency requirements under the scope of ecodesign have been proposed for a number of products, such as computers, and data storage systems. Similar requirements have been proposed for the component and hardware characteristics, as well as taking into account the similar repair and disposal pathways that welding equipment share with these products. The requirements on product material efficiency refer to the extraction of components for separate depollution treatment, identification and extraction and of critical raw materials, and availability of built-in data deletion tools. 2.5.Who is affected by the problem, in what ways and to what extent? The supply chain and additional stakeholders are affected by the problems described in different ways: 2.5.1.Welding equipment manufacturing industry In the EU, there are about 50 welding equipment manufacturers, composed of a small number (10-15) of large (>250 employees) global product manufacturers, and a larger number (around 40) of smaller producers (SMEs with <250 employees),. SMEs are in general specialised in the manufacture of lower-end products, primarily for hobby use, but some models also for professional use. The welding equipment market is global. The rate of exports of the EU products is about one third, while the European market uses essentially EU-assembled welding equipment, with only 15% of the market in 2016 stemming from imported welding units. However, Asian (especially Chinese) manufacturers are rapidly expanding their global market share, initially of the low-end product range, but increasingly also in the higher efficiency devices, profiting from the fact that most of the inverter and controller component manufacturers are located in China. Particularly China has already responded to the problems identified in section 2.2, and has implemented in the domestic Chinese market a standard/regulation GB 28736 – 2012 on energy efficiency of welding equipment. As the domestic market in China gets with time more restrictive to the less efficient appliances, Chinese welding equipment manufacturers may search overseas, including the EU, to find an outlet for such appliances, for which know-how and production lines are already amortised. Following this, in the absence of the additional incentive of the ecodesign regulation, smaller EU manufacturers that specialise in the price-friendly, less investment-intensive manual welding devices (MMA) may rapidly be pushed out of the market in the next 5-10 years. Manufacturers in the EU are very alert of the developments described above, and have been in the last decade gradually adapting their production from traditional transformer technology to electronic-based inverter technology, and are joining efforts to assist CEN-CENELEC in the development of measurement methods for energy and material efficiency. 2.5.2.Suppliers of components Manufacturers are aware that an important proportion of the efficiency gains of welding equipment (about 80-85%) are achieved through power source efficiency. Manufacturers indicate that they have access to only 5-10 major component manufacturers of power sources, and essential electronic components, mainly located in Asia. These suppliers serve electronics and power sources not only to all the welding manufacturers, but also to manufacturers of electric and electronic products such as cars, trains, aircrafts, and household appliances. Manufacturers indicate that access to efficient components is increasingly difficult, and prices are increasing. They face tough competition with much larger sectors that have more negotiation power with component manufacturers. This affects in particular welding equipment manufacturing SMEs. Manufacturers also experience the lack of communication in the supply chain, when requesting information about component composition (of valuable, critical or hazardous substances) or when negotiating component efficiency. 2.5.3.Industry end-users Welding equipment products are used horizontally in industry for a wide variety of sectors, and in general for repair and maintenance operations. The problems described mean that, despite the availability of affordable efficient technology, end-users are currently not enjoying saving costs of electricity and ancillary materials. For industrial users, the provision of energy and material efficiency information offers them the opportunity to make batter informed choices as to which products offers the best environmental and energy performance over the lifetime. Moreover, ecodesign requirements safeguard end-users from the worst performing products. Additionally, insufficient or absent information on reparability hinders that appliances can extend their lifetimes. 2.5.4.Private consumers Welding equipment within the scope of this Impact Assessment provides services for industry. The private end consumer is only occasionally affected by the market failures described (e.g. housing and vehicle refurbishment), repairs requiring sometimes metal welding tasks. 2.5.5.Repair and recycling industry

Welding equipment rarely arrives to recyclers. If they do, recyclers have to comply to the prescriptions of Article 8(2) of the WEEE Directive, on the separate collection and treatment of hazardous components in electric and electronic appliances. The absence of information on the presence and location of hazardous components (electronic boards, transistors, inverters, transformers, displays) makes WEEE compliance difficult. Currently in the EU, welding equipment is thus treated in large installations, together with household appliances, hardly targeting any hazardous or valuable substance. For repairers, the absence of any information on disassembly, or of any measure facilitating disassembly, means they unnecessarily use too much time for repair, resulting in larger bills for end-users and discarding repairable devices. 2.5.6.Society as a whole Despite the limited scope of impact of welding equipment, society at large is affected by the problems described by not making profit of existing knowledge to reduce overall environmental impacts, ie. a matter of lost opportunities. For society as a whole, ambitious policies in the area of energy and material efficiency are important tools to mitigate greenhouse gas emission targets, and improve material recycling. Effective and efficient ecodesign regulations contribute to achieving goals set in the Paris Agreement, the 2030 EU climate goals. In total for ecodesign products, ecodesign measures currently proposed will generate 0.29 % of the total EU GHG-emissions savings target for 2030 and 0.66 % of the total EU final energy consumption savings target for 2030. 2.6.How would the problem evolve? Both the product choice by end-users and the product design of the welding equipment are dominated by inertia and consist in repeating a beaten business track. The current market practices in the sector seem insufficient to change this state of affairs. Welding is a professional practice that requires skilled labour, which is the main cost of the operation. This focuses attention in the sector on labour costs and performance, relegating use of energy and materials to a secondary concern. This state of play is likely to continue in the future. The evolution of the problem described will not enable society to harvest all the potential for energy and material savings that the current development of technology and knowledge about energy efficiency allows. Evolution will be guided by business interests only. Additionally, as mentioned in section 2.5.1, the European Welding Association (EWA) reports a gradual increase of total imports of arc welding equipment from Asia, from a few hundred euros in 2003 to ca. EUR 60 Million in 2017. Most of these imports concern small, low power welding equipment from China sold mainly by distributors for manual welding, and sport mainly lower purchase cost, and lower quality, including energy efficiency. In the near future less efficient, poorer welding equipment from third countries would be gradually increasing their share in the EU market. Although the energy savings estimate for welding equipment are currently modest, due to imports of less efficient equipment from third countries, the dynamics of potential overall energy savings for the welding equipment sector might increase in the coming years in the absence of policy intervention. 2.7.How do existing policies and legislation affect the issue? 2.7.1.Energy and material efficiency legislation There is currently no legislation at EU level or in EU Member States that would foster energy or material efficiency regarding welding equipment. The preparatory study screened the existence of such legislation at the international level, and found that only China has an energy efficiency regulation for arc welding equipment based on the regulation/standard GB 26736-2012 (entitled 'Minimum allowable values of energy efficiency and energy efficiency grades for arc welding machines'). The standard is currently mandatory for welding equipment to enter the Chinese market (China Compulsory Certification –CCC, similar to the European CE system). This standard addresses professional arc welding equipment, and similarly to this proposed EU Regulation, excludes hobby equipment, resistance welding, and stud welding. The Chinese regulation includes both voluntary and mandatory requirements as grades: ·Grade 3 (includes efficiency values limits), the lowest limit is compulsory; ·Grade 2 (includes efficiency and power factor limits), and is voluntary; ·Grade 1 (includes efficiency, power factor and idle power limits) is voluntary. The limit values for the grades in the potential Chinese regulation, just like the ecodesign requirements envisaged for welding equipment in the EU, also depend on the type of phase of the welding current used (AC or DC). Although standard GB 26736 was already published in 2012, it is still not mentioned in the Chinese implementation of energy-efficiency labelling products overview. Concerning material efficiency aspects, legislation on the "Right to Repair" of electronics equipment is under analysis in some US states, such as Massachusetts and New York. These initiatives aim to ensure that: ·(New York) manufacturers make available diagnostic and repair information for digital electronic parts and machines to independent repair providers; ·(Massachusetts) 'Manufacturers of digital electronic products shall make available to independent repair facilities or owners of products manufactured by the manufacturer the same diagnostic and repair information, including repair technical updates, diagnostic software, service access passwords, updates and corrections to firmware, and related documentation, free of charge and in the same manner the manufacturer makes available to its authorized repair providers'.

2.7.2.Relevant boundary EU legislation EU Directives for health, safety, and performance apply to welding equipment. They are described in detail in Annex 6. EU legislation on end-of-life treatment affects welding equipment. As explained in section 2.2, compliance with this legislation is the reason why repairers and recyclers demand additional information from manufacturers. The most relevant EU legislation is: ·The Waste Electrical and Electronic Equipment (WEEE) Directive (2012/19/EU), which sets requirements on recovery and recycling of Waste of Electrical and Electronic Equipment to reduce the negative environmental effects resulting from the generation and management of WEEE and from resource use. It also requires manufacturers to finance collection, treatment, recovery and environmentally sound disposal costs. The WEEE directive applies directly to welding equipment. Ecodesign implementing measures can facilitate the implementation of the WEEE directive by including measures for material efficiency contributing to waste reduction, and instructions for correct assembly and disassembly, contributing to waste prevention. ·The Restriction of hazardous Substances (RoHS) Directive (2011/65/EU), which restricts the use of six specific hazardous materials: lead, mercury, cadmium, chromium-IV, PBB, and PBDE in electric and electronic equipment, including welding equipment. Exemptions from RoHS bans for certain applications apply, such as lead used in solder wire for welding, and exemptions for lead content up to a certain level in steel, aluminium and copper alloys (which allow s better workability of these alloys). There is no overlapping requirement with a proposed ecodesign regulation. ·The REACH Directive, which restricts the use of Substances of Very High Concern (SVHC) to improve protection of human health and the environment. The REACH Directive applies directly to welding equipment. There is no overlapping requirement with a proposed ecodesign regulation. 2.7.3.Standards regarding energy and material efficiency of welding equipment Harmonised metrics for energy and material consumption of welding equipment, as well as for air emissions from welding processes are essential to measure and compare the life-cycle costs of different equipment. The envisaged ecodesign requirements for welding equipment calculation rely directly on these measurements, based on reliable, accurate and reproducible measurement and calculation methods, set up in accordance with Article 10 of Directive 2009/125/EC. The European Commission has just adopted a standardisation request to CEN/CENELEC for developing such standards, based on the international standard IEC 60974 of performance of arc welding equipment. The remit of the future CEN/CENELEC standard is to unambiguously describe measurement methods for, inter alia: 1.the efficiency (in %) of single-phase and three-phase welding power sources with direct current (DC) and alternating current (AC) output, 2.the durability or lifetime expectations of the welding power source, and/or its key components. 3.the consumption related to welding processes, of shielding gases, and welding wire or filler material; 4.the emissions to air during welding processes; Complementing this, CEN/CENELEC Joint Technical Committee 10 is currently developing, with final delivery by the end of 2019, horizontal measurement methods on material efficiency, which will be used for assessing compliance with the following material efficiency requirements: 1.requirement on extraction of key-components (analysis of the joining, fastening or sealing techniques at product level, and on the presence of documentation on the sequence of disassembling operations) 2.requirement on secure data deletion functionality (check of the presence of this functionality in the product) 3.requirement on the critical raw material information (check of the information reported by the manufacturer). 3.Why should the EU act? 3.1.Legal basis The legal basis for acting at EU level through the Ecodesign framework Directive and the Energy Labelling framework Regulation is Article 114 and Article 194 of the Treaty on European Union and the Treaty on the Functioning of the European Union (TFEU) respectively. Article 114 relates to the "the establishment and functioning of the internal market", while Article 194 gives, amongst others, the EU the objective "in the context of the establishment and functioning of the internal market and with regard for the need to preserve and improve the environment" to "ensure security of energy supply in the Union" and "promote energy efficiency and energy saving and the development of new and renewable forms of energy".

The Ecodesign Framework Directive includes a built-in proportionality and significance test, which however is described in relative terms. Articles 15(1) and 15(2) state that a product should be covered by an ecodesign or a self-regulating measure if the following conditions are met: ·The product represents a significant volume of sales; ·The product has a significant environmental impact within the EU; ·The product presents a significant potential for improvement without entailing excessive costs, while taking into account: o an absence of other relevant Community legislation or failure of market forces to address the issue properly, oa wide disparity in environmental performance of products with equivalent functionality; The procedure for preparing such measures are described in Article 15(3). In addition, the criteria of Article 15(5) should be met: ·No significant negative impacts on user functionality of the product; ·No significant negative impacts on Health, safety and environment ·No significant negative impacts on affordability and life cycle costs ·No significant negative impacts on industry’s competitiveness (including SMEs see Section 6.2.2). During the preparatory phase, it was concluded that despite the modest energy saving potential, welding equipment appliances would meet the eligibility criteria listed above. A detailed assessment of how the different policy options meet the criteria above is provided in Section 7. 3.2.Subsidiarity: Necessity of EU action The EU should not act if the objectives of the action can be achieved sufficiently by Member States acting along. However, action by Member States could not solve the problem for the following reasons: Action at EU level gives end-users the guarantee that they buy an energy efficient product and provides end-users with harmonised information no matter in which MS they purchase their product. Welding equipment is traded internationally. Technology for these products is very complex; hence it would be highly difficult for Member States to develop national schemes and regulations, while an EU action would eliminate additional costs needed in each Member State to regulate a technology that does not vary from country to country. It is essential to ensure a level playing field for manufactures and dealers in terms of requirements to be met before placing an appliance on the market, and in terms of the information supplied to customers for sale across the EU internal market. For this reason EU-wide legally binding rules are necessary. Market surveillance is carried out by the MSAs appointed by MSs. In order to be effective, the market surveillance effort must be uniform across the EU to support the internal market and incentivise businesses to invest resources in designing, making and selling energy efficient products. 3.3.Subsidiarity: Added value of EU action There is clear added value in requiring minimum energy efficiency levels at EU-level.

With ecodesign at EU level, energy efficient products are promoted in all MSs, creating a larger market and hence greater incentives for the industry to develop them. Without harmonised requirements at EU level, MSs would be incentivised to lay down national product-specific minimum energy efficiency requirements in the framework of their environmental and energy policies. This would undermine the free movement of products. Fragmentation of requirements, moreover, with consequent unnecessary multiplication of specific models, would inevitably increase design, manufacturing and distribution costs, and often be passed on to customers. Manufacturers have expressed views that national schemes and regulations would create more obstacles and administrative burden for entering national markets, and would prefer to comply with an EU-wide legislation. The preparatory studies have established for the products within scope a significant potential for improvement (wide disparity in environmental performance), which can be achieved without excessive costs (improvement of average product results in lower life cycle costs). Moreover, it is expected in absence of regulatory interventions, the market failures analysed in Section 2 could not be solved, and they would represent missed opportunities to move the market from a non-optimal situation. 4.Objectives: What is to be achieved? This impact assessment addresses both the general and the specific objectives, but it only elaborates on how to achieve the specific objectives, since the general ones have already been set out in the impact assessments for the Ecodesign Directive. 4.1.General objectives The general objective of the initiative is to contribute to the EU climate and energy targets i.e. the 2030 targets, while ensuring the functioning of the internal market. Following the legal basis of Directives 2009/125/EC in the TFEU, the general objectives are to: 1.Facilitate free circulation of efficient welding equipment within the internal market; 0.Promote competitiveness of the EU welding equipment industry through the creation or expansion of the EU internal market for sustainable products; 1.Promote the energy efficiency of welding equipment as a contribution to the Commission's objective to reduce energy consumption by at least 30 % and domestic greenhouse gas (GHG) emissions by 40 % by 2030; implement the energy efficiency first principle established in the Commission Communication on Energy Union Framework Strategy; and 2.Increase energy security in the EU and reduce energy dependency through a decrease in energy consumption of welding equipment. There are several synergies between these objectives. Reducing electricity consumption (by increasing the energy efficiency) leads to lower carbon, acidifying and other environmental impacts, and contributes to circular economy targets by promoting reuse and recycling, in light of EU’s Circular Economy Package. Tackling the problem at EU level enhances efficiency and effectiveness of the measure. 4.2.Specific objectives The specific objectives of this proposal are the following: 1.Improve the energy efficiency of welding equipment in the EU, in line with international and technological developments, to achieve cost-efficient energy savings; 2.Improve the material efficiency of welding equipment, contributing towards a circular economy in the EU by including requirements on reparability and recyclability; 4.3.Consistency with other EU policies These objectives should drive investments and innovations in a sustainable manner, increase monetary savings for the consumer, contribute to the Energy Union Framework Strategy and the Paris Agreement, contribute to the Circular Economy Initiative and strengthen the competitiveness of EU industry. Improved energy efficiency of welding equipment is in line with and would contribute to reaching the minimum of at least 30% energy savings potential by the year 2030 compared to the 1990 baseline, as agreed in the 2030 framework for climate and energy policies .

5.What are the available policy options? Policy options have been developed in close cooperation with stakeholders in the course of the review study and at the Ecodesign Consultation Fora. They were also inspired by the Eco-design Framework Directive and the Circular Economy Initiative. The policy options defined for welding equipment are listed in Table 1 , with a detailed description in the following sections. Option Description Option 1 No EU action (“BAU”, Business-as-Usual) Option 2 Self-regulation Option 3 Energy labelling Option 4a Mandatory ecodesign requirements for welding equipment a.Minimum efficiency limits for power supply, designed at the level of the Least Life Cycle Cost (LLCC) b.Minimum requirement for idle mode energy consumption c.Information requirements for material efficiency Option 4b Same requirements as option 4a, but the quantitative limits to be met in a stricter timescale (year 2025 instead of 2028) than in option 4a. Option 5 Mandatory ecodesign information provision requirements (identical to options 4a and 4b), on energy and material efficiency. No quantitative requirements on energy or material efficiency. To meet the specific objectives described, and raise awareness in the supply chain regarding efficiency and environmental performance of welding equipment, the first fundamental pillar of any of the proposed options is to generate unambiguous and comparable energy and material efficiency information. Lack of harmonised information is usually addressed by mobilising a standardisation group, which is tasked with developing measurement methods of energy and material consumption of a product. Once the standard is in place, different policy options can ensure or facilitate that the data is generated following the standard, and users can compare products. As one of the first parallel activities since the launching of the preparatory study in 2012, and in order to generate harmonised and comparable information, relevant industry actors and Member State specialists have been cooperating with the European Commission in the preparation of a standardisation request for the European Standardisation bodies CEN-CENELEC, based on existing IEC standards, the purpose of which is to define a standardised testing methodology for energy and material consumption efficiency. Table 2 gives an overview of the action that needs to be undertaken. What Who By When Ecodesign Test appliances’ material and energy efficiency, and air emissions. Open to all stakeholders. Current standardisation committees are mainly composed of manufacturers/ importers 1 July 2021 [36 months from acceptance by standardisation organisation of the standardisation request, expected July 2018] The industry actors involved in the standardisation committee have calculated that the total workload based on the available test capacity amounts to 36 months. Assuming an entry into force of the Regulation on 1 April 2019, with the first requirements applying as of 1 January 2021 , an adoption by the Standardisation bodies of the standardisation request in July 2018 would allow the customary 36 months to develop the testing methodologies. As such, the actions to be undertaken are feasible within the given time frame. In addition, this test standard aims to be universally applicable. The use of the standard will improve the quality of the products and enhance global competitiveness. In this Impact Assessment, the generation and availability of the standard is considered part of the baseline scenario. Stakeholder views: None of the stakeholders opposed the development of the standard. The Commission has discussed extensively with Member States and industry the precise phrasing of the standard, especially the air emissions and consumption which is possible to attribute to the welding equipment, compared to the consumption and emissions that depend on the welding process and the skills of the welder. 5.1.What is the baseline against which other options are assessed? (Option 1: BAU) Section 2 describes qualitatively how the situation would evolve in the absence of action at EU level. A quantitative description of impacts is provided in Section 6, where the BAU is used as a reference and compared with the other policy options. Option 1 – “Business as usual” (BAU) scenario - is the baseline where welding equipment will continue without EU regulatory intervention. The reference year used is 2016, the year from which the latest information on sales and technology uptake is available. Based on the current trend, the following development in the welding equipment market can be expected: ·Welding equipment sales will likely remain stable until 2030. This hypothesis is based on the observation of the sales over the past 20 years (1995-2015), when only very limited sale increase occurred (5% increase in total). The main reason for the stability of sales is probably a close link of welding with industrial activities for which yearly growth rate in the EU has been modest or even negative on over the last two decades: for e.g. civil engineering and construction it was 0.07% growth, for transport: 1.1%, and for energy (-0.04%). It is thus assumed that the market for welding equipment is saturated, and sales are assumed to remain constant until 2030, replacing gradually the units that cease to work or are not repairable. ·As a consequence of the development of European harmonised measurement standards by 2021, the generation of comparable information on energy and material efficiency will be possible. However, in the absence of any voluntary or regulatory approach referring to these measurement standards, the provision of data by manufacturers will be unstructured: some may measure and some may not, some may deliver data to end-users and some may not. The baseline scenario assumes therefore that the finalisation of the standardisation exercise will have no significant effect on the technology and efficiency of the appliances brought to the market.

·Many factors can stimulate sales upwards and downwards. For welding equipment the following factors may apply, possibly compensating for one another: oslight decreases in sales may result from the gradual technology switch to inverter controllers which is already happening. These systems allow the same machine to perform several welding tasks, and makes the replacement of mechanical bonding by welding (e.g. aluminium welding) affordable. The consequence of this may be that fewer, but more versatile welding machines will be sold. oinverter-controlled welding equipment has a shorter lifetime than transformer equipment. Firstly, due to the higher intensity of operation (on tasks where previously two devices were used), and secondly, due to the lower intrinsic longevity of electronic components (about 7 years) compared to transformers (9-15 years). Shorter lifetime means higher rates of replacement, and consequently higher sales. ·Transformer-controlled welding technology will be gradually replaced by the more efficient and versatile inverter technology. Without stimulating measures, this process may be long, and in any case at a slower pace than if measures were introduced. It will also be a process geared by market forces, and business interests and dynamics, European or international. ·The observed trends of gradually increasing import of welding equipment from outside the EU (especially China) will continue, increasing their share in the EU market from €40m in 2012 to nearly €70m in 2017, and projections of €100in 2020 and €150m in 2030. EWA (2018) indicates that these appliances serve the inexpensive market share and are of lower efficiency. In the current absence of harmonised and comparable information on energy performance, it is more likely that users that prioritise purchase price (i.e. short-term costs) above total life-cycle costs will choose these devices. The baseline scenario assumes that current policy measures at Member State level will not change, and that no further action at EU level will be taken. However, responding to the request from stakeholders, the baseline has been adapted to account for the already on-going technology transformation triggered by this policy process, which started in 2011. If in the end there is no intervention at the EU level, the transformation would most likely be interrupted and set to a standstill. The full saving potential of materials and energy would not be realised for the welding equipment and the market failures mentioned earlier would persist: standardised measurement methodologies would be missing and sub-optimised behaviour of users would continue. The baseline scenario also assumes that the average power use of welding equipment is roughly constant. According to the MEErP (Methodology for Ecodesign of Energy-related Products) methodology used for Eco-design and developed in close consultation with the industry affected, the baseline scenario has to be developed using a hypothetical 'average technology' product or 'base-case' that also represents a major market share. This helps to establish the energy consumption which is most representative for the sector. Whilst the introduction of more efficient equipment does take place gradually (approximately 1% replacement yearly of technology from transformer to inverter), the new equipment has a shorter lifetime (7 years as opposed to 10 years for transformer-based equipment) with subsequent more frequent replacements and sales. A more detailed description of base case and the baseline assumptions can be found in Annex 4. Stakeholder views – The welding industry stakeholders have highlighted the transformation effort of manufacturers since the inception of the regulation proposal in 2011, now included in the baseline scenario, as well as to take into account the particular needs of SMEs, both as manufacturers and as users of welding equipment. 5.2.Discarded options Option 2: Self-regulation. According to the Eco-design Framework Directive, a voluntary agreement has to be given priority provided it meets the objectives in a quicker and more cost-effective manner. However, the welding equipment industry has not proposed any kind of self-regulation during the preparatory phase of the project, which is a minimum condition in accordance with Article 17 and Annex VIII of the Directive 2009/125/EC to consider such an option. Both during the preparatory study work, and during initial collection of inputs to the impact assessment, thorough discussions were held between the European Commission and the European Welding Association to explain to the welding industry the needs and implications of a Voluntary Agreement to meet the stipulations of the Ecodesign Framework Directive. Following their own internal discussions, the EU welding industry decided that regulatory measures would provide more certainty for both manufacturers and end-users than the certainty which a Voluntary Agreement promoted by themselves could provide. As a consequence, this option is discarded from further analysis. Stakeholder views –Welding industry stakeholders have expressed their preference for the legal certainty that a regulatory approach provides. Member States have had a neutral position on this matter: they support self-regulatory initiatives when feasible, but they do not have the leverage to prioritise this option if the industry itself does not promote and support it. Option 3: Energy efficiency labelling. This option is usually implemented jointly with ecodesign, so that the ´pull´ effect of the label (of the best performing products) adds to the ´push’ effects of eco-design, eliminating the worst performing products from the market. This option has been discarded for the following reasons: First of all, there are no or very few direct sales of professional welding equipment to private households (B2C), at whom the energy (or material) efficiency label would normally target. A B2C consumer has normally no technical insight of the product, and therefore the label is used to display technical characteristics of the product graphically, in a very simplified manner. For business-to-business (B2B) products as welding equipment, given that users normally have a higher technical understanding of the products, the 'pull' effect of the extra information provided by the energy label is normally not that fundamental to generate energy savings. A professional end-user, even if initially not aware of the efficiency, would also effectively respond to information about efficiency not presented as a simplified label, but as technical documentation in the instruction manuals, and the product fiche. Secondly, in order for the EU energy label to be a relevant tool to promote informed choices when buying the products, it should be carefully designed to provide concise but at the same time relevant and effective information. There should normally also be a known "spread" of performance of the product within scope, so that any Energy Label proposed is able to guide end-consumers to differentiate the best performing products (those towards "A" or "B") from the worst-performing products (those placed in Energy Classes "F" or "G"). The present lack of both a well-established metric for the energy efficiency of welding equipment, and necessary data on product performance and efficiency collected annually, would be the main obstacle for the development of an energy label at this stage. The preparation of the scaling and ranges of values for each energy class of a labelling system entails knowledge of the efficiencies of products on the market over a time-series of several years, indicating how products might be split in the various potential energy classes. The level of detail is even higher than the one needed to set minimum threshold requirements for ecodesign. Current knowledge of the "spread of performance" of the different welding equipment devices is judged not sufficient to merit the introduction of 5 or 6 discrete energy class labels. In the absence of a minimum critical mass of data related to product performance and efficiency, it has not been possible to further contemplate this option. In case an ecodesign regulation was finally adopted, this assessment could be revised in a revision 4-5 years after adoption, if a reliable data pool is by then made available. Stakeholder views – Member States, NGOs and industry have supported the exclusion of this option, as they did not consider that it would provide any added-value. 5.3.Description of policy option 4: Mandatory ecodesign requirements for welding equipment (energy efficiency, and information) Option 4 is divided into two sub-options 4a and 4b, which are based on the same principle of mandatory requirements and thresholds. The two sub-options proposed differ in terms of timing and speed of adaptation of the measures, one being more conservative (4a) and the second option more ambitious (4b). Both sub-options propose a number of mandatory requirements for energy efficiency, material efficiency and provision of information thereon.

For the energy efficiency related measures, the preparatory study identified the following cost-effective measures that could reduce the life-cycle costs (LLCC) of welding equipment for users. They are developed in more detail in sections 5.3.1-5.3.3. Collectively they are referred to as LLCC measures: ·Efficiency of welding power sources: higher efficiency in operation and reduced consumption in idle state; ·Optimised shielding gas supply; ·Optimised supply of weld (wire or electrode) metal and reduction of spatter losses. Table 3 summarises all the requirements. They have been prepared in close cooperation with the industry (especially the European Welding Association and its members), and were discussed openly at the Consultation Fora on 6 May 2014, and on 25 October 2017. Sections 5.3.4-5.3.8 of this chapter provide a justification for the measures as well as stakeholders views. Identified problems Corrective measures Problem 1 (The manufacturers of the welding equipment are unaware of design demands to improve efficiency of these devices) a)Product designers unaware of interest of users in energy efficiency data. ·Mandatory declaration of energy efficiency for the power source; ·Mandatory declaration of idle state consumption values of the power source. b)Product designers unaware of interest of users in material efficiency data. ·Mandatory declaration of expected shielding gas utilisation; ·if the welding equipment has a display, this must indicate the shielding gas consumption, and indicate if it is normal or excessive; ·Mandatory declaration of expected welding wire or filler material utilisation; ·if the welding equipment has a display, this must indicate the welding wire consumption, and indicate if it is normal or excessive. Problem 2 (There are no incentives to improve the efficiency design of welding equipment in terms of energy and material) a)No incentives for designers to improve energy efficiency of products. ·Mandatory minimum energy efficiency for the power source; ·Mandatory maximum idle state consumption values for the power source. b)No incentives for designers to improve material efficiency of products. ·Mandatory reparability requirements: - access to components; - joining techniques that do not prevent disassembly; - enabled data deletion prior to reuse. Problem 3 (Poor communication of energy and material consumption in the supply chain) Poor communication in the supply chain between downstream actors (end-users, and recyclers) and product designers and manufacturers. ·Mandatory declaration of information relevant to disassembly; ·Mandatory declaration of information relevant to recycling and disposal at end-of-life, including access and removal of components that need special treatment according to the WEEE Directive; ·Mandatory declaration of the mass per product of critical raw materials. 5.3.1.Efficiency of welding power sources Welding power sources have undergone major technical changes from bulky transformers to inverters. The major reasons driving this development have been the overall size and weight reduction of the power sources, the lower material costs, and the better multi-process capabilities and process controllability of inverter-powered welding equipment. Additionally, a beneficial side-effect of this development has been considerably higher efficiency power transformation. Equipment based on inverter-based power sources reduce energy consumption by up to 10-15% compared to the transformer-based counterparts. According to EWA estimates, the maximum achievable efficiency for an arc welding power source is ca. 90%. According to EWA, the above-stated efficiency increase will not be achievable for alternating current (AC) arc welding power sources, which are designed for some advanced welding processes (e.g. on aluminium). These AC welding machines need a second direct current (DC)/AC converter which results in additional losses. Regarding idle power consumption, where previous generation welding machines consumed more than 100 watts (W), the current generations are in the order of 60W. According to manufacturers, the newest generations could be expected to consume less than 30W. These figures have been used as targets to be reached by the mandatory requirements (see 5.3.4 and Table 4 below). In addition, air-flow–cooled welding units can feature a fan which is switched off, when the equipment is in idle mode and at cold state, which allows reduced power consumption. 5.3.2.Optimised shielding gas supply Welding gas manufacturing requires resources for production, including energy. Excessive shielding gas consumption has also an adverse effect on weld quality due to turbulences. An optimized gas flow thus also has a positive effect on productivity (less rework), weld quality, and lifetime, and indirectly on the lower required supply of weld metal due to reduced spatter losses. The setting of the flow rate depends heavily on the information the welder has about the recommended gas use, so she/he is aware of when consumption is normal or excessive. Welding gas savings of 40% to 50% are reported, but this depends on many variables,. This study estimates conservatively the potential of a 10% gas saving through a combination of state-of-the-art measures, which are estimated to increase the purchase price of the equipment by 10%. 5.3.3.Optimised supply of weld metal and reduction of spatter losses Like welding gas, the manufacturing of weld wire (or electrodes, depending on the welding type) requires resources for production, including energy. Excessive wire use is unnecessary to reach the desired weld resistances. It is essentially up to the skill of the welder to achieve a smooth and proportionate weld wire deposition, but equipment that allows fine adjustment of the wire feeding, and/or information of the wire use, facilitates the welder be aware of when consumption is normal or excessive, and correct accordingly. This study estimates conservatively the potential of a 5% welding wire saving through a combination of state-of-the-art measures. These would have the estimated effect of increasing the purchase price of the equipment by 10%.

The aggregated implementation of the technical measures described above represents the point of least life cycle costs (LLCCs) for users ( Figure 4 ), where the LCCs reach a minimum at reduced environmental impacts. The realised savings are estimated to represent some 12.2% of total energy consumption, at a 7.5% lower LCC. 5.3.4.Measures related to problem 2a: Lack of incentives for designers to improve energy efficiency of products The following two measures have been proposed: ·Mandatory minimum energy efficiency to the power source, and ·Mandatory maximum idle state consumption values to the power source The LLCC scenario requires that the powers sources of welding equipment achieve minimum efficiency values of between 80 and 87%, as shown in Table 4 , and to achieve a maximum idle consumption of 30W. The new efficiency levels would become applicable as of 1st January 2028 ('Tier 2'). They would correspond to the LLCC point as determined in the preparatory study with an intermediate Tier in 2023. Both timing and strictness of the measures were discussed with stakeholders at the consultation forum meetings. Option 4a is considered challenging (especially for SMEs) but feasible according to the manufacturing industry, as it consolidates a development and effort that the industry has already started to undertake, but ensures international access to the more efficient components, cf. section 2.5.2. Some MSs commented that the adaptation time of 8 years was long, suggesting the elimination of Tier 1 (2023) and bringing forward to 2025 the measures of Tier 2. This enhanced ambition scenario has been further elaborated and is presented as option 4b. The measures would require from all the manufacturers of welding equipment (including overseas manufacturers if the equipment is imported) adaptation of the design and production methods by this date. Beyond this date, products incompatible with the new requirements could not be placed on the EU market. All stakeholders agree that the timing for the measures should be sufficient to allow manufacturers to test their redesigned appliances, and ensure that they could confidently meet the ecodesign requirements, the associated manufacturer performance self-declarations, and market surveillance authorities' inspections. The requirements proposed are approximately 5% stricter than the similar requirements introduced in China by GB28736-2012 Standard/ Regulation, see Annex 8. Power source minimum efficiency values Maximum idle state power consumption 1 January 2023 (Tier 1) 1 January 2028 (Tier 2) 1 January 2023 (Tier 1) 1 January 2028 (Tier 2) Three-phase power sources with direct current (DC) output 85% 87% 50 30 Single-phase power sources with direct current (DC) output 80% 82% 50 30 Single-phase and three-phase power sources with alternating current (AC) output 80 % 80% 50 30 The increase of the energy efficiency requirements will result in the removal from the market by 2023 of 13% of the products currently sold, increasing to a product removal share of 19% in 2028, compared to a BAU scenario (see Annex 4). By 2028, the measures would have the projected effect that there would be no more sales in the EU of transformer-powered welding equipment within the scope of the regulation. What Who By When Eco-design To adapt production to stricter energy efficiency limits (see Table 4), after which products not meeting the requirements cannot be placed on the EU market. Manufacturers (including overseas manufacturers if the equipment is imported) or importers 1 January 2023 (Tier 1) 1 January 2028 (Tier 2) 5.3.5.Measures related to problem 2b: Lack of incentives for designers to improve material efficiency of products. The following three measures have been proposed for the design of the equipment to make it repairable in an easier manner: ·Access is possible to all essential components. ·Joining techniques do not prevent disassembly, ·Systems are in place that enable data deletion (e.g for remanufacturing prior to reuse).

In addition to promoting the design of repairable appliances, and thereby extending the average lifetime of these, these measures attempt to avoid the creation of 'captive market' for repair, for instance by the equipment manufacturers themselves. Manufacturers should ensure that a number of components essential to the operation of the equipment can be accessed and removed so that they may be fully inspected, cleaned, maintained, repaired or upgraded as required, by third-party maintenance organisations or representatives of the manufacturer or importer. Manufacturers should also ensure that joining, fastening or sealing techniques do not prevent the disassembly of the essential components, e.g. by using soldered, welded or glued joints. Accessing these components for disassembly must be ensured by documenting the sequence of dismantling operations needed to access the targeted components, including for each of these operations: type of operation, type and number of fastening technique(s) to be unlocked, and the tool(s) required. Finally, manufacturers are required to build in software-based data deletion tool(s) in potentially reusable welding equipment (e.g. on any embedded hard drives and solid state drives). Actions Who By When Ecodesign Adapting the design of welding equipment so that: - access is possible to all essential components. - joining techniques do not prevent disassembly, - systems are in place that enable data deletion (e.g for remanufacturing prior to reuse). Manufacturer or importer 1 January 2021 All of the proposed measures have been thoroughly discussed with stakeholders and Member States and found to have a value. A standardisation request to define reliable measurement methods has been adopted in July 2018. The measures proposed are simple and enforceable. They have been selected on the basis of input from stakeholders. Contrary to other ecodesign examples (e.g. refrigerator´s tradeoff of durability vs replacement with more efficient appliances), the measures proposed do not imply any trade-off with energy requirements, which would have implied a more detailed quantitative assessment. They are thus fully compatible to the proposed energy-related requirements. The measures above are not specific for welding equipment. Similar measures are also being proposed to other EEE (Electric and Electronic Equipment) under ecodesign in 2018. Welding equipment is under the scope of the WEEE Directive, where recyclers have to meet the requirements (Art 8 and Annex VII) of safe treatment and disposal. Stakeholder views: All stakeholders are in favour of setting these requirements. Users support these measures for obvious reasons: welding equipment is expensive and needs maintenance and repair. Manufacturers are on the other hand interested in protecting their brand reputation and the continuity of B2B relationships with clients. These measures have the support of environmental NGOs and Member States. 5.3.6.Measures related to problem 1a: Product designers unaware of interest of users in energy efficiency data The following two measures have been proposed: ·Mandatory declaration of energy efficiency of the power source, and ·Mandatory declaration of idle state consumption values of the power source Welding equipment products must include energy efficiency information in the instruction manuals for installers and end-users, and on the free-access websites of manufacturers, their authorised representatives and importers. The information to be made available to the user is the minimum necessary for her/him to calculate life-cycle costs: ·minimum power source efficiency (%) at the stated highest power consumption point, and ·maximum idle power consumption at cold state (Watts).

Stakeholder views: All stakeholders are in favour of setting these information requirements. The concept is well-known to the Consultation Forum stakeholders as it is part of the methodological approach used in all eco-design proposals. 5.3.7.Measures related to problem 1b: Product designers unaware of the interest of users in material efficiency data The following four measures have been proposed: ·Mandatory declaration of expected shielding gas utilisation, including tabulated information on expected shielding gas utilisation of the product for representative welding schedules and programmes; ·If the welding equipment has a display, this shall indicate the shielding gas consumption, and indicate if it is normal or excessive; ·Mandatory declaration of expected welding wire or filler material utilisation, including tabulated information on expected wire or filler material utilisation of the product for representative welding schedules and programmes; ·If the welding equipment has a display, this shall indicate the welding wire consumption, and indicate if it is normal or excessive. Section 2 (problem definition) proves how significant material consumption is during the use phase. In the overall energy footprint and operational cost of welding equipment, this relates in particular to welding wire, but also to a smaller extent to shielding gas. In terms of total primary energy consumption over the life cycle of a welding unit, wire and gas use contribute respectively to ~15-20% and ~ 3-4%, and in terms of cost to 7% and 5% (including labour) and ~ 55% and ~30 % (excluding labour). This justifies the need for information on material consumption provided to the user. Such an information would help users calculate life-cycle costs and see the benefits of more efficient equipment. Actions Who By When Ecodesign Accompany welding equipment with documentation to users on material efficiency consumption (shielding gas, welding wire) Manufacturer or importer 1 January 2021 The measures above are specific measures for welding equipment (not found in other products). These specific measures aim at providing information to end-users of the real-life (if the equipment has a display) and expected consumption of welding wire and shielding gas. The measures are simple, easy, low cost and enforceable, selected on the basis of input from stakeholders, and are meant to solve cost-effectively the identified problem of lack of communication to end-users. The measures include no 'hard criteria', and are essentially informational, the least common denominator criterion. The measures involving the use of the display are conditional: if the display is available, the consumption values shall be presented on it. The measures proposed do not imply any trade-off with energy requirements, which would have implied a more detailed quantitative assessment. They are thus fully compatible to the proposed energy-related requirements. Stakeholder views: Stakeholders are in favour of setting these requirements. Manufacturers indicated that, however relevant may be the wire and gas consumption, their consumption is not only dependent on the welding equipment itself, but also on the process of welding. They support the information provision, but for the reason above, they would be against the proposal of mandatory levels of consumption. 5.3.8.Measures related to problem 3: Poor communication of energy and material consumption of the welding equipment in the supply chain between downstream actors and product designers and manufacturers.

The following three measures have been proposed: ·Mandatory declaration of information relevant for disassembly. This measure complements the measures above related to problem 2b (Mandatory reparability requirements) and ensures the access to components during disassembly by documenting the sequence of dismantling operations needed to access the targeted components, including for each of these operations: type of operation, type and number of fastening technique(s) to be unlocked, and the tool(s) required. ·Mandatory declaration of information relevant for recycling, and disposal at end-of-life, including access to and removal of components that need special treatment listed in Annex VII of WEEE Directive (2012/19/EU); ·Mandatory declaration of the mass per product of critical raw materials, including the total mass of the three most present critical raw materials per product, expressed in grams rounded to the nearest integer, and a clear indication of those components in which the cited critical raw materials are present. Actions Who By When Ecodesign Accompany welding equipment with documentation for disassembly and recycling Manufacturer or importer 1 January 2021 All of the proposed measures have been thoroughly discussed and agreed with stakeholders. A standardisation request to define reliable measurements methods has been adopted in July 2018. They measures are purely informational, the least common denominator criterion. They are meant to solve cost-effectively the identified problem of lack of communication to end-users, and downstream actors of the supply chain. They are simple, easy, low cost and enforceable, selected on the basis of the input from stakeholders. The measures proposed do not imply any trade-off with energy requirements, which would have implied a more detailed quantitative assessment. They are thus fully compatible to the proposed energy-related requirements. The measures are not specific to welding equipment. Similar measures are being also proposed in 2018 to other EEE (Electric and Electronic Equipment) under ecodesign. Stakeholder views: WEEE recyclers are strong supporters of this measure. Environmental and consumer NGOs, and some Member States, strongly recommend including such requirements in the regulation. Some Member States are cautious about the value added of the requirements but would accept it if it is not too onerous for the manufacturing industry. 5.4.Policy option 4b: Mandatory eco-design requirements for welding equipment with stricter adaptation timing The requirements proposed for this option are the same as for 4a but their application is spread over a period of three years, from 2019 to 2025 with no intermediate target, as indicated in Table 9 . This option was suggested by some Member States during the Consultation Forum. Stakeholder views: Most stakeholders, especially industry, agreed that the timing in combination with the minimum requirements was too demanding. The main objection reasons that were mentioned were the need to redesign and test all appliances, which is especially difficult for SMEs. Tier 1 Tier 2 Option 4a 1 January 2023 1 January 2028 Option 4b No Tier 1 1 January 2025

5.1.Option 5 ("Info"): mandatory information provision on energy and material efficiency (but no quantitative minimum efficiency requirements) This option proposes information requirements, but no 'hard' quantitative energy efficiency requirements. The information requirements and application deadlines are the same as for Options 4 (see sections 5.3.5 to 5.3.8), that is 1 January 2021 In terms of modelling and quantification, this option has been structured conceptually assuming that the information requirements will: 1) result in the systematic testing and provision of information by manufacturers on efficiency, disassembly and recycling, which will create more awareness in the sector and supply chain about these parameters. Contrary to the baseline scenario, the observed technical development will continue, both in terms of energy efficiency, and material efficiency. 2) not result in a fast replacement of equipment to meet the sunset dates of removal of non-compliant equipment from the market, as in options 4a and 4b. Equipment will develop in light of technical development (pt.1), but manufacturers will not adapt production lines and still manufacture equipment as currently, following market demand, subject however to testing and having to bear new information on energy and material efficiency. This option has been suggested during the ISSG consultation, and as such has not been consulted with Member States and other stakeholders. However, stakeholders, especially Member States, answering a similar question related to machine tools, have expressed their reluctance to the proposal of ecodesign regulations purely based on information requirements. Member States have highlighted the possibly relatively small benefits in relation to the burdens on industry and market surveillance. 6.What are the impacts of the policy options? This chapter describes the environmental, economic and social impacts associated with the policy options mentioned in Section 5. Details of the stock model inputs and analytical methods used to determine the impacts and projections are provided in Annex 4. The requirements on improved material efficiency information to users, reparability and recyclability introduced in the LLCC (both 4a and 4b) and Info (Option 5) options are not discussed quantitatively. A qualitative assessment is included in Section 6.1.3. 6.1.Environmental impact 6.1.1.Final energy savings Energy savings potentials have been estimated for the years 2020 – 2030 for different policy scenarios in this impact assessment. With no action, it is estimated that the consumption of energy for welding would remain stable until 2030, despite the availability of affordable technology know-how to bring it down. If ecodesign measures based on minimum efficiency limits (options 4a and 4b) are undertaken, yearly primary energy demand savings of ca. 10 PJ have been estimated by 2030 (equivalent to 1.1 TWh of final electricity savings yearly or to the consumption of about 300.000 households). Figure 5 shows the EU-wide final energy consumption of the total population of welding equipment within scope, for the different scenarios. The average lifetime of welding equipment within scope is 9 years for transformer-controlled equipment, and 7 years for inverter-controlled equipment. The share of sales by 2016 was: 81% of inverter-based units, and 19% transformer-based units. The overview of savings expected by 2030 for the different scenarios presented are provided in Table 10 . The energy consumption of the baseline over time, relative to 2015 are 7.10 TWh/a (+0.5 %) in 2025 and 7.17 TWh/a (+1.5 %) in 2030. Scenarios Energy consumption (TWh/a), 2016 Savings vs BAU in 2025 (TWh/a) Savings vs BAU in 2030 (TWh/a) Savings vs BAU in 2030 (%) Cummulative savings 2019- 2030 (TWh) Baseline 7.06 (consumption value: 7.10 TWh/a) (consumption value: 7.17 TWh/a) 0% - Option 4a. LLCC 7.06 (-0.86) (-1.09) (-15.2%) (-9.49) Option 4b. LCCC -amb 7.06 (-1.08) (-1.09) (-15.2%) (-10.3) Option 5. Info 7.06 (-0.56) (-0.7) (-9.8%) (-6.18) Additional basic estimations have been performed to provide an illustration of the sensitivity of the model to change of the main variables. The maximum and minimum saving potential extremes are the following:

- For year 2025 reference value (-0.86) TWh/yr: extreme minimum: (-0.52) TWh/yr, extreme maximum: (-1.2) TWh/yr. - For year 2030 the values are: reference (-1.09) TWh/yr, extreme minimum: (-0.75) TWh/yr, extreme max: (-1.43) TWh/yr. 6.1.2.GHG-emissions The trends for GHG-emissions are largely comparable to the energy consumption trends. The main difference is that for the energy scenarios, by convention, a primary energy factor of 2.5 is used (according to the Annex V of the Energy Efficiency Directive (Directive 2012/27/EU), whereas for the projections of the GHG-emissions, the changes over time in carbon-intensity of the types of electric power generation are taken into account. Table 11 shows the EU GHG-emissions of the total population of welding appliances within scope for different scenarios. Greenhouse gas emissions associated with the electricity consumed by welding equipment during the use phase, plus with the manufacturing (including welding consumables) comprised in total about 2.45 Mt CO2-eq in 2015. For material resources efficiency, the emissions in 2016 were an additional 1.05 Mt CO2-eq. The proposed ecodesign measures on energy efficiency are projected to save 0.27 Mt CO2-eq yearly by 2030 (Options 4a and 4b). This saves cumulatively between 2019 and 2030 2.7 Mt CO2-eq compared to the baseline scenario. Scenarios GHG emissions (Mt CO2 eq./yr), 2016 Savings vs BAU in 2025 (Mt CO2 eq./yr) Savings vs BAU in 2030 (Mt CO2 eq./yr) Savings vs BAU in 2030 (%) Cummulative savings vs BAU 2019-2030 (Mt CO2 eq) Baseline 2.46 [2.06 Mt CO2 eq./yr] (-0.4 vs 2016) [1.76 Mt CO2 eq./yr] (-0.7 vs 2016) - - Option 4a. LLCC 2.46 (-0.25) (-0.27) (-15.2%) (-2.66) Option 4b. LLCC Amb 2.46 (-0.31) (-0.27) (-15.2%) (-3.03) Option 5. Info 2.46 (-0.16) (-0.17) (-9.8%) (-1.73) 6.1.3.Material efficiency impacts Table 12 shows the EU energy equivalent consumption and GHG-emissions of the total population of welding appliances within scope. It additionally includes the savings in primary energy and GHG emissions of the transformation from the BAU to the LLCC point (To be reached by 2028 for Option 4a, and by 2025 for Option 4b). Totals (2016) Potential saving per year by a transition to LLCC Primary Energy Use Final energy (power) Emissions GWP Final energy (power) Primary Energy Use Emissions GWP PJ/yr TWh/yr t CO2-eq/yr TWh/yr PJ/yr t CO2-eq/yr ANCILLARY MATERIALS (WHEN APPLICABLE) SHIELDING GAS 3.48 0.39 66,514 0.02 0.35 3,326 WELDING WIRE 15.17 1.69 956,263 0.08 0.76 47,813 ELECTRODES 20.21 2.25 1,274,177 0.11 1.01 63,709 MATERIAL REDUCTION SAVINGS Inverter vs Non-inverter welding equipment Copper savings 0.005 0.04 2,216 Steel casing and chassis 0.013 0.12 7,743 The overall savings of the material efficiency measures are modest compared to the energy efficiency savings: Shielding gas is about 2%, Wire/electrode savings are ca. 7-9%, and the reduction in weight of the unit from transformer-bas