Contents 1.INTRODUCTION 2.PROCEDURAL ISSUES AND CONSULTATION OF INTERESTED PARTIES 2.1.Organisation and timing of the IA and regulatory committee 2.2.Consultation and expertise 3.PROBLEM DEFINITION 3.1.What is the issue or problem that may require action? 3.2.What is the scale of the problem? 3.3.What are the underlying drivers of the problem? 3.4.How are existing policies and legislation affecting the issue? 3.5.Subsidiarity and proportionality 3.6.EU context 3.7.Baseline scenario 3.8.Should the EU act? 4.POLICY OBJECTIVES 4.1.General objectives 4.2.Specific and operational objectives 5.POLICY SCENARIOS 5.1.Basic assumptions

5.2.Assessment of energy efficient policies 5.3.Assessment of end-of-life policies 5.4.Refrigerants 5.5.Scenario 0: No EU action (Business As Usual) 5.6.Scenario 1: Self-regulation, “Voluntary agreement” 5.7.Scenario 2: Mandatory ecodesign (MEPS) requirements only 5.8.Scenario 3: Mandatory energy labelling scheme only 5.9.Scenario 4: Ecodesign requirements (MEPS) and energy labelling, 3 tiers 5.10.Scenario 5: Ecodesign requirements (MEPS) and energy labelling, 2 tiers 5.11.Selected options for further analysis 6.ANALYSIS OF IMPACTS 6.1.Economic impact 6.2.Market transformation 6.3.Cost 6.4.Environmental impact 6.5.End-of-Life (EoL) 6.6.Social impact 6.7.Conclusion on economic, social and environmental impacts 7.COMPARISON OF POLICY OPTIONS 8.MONITORING AND MARKET SURVEILLANCE

8.1.Monitoring 8.2.Market surveillance 9.ANNEXES 9.1.Annex I: Minutes Consultation Forum 2 July 2014 and comments 9.2.Annex II: Scope 9.3.Annex III: Comparison with other world regions 9.4.Annex IV: Properties and typical energy efficiency values of base cases 9.5.Annex V: Assumptions for the stock model 9.6.Annex VI: Sales figures 9.7.Annex VII: Stock figures 9.8.Annex VIII: MEPS and energy labelling 9.9.Annex IX: Data sources 9.10.Annex X: Data distribution, MEPS and labelling classes 9.11.Annex XI: Splitting of supermarket segment remotes vs. plugins 9.12.Annex XII: Functionality approach 9.13.Annex XIII: Comments of stakeholders on expected positive and negative impacts 9.14.Annex XIV. Sensitivity analysis 9.15.Annex XV. EoL requirements considerations 9.16.Annex XVI: Acronyms and abbreviations 9.17.Annex XVII: Consultation of the RSB

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. 1.INTRODUCTION Directive 2009/125/EC of the European Parliament and of the Council establishes a framework for the Commission, assisted by a regulatory committee to set Ecodesign requirements for energy-related products. An energy-related product, or a group of energy-related products, shall be covered by Ecodesign implementing measures, or by self-regulation (cf. criteria in Article 17), if the energy-related product represents significant sales volumes, while having a significant environmental impact and significant improvement potential (Article 15). The structure and content of an Ecodesign implementing measure shall follow the provisions of the Ecodesign Directive (Annex VII). This study assesses the impacts of different policy options for commercial refrigeration cabinets in the context of the Ecodesign Directive 2009/125/EC and the Energy Labelling Directive 2010/30/EU. The preparatory study for commercial refrigeration cabinets has concluded that these appliances comply with the criteria in Art. 15, sub 1, of the Ecodesign Directive and are therefore a candidate for measures. This report presents the results of the Impact Assessment carried out on proposals of implementing measures on ecodesign and energy labelling of commercial refrigeration. 2.PROCEDURAL ISSUES AND CONSULTATION OF INTERESTED PARTIES 2.1.Organisation and timing of the IA and regulatory committee Article 19 of the Directive 2009/125/EC foresees a regulatory procedure with scrutiny for the adoption of implementing measures. Subject to qualified majority support in the regulatory committee and after scrutiny of the European Parliament, the adoption of the measure by the Commission could take place by end 2015. This policy initiative was launched in 2004-2005. The first preparatory study on ecodesign for commercial refrigeration started in 2005 and finalized in 2007. The subsequent implementing phase followed in 2008-2010, starting with an impact assessment (IA) study carried out from October 2008 till July 2010. Further to Article 18 of the 2009/125/EC Directive, a formal consultation of MS and stakeholders was carried out through the Ecodesign Consultation Forum. The first Consultation Forum on commercial refrigerators and freezers took place on 23 April 2010. However, the above-mentioned work did not conclude. The process was re-launched in 2012. Given the substantial delay between the earlier preparatory work (preparatory study in 2007, IA in 2010) and the expected adoption of the re-launched proposal of implementing measures (2015), an update of the preparatory work has been undertaken by the JRC in 2013-2014. A new meeting of the Consultation Forum took place on 2 July 2014, preceded by the distribution of updated working documents (explanatory notes, draft Regulation Ecodesign, draft Regulation energy label, draft transitional methods). The Commission, in close collaboration with national experts and stakeholders, proposes to complete the preparatory work undertaken and regulate refrigerated commercial display cabinets. This policy would be complementary to the Commission Regulation for household refrigerating appliances and the Commission Regulation for professional refrigeration products (ENTR Lot1). 2.2.Consultation and expertise The update of the preparatory work and the formulation of technical options for the implementing measures have been undertaken by the JRC by means of an intensive interaction process with stakeholders, in a structured Technical Working Group (TWG). The Technical Working Group on commercial refrigeration is composed of experts from Member States' administration, industry, NGOs and academia. The experts of the group have voluntarily joined through the website of the project, and have contributed with data, information and/or written comments to interim draft versions of the preparatory study, and through participation in expert workshops organised by the JRC-IPTS. The first workshop was held on 23 April 2013 in Seville. The second workshop took place on 10 December 2013 in Brussels. Complementary, three questionnaires have been distributed to the TWG along the process, addressing information and data updates, and gathering opinions on scope, definitions, and energy consumption specificities. Furthermore, stakeholder communication has included numerous bilateral meetings, and site visits to manufacturing, testing and dismantling plants. 3.PROBLEM DEFINITION 3.1.What is the issue or problem that may require action? Refrigerated commercial cabinets are fundamental appliances for ensuring food quality preservation in the food chain in the EU28, and in addition to provide to consumers other non-perishable foodstuff, e.g. beverages, that is customarily consumed at temperatures below the ambient temperature. However, in fulfilling this function, the cabinets are significant energy users and contributors to greenhouse gas emissions, with an annual consumption of over 60 TWh in the EU-28, equivalent to ca. 0.46% of the total final energy consumption of the Union. In comparison to other appliances regulated by ecodesign and energy labelling measures, commercial refrigerating appliances consume about 25 % less than household and 22 % less than professional refrigerating appliances; but they consume 50 % more than washing machines, 96 % more than dishwashers, 84 % more than laundry dryers and 101 % more than vacuum cleaners. Improving the energy efficiency, thus reducing the energy consumption, will increase the security of energy supply and allow a more efficient utilization of the limited energy resources in Europe. A more efficient use of energy in Europe is a key element to achieve renewable energy targets, greenhouse gas reduction targets and to improve the security of energy supply due to a reduced dependence on fossil fuel imports and the corresponding fuel costs. 3.2.What is the scale of the problem? As requested by Article 15 of the Ecodesign Directive, the preparatory study identified the relevant environmental aspects of refrigerated commercial cabinets, and analysed the legislative, technical, environmental, economic and behavioural aspects of commercial refrigeration. It has shown that in the product lifecycle the energy consumption during the use phase accounts for up to 80% of the product’s total energy use. Many types of commercial refrigeration equipment are used 24 hours a day, 7 days per week. Using current best practice, there are many relatively simple design/operation steps that can be taken to reduce energy consumption of these refrigerating appliances, especially for appliances without doors. In most best-case scenarios of open cabinets, energy savings exceed 50% with a payback time of less than 18 months depending on the type and design of the equipment.

With more than 1.6 million units purchased in the EU-28 in 2012, this product group has a market volume largely exceeding 200 000 sales annually, which is the threshold for the Ecodesign Directive. The EU-28 stock is expected to increase from about 14 million units in 2013 to 17 million units in 2030. In 2013 the EU stock had the following composition: –26.2 % supermarket segment cabinets –45.3 % beverage coolers –19.4% small ice-cream freezers –9.2% vending machines Detailed descriptions of the main cabinet types, including pictures, are provided in Annex IV. Additional arguments for the inclusion and exclusion from the scope of specific cabinet subtypes are explained Annex 9.2.



Figure 2 Share of stocks and energy use in the EU28 of the appliances under scope. Figure 2 illustrates that the share of energy use differs significantly from the share of stocks, a reflection of the large variation of design, function and specific energy consumption of the different cabinet types. 3.3.What are the underlying drivers of the problem? A substantial potential for economic saving and environmental improvement exists for this product group. Market, regulatory and communication failures are the main barriers that hinder the realisation of these improvements. 3.3.1.Regulatory failure There is currently no EU legislation specifically dealing with the energy consumption of commercial refrigeration equipment. However, the Ecodesign Working Plan for 2009-2011 identified "refrigerating and freezing equipment" as one of the ten priority product groups. There are national benchmarking initiatives in a number of Member States, and also at European level, but this does not address the problem for the EU as a whole. National rules could in fact hamper the functioning of the EU internal market. Additionally, due to a lack of commonly accepted standards for some of the cabinet categories, especially beverage coolers, there is currently a considerable variability of used test methods and conditions to define the energy consumption. 3.3.2.Limited/asymmetric information The information about the energy consumption of the products is limited, even in cabinet types where a voluntary energy labelling scheme exists, i.e. the supermarket segment. Purchasers of equipment do not always know the energy consumption of the cabinets, also taking into account the large number of different cabinet types on the market, and producers do not regularly attach this information to the cabinet's technical dossier. The necessary technical information affecting energy efficiency may be available somewhere (e.g. on a web site or in a technical documentation) but is hard to locate and/or to understand, or requires additional calculation (e.g. the power of the components is declared, but not the consumption, or the consumption is declared, but not the conditions/standard at which this was tested). Therefore, the complexity or lack of understandable information for consumers introduces asymmetrical information. 3.3.3.Information myopia One of the main reasons for the persistent sales of low efficiency refrigeration cabinets and the out-dated, inefficient stock is that the end-user purchase decisions are not systematically based on life cycle costs of the product. Such life cycle costing should include purchase, installation, disposal, maintenance and running costs. Some users, including some large retail groups, do not realise that energy costs are commonly the major part of total life cycle cost, or knowing it, cannot convince procurement departments that the purchase shall not be based on purchase price only, or that reasonable payback times shall be provided considering the long (7-14 years) lifetime of the appliances. Even if many large retailers do life cycle cost calculations in their technical departments, the results from these are not the only parameter influencing the purchase decision. In particular, arguments from a procurement or marketing department, usually more interested in purchase price and design characteristics, also have to be taken into account. The final decision could well be to transfer the extra energy cost to consumers through the price of the cooled products sold. . Smaller retailers and corner / night shops still base their choice mainly on purchase price and other factors like availability, service or 'trusted' brand names, as they do not have the means to do life cycle cost calculations. Discount retailers tend to apply life cycle cost calculations, but they have special marketing preferences and design restrictions (e.g. open cabinets for large turnover business models).

3.3.4.Split incentive Even in cases of full awareness of life cycle costs, the problems of asymmetric information can persist by lack of economic incentives for information provision on energy efficiency in the supply chain. Consequently, readily available cost-effective improvement potentials for the end-user are not realised. This is especially true in business areas where the buyer of the appliance is not the end-user, such as for small ice-cream cabinets, beverage coolers and vending machines placed by a food or drink brand in supermarkets, corner shops, airports, railway stations, sport clubs, etc. These machines are owned by e.g. a food company, which provides the machines to retailers. Refrigerated vending machines are typically bought and owned by a vending service company that has contracts with end users (offices, public spaces, shopping malls, etc.), and ensures maintenance and product refilling. In all the cases above, the buyer/owner of the appliance will not pay for its electricity bill, so energy efficiency is not a purchase primary criterion. At the same time, the end-user pays the bill but does not choose or own the machine. This is only gradually changing. Some large food and beverage companies do increasingly pay attention to this factor because of corporate image reasons, and some end-users are increasingly demanding more energy-efficient appliances, especially in public procurement contracts. 3.3.5.Other barriers Non-energy environmental impacts have been analysed as well. It has been noted that the WEEE Directive will include commercial refrigeration appliances in its scope as of August 2018. The end of life treatment of all appliances will thus have to meet from this date WEEE requirements. While WEEE prescribes generic hazardous content goals, this policy provides no hint as to how appliances shall be dismantled in order to meet those goals. 3.3.6.Estimated lost savings due to market failures Normally, remote supermarket cabinets are installed only at big retailers. It is difficult to estimate which retailers effectively practice life-cycle cost policies, but if we suppose that half of the remote supermarket cabinets that are bought were subject to in-depth life cycle costing, a maximum of 25% of the energy savings could be generated by the ‘best practice’ retailers. Only 5-10% of the plug-in supermarket cabinets will end up in big supermarkets, so less than 1% of these cabinets will be ’covered’ by the ‘best practice’ retailers. The rest of these plug-in appliances usually are placed in smaller shops such as convenience stores, petrol stations, bars, etc., i.e. in cases where no extended life cycle costing calculations are done. Beverage coolers, small ice-cream freezers and vending machines are usually owned by another entity than the one that pays the electricity bill so there is no incentive for more energy efficient machines. Moreover, about 25% of the vending machines are placed in public places, which could benefit from a request for a certain energy class in the procurement process. Overall, this would mean that about 77% of the savings would be missed because life-cycle costs are not properly taken into account. While it may be tempting to exclude product categories with a smaller market share, there are arguments to keep them in scope. Acting on the major categories makes improvements available also for the smaller ones. The energy efficiency technology is the same for all appliance subgroups, is known, available and affordable. Manufacturers are sometimes the same. The market share data alone is therefore not a reason for exclusion: the argument can be used indefinitely if used in isolation, as one can further split subcategories until only categories with <5% market shares are left. As a result, all subcategories could be excluded ultimately, even though they share 95% of the technology and functions. 3.4.How are existing policies and legislation affecting the issue? The promotion of market uptake of efficient commercial refrigeration cabinets complies with the Europe 2020 Agenda and its 20% energy savings target by the year 2020, as it aims to support more efficient and sustainable use of resources, protect the environment, strengthen EU's leadership in developing new green technologies, improve the business environment and help consumers make more informed choices. Directive 2012/27/EU establishes a common framework of measures for the promotion of energy efficiency within the Union in order to ensure the achievement of the Union’s 2020 20 % headline target on energy efficiency and to pave the way for further energy efficiency improvements beyond that date. All EU-28 countries are thus required to use energy more efficiently at all stages of the energy chain – from the transformation of energy and its distribution to its final consumption. The new Directive will help remove barriers and overcome market failures that impede efficiency in the supply and use of energy and provides for the establishment of indicative national energy efficiency targets for 2020. Directive 2010/31/EU on the energy performance of buildings ("EPBD") requires Member States, amongst others, to apply minimum requirements to the energy performance of new and certain existing buildings. According to Recital (12) of the EPBD, Member States should use, where available and appropriate, harmonised instruments, in particular testing and calculation methods and energy efficiency classes developed under the Ecodesign and Energy Labelling Directives when setting energy performance requirements for commercial refrigeration. The EPBD also categorizes wholesale and retail trade services buildings for the purpose of energy performance calculation. No direct regulatory approach to reduce the energy consumption of commercial refrigeration products has been identified in the EU to date. In the preparatory study and earlier Consultation Forum debates, options such as self-regulation based on existing voluntary, sectorial benchmarks (e.g. Eurovent and/or EVA certification and labelling scheme) were analysed, and assessed insufficient to achieve the policy objectives. The recently updated F-gas regulation will increase investment to search for new technologies related to low GWP refrigerants such as hydrocarbons, HFOs or CO2. Most of these technologies are available, but reliability and energy efficiency can be lower compared to established technologies. In Europe, most of this technology is under development. 3.5.Subsidiarity and proportionality The adoption of ecodesign measures for commercial refrigeration products by individual Member States' legislation would lead to obstacles to the free movement of goods within the Union. Such measures must therefore have the same content throughout the Union. In line with the principle of subsidiarity, it is thus appropriate for the measure in question to be adopted at Union level. The Consultation Forum meeting of 2 July 2014 resulted in broad support from Member States to EU-wide implementing measures for commercial refrigeration. The EU will limit itself only to setting the legislative framework. As far as certain aspects of the implementation are concerned, i.e. market surveillance and monitoring, EU action is not necessary to achieve the objectives, as Member States assume these responsibilities under the Ecodesign Directive. Under the principle of proportionality, the content and form of Union action shall not exceed what is necessary to achieve the objectives of the Treaties. In accordance with this principle, the proposed measures do not go beyond what is necessary in order to achieve the objective. It offers requirements which act as an incentive for technology leaders to invest in high-efficiency refrigerating technology. It also intends to lead to higher savings than any other conceivable option with minimum administrative costs. 3.6.EU context 3.6.1.Existing EU legislation

No EU legislation has been identified in the field of energy consumption of commercial refrigeration. For commercial refrigeration, relevant Community legislation applies in the field of safety, both mechanical and electrical, and standards. Other legislation with relevance for commercial refrigeration products on environmental aspects includes: ·Directive 2012/19/EU of the European Parliament and of the council of 4 July 2012 on waste electrical and electronic equipment (WEEE) (recast) ·Directive 2011/65/EU of the European Parliament and of the Council of 8 June 2011 on the restriction of the use of certain hazardous substances in electrical and electronic equipment (RoHS); ·Regulation (EU) No 517/2014 of the European Parliament and of the Council of 16 April 2014 on fluorinated greenhouse gases and repealing Regulation (EC) No 842/2006. The previous WEEE Directive (2006) covered only some types of commercial appliances explicitly, e.g. vending machines (in category 10 “Automatic dispensers”). After its recent recast (2012/19/EU), the inclusion of all commercial refrigeration appliances is foreseen, with an adaptation time until 15 August of 2018. The RoHS Directive does not apply explicitly to commercial refrigeration products, but the electronics in commercial refrigeration products are expected to be in compliance with this Directive through the implementation of the Directive in the general product portfolio of suppliers. 3.6.2.Consistency with other policies and objectives of the Union The Ecodesign Framework Directive 2009/125/EC is an important instrument for achieving the objective of 20 % energy savings compared with projections for 2020, and its implementation is one of the priorities in the Commission's Communication on Energy 2020 and Energy Efficiency Plan 2011. Furthermore, implementation of the Directive 2009/125/EC will contribute to the EU's target of reducing greenhouse gases by at least 20 % by 2020, or 30 % if there is an international agreement that commits other developed countries to comparable emissions reductions. The proposed Regulation is a concrete contribution to this process and is in line with the Commission Action Plan on Sustainable Consumption and Production and Sustainable Industrial Policy. Complementary to this proposal, Member States shall set requirements on air heating and/or cooling systems under the Energy Performance of Buildings Directive 2010/31/EU. Such requirements should complement the specificity of the proposed Regulation with the more general consideration of the building context of the products, and analyse from a system perspective the interaction of heat and chill demands of cabinets with other technical systems in stores and supermarkets such as air conditioning, heating, and other products/areas with high energy throughput (professional refrigeration and heating areas, kitchens). 3.6.3.Limitations of scope due to other ecodesign / energy labelling studies and measures Two other ecodesign and energy labelling measures are closely related to the proposed Regulation on commercial refrigeration: ·Ecodesign requirements for household refrigerating appliances, Commission Regulation (EC) No 643/2009. Household refrigerators are also subject to energy labelling following Commission Delegated Regulation (EU) No 1060/2010. ·Professional refrigeration (ENTR Lot1, both energy labelling and ecodesign), currently in the last steps of the adoption phase. Publication of this Regulation is foreseen in the beginning of 2015. The boundaries with these two policies are essentially clear. Household refrigerated cabinets are intended for the storage, but not the sale or display of chilled and/or frozen foodstuff, and are not designed for the use by commercial, institutional or industrial facilities. Commercial refrigeration is found in areas where customers have visual contact with the products and normally have access (supermarkets, beverage coolers, commercial ice cream freezers, etc.). Professional refrigeration appliances are also for use by commercial, institutional or industrial facilities, but are found in areas where customers have neither visual contact, nor direct access, such as back shops, below or behind counters, or professional kitchens. Equipment used in gastronomy and non-household refrigerating equipment for storage purposes without any display or merchandising function are thus in the scope of the professional refrigeration implementing measures. 3.6.4.Other world regions Some world regions already apply Minimum Energy Performance Standards (MEPS) and/or energy labelling for commercial refrigeration equipment. MEPS apply currently in Australia, New-Zealand, China, Mexico, and the US. China and Mexico are the only economies that apply mandatory energy labelling for refrigerated display cabinets. In addition to the MEPS, Australia applies a high efficiency designation scheme and the US operates a voluntary energy labelling through Energy Star. In the EU, the UK Energy Technology List operates, indicating the better performing products on the market. For some selected types of commercial cabinets, data and policies from the US, Australia and some Member States have been compared. In this exercise, the data and threshold values applicable in the different countries were normalised and compared. However, care has to be taken in such comparison exercises, as appliances are often intrinsically not fully comparable (total size, different components, etc.), are usually tested under different conditions (temperature, humidity, duration of the test, sequence of door opening, test packages, etc.), and use different metrics and units to express the energy consumption (e.g. per volume versus per total display area). Caution is thus advisable in the comparison of MEPS from other world regions, even after normalization of the measurement methods. Moreover, as implementing measures drive the market to more efficient appliances, it is often the case that in world regions where MEPS have been in place for a long time, the average energy use is much lower as a result of several years of improvements.

Once these cautions are applied, the comparison of the MEPS initially proposed in the CF with the MEPS levels in other world regions, together with the experience in the EU with other appliance types, have led to the proposal of alternative scenarios with more strict MEPS and a stricter energy labelling scheme as initially foreseen. More details about the comparison with the US and Australian MEPS and the impact of the Australian MEPS on the 2015 Australian market can be found in Annex 9.3. 3.7.Baseline scenario 3.7.1.Scope of appliances covered Commercial refrigeration appliances need to fulfil the double function of storage at a given temperature below the ambient temperature, and allow that customers have visual contact with the products and/or direct access to them, in retail stores or private non-household environments. The denomination freezer is used when the cabinet contains frozen products, below 0oC, and refrigerator is used for chilled products, above 0oC. The main subgroups of cabinets are listed in section 3.2 and the base cases are further detailed in Annex 9.4. Annex 9.2 provides a detailed list of subtypes of cabinets under the scope of the implementing measures, as well as a list of cabinets excluded from the scope, with explanations of the rationale for exclusion or inclusion. The baseline assumes as reference that current policy measures at Member State level will not change and no further action at EU level will be introduced. Thus, it assumes a continuation of existing trends regarding size and use of appliances sold on the European market, but no change in the specific efficiency and emission values per product type. For this development, ‘typical’ product types and their properties have been defined in the preparatory study. Consequently, the following four functional types of cabinets are distinguished: ·Retail/supermarket display cabinets (both refrigerators and freezers) ·Small ice-cream freezers for merchandising (V ≤ 500 litre) ·Beverage coolers (refrigerators only) ·Refrigerated vending machines (both refrigerators and freezers) The properties and the typical energy efficiency values of base cases selected for these types in the year 2013 are reproduced in Annex 9.4. The commercial refrigerated cabinets can be plug-in (also called integral, or self-contained) or remote. Plug-in cabinets are appliances where all refrigerating components are an integral part of the refrigerated equipment. Remote cabinets work with a remote refrigerating unit (condensing part and compressor) which is not an integral part of the display cabinet and is connected via piping. Frequently, these condensing components are located on the roof or façade of the store. The scope of this policy only includes the cabinets themselves, both remote and plugins, but not the remote components (condensing unit or other). Annex 9.14.2 discusses the complementarity of the proposed policy with a system (building and its thermal needs) perspective. 3.7.2.Functionality approach The supermarket display cabinets are further segmented into freezers and refrigerators, and vertical and horizontal appliances. As such, different supermarket cabinet types are segmented according to their function and in accordance with the first layer of segmentation in the measurement standard ISO 23953. Further segmentation levels are possible, as described in ISO 23953, differentiating between different cabinet types, e.g. open vs. closed, semi-vertical, etc. This level of subdivision is not followed, as it is essentially not linked to the provision of a different function, but to a design option. 3.7.3.Efficiency and emissions Manufacturers indicate that the launching by the Commission of the earlier phase of this ecodesign and energy labelling exercise in 2004, despite not resulting in a formal legislative text, has led to improvements in cabinet efficiency in the last decade. Other reported drivers for this evolution are the increase in energy prices, and the larger awareness of the saving potentials by retailers and food companies. This effect has been taken into account in the design of the baseline scenario, and is specified in quantitative terms in section 6.1.1. The specific efficiency assumed for the different base cases in the baseline are given in Annex 9.4. 3.7.4.Sales, stock and further assumptions The preparatory study estimated the market shares of the different categories of cabinets, as well as the historic and forecasted sales of each type, using a stock model. Sales data have been estimated based on 2004-2012 data obtained from industry. Stock data have been estimated based on sales, and on the average lifetime expectancy of appliances, and have been cross-checked with the few stock data available. The total annual sales of commercial refrigeration cabinets under consideration are about 1.6 million units in the EU in 2012. The largest share of sales are of beverage coolers (0.80 million), followed by supermarket display cabinets (0.44 million), small ice-cream freezers (0.34 million), and vending machines (0.063 million).

Assumptions for product prices, installation and maintenance costs in the base year (2013) are derived from data collected in the preparatory study and further data collected in the course of the impact assessment. Regarding ‘typical’ appliances, the ranges of purchase and installation prices can be large, due to product customisation, especially in the supermarket segment. 3.7.5.Market structure and sales destination Remote supermarket segment cabinets are mostly sold directly to the end users (68%). About 1/3 is sold through a distributor and the rest to the food and beverage industry. Most medium and large retailers have technical departments which define, together with procurement departments, the need of provision of cabinets, as well as their technical details. Some retailers would launch open calls for each procurement batch, while others work with a closed list or framework contracts with one or more manufacturers. Remote cabinets are mainly produced by bigger companies, who sometimes produce plug-ins for the supermarket segment as well. Smaller companies who produce plug-in supermarket cabinets usually also produce other products such as serve-over counters, professional refrigeration, household refrigeration, chest freezers, etc. In the supermarket segment, remote cabinets have a 54% share of the total sales, the remaining 46% being plug-ins. Remote cabinet manufacturing is dominated by 5-7 large manufacturers that cover ca. 70 % of the market. Beverage cooler and ice-cream freezer manufacturing is also dominated by 5-10 companies, mostly non-SMEs. The plug-in segment is more fragmented, with over 50 manufacturers in the EU, some of them SMEs. The vending machine market consists of about 16 manufacturers with a domination of the market by 5 companies. 5-10% of the production is carried by SMEs. Vending machine sales are dropping in general due to an increasing interest in refurbishing machines. Additionally, many SMEs are involved in the installation, operation and maintenance of the appliances. More than 95 % of beverage coolers and small ice cream freezers are sold to the food and beverage industry. These companies deliver their choice of cabinets to end-users (retailers, corner shops, etc.), frequently subject to the condition that only certain (normally their) products can be stored in them. Food companies would still own the appliances and ensure replacement/repair when needed. Vending machines are operated in a similar way. A proportion of vending machines are produced for the food and beverage industry, as indicated above. Only 10 % of cold vending machines are sold directly to the end-users. The largest part is sold to vending companies, which own a stock of machines. Machines are then leased to end-users, and vending companies ensure maintenance and product replacement. While intra EU trade is fluent, the EU has currently a relatively small share (<10%) of extra-EU exports, as commercial cabinets (contrary to the more homogeneous household refrigeration cabinets) are to a large extent tailored goods where end-users demand local maintenance and/or post-sale service. Trade is limited also because the cabinets are bulky, and of relatively low value in the basic configurations that do not incorporate advanced energy saving designs. The beverage cooler and vending machine markets have additional specificities, following the different consumer habits of the US, the EU or Japan. The main industry associations that represent the EU industry in this sector are: –Eurovent, an umbrella association for national associations and some direct members. Around 50 % of the members that are active in the discussions on commercial refrigerating appliances are SMEs. –EPEE’s members include direct members, which are mainly larger manufacturers, and national associations, which also represent SMEs. The members active in the discussions are mainly larger companies. However, all its members, including the national associations, endorse the comments sent by EPEE. –EVA, an umbrella association for national associations and some direct members, represents mainly the vending machines manufacturers. Members include direct members, which are mainly larger manufacturers, and national associations, which also represent SMEs. –EuroCommerce, represents the retailers. Members include direct members, which are mainly larger manufacturers, and national associations, which also represent SMEs. 3.7.6.Economic significance The total annual sales in the EU of commercial refrigeration products is of about 1.6 million units in 2012, estimated to a value of about 1800 million euro, which is on average 20% of the total product costs of these appliances (ca. 9500 million euro annually). The current annual running costs of these appliances exclusively for energy (electricity) would make up for some 7200 million euro (ca. 75% of the total product cost). The remaining 5% of costs are of maintenance and disposal. Life cycle cost calculations over the total product life (purchase, running costs, etc.) indicate differences between appliance groups. For the supermarket segment, the cost of electricity is the largest part (65-80%), while the purchase price is a small proportion (10 % for remotes, 30 % for plugins). Vending machines have a different distribution of the life cycle cost, with product price being about 40% and the cost of electricity being about 55% of the life cycle cost. For beverage coolers the cost is distributed as 20% related to purchase price and 75% to electricity costs. The purchase price for small ice-cream freezers is about 30% of the total life cycle cost while the electricity cost accounts for 65% of the total. The remaining costs are attributed to maintenance and end of life management. For retailers, average energy costs of commercial refrigeration are estimated to be around 3-4% of the total sales prices of a refrigerated food or drink item. A reduction in energy consumption has thus a small deflationary effect on the retail price of chilled and frozen products. 3.7.7.Energy consumption and other environmental concerns The use phase is responsible for up to 80 % of the total energy use in the life cycle of the product. Use phase energy consumption is about 6 times higher than energy consumption of the production phase. The distribution and the end-of-life phases are negligible in terms of energy consumption. Regarding other impact categories, the use phase accounts for 75 % of water use, 85 % of acidification impacts, 42 % of non-hazardous waste production, and 34 % of heavy metals emissions to water.

It is thus justified that the energy ecodesign requirements deal essentially with technologies that reduce power consumption and improve energy efficiency in the use phase of the cabinets. The average product life of most refrigerated display cabinets is estimated to be between 7-14 years (median 8-9 years). Some cabinets are in busy areas and therefore subject to very intensive use and wear. Most cabinets are not substituted because of malfunction, but because of aesthetics and commercial reasons related to their design (newer designs can attract consumers and increase sales), and image loss for retailers when displaying worn-out cabinets. Little reliable data is available on the end-of-life phase and the refurbishment rate. Cabinets are often refurbished or retrofitted to replace their most worn-out parts, or to install energy-saving elements (doors, night curtains, better fans or compressors). Some prolong their lifetime by moving to less demanding applications (backshops, retailers focusing on costs and not on image), be it in the EU or outside it. Refurbishment, reuse of parts, and modularity are especially developed for vending machines. When finally dismantled, cabinets are normally split into smaller parts, and treated for recycling or disposal. The extent of compliance to WEEE depends until August 2018 on the MS interpretation, except vending machines, which are already covered by WEEE prescriptions. The two main concerns in end-of-life are (1) reclaiming of the materials for recycling, especially metals, and (2) the removal of potentially hazardous materials, especially the refrigeration fluid, the foaming agent, and any electronic component. WEEE compliance has so far been dealt with in ecodesign regulations by means of a generic information provision request. The proposed Regulation lays out more specific requirements, as an alternative to better address the specific end-of-life impacts of refrigerated commercial display cabinets (see section 6.5). 3.8.Should the EU act? As shown in Table 1, there is a clear untapped improvement potential of energy efficiency of the cabinets currently sold, and expected in the market in the next years. A comparison of base cases current performance, as assumed for the BAU, and best available technology (BAT) shows that further to the installation of the well-known improvement technologies that result in low life cycle cost, significant additional technical improvements are still possible (see Table 1). Table 1: Comparison of base case and current best available technology (BAT) performance Base case Energy Efficiency (kWh/day) Energy improvement (% of BAT to Base case Base Case (BAU) BAT Open vertical multi-deck remote refrigerator (RVC2)

(TDA = 5.25 m²) 56.9 36.3 * 36% Open remote horizontal island for frozen products (RHF4) |

(TDA = 2.9 m²) 32.2 27.1 * 16% Beverage cooler, glass door

(V = 500 litre) 7.5 1.3 83% Small ice-cream freezer

(V = 291 litre) 3.6 1.5 58% * Note that this BAT does not include the installation of doors. The installation of doors could bring down the energy of the first base case to 21.2 kWh/day (63% improvement) and for the second base case to 16.0 kWh/day (50% improvement). Without taking additional specific action on commercial refrigeration cabinets, the market transformation towards more efficient appliances will take place only very slowly, and negative impacts on environment and health readily avoidable would persist. Action is necessary on EU level, as the outlined lack of harmonized specific regulation in the EU induces the risk that individual energy efficiency requirements set by Member States could hamper the functioning of the EU internal market. The Ecodesign Directive (Article 16 in particular), which has the internal market objective as Treaty legal basis, and the Energy Label Directive (Article 1) provide the legal basis for the European Commission to adopt implementing measures reducing energy consumption of commercial refrigerated cabinets as well as guiding consumers towards the most efficient appliances. 4.POLICY OBJECTIVES 4.1.General objectives The preparatory study has confirmed an existing and cost-effective potential to reduce energy consumption. This potential is not sufficiently realised and the general objectives are therefore to develop a policy, which corrects the regulatory and market failures described in section 3.3: ·Reduce the average energy consumption of commercial refrigeration cabinets. Reduce additionally GHG emissions which for commercial refrigeration are mainly related to energy consumption, but also refrigerant leakage. Promoting energy efficiency, encouraging innovation, and reducing energy dependence. ·Promote energy efficiency as contribution to security of energy supply in the framework of the Community objective of saving 20 % of the EU's energy consumption by 2020. Moreover, specific end-of-life requirements are proposed to address current imperfections in the dismantling of the cabinets and the fulfilment of the objectives of the WEEE Directive. 4.2.Specific and operational objectives The specific objectives of this proposal are: ·to facilitate the removal of the poorest performing products from the market, where their life cycle cost disadvantages have proven insufficient to do this.

·to help purchasers to make an informed and rational choice based on performance information, thereby moving the market to adopt improved technology solutions. ·to drive manufacturer's investments in R&D towards energy efficient technology and products. ·to make energy-efficient products more affordable through mass production, and generate cost savings for end-users (and ultimately customers). No negative impact should arise in terms of functionality of the product, health, safety and environmental aspects, industry’s competitiveness, imposing proprietary technology and excessive administrative burden (Article 15 (5) of the Ecodesign directive). The operational objectives are: ·to establish minimum energy performance levels to remove the worst performing products from the market. ·to establish information requirements coupled to an energy labelling scheme to establish a level playing field and foster an effective competitive market. ·regarding end-of-life requirements, to improve the design for recycling of products, in order to increase the quality and quantity of recycled materials, facilitate the removal of hazardous components, and ultimately facilitate enforcement of the prescriptions of the WEEE Directive. 5.POLICY SCENARIOS In order to address the issues identified in Section 3 and to meet the targets defined as policy objectives in Section 4, a number of policy scenarios are considered for this Impact Assessment, as outlined below. 5.1.Basic assumptions The energy labelling class limits and MEPS thresholds are parameterised using an Energy Efficiency Index (EEI), which refers to specific energy consumption values for the different segments proposed (see Annex 9.8). This is a known procedure in product ecodesign policy. The reference energy consumption is defined at EEI = 100 with the reference data, which for commercial refrigeration refers to year 2013. Energy consumption is referred to the total display area (TDA) or volume according to the most common metric used in industry for each appliance subcategory. The key assumptions of the analysed scenarios are summarised in Annex 9.5. 5.2.Assessment of energy efficient policies In the preparatory study, four scenarios were analysed, and compared to a business as usual (BAU) scenario. These scenarios were (1) self-regulation based on voluntary agreements, (2) mandatory ecodesign (MEPS) requirements only, (3) mandatory energy label (EL) requirements only, and (4) mandatory ecodesign and energy label. Scenario 4 was designed with 3 tiers of MEPS, as presented in Table 2. The energy labelling classes were set as to find a distribution of the data points similar to a normal distribution over the different energy classes, but leaving the top A- and B-classes essentially empty. Table 2 Energy labelling classes threshold and MEPS for scenario 4 and 5 Commercial refrigeration Energy efficiency class EEI energy efficiency index EEI MEPS Scenario 4 EEI MEPS Scecnario 5.1. and 5.2. A EEI < 20 B 20 ≤ EEI < 35 C 35 ≤ EEI < 50 D 50 ≤ EEI < 65 E 65 ≤ EEI < 80 80 (1 Jan 2020) F 80 ≤ EEI < 100 G EEI ≤ 100 110 (1 Jan 2021) 130 (1 Jan 2019) 150 (1 Jan 2017) 110 (1 Jan 2017) The discussion of these scenarios in the Consultation Forum meeting of 2 July 2014 resulted in a number of suggestions, as follows:

- MEPS and energy labels: the thresholds of Scenario 4 are not stringent enough. About 20%-30% more stringency shall be proposed. Label class A shall be empty with current best practice to allow future development. This is supported by the Member States and environmental NGOs. EPEE and Eurocommerce are not in favour of a label. - The number of tiers shall be reduced from three (Scenario 4) to two. Austria, the Netherlands and the UK, the EPEE and EuroCommerce support this. - The revision shall take place after the last tier. This was supported by most stakeholders. EVA requested a quick revision in view of the publication of a new test standard. - The functionality approach (see section 3.7.2) is largely endorsed by Member States and the NGOs, while industry is concerned about that the functionality approach does not reflect the diversity of products in the market. There shall be as few categories as sensibly possible. This would also facilitate market surveillance. - The arguments for proposing end-of-life requirements are largely endorsed by Member States and NGOs, only EFCEM argued against such requirements. However, the labelling of the foaming gas can if appropriate be handled by means of a voluntary standard (IEC 60335-2-89). The wording of the requirement on dismantling shall be revised to facilitate market surveillance and to ensure reproducibility. - A single energy labelling class structure shall be proposed for all the different appliances, i.e. supermarket segment, beverage coolers, small ice-cream freezers and vending machines. Prior to the Consultation Forum, different structures were proposed for the different appliance types. Most Member States supported this. In response to this, new harmonised reference energy formulas, and a revamped labelling scheme has been proposed. Two additional scenarios were added to the scenarios analysed in the preparatory study and the CF working documents. All the options are based on the expected adoption of the measures in the end of 2015. The new scenarios 5.1 and 5.2 are defined as follows (see also Table 2 and Table 2A): ·Scenario 5.1: Two-tier scenario with more strict MEPS (EEI = 110 in January 2017, EEI = 80 in January 2020) and a redistribution of energy classes to ensure that the A class is not populated as of 2014. Introduction of temperature classes. This results in the following values: Table 3A Updated energy labelling classes threshold for scenarios 4 and 5 Energy efficiency class EEI energy efficiency index A EEI < 10 B 10 ≤ EEI < 20 C 20 ≤ EEI < 35 D 35 ≤ EEI < 50 E 50 ≤ EEI < 65 F 65 ≤ EEI < 80 G EEI ≤ 80 ·Scenario 5.2: Same as scenario 5.1, but additional breakdown for remote vs. plugin. Other discussion points raised during the Consultation Forum such as the EoL requirements, linearity of the MEPS functions, and differences of testing vs. real-life conditions (see minutes of the CF in Annex 9.1) have been analysed in detail and when appropriate included in all the scenarios. The conclusions obtained on these issues are presented in Annex 9.14. In the analysed scenarios, requirements for minimum energy efficiency and energy labelling are proposed for the following categories or segments of equipment: ·Supermarket segment display cabinets ·Beverage coolers ·Small ice-cream freezers ·Refrigerated vending machines It is proposed that the cabinet category soft scoop ice-cream cabinets is still part of the scope of the policy.

Specific MEPS are proposed for the following subcategories of supermarket segment display cabinets: ·Horizontal refrigerators ·Vertical refrigerators ·Horizontal freezers ·Vertical freezers In Scenario 5.2, the four categories above are further split into remote and plug-in, resulting in eight MEPS in total for supermarket segment cabinets. 5.3.Assessment of end-of-life policies End-of-life requirements have not been presented as separate scenarios, as the introduction of such requirements would not have any significant effect on the energy consumption of the appliances, the related emissions, the expenditure or the associated employment. 5.4.Refrigerants In the earlier phases of this project developed by BIO IS and Wuppertal Institute, a bonus-malus system related to the GWP of the refrigerant was discussed, as a means to reduce the extensive use of high GWP F-gases in commercial refrigeration detected in the early 2000's. However, it has been observed in the revision of this work that substitution of the gases to low GWP agents has already taken place in this sector for over a decade by a combination of ·the effect of the updated F-gas Regulation ·the better energy efficiency of a large number of low GWP refrigerants now in use, compared to fluorinated fluids. ·the efforts of image and green policy of a number of food and beverage companies. ·taxation policies to F-gases introduced in some Member States. In line with this, the Professional Refrigeration policy (ENTR Lot 1) proposes no bonus-malus system for professional storage cabinets, as the markets have already taken up the policy signals and are gradually phasing out high GWP gases. In addition to the arguments above, remote cabinets can work in principle with different refrigerants, so it would be very difficult to impose a bonus-malus system if it is not decided beforehand which refrigerant will be used when operated. The estimation of the direct emissions of refrigerants by leakage seems, according to the discrepancy in the information available, subject to large uncertainty. A wide range of between 4 and 20 MtCO2/yr of direct refrigerant emissions would result in all the scenarios proposed (see Annex 9.14.6). The measures to reduce these emissions are now in place in the F-gas Regulation and are thus not further addressed in this impact assessment. 5.5.Scenario 0: No EU action (Business As Usual) This scenario assumes continuation of current policy measures at Member State level, no further measures for cabinets in the EU and thus continuation of existing trends regarding size and use of appliances sold on the European market. Significant changes have been detected in the time period 2004-2014, as described in Section 3.7, including a gradual but very moderate efficiency increase. However, the market and regulatory failures would persist, harmonised information on energy consumption would not be systematically generated other than through one voluntary industry scheme, and consumers would not be able to differentiate between high-efficient and low-/average-efficient appliances. This option is included in the impact assessment as the baseline and serves as a reference to calculate the savings of the other policy options in Section 6. Rising energy prices will contribute to the change but will not on their own turn the situation around. Even when customers are interested in long term costing, suppliers do not have a widely accepted means to certify consistently better efficiency. If the advantages of efficiency investments cannot be clearly communicated, then lowest purchase price practices will persist as the main driver. Moreover, customers (mainly retailers) of these appliances may simply transfer rising energy prices to their own clients by increasing the price of the cooled products. In this context it has to be noted that <5% of the price of food products is related to their refrigeration, divided in varying proportions between running and purchase costs of the display cabinet. Running costs include maintenance alongside electricity use. Even if electricity price is increased by 100%, and the increase is transferred fully to the food consumer, the resulting food price increase would be still quite limited. Smaller retailers without knowledge of life cycle costs would probably just pay more because of ignorance. In situations where the shop owner is not the owner or installer of the appliance, electricity prices would not be taken into account at all (most notably with vending machines, beverage coolers, and small ice cream freezers).

The option of this scenario is therefore discarded. 5.6.Scenario 1: Self-regulation, “Voluntary agreement” Self-regulation or voluntary agreements have as benefits over legislative measures that the implementation may be much faster and at the same time offer more flexibility. However, in order to be accepted as viable alternative to legislation, self-regulation initiatives have to comply with a set of criteria defined by Annex III of Directive 2010/125/EC that are generally not easy to meet. Related to refrigerated cabinets, this would be very complex, due to diverse national regulations, combination of international, European and commercial measuring methods, and climate condition and traditions existing in the sub-markets within the EU (Nordic & UK, Central European, Eastern European, Southern European and others). The endorsement and support of the existing voluntary systems (Eurovent, EVA) has experienced important changes in support in the last decade. This option is therefore discarded. 5.7.Scenario 2: Mandatory ecodesign (MEPS) requirements only This scenario includes the setting of ecodesign requirements for energy efficiency (MEPS) under the Ecodesign Directive, without an energy labelling scheme. Mandatory minimum energy performance requirements alone would indeed ensure withdrawal from the market of the poorest performing products and through more stringent levels could significantly transform the market by driving through changes towards cost effective good performance levels. It is not, however, a powerful tool to drive innovation as it lacks the means to secure recognition for the best performing products. The potential for more discerning customers to help draw the market onwards could remain under-exploited. Not opposing energy labelling, some industry stakeholders, i.e. EPEE and EuroCommerce have expressed that a MEPS only scenario would be sufficient in pushing industry to deliver more energy efficient products. These stakeholders do not see the added value of energy labelling as they see cabinets as a commodity traded from business to business. These stakeholders also assume that the buyers (mainly retailers) are acquainted with life cycle costing, which is not always the case. Conversely, several retailers, some of them large companies, have highlighted that energy labelling would indeed be a useful communication tool to purchase departments, and would help bring energy consumption to the centre of purchase considerations. Labelling would also be a very useful parameter in public procurement (vending machines) and in the communication between food producers and small retailers (beverage coolers, small ice-cream cabinets). Moreover, minimum requirements alone would not drive the market to closed appliances, which is one of the most cost effective measures that could be taken to improve energy efficiency. By introducing minimum requirements together with an energy label, only the best performing open appliances would stay on the market, but would not obtain the higher classes on the label. Thus, the label plays an important complementary role in providing the right signals to retailers on how appliances perform in comparison with others. Minimum requirements in combination with an energy label would clearly show the benefits of closed appliances. In addition to the arguments above, the implementation of this option would be incoherent with the approach chosen for household and professional refrigeration policies, as both include energy labelling and are either running (household) or close to adoption (professional). For the reasons mentioned above, the option represented by this scenario is discarded. 5.8.Scenario 3: Mandatory energy labelling scheme only This scenario includes labelling without ecodesign requirements. Mandatory energy labelling would help address the information failures in this market and enable manufacturers to secure recognition for the better performance of premium products and so help secure sales and justify a higher price (if applicable). This is the intention behind the voluntary energy label scheme that the industry association Eurovent has developed, but which is not embraced throughout the whole industry. A mandatory energy label would greatly assist the market to move ahead towards more efficient products. It would also clearly mark the poorest performing products which many manufacturers would not wish to have in their range. Some suppliers would be likely to retain poorer performing products if they were cheaper, but several technical improvement options are low or zero cost (e.g. better design for refrigerant flow, sizing of capillary tubing) and so the poorest performers are likely to disappear from the market fairly quickly. From the perspective of large retailers, labelling the cabinets would make it easier for technical departments to communicate the life cycle costs to marketing/procurement departments, and would give them more support in defending their calculations. Small retailers or corner/night shops do not have the means to do life cycle cost calculations, and a label is necessary to identify which appliance is more energy efficient. In situations where the owner of a plug-in appliance installs it but does not pay the electricity bills, the operator of the location where the appliance is installed could consider the energy label class before agreeing that the appliance is operated at the expense of his electricity bill. Energy labels alone would, however, be unlikely to ensure improvement to the cost effective potential level due to the cost increases: in this highly price-sensitive market, price rises would not be taken on by the majority of the market if not also pushed by MEPS. It is also known from earlier ecodesign-labelling experience of other product groups that a labelling scheme (as ‘pull-effect’) alone, while reported being a strong driver in improvement alone, is less effective without MEPS. The retail market is very heterogeneous, and part of the market still does not recognise the importance of energy performance vis-a-vis other marketing parameters such as cabinet design, or is simply running low-cost, high turnover business models. With labelling alone, there is a risk that very poor performing appliances or cabinet types remain on the market, not applying the known and effective technical improvements at zero or very low cost. Taking into account the size of the problems described, labelling alone would not fully address them and seize the potential energy savings. No stakeholder has expressed support to this option. The scenario represented by this option is therefore discarded.

5.9.Scenario 4: Ecodesign requirements (MEPS) and energy labelling, 3 tiers This scenario introduces ecodesign and energy labelling as a combined market 'push and pull' effect. It is intended to achieve a dual and synergic effect of removing the worst products from the market in a way that is fair to all manufacturers and with the motivating effect of transparency on efficiency information that will drive competition and innovation on energy efficiency. In the preparatory study, this scenario was the one resulting in largest potential savings relative to scenarios 0, 1, 2 and 3. The energy efficiency classes and 3-tier MEPS proposed in the preparatory study are presented in Table 2 . 5.10.Scenario 5: Ecodesign requirements (MEPS) and energy labelling, 2 tiers This scenario reduces the number of tiers from three to two, and proposes more strict MEPS: EEI < 110 in tier 1 in 2017, EEI < 80 in tier 2 in 2020. For the supermarket segment cabinets, two additional features have been investigated, i.e. the effect of accounting for different working temperatures and the differences between plug-in and remote cabinets. The potential effect of temperature differentiation on total energy saving has been modelled and the quantitative, sales-weighted results obtained are conclusive: the effect of temperature differentiation is minimal, more specifically 0.21% for plugin cabinets, and 0.25% for remote cabinets. Temperature class differentiation has thus barely any influence for the purpose of energy saving of the policy. It is important, however, to clearly indicate at which temperature class the energy consumption is tested, and how this relates to the temperature at which the labelling is declared, in order to harmonise the testing procedures, ensure a level playing field for the energy label, and to facilitate market surveillance. Regarding the splitting between plug-in and remote cabinets, the assessment has two main conclusions: (1) for the purpose of estimating the potential energy savings, the differences are not large, as the saving options recorded are equally applicable to plug-in and remote cabinets, and (2) for the purpose of policy formulation, a split between plug-in and remote cabinets would be advisable, even if using identical values of MEPS for both remote and plug-in cabinets, as this would facilitate a future review in case new technologies dedicated to a certain type of cabinet are introduced in the market, or in case the ISO 23953 standard is updated for only one of the two categories. The energy labelling scheme would enter into force as soon as feasible, i.e. with the entering into force of the first tier in 2017, in order to initiate the market transformation for energy efficiency An early implementation of ambitious MEPS requirements on EU-level could be a challenge for those manufacturers which currently do not have best available technology (BAT) products in their portfolio and would need time to develop and to put on the market products complying to the new regulation. According to experts and representatives of the industry, the design cycle of cabinets lasts about 3 years, and approximately four years are necessary to develop and put such a new product on the market. Based on these considerations, and on the available performance data of 2013 appliances, Scenario 5 foresees the adoption of a policy which includes a target 2020 tier with stringent ecodesign requirements (MEPS), and a transitional tier in 2017. Stricter levels may not be achieved by industry on time for all cabinet types, despite the reported developments in 2004-2014. 5.11.Selected options for further analysis In the preparatory study and the working documents for the Consultation Forum, the pros and cons of the scenario combining MEPS and energy labelling (Scenario 4) were presented, initially based on the assessment of this comparison presented in the earlier work by BIO IS, and further elaborated in the 2010 Impact Assessment by Wuppertal Institute. These studies already excluded the scenarios of 'no action' (BAU, Scenario 0) and self-regulation (Scenario 1). No new evidence has been collected in the course of the preparatory study in 2013-2014 suggesting that none of these two scenarios would be currently delivering the energy saving objectives proposed. The analysis of the comparison of Scenario 4 (MEPS+EL) versus the scenarios of MEPS-only (Scenario 2) and EL-only (Scenario 3) were presented in the preparatory study, concluding that the combined effect of MEPS and EL resulted in the largest potential energy savings. Compared to BAU, Scenario 4 proposes a reduction of energy consumption in the use phase, by the implementation of minimum energy requirements (MEPS) and an energy labelling scheme. MEPS alone would ensure withdrawal of the poorest performing products from the market and push the market to better average performance levels. A pull effect to drive innovation, and recognition and reward for the best performing products is also established by means of an energy labelling scheme. Voluntary agreements based on MEPS and labelling may achieve these results in the long run, but it is assessed that they would not deliver them as quickly as the available technologies allow. Moreover, the industry did not show intention to develop such measures itself. Therefore, only the proposed Scenarios 4 and 5 have been further analysed and compared in this Impact Assessment. 6.ANALYSIS OF IMPACTS To analyse the full impact of a policy, it is important to consider a period during which the whole stock of installed appliances will be replaced by new products purchased after the MEPS requirements and the labelling scheme have entered into force. Assuming regulations are adopted by end of 2015, the ecodesign requirements and labels will apply in the years as indicated in the description of the options. The analysis of the impacts looks at the period until 2030. The quantitative impacts presented in this chapter cover the cabinet types for which there is available information currently, as comprehensive data are available from the preparatory study. For certain categories, especially some subtypes of supermarket segment cabinets, no such comprehensive data are available, but information on them has been gathered showing that they have similar technical characteristics to cabinets for which information is available, and thus the impacts would be similar as for those for which data is known. Further information has been gathered also through the meetings of the Consultation Forum and bilateral meetings with industry representatives, including SMEs, with Eurovent, EPEE, Orgalime and Food&DrinkEurope contributing to the discussion (see Annex 9.1).

It has to be noted that ecodesign and energy labelling legislation applies to products "placed on the market". A product is "placed on the market" when it is made available for the first time in the Union market. Therefore, the introduction of requirements on a specific date would not mean that all products in use must be replaced. Products already in use or available on the market for sale before the date of application of the new regulations can be used and bought without an end date. Moreover, the lifetime of a commercial refrigerated cabinet is often between 10-15 years: this means that customers of these products may be impacted by the new requirements only after several years from the application of the new requirements (i.e. when the existing appliances need to be replaced). Qualitative impacts of the regulation have been estimated and identified by interviewing a large number and variety of retailers and manufacturers.. The main issues raised by stakeholders are described in the different sections below. 6.1.Economic impact 6.1.1.Electricity consumption, energy saving and security of supply The total electricity consumption in the baseline has been estimated to gradually decrease from 65 to 59 TWh/yr in 2015-2020, and then remain stable until 2030. In the fifteen years from 2015 to 2030, the stock of cabinets is expected to increase by ca. 6%, but this would be compensated for by slow energy improvements of ca. 8% over 15 years, if following the current pace without ecodesign measures. The figures and tables below present the results of total annual and accumulative impact of the policy scenarios outlined. Table 4. Total annual energy consumption of commercial refrigeration cabinets in the EU-28 of the scenarios analysed, in the reference years 2013, 2020 and 2030. Units: TWh/yr, BC: beverage cooler, ICF: small ice-cream freezer, VM: vending machines, Integrals: supermarket plug-ins/integrals, remote: supermarket segment remote TWh/yr 2013 2020 2030 Year BAU S4 S5.1 S5.2 BAU S4 S5.1 S5.2 BAU S4 S5.1 S5.2 BC 17.2 17.2 17.2 17.2 15.5 14.2 13.4 13.4 15.5 11.6 9.6 9.6 ICF 4.0 4.0 4.0 4.0 3.6 3.6 3.5 3.5 3.6 3.6 3.4 3.4 VM 2.5 2.5 2.5 2.5 1.6 1.4 1.3 1.3 1.6 1.1 0.9 0.9 Integrals 8.7 8.7 8.7 8.7 9.4 9.0 8.7 8.7 11.4 9.9 8.9 8.9 Remotes 32.5 32.5 32.5 32.5 29.1 27.0 25.8 26.0 27.4 21.0 17.6 18.2 TOTAL 64.8 64.8 64.8 64.8 59.2 55.2 52.8 53.0 59.5 47.2 40.3 41.0 Figure 3 depicts the evolution assumed for the BAU scenario, and the time evolution of the potential energy use reduction in the EU28 of the MEPS+EL scenarios, of about 12 TWh/yr in Scenario 4, and ca. 19 TWh/yr in Scenarios 5 in 2030. These estimations reinforce and refine the saving estimates predicted in BIO IS preparatory study (2007) and Wuppertal Institute IA study (2010). Figures 4a and 4b depict the shares of potential savings that one can attribute to the different base cases and other supermarket categories for scenarios 5, as well as their evolution over time. The largest savings are attributable to improvement of beverage coolers (e.g. introducing EMDs: 20-40% energy reduction depending on the use conditions), and supermarket cabinets (most notably multi-decks, by installing doors: 40% energy reduction). These electricity savings are expected to result in significant cost savings for retailers and other end-users, the magnitude of which depend on the electricity price. Figure 3 Estimated evolution over time of the total energy consumption of commercial refrigeration cabinets in the EU-28, including scenarios for Business as Usual (BAU), and Scenarios 4 and 5. (a) (b) Figures 4a and 4b. Shares of the contributions of the different base cases and non-base-case cabinet types to the total energy use in the EU-28. BC: Beverage Coolers, ICF: Ice-cream Freezers. VM: vending machines; RVC2: remote, chilled, open multideck; RHF4: remote, open island freezer. The remaining acronyms are supermarket segment cabinet subtypes, following the ISO 23953 nomenclature (see Annex 9.9).

6.1.2.Competitiveness proofing and effects in third countries It is estimated that the policy options analysed do not affect negatively competitiveness of the European industry. In theory, the proposed measures could potentially remove a number of cabinet models from the market. However, the effect of this will be limited as the technical analysis and the opinions from manufacturers suggest that the costs of redesign to meet proposed requirements is not particularly large. Conversely, already in the short term, the introduction of MEPS will raise the demand of high efficiency cabinets, components, and related services (e.g. retrofitting) providing opportunities for EU companies. Extra-EU import is small for cabinets, and the import of commercial refrigeration cabinets with low efficiency to the European market will not be allowed once introducing MEPS. The extra-EU import of high efficiency components may rise. Prices for high efficiency products and services may rise in the short term due to the demand increase, and probably will not descend until the mid-term, when one can expect a drop in price for efficient components. Development of innovative technology at competitive prices due to requirements set and additional policy implemented will increase competitiveness of European manufacturers in other markets, even though export outside Europe is currently low. Notably, the policy will foster competition between manufacturers within Europe, where markets seem to be not fully integrated yet. Manufacturers interviewed — including SMEs — seem most concerned by: (1) the higher costs of testing, (2) the risk that they are not able to reflect the additional costs of testing and new components into the cabinet's price, due to the high negotiation power of retailers, (3) that the market levelling role of enforcement and surveillance authorities in the EU may be weak and not sufficient to remove low performance cabinets from the market, and justify the higher prices of best performers, and (4) that some inefficient cabinet types would be excluded from the market while they could still be specifically demanded by retailers. The process for establishing ecodesign requirements is transparent, and before adoption of the measures a notification under WTO-TBT will be issued. There are a number of regulations on refrigerated cabinets in third countries. Canada, Australia, New Zealand, the USA and Japan are among them. The EU is not leading standardisation and energy labelling on this product type, and it is thus likely that the mentioned countries will look carefully at how the EU policy compares with their own. The EU policy will strengthen the global effort to introduce high-efficiency cabinets in the market. In the short term this will constitute a negative impact for manufacturers of low-efficiency cabinets around the globe. Policy scenario 5 would imply a faster restriction of the low-efficiency models, and therefore would affect the competitiveness of EU manufacturers that have mostly or only these low-efficiency models in their portfolio. The enquiries to manufacturers have revealed that most manufacturers are able to provide cabinets in a wide range of efficiency levels. Some non-EU manufacturers do indeed specialise on low cost, low efficiency cabinets, and would be directly affected. To protect SMEs, the timing between the different tiers are aligned with the duration of the normal design cycles of the appliances so that manufacturers have sufficient time to adapt their products to the energy efficiency requirements. On the long run, the production of high-quality cabinets both in- and outside the EU will become more profitable. 6.1.3.Territorial impact Territorial impact assessment (TIA) is one of the possible elements of the impact assessments. As stated in a recent presentation of the Commission services, TIA is only required when the policy explicitly targets a (type) of a region and/or the policy targets some regions or areas more than others. In this case, these conditions do not apply and thus the TIA is not required. 6.1.4.Small and medium-sized enterprises (SMEs According to Eurostat, in 2008 five large manufacturers held 67% of the market, while 43% of the ‘commercial’ refrigeration retail trade and repair businesses are consisting of micro SMEs and 7% of medium-sized SMEs. Greater market fragmentation is observed in the plug-in market, which is believed to be split between more than 50 manufacturers in the EU. Refrigeration equipment is also produced in the mature markets of Western Europe, Japan and the US; however, there has been an increase in manufacturing from countries with low labour costs, such as Eastern European countries and Turkey, which aim to compete on price. The major manufacturers in the integral and the remote commercial refrigeration markets tend to be larger companies. Generally within the EU, manufacturers of remote cabinets are located in Italy, France, Germany, the Czech Republic and Hungary whereas manufacturers of integral cabinets tend to be found in Italy, Germany, France, Sweden and Spain. The technical competence of SMEs is variable and there are several types of SMEs that sell commercial cabinets: 1.Larger SMEs who have their own test facilities and experienced engineers to operate the test rooms and develop the cabinets (mainly medium and small SMEs). These companies often have equivalent knowledge and experience compared to larger companies, but may not have access to expensive equipment or certain design capabilities. 2.SMEs that sell cabinets manufactured elsewhere and so do not have any detailed technical knowledge of how the cabinets were designed (distributors). 3.SMEs that developed from companies who cut metal and made metal shelves or components. Often these companies have less experience of refrigeration design and air flow optimisation. They often do not have test facilities and have less knowledge of design and optimisation of cabinets.

4.There are other SMEs that developed from companies who cut metal (as 3. above), but have experienced engineers who understand refrigeration systems and how to optimise the performance of a commercial cabinet. These companies can produce excellent well-built and energy efficient cabinets, often with innovative designs. 5.There are also innovative SMEs who design and build novel commercial refrigeration systems. These companies have a good grasp on the market and have engineers who understand how to optimise refrigeration systems. These companies sometimes invest in test facilities. The proposed policy will not specifically affect larger or smaller manufacturers, although manufactures with a broad array of products and/or with experience in high efficiency cabinets, and own testing facilities would have market advantages. In Member States where electricity costs are highest, retailers are likely to have already demanded high efficiency appliances, and manufacturers serving these countries are more likely to have adapted their portfolio accordingly. As regards the access to test facilities for SMEs, micro and small SMEs are less likely than medium sized SMEs and large companies to have access to a range of test facilities. Small and micro SMEs usually produce fewer cabinets than large companies and so have less incentive to build and manage test rooms. All companies, whether they are an SME or a large company, can have their cabinets independently tested. Depending on the number of cabinets that a company produces, the costs for testing may look attractive when compared to setting up and operating a test facility. It is not perceived that the availability of independent test facilities is an issue. It should be noted that Ecodesign regulations fall on the product, not on the producer. Therefore, it is not possible to reduce the impact of the regulations through exemptions or special regimes according to the size of the company. The impact on SMEs is limited in Scenario 4 and 5. In Scenario 4, by introducing less ambitious minimum energy efficiency requirements, which would ensure that SMEs meet the requirements, but which lacks ambition for the other manufacturers. In Scenario 5, by a two-tiered approach with a transitional first tier, which only removes a limited number of appliances from the market, and a stringent second tier, which applies 3 years after the first tier to account for the design cycle of a commercial refrigerating appliance. This would allow introducing stringent requirements while ensuring that SMEs have sufficient time to develop products that comply with the new requirements. Moreover, an initiative to reduce the burden of testing could help these and other companies, especially those without testing facilities. Hence, the calculation of the parameters based on the design, or the extrapolation from another model, or both is allowed. 6.1.5.Retailers and installers Retailers report that on a life cycle perspective, the benefits of using energy efficient cabinets largely outweigh the drawbacks. This is also the case for efficient cabinets without doors (e.g. as preferred by some discount retailers). 6.1.6.Administrative burden Administrative costs of the options analysed are comparatively low and almost the same for the investigated sub-scenarios, since they all assume the implementation of MEPS and energy labelling. They include requirements to provide information on the efficiency of the appliances as well as the measurement and calculation methods. The energy labelling measure includes the provision of an energy label and a technical fiche. 6.1.7.Compliance cost and timing Compliance costs include the costs for product testing and provision of information as well as costs for market surveillance. More information is provided in section 6.3. Manufacturers are concerned that these costs may be high for the labelling, as this policy instrument is new to them, and would affect all cabinets. This concern extends to the EoL requirement for the identification of hazardous elements. 6.1.8.Expenditure in the EU It is estimated that the implementation of Scenarios 5 would result in savings of about EUR 300 million by 2020 only for the base cases studied, representing 80% of the cabinet stocks, mostly associated to energy use savings (see section 6.7). It is assumed that due to technical similarities, the remaining 20% of the stock which are not base cases but still included in the scope of the policy would behave similarly and provide additional savings to the figure above. 6.2.Market transformation 6.2.1.Market limitations Stakeholders (especially component and cabinet manufacturers, including SMEs) have been interviewed to identify any possible bottleneck in the market, such as the availability of glass doors, efficient compressors or fans, low GWP refrigerants, etc. These stakeholders have not identified any foreseeable market constraint to the adaptation of production to the new policy. In the past, the availability of affordable CO2 compressors is mentioned as an example of a constraint to the mass production of cabinets using CO2 as refrigerant. The production components contributing to efficiency, including the supply of materials for doors and night curtains and its installation is expected to grow, in economic and employment terms. Most manufacturers of components for the refrigeration industry are European. 6.2.2.Exclusion of cabinet types from the market

The functionality approach proposed, operationalised in the proposal as the minimal breakdown possible of commercial refrigeration categories, is intended to bring clear signals to the markets on which cabinet types and designs are more/less energy efficient in delivering the same function. Inefficient cabinet types/designs will have more difficulties to position themselves in a certain energy labelling class or exceptionally not even meet the minimum energy requirements. This effect is not only applicable for existing designs and concepts, but to future designs conceived after the policy enters into force. The identified pros and cons of this approach are presented in more detail in Annex 9.12. Based on the above, a thorough assessment of the energy use data for the cabinet types currently on the market has been undertaken, in order to identify any possible conflicts. In Scenario 4, no risk for exclusion is detected for any specific cabinet type. Closed cabinet types will typically not be excluded, unless extremely inefficient for other reasons. Open cabinets will not be excluded per se if they compensate this by energy efficiency measures such as night blinds, efficient fans and compressors, or additional insulation. Three cabinet types have been identified which may need additional efforts to meet the targets of scenario 5: -roll-in cabinets; -semi-vertical cabinets; -vertical and semi-vertical (closed) freezers. Roll-in cabinets are typically used for (fresh) dairy products, characterised by high turnover in stores, and high space needs. Most current front-access roll-in cabinet designs are open cabinets. Doors are more common in back-store access roll-ins, though. Some stakeholders have argued that it is difficult to install doors on front-access cabinets, as this makes it difficult to operate (reposition) with the heavy-weighted dairy trolleys. However, new closed designs are being introduced on the market. Open, roll-in cabinets that do not significantly improve their energy efficiency compared to current levels could face a gradual phase-out. Semi-vertical cabinets have traditionally been open cabinets. If not significantly improving their energy efficiency compared to current levels, these cabinets could also face a gradual phase-out. It has been argued that the angled surface of lids and doors is prone to deposit condensation, which is difficult to avoid by the use of air flows. In some cases, heating of the door/lid may be needed, increasing the energy use. Meeting the proposed MEPS in Scenario 5 will be difficult for semi-vertical cabinets unless a number of alternative energy efficiency measures are installed simultaneously. The thresholds will be easily met if the cabinets are closed with lids or doors, an option which is in the market, but at the moment rarely used by retailers. Vertical and semi-vertical freezers are currently mostly closed, but even if closed could also experience difficulties in meeting the MEPS, as these appliances double the energy consumption of their horizontal counterparts. The higher energy use is explained by very important losses each time doors are open. Intensive design activity will be necessary to avoid these energy losses and keep these appliances in the market, e.g. by splitting the vertical doors so only a section of the cabinet is open. Additional UK data shows that more efficient cabinets of this type already exist on the market and can comply with the proposed MEPS. Analysis of the available data has shown that the likely market response to the policy, in all scenarios analysed, is that the first choice for manufacturers and retailers for open cabinets will be to offer closed cabinets, as this ensures meeting MEPS and a short investment and payback time for users. Open cabinets equipped with a combination of alternative energy efficiency measures will also meet the MEPS, but the installation of these components (efficient compressors, fans, refrigerant change, etc.) may result in longer payback times than doors. Moreover, open cabinets will have more difficulties in positioning within the best energy labelling classes. It can still be the choice of retailers to use these cabinets, with the aforementioned drawbacks, if the retailers choose to use these models because they deliver additional functions for their store such keeping a certain market or sales concept, or supporting brand image. It is foreseen that the commercial refrigeration market will by itself create internal competition, and new designs will push energy efficiency as one of the central elements of cabinet choice. This mechanism could phase out certain cabinet types, even if they still met energy efficiency limits. An overview of which cabinet types would have more difficulties to reach the implemented MEPS is shown in Annex 9.10. Certain manufacturers have argued that some large supermarkets drive innovation in the retail sector by demanding new sales concepts and equipment to manufacturers. These demands are usually intended to enhance the sales. They claim that ecodesign requirements could be an obstacle for manufacturers to meet the customers’ demands. However, a thorough assessment of data for the variety of cabinets and technologies currently available in the EU market show that all display options can be delivered by means of both efficient and inefficient cabinets. It is thus concluded that the proposed MEPS (especially for Scenario 4, to a less extent for Scenarios 5.1 and 5.2), based on existing affordable technologies, do not interfere with meeting the needs of retailers. Inquired on this, some retailers have highlighted that the most beneficial part of the policy elements is for them the MEPS, even if it compromises some business models, as long as it is enforced equally for the entire EU. The labelling is seen as having less added-value for the large retailers that already use life cycle costing in their purchase. Unfair competition amongst retailers is the largest concern. Smaller shops or retailers that do not apply life cycle costing will benefit the most from energy labelling. The higher purchase cost of cabinets is also not seen as an important impact, as due to the energy savings under the use phase, it does not alter significantly the payback time. Only some cabinet types would have limited improvement margins. Small ice-cream freezers are already virtually in all cases closed, and the substitution of components (e.g. compressors) would have large impacts on the price of the cabinets (which is already among the lowest of all cabinets analysed). Beverage coolers are also mainly closed, and improvements would come from the replacement of glass doors/sides by solid sides, energy management systems or other innovative concepts. Open beverage coolers and small desk beverage coolers would likely be excluded from the market in all scenarios. Vending machines for non-perishable goods can install energy management systems, as well as work further on designs that split and insulate the refrigerated sections, and/or only cool down the products that are about to be consumed and need refrigeration, and not all the volume of products stored. Vending machines with perishable foodstuffs would have to cool more specifically that zone where these products are stored. 6.2.3.Assessing timing and stringency of requirements Annex 9.10 provides detail graphic representations of the relative stringency of the MEPS and the amount and nature of appliances likely excluded from the market. The proposed sunset dates for MEPS have been set based on an assessment of the data collected as of 2014. The distribution of the energy labelling is also largely based on the experience collected in the last decade on the implementation of labels in other appliances, including household refrigerators. It also takes into account the developments detected in energy consumption of commercial cabinets in the last 5-10 years. The high stringency of the best classes (B, A) is proposed as a measure to avoid the early need of review and addition of classes (A+, A++, etc.). The suited date for review has also been discussed. On the one hand, time has to be provided for the collection of data, especially for the cabinet types for which new testing standards are currently being developed. On the other hand, the review should be prompt in checking the fitness of the requirements to the new data obtained with new standards. Additionally, some MS have requested that the review shall not take place too much earlier than the last of the tiers for the MEPS. 6.3.Cost 6.3.1.Purchase and running cost

The manufacturing costs may likely increase in the short term due to the use of more efficient components such as high–efficiency fans, higher efficiency compressors, improved insulation, etc. Manufacturers reflect additionally in product costs the costs of machinery and production line adaptation, staff training, costs of trials/pilots, testing, etc. Due to economy of scale effects, competition and larger sales, it is also expected that component and cabinet costs will decrease in the mid and long-term, after ecodesign requirements are introduced. The effect of these price fluctuations on cabinet sales depends additionally on the evolution of energy costs, as energy prices change the profitability of cabinet replacement (payback times) and therefore the purchase decision. The life cycle cost of commercial refrigeration appliances is currently dominated by the cost of energy consumption in the use phase. More efficient appliances will reduce the overall life cycle cost and thus the most efficient appliance will represent the least life cycle cost. With current energy prices, payback times of 1-3 years are common for most energy-efficiency retrofitting options, or for the replacement of cabinets with more efficient ones. The average lifetime of refrigeration cabinets spans from 7 to 14 years, depending on the type. Once the shortest payback time measures have been introduced, additional energy efficiency gains are more costly, resulting in longer payback times. Until the next review of this policy, it is expected that the most efficient appliances represent the appliances with the lowest life cycle cost, as a number of untapped low-cost measures can still be taken in many cabinet categories to bring down the energy consumption. It is not expected that the initial higher prices of the cabinets would lead to retailers postponing investment in new more energy efficient installations. In a large part of the sector, purchasing decisions are made in the context of large refurbishments or the building of new shops, in which case the purchase price of the refrigerating appliances is such a minor aspect in the overall budget that a slight increase would not delay decisions. If the purchaser gets a clear indication through a label that more efficient appliances are on the market, the purchaser will be tempted to buy a more efficient appliance which is maybe a bit more expensive. Moreover, the payback times are usually short for the most expensive improvements (e.g. for a cabinet with doors about 2 years of additional payback time versus an open cabinet). Furthermore, large retailers are reported by manufacturers as having a large bargaining capacity, and will demand higher energy efficiency at no additional cost. For smaller retailers or other buyers, the same arguments hold as for household appliances: people tend to invest more in an energy efficient appliance because they know it will save money or they have some level of environmental awareness. An overview of the acquisition cost and the running costs is given in section 6.7. 6.3.2.Testing The introduction of MEPS and energy labelling will require more systematic testing. The frequency of testing will increase for the appliance types where this is not compulsory at the moment. In the past, energy information was provided in some cases as one among a number of technical specifications. The voluntary certification system from Eurovent encouraged the display of this information for the better performing cabinets. In the future, this data will be key information in purchase. Remote cabinets are the category for which testing seems most costly. The testing of freezers is reported 10%-20% more expensive than of chillers. Average basic costs of EUR 2 500 – 4 000 are reported for the testing of a standard 2.5m supermarket cabinet, which takes 2-3 days. The testing of bottle coolers and ice-cream freezers is reported to cost EUR 1 500 – 2 500. Remote chillers are normally highly customised, and for some of them 1 week of testing may be needed to check different cabinet configurations leading to overall test costs of

EUR 10 000. However, EU manufacturers of remote cabinets are ~15 large companies, not SMEs. Most of the larger SMEs and virtually all large companies have own test facilities to allow the frequent testing required by new designs before a market version is available. Small companies and market surveillance have in the past relied on accredited external testing. Building test facility with climatic chambers is reported to cost around EUR 100 000. Testing cost calculations for professional storage cabinets have shown that the expenses of testing could be about EUR 161000 per year per manufacturer. A similar figure is expected for commercial refrigerated display cabinets, and even higher for remote supermarket cabinets. The introduction of MEPS and an energy labelling scheme will lead to testing of virtually all cabinet types, although there shall be flexibility to obtain energy use information from calculations if a cabinet has the same basis and different configurations. To reduce the cost of testing, the Commission could provide a method to extrapolate cabinet data for different configurations. Inspiration could come from an alternative efficiency determination method (AEDM) used in the US for commercial refrigeration. The guiding principle is to have a basic energy model of a family of products that allows algorithms to be developed that are supplemented by empirical lab test data. The idea is to be able to test a reasonably small sample of products from the family and produce accurate published data (working within a 5% tolerance). 6.4.Environmental impact The environmental impact of the proposed measures has been quantified in terms of CO2 emissions by conversion from the energy use forecasts. Additionally, a qualitative assessment is provided for the impact of the EoL requirements. All investigated scenarios show a decrease in energy-related CO2 emissions compared to the baseline scenario. The table below