Energy Conservation Program: Energy Conservation Standards for Commercial Refrigeration Equipment

Federal RegisterSep 11, 2013

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DEPARTMENT OF ENERGY

10 CFR Part 431

[Docket No. EERE-2010-BT-STD-0003]

RIN 1904-AC19

Energy Conservation Program: Energy Conservation Standards for Commercial Refrigeration Equipment

AGENCY:

Office of Energy Efficiency and Renewable Energy, Department of Energy.

ACTION:

Notice of proposed rulemaking and public meeting.

SUMMARY:

The Energy Policy and Conservation Act of 1975 (EPCA), as amended, prescribes energy conservation standards for various consumer products and certain commercial and industrial equipment, including commercial refrigeration equipment (CRE). EPCA also requires the U.S. Department of Energy (DOE) to determine whether more-stringent, amended standards would be technologically feasible and economically justified, and would save a significant amount of energy. In this notice, DOE proposes amended energy conservation standards for commercial refrigeration equipment. The notice also announces a public meeting to receive comment on these proposed standards and associated analyses and results.

DATES:

DOE will hold a public meeting on Thursday, October 3, 2013, from 9 a.m. to 4 p.m., in Washington, DC. The meeting will also be broadcast as a webinar. See section VII, “Public Participation,” for webinar registration information, participant instructions, and information about the capabilities available to webinar participants.

DOE will accept comments, data, and information regarding this notice of proposed rulemaking (NOPR) before and after the public meeting, but no later than November 12, 2013. See section VII, “Public Participation,” for details.

ADDRESSES:

The public meeting will be held at the U.S. Department of Energy, Forrestal Building, Room 8E-089, 1000 Independence Avenue SW., Washington, DC 20585. To attend, please notify Ms. Brenda Edwards at (202) 586-2945. Persons can attend the public meeting via webinar. For more information, refer to section VII, Public Participation.

Any comments submitted must identify the NOPR for Energy Conservation Standards for Commercial Refrigeration Equipment and provide docket number EERE-2010-BT-STD-0003 and/or regulatory information number (RIN) 1904-AC19. Comments may be submitted using any of the following methods:

Federal eRulemaking Portal:

www.regulations.gov

. Follow the instructions for submitting comments.

Email: CRE-2010-STD-0003@ee.doe.gov.

Include the docket number and/or RIN in the subject line of the message.

Mail:

Ms. Brenda Edwards, U.S. Department of Energy, Building Technologies Program, Mailstop EE-2J, 1000 Independence Avenue SW., Washington, DC 20585-0121. If possible, please submit all items on a CD. It is not necessary to include printed copies.

Hand Delivery/Courier:

Ms. Brenda Edwards, U.S. Department of Energy, Building Technologies Program, 950 L'Enfant Plaza SW., Suite 600, Washington, DC 20024. Telephone: (202) 586-2945. If possible, please submit all items on a CD, in which case it is not necessary to include printed copies.

Written comments regarding the burden-hour estimates or other aspects of the collection-of-information requirements contained in this proposed rule may be submitted to Office of Energy Efficiency and Renewable Energy through the methods listed above and by email to

Chad_S_Whiteman@omb.eop.gov

For detailed instructions on submitting comments and additional information on the rulemaking process, see section VII of this document (“Public Participation”).

Docket: The docket, which includes

Federal Register

notices, public meeting attendee lists and transcripts, comments, and other supporting documents/materials, is available for review at regulations.gov. All documents in the docket are listed in the regulations.gov index. However, some documents listed in the index, such as those containing information that is exempt from public disclosure, may not be publicly available.

A link to the docket Web page can be found at:

http://www.regulations.gov/#!docketDetail;D=EERE-2010-BT-STD-0003

. This Web page will contain a link to the docket for this notice on the regulations.gov site. The regulations.gov Web page will contain simple instructions on how to access all documents, including public comments, in the docket. See section VII for further information on how to submit comments through

www.regulations.gov

For further information on how to submit a comment, review other public comments and the docket, or participate in the public meeting, contact Ms. Brenda Edwards at (202) 586-2945 or by email:

Brenda.Edwards@ee.doe.gov

FOR FURTHER INFORMATION CONTACT:

Mr. Charles Llenza, U.S. Department of Energy, Office of Energy Efficiency and Renewable Energy, Building Technologies Program, EE-2J, 1000 Independence Avenue SW., Washington, DC 20585-0121. Telephone: (202) 586-2192. Email:

commercial_refrigeration_equipment@EE.Doe.Gov

Ms. Jennifer Tiedeman, U.S. Department of Energy, Office of the General Counsel, GC-71, 1000 Independence Avenue SW., Washington, DC 20585-0121. Telephone: (202) 287-6111. Email:

Jennifer.Tiedeman@hq.doe.gov

SUPPLEMENTARY INFORMATION:

Table of Contents

I. Summary of the Proposed Rule

A. Benefits and Costs to Customers

B. Impact on Manufacturers

C. National Benefits

II. Introduction

A. Authority

B. Background

1. Current Standards

2. History of Standards Rulemaking for Commercial Refrigeration Equipment

III. General Discussion

A. Test Procedures and Normalization Metrics

1. Test Procedures

2. Normalization Metrics

B. Technological Feasibility

1. General

2. Maximum Technologically Feasible Levels

C. Energy Savings

1. Determination of Savings

2. Significance of Savings

D. Economic Justification

1. Specific Criteria

a. Economic Impact on Manufacturers and Commercial Customers

b. Life-Cycle Costs

c. Energy Savings

d. Lessening of Utility or Performance of Equipment

e. Impact of Any Lessening of Competition

f. Need of the Nation To Conserve Energy

g. Other Factors

2. Rebuttable Presumption

IV. Methodology and Discussion of Comments

A. General Rulemaking Issues

1. Statutory Authority

2. January 2009 Final Rule Equipment

3. Normalization Metrics

4. Treatment of Blast Chillers, Thawing Cabinets, Prep Tables, Salad Bars, and Buffet Tables

5. Dedicated Remote Condensing Units

6. Small Units

7. Consideration of Impact of Amended Standards

8. CO

Cascade Systems

9. Coverage of Existing Cases Undergoing Refurbishments or Retrofits

10. Components Shipped as After-Market Additions

11. Definition of Hybrid Equipment

12. Coverage of Commercial Refrigeration Equipment With Drawers

B. Test Procedures

C. Market and Technology Assessment

1. Equipment Classes

a. Equipment Classification

b. Application Temperature Equipment

c. Open Cases

d. Service Over Counter Equipment

2. Technology Assessment

a. Technologies Applicable to All Equipment

b. Technologies Relevant Only to Equipment With Doors

c. Technologies Applicable Only to Equipment Without Doors

d. Self-Contained Equipment Technologies

D. Screening Analysis

E. Engineering Analysis

1. Representative Equipment for Analysis

a. Representative Unit Selection

b. Baseline Models

2. Design Options

3. Refrigerants

4. Cost Assessment Methodology

a. Teardown Analysis

b. Cost Model

c. Manufacturer Production Cost

d. Cost-Efficiency Relationship

e. Manufacturer Markup

f. Shipping Costs

g. Manufacturer Interviews

5. Energy Consumption Model

a. Energy Consumption Model Results

b. Anti-Sweat Heater Power

c. Evaporator Fan Motor Power

d. Condenser Energy Consumption

e. Evaporator Coil Design

F. Markups Analysis

1. Baseline and Incremental Markups

2. Distribution Channel Market Shares

G. Energy Use Analysis

H. Life-Cycle Cost Analysis

1. Effect of Current Standards

2. Equipment Cost

3. Installation, Maintenance, and Repair Costs

a. Maintenance and Repair Costs by Efficiency Level

b. Maintenance and Repair Cost Annualization

c. Maintenance Cost Estimates

d. Refrigerant Costs

e. Repair Costs

4. Annual Energy Consumption

5. Energy Prices

6. Energy Price Projections

7. Equipment Lifetime

8. Discount Rates

9. Compliance Date of Standards

10. Base-Case and Standards-Case Efficiency Distributions

11. Inputs to Payback Period Analysis

12. Rebuttable-Presumption Payback Period

I. National Impact Analysis—National Energy Savings and Net Present Value

1. Shipments

a. VOP.RC.L Shipments

b. Shipments by End User Type

c. Shipments Forecasts

2. Forecasted Efficiency in the Base Case and Standards Cases

3. National Energy Savings

4. Net Present Value of Customer Benefit

5. Benefits From Effects of Amended Standards on Energy Prices

J. Customer Subgroup Analysis

K. Manufacturer Impact Analysis

1. Overview

2. Government Regulatory Impact Model

a. Government Regulatory Impact Model Key Inputs

b. Government Regulatory Impact Model Scenarios

3. Discussion of Comments

a. Testing and Certification

b. Cumulative Regulatory Burden

c. Small Manufacturers

d. Manufacturer Markup

4. Manufacturer Interviews

a. Enforcement

b. Certification and Compliance Costs

c. Disproportionate Impact on Small Businesses

d. Potential Loss of Product Utility and Decrease in Food Safety

L. Employment Impact Analysis

M. Utility Impact Analysis

N. Emissions Analysis

O. Monetizing Carbon Dioxide and Other Emissions Impacts

1. Social Cost of Carbon

a. Monetizing Carbon Dioxide Emissions

b. Social Cost of Carbon Values Used in Past Regulatory Analyses

c. Current Approach and Key Assumptions

2. Valuation of Other Emissions Reductions

P. Regulatory Impact Analysis

V. Analytical Results

A. Trial Standard Levels

1. Trial Standard Level Formulation Process and Criteria

2. Trial Standard Level Equations

B. Economic Justification and Energy Savings

1. Economic Impacts on Commercial Customers

a. Life-Cycle Cost and Payback Period

b. Life-Cycle Cost Subgroup Analysis

2. Economic Impacts on Manufacturers

a. Industry Cash-Flow Analysis Results

b. Impacts on Direct Employment

c. Impacts on Manufacturing Capacity

d. Impacts on Subgroups of Manufacturers

e. Cumulative Regulatory Burden

3. National Impact Analysis

a. Amount and Significance of Energy Savings

b. Net Present Value of Customer Costs and Benefits

c. Employment Impacts

4. Impact on Utility or Performance of Equipment

5. Impact of Any Lessening of Competition

6. Need of the Nation To Conserve Energy

7. Other Factors

C. Proposed Standard

VI. Procedural Issues and Regulatory Review

A. Review Under Executive Orders 12866 and 13563

B. Review Under the Regulatory Flexibility Act

1. Description and Estimated Number of Small Entities Regulated

2. Description and Estimate of Compliance Requirements

3. Duplication, Overlap, and Conflict With Other Rules and Regulations

4. Significant Alternatives to the Rule

C. Review Under the Paperwork Reduction Act

D. Review Under the National Environmental Policy Act of 1969

E. Review Under Executive Order 13132

F. Review Under Executive Order 12988

G. Review Under the Unfunded Mandates Reform Act of 1995

H. Review Under the Treasury and General Government Appropriations Act, 1999

I. Review Under Executive Order 12630

J. Review Under the Treasury and General Government Appropriations Act, 2001

K. Review Under Executive Order 13211

L. Review Under the Information Quality Bulletin for Peer Review

VII. Public Participation

A. Attendance at the Public Meeting

B. Procedure for Submitting Prepared General Statements for Distribution

C. Conduct of the Public Meeting

D. Submission of Comments

E. Issues on Which DOE Seeks Comment

1. Primary and Secondary Equipment Classes

2. Design Option and Core Case Costs

3. Offset Factors

4. Extension of Standards

5. Types of Refrigerant Analyzed

6. Distribution Channel Market Shares and Markups

7. Market Shares of Efficiency Levels

8. Maintenance and Repair Costs at Higher Efficiency Levels

9. Impact of Amended Standards on Future Shipments

10. Small Businesses

VIII. Approval of the Office of the Secretary

I. Summary of the Proposed Rule

Title III, Part C of the Energy Policy and Conservation Act of 1975 (EPCA), Public Law 94-163 (42 U.S.C. 6311-6317, as codified), added by Public Law 95-619, Title IV, section 441(a), established the Energy Conservation Program for Certain Industrial Equipment, a program covering certain industrial equipment, which includes the commercial refrigeration equipment that is the focus of this notice.

1 2

EPCA specifies that any new or amended energy conservation standard that DOE prescribes for the equipment covered shall be designed to achieve the maximum improvement in energy efficiency that the Secretary of Energy (Secretary) determines is technologically feasible and economically justified. (42 U.S.C. 6295(o)(2)(A) and 6316(e)(1)) Furthermore, EPCA mandates that the new or amended standard must result in significant conservation of energy. (42 U.S.C. 6295(o)(3)(B) and 6316(e)(1)) In accordance with these and other statutory criteria discussed in this

notice, DOE proposes to adopt amended energy conservation standards for commercial refrigeration equipment. The proposed standards, which consist of maximum daily energy consumption (MDEC) values as a function of either refrigerated volume or total display area (TDA), are shown in Table I.1. DOE proposes that the standards proposed in this NOPR, if adopted, would apply to all equipment listed in Table I.1 that is manufactured in, or imported into, the United States on or after 3 years following the publication date of the final rule. (42 U.S.C. 6313(c)(6)(C)) For the NOPR analysis, DOE assumed a publication date in 2014 for this final rule and a compliance date in 2017 for the amended standards established by the final rule.

For editorial reasons, upon codification in the U.S. Code, Part C was re-designated Part A-1.

All references to EPCA in this document refer to the statute as amended by the American Energy Manufacturing Technical Corrections Act (AEMTCA), Public Law 112-210 (Dec. 18, 2012).

Table I.1—Proposed Energy Conservation Standards for Commercial Refrigeration Equipment

[Assumes compliance beginning in 2017]

Equipment class *

Proposed standard level **

†

VCT.RC.L

0.43 × TDA + 2.03

VOP.RC.M

0.61 × TDA + 3.03

SVO.RC.M

0.63 × TDA + 2.41

HZO.RC.L

0.57 × TDA + 6.88

HZO.RC.M

0.35 × TDA + 2.88

VCT.RC.M

0.08 × TDA + 0.72

VOP.RC.L

2.11 × TDA + 6.36

SOC.RC.M

0.39 × TDA + 0.08

VOP.SC.M

1.51 × TDA + 4.09

SVO.SC.M

1.5 × TDA + 3.99

HZO.SC.L

1.92 × TDA + 7.08

HZO.SC.M

0.75 × TDA + 5.44

HCT.SC.I

0.49 × TDA + 0.37

VCT.SC.I

0.52 × TDA + 2.56

VCS.SC.I

0.35 × V + 0.81

VCT.SC.M

0.04 × V + 1.07

VCT.SC.L

0.22 × V + 1.21

VCS.SC.M

0.03 × V + 0.53

VCS.SC.L

0.13 × V + 0.43

HCT.SC.M

0.02 × V + 0.51

HCT.SC.L

0.11 × V + 0.6

HCS.SC.M

0.02 × V + 0.37

HCS.SC.L

0.12 × V + 0.42

PD.SC.M

0.03 × V + 0.83

SOC.SC.M

0.32 × TDA + 0.53

VOP.RC.I

2.68 × TDA + 8.08

SVO.RC.L

2.11 × TDA + 6.36

SVO.RC.I

2.68 × TDA + 8.08

HZO.RC.I

0.72 × TDA + 8.74

VOP.SC.L

3.79 × TDA + 10.26

VOP.SC.I

4.81 × TDA + 13.03

SVO.SC.L

3.77 × TDA + 10.01

SVO.SC.I

4.79 × TDA + 12.72

HZO.SC.I

2.44 × TDA + 9.0

SOC.RC.L

0.83 × TDA + 0.18

SOC.RC.I

0.97 × TDA + 0.21

SOC.SC.I

1.35 × TDA + 0.29

VCT.RC.I

0.51 × TDA + 2.37

HCT.RC.M

0.14 × TDA + 0.11

HCT.RC.L

0.3 × TDA + 0.23

HCT.RC.I

0.35 × TDA + 0.27

VCS.RC.M

0.1 × V + 0.24

VCS.RC.L

0.21 × V + 0.5

VCS.RC.I

0.25 × V + 0.58

HCS.SC.I

0.35 × V + 0.81

HCS.RC.M

0.1 × V + 0.24

HCS.RC.L

0.21 × V + 0.5

HCS.RC.I

0.25 × V + 0.58

SOC.SC.L

0.67 × TDA + 1.12

* Equipment class designations consist of a combination (in sequential order separated by periods) of: (1) an equipment family code (VOP = vertical open, SVO = semivertical open, HZO = horizontal open, VCT = vertical transparent doors, VCS = vertical solid doors, HCT = horizontal transparent doors, HCS = horizontal solid doors, SOC = service over counter, or PD = pull-down); (2) an operating mode code (RC = remote condensing or SC = self-contained); and (3) a rating temperature code (M = medium temperature (38±2 °F), L = low temperature (0±2 °F), or I = ice-cream temperature (−15±2 °F)). For example, “VOP.RC.M” refers to the “vertical open, remote condensing, medium temperature” equipment class. See discussion in chapter 3 of the NOPR technical support document (TSD) for a more detailed explanation of the equipment class terminology.

** “TDA” is the total display area of the case, as measured in the Air-Conditioning, Heating, and Refrigeration Institute (AHRI) Standard 1200-2010, appendix D.

†

“V” is the volume of the case, as measured in American National Standards Institute (ANSI)/Association of Home Appliance Manufacturers (AHAM) Standard HRF-1-2004.

A. Benefits and Costs to Customers

Table I.2 presents DOE's evaluation of the economic impacts of the proposed standards on customers of commercial refrigeration equipment, as measured by the average life-cycle cost (LCC) savings

and the median payback period (PBP).

The average LCC savings are positive for all equipment classes under the standard proposed by DOE in this notice. At TSL 4, the percentage of customers who experience net benefits or no impacts ranges from 59 to 100 percent, and customers experiencing a net cost range from 0 to 41 percent. Chapter 11 presents the LCC subgroup analysis on groups of customers that may be disproportionately affected by the proposed standard.

Life-cycle cost (LCC) of commercial refrigeration equipment is the cost to customers of owning and operating the equipment over the entire life of the equipment. Life-cycle cost savings are the reductions in the life-cycle costs due to amended energy conservation standards when compared to the life-cycle costs of the equipment in the absence of amended energy conservation standards. Further discussion of the LCC analysis can be found in Chapter 8 of the TSD.

Payback period (PBP) refers to the amount of time (in years) it takes customers to recover the increased installed cost of equipment associated with new or amended standards through savings in operating costs. Further discussion of the PBP can be found in Chapter 8 of the TSD.

Table I.2—Impacts of Proposed Standards on Customers of Commercial Refrigeration Equipment

Equipment class *

Average LCC

savings

2012$

Median PBP

years

VOP.RC.M

$1,493.72

3.91

VOP.RC.L

1,129.51

2.22

VOP.SC.M

691.27

4.39

VCT.RC.M

1,108.13

2.70

VCT.RC.L

797.91

1.64

VCT.SC.M

641.05

2.54

VCT.SC.L

1,342.84

0.96

VCT.SC.I

431.88

1.97

VCS.SC.M

131.80

1.75

VCS.SC.L

220.83

1.15

VCS.SC.I

152.69

2.42

SVO.RC.M

1,008.46

4.50

SVO.SC.M

491.99

4.75

SOC.RC.M

494.51

4.41

HZO.RC.M **

0.00

HZO.RC.L **

0.00

HZO.SC.M

28.78

6.40

HZO.SC.L **

0.00

HCT.SC.M

253.60

3.08

HCT.SC.L

368.92

1.47

HCT.SC.I

42.48

4.28

HCS.SC.M

8.68

4.28

HCS.SC.L

80.72

2.57

PD.SC.M

310.43

2.27

SOC.SC.M

739.75

2.99

* Values have been shown only for primary equipment classes, which are equipment classes that have significant volume of shipments and, therefore, were directly analyzed. See chapter 5 of the NOPR TSD, Engineering Analysis, for a detailed discussion of primary and secondary equipment classes.

** For equipment classes HZO.RC.M, HZO.RC.L, and HZO.SC.L, no efficiency levels above the baseline were found to be economically justifiable. Therefore, the proposed standards for these equipment classes are the same as the current standards. As a result, LCC savings for these equipment classes are shown as zero. The PBP values are indeterminate and are shown as “NA.”

B. Impact on Manufacturers

The industry net present value (INPV) is the sum of the discounted cash flows to the industry from the base year (2013) through the end of the analysis period (2046). Using a real discount rate of 10 percent,

DOE estimates that the INPV for manufacturers of commercial refrigeration equipment is $1,162.0 million in 2012$. Under the proposed standards, DOE expects the industry net present value to decrease by 3.95

percent to 7.97 percent. Total industry conversion costs are expected to total $87.5 million.

This is the rate used to discount future cash flows in the Manufacturer Impact Analysis. A discount rate of 10% was calculated based on SEC filings and feedback from manufacturer interviews about the current cost of capital in the industry. For more information, refer to Chapter 12 of the NOPR TSD.

C. National Benefits

DOE's analyses indicate that the proposed standards would save a significant amount of energy. The lifetime savings for commercial refrigeration equipment purchased in the 30-year period that begins in the year of the compliance with amended standards (2017-2046) amount to 1.001 quadrillion British thermal units (quads). The average annual energy savings over the life of commercial refrigeration equipment purchased in 2017 through 2046 is 0.04 quads.

Total U.S. commercial sector energy (source energy) used for refrigeration in 2010 was 1.21 quads. Source: U.S. Department of Energy—Office of Energy Efficiency and Renewable Energy.

Buildings Energy Data Book,

Table 3.1.4, 2010 Commercial Energy End-Use Splits, by Fuel Type (Quadrillion Btu). 2012. (Last accessed April 23, 2013.)

http://buildingsdatabook.eren.doe.gov/TableView.aspx?table=3.1.4.

The cumulative national net present value (NPV) of total customer costs and savings of the proposed standards for commercial refrigeration equipment in 2012$ ranges from $1.606 billion (at a 7-percent discount rate) to $4.067 billion (at a 3-percent discount rate). This NPV expresses the estimated total value to customers of future operating cost savings minus the estimated increased installed costs for equipment purchased in 2017-2046, discounted to 2013.

The proposed standards are expected to have significant environmental benefits. The energy savings would result in cumulative greenhouse gas (GHG) emission reductions of 54.88 million metric tons (MMt)

of carbon dioxide (CO

), 265.9 thousand tons of methane, 1.1 thousand tons of nitrous oxide, 70.1 thousand tons of sulfur dioxide (SO

), 81.1 thousand tons of NO

and 0.1 tons of mercury (Hg).

A metric ton is equivalent to 1.1 U.S. short tons. Results for NO

and Hg are presented in short tons.

DOE calculated emissions reductions relative to the Annual Energy Outlook (AEO) 2013 Reference case, which generally represents current legislation and environmental regulations for which implementing regulations were available as of December 31, 2012.

DOE also estimated CO

and CO

equivalent (CO

eq) emissions that occur through 2030 (CO

eq includes greenhouse gases such as CH

and N

O). The estimated emissions reductions through 2030 are 16 million metric tons CO

, 1,687 thousand tons CO

eq for CH

, and 72.27 thousand tons CO

eq for N

The value of the CO

reductions is calculated using a range of values per metric ton of CO

(otherwise known as the Social Cost of Carbon, or SCC) developed by a recent Federal interagency process. The derivation of the SCC values is discussed in section IV.O. DOE estimates that the net present monetary value of the CO

emissions reduction would be between $0.31 and $4.55 billion. DOE also estimates the present monetary value of the NO

emissions reduction would be between $8.8 and $90.7 million at a 7-percent discount rate, and between $19.1 and $196.2 million at a 3-percent discount rate.

DOE is currently investigating valuation of avoided Hg and SO

emissions.

Table I.3 summarizes the national economic costs and benefits expected to result from the proposed standards for commercial refrigeration equipment.

Table I.3—Summary of National Economic Benefits and Costs of Proposed Commercial Refrigeration Equipment Energy Conservation Standards

Category

Maximum daily energy consumption

kWh/day *

Refrigerators with solid doors

0.10 V ** + 2.04.

Refrigerators with transparent doors

0.12 V + 3.34.

Freezers with solid doors

0.40 V + 1.38.

Freezers with transparent doors

0.75 V + 4.10.

Refrigerators/freezers with solid doors

the greater of 0.27 AV

†

−0.71 or 0.70.

Self-contained refrigerators with transparent doors designed for pull-down temperature applications

0.126V + 3.51.

* kilowatt-hours per day.

** Where “V” means the chilled or frozen compartment volume in cubic feet as defined in the Association of Home Appliance Manufacturers Standard HRF-1-1979. 10 CFR 431.66.

†

Where “AV” means that adjusted volume in cubic feet measured in accordance with the Association of Home Appliance Manufacturers Standard HRF-1-1979. 10 CFR 431.66

Table II.2—Commercial Refrigeration Equipment Standards Established in the January 2009 Final Rule—Compliance Required Beginning on January 1, 2012

Equipment class *

Standard level **

†

kWh/day

VOP.RC.M

0.82 × TDA + 4.07

SVO.RC.M

0.83 × TDA + 3.18

HZO.RC.M

0.35 × TDA + 2.88

VOP.RC.L

2.27 × TDA + 6.85

HZO.RC.L

0.57 × TDA + 6.88

VCT.RC.M

0.22 × TDA + 1.95

VCT.RC.L

0.56 × TDA + 2.61

SOC.RC.M

0.51 × TDA + 0.11

VOP.SC.M

1.74 × TDA + 4.71

SVO.SC.M

1.73 × TDA + 4.59

HZO.SC.M

0.77 × TDA + 5.55

HZO.SC.L

1.92 × TDA + 7.08

VCT.SC.I

0.67 × TDA + 3.29

VCS.SC.I

0.38 × V + 0.88

HCT.SC.I

0.56 × TDA + 0.43

SVO.RC.L

2.27 × TDA + 6.85

VOP.RC.I

2.89 × TDA + 8.7

SVO.RC.I

2.89 × TDA + 8.7

HZO.RC.I

0.72 × TDA + 8.74

VCT.RC.I

0.66 × TDA + 3.05

HCT.RC.M

0.16 × TDA + 0.13

HCT.RC.L

0.34 × TDA + 0.26

HCT.RC.I

0.4 × TDA + 0.31

VCS.RC.M

0.11 × V + 0.26

VCS.RC.L

0.23 × V + 0.54

VCS.RC.I

0.27 × V + 0.63

HCS.RC.M

0.11 × V + 0.26

HCS.RC.L

0.23 × V + 0.54

HCS.RC.I

0.27 × V + 0.63

SOC.RC.L

1.08 × TDA + 0.22

SOC.RC.I

1.26 × TDA + 0.26

VOP.SC.L

4.37 × TDA + 11.82

VOP.SC.I

5.55 × TDA + 15.02

SVO.SC.L

4.34 × TDA + 11.51

SVO.SC.I

5.52 × TDA + 14.63

HZO.SC.I

2.44 × TDA + 9.

SOC.SC.I

1.76 × TDA + 0.36

HCS.SC.I

0.38 × V + 0.88

* Equipment class designations consist of a combination (in sequential order separated by periods) of: (1) an equipment family code (VOP = vertical open, SVO = semivertical open, HZO = horizontal open, VCT = vertical transparent doors, VCS = vertical solid doors, HCT = horizontal transparent doors, HCS = horizontal solid doors, or SOC = service over counter); (2) an operating mode code (RC = remote condensing or SC = self-contained); and (3) a rating temperature code (M = medium temperature (38 °F), L = low temperature (0 °F), or I = ice-cream temperature (-15 °F)). For example, “VOP.RC.M” refers to the “vertical open, remote condensing, medium temperature” equipment class.

** TDA is the total display area of the case, as measured in ANSI/Air-Conditioning and Refrigeration Institute (ARI) Standard 1200-2006, appendix D.

†

V is the volume of the case, as measured in AHAM Standard HRF-1-2004.

2. History of Standards Rulemaking for Commercial Refrigeration Equipment

EPCA, as amended by EPACT 2005, prescribes energy conservation standards for certain self-contained commercial refrigeration equipment designed for holding temperatures

(

i.e.,

commercial refrigerators, freezers, and refrigerator-freezers with transparent and solid doors designed for holding temperature applications) and self-contained commercial refrigerators with transparent doors designed for pull-down temperature applications.

Compliance with these standards was required as of January 1, 2010. (42 U.S.C. 6313(c)(2)-(3)) DOE published a technical amendment final rule on October 18, 2005 codifying these standards into subpart C of part 431 under title 10 of the Code of Federal Regulations (CFR). 70 FR 60407.

EPCA defines the term “holding temperature application” as a use of commercial refrigeration equipment other than a pull-down temperature application, except a blast chiller or freezer. (42 U.S.C. 6311(9)(B))

EPCA defines the term “pull-down temperature application” as a commercial refrigerator with doors that, when fully loaded with 12 ounce beverage cans at 90 °F, can cool those beverages to an average stable temperature of 38 °F in 12 hours or less. (42 U.S.C. 6311(9)(D))

In addition, EPCA requires DOE to set standards for additional commercial refrigeration equipment that is not covered by 42 U.S.C. 6313(c)(2)-(3), namely commercial ice-cream freezers; self-contained commercial refrigerators, freezers, and refrigerator-freezers without doors; and remote condensing commercial refrigerators, freezers, and refrigerator-freezers. (42 U.S.C. 6313(c)(5)) DOE published a final rule establishing these standards on January 9, 2009 (74 FR 1092), and manufacturers must comply with these standards starting on January 1, 2012. (42 U.S.C. 6313(c)(5)(A))

EPCA requires DOE to conduct a subsequent rulemaking to determine whether to amend the standards established under 42 U.S.C. 6313(c), which includes both the standards prescribed by EPACT 2005 and those prescribed by DOE in the January 2009 final rule. (42 U.S.C. 6313(c)(6)) If DOE decides as part of this ongoing rulemaking to amend the current standards, DOE must publish a final rule establishing any such amended standards by January 1, 2013.

Id.

To satisfy this requirement, DOE initiated the current rulemaking on April 30, 2010 by publishing on its Web site its “Rulemaking Framework for Commercial Refrigeration Equipment.” (The Framework document is available at:

www1.eere.energy.gov/buildings/appliance_standards/commercial/pdfs/cre_framework_04-30-10.pdf

.) DOE also published a notice in the

Federal Register

announcing the availability of the Framework document, as well as a public meeting to discuss the document. The notice also solicited comment on the matters raised in the document. 75 FR 24824 (May 6, 2010). The Framework document described the procedural and analytical approaches that DOE anticipated using to evaluate energy conservation standards for commercial refrigeration equipment, and identified various issues to be resolved in the rulemaking.

DOE held the Framework public meeting on May 18, 2010, at which it: (1) Presented the contents of the Framework document; (2) described the analyses it planned to conduct during the rulemaking; (3) sought comments from interested parties on these subjects; and (4) in general, sought to inform interested parties about, and facilitate their involvement in, the rulemaking. Major issues discussed at the public meeting included: (1) the scope of coverage for the rulemaking; (2) potential updates to the test procedure and appropriate test metrics (being addressed in a concurrent rulemaking); (3) manufacturer and market information, including distribution channels; (4) equipment classes, baseline units,

and design options to improve efficiency; (5) life-cycle costs to customer, including installation, maintenance, and repair costs; and (6) any customer subgroups DOE should consider. At the meeting and during the comment period on the Framework document, DOE received many comments that helped it identify and resolve issues pertaining to commercial refrigeration equipment relevant to this rulemaking. These are discussed in subsequent sections of this notice.

Baseline units consist of units possessing features and levels of efficiency consistent with the least-efficient equipment currently available and widely sold on the market.

DOE then gathered additional information and performed preliminary analyses to help review energy conservation standards for this equipment. This process culminated in DOE's notice of another public meeting to discuss and receive comments regarding the tools and methods DOE used in performing its preliminary analysis, as well as the analyses results. 76 FR 17573 (March 30, 2011) (the March 2011 notice). DOE also invited written comments on these subjects and announced the availability on its Web site of a preliminary analysis technical support document (preliminary analysis TSD).

Id.

(The preliminary analysis TSD is available at:

www.regulations.gov/#!documentDetail;D=EERE-2010-BT-STD-0003-0030.

) Finally, DOE sought comments concerning other relevant issues that could affect amended energy

conservation standards for commercial refrigeration equipment, or that DOE should address in this NOPR. 76 FR 17575 (March 30, 2011).

The preliminary analysis TSD provided an overview of DOE's review of the standards for commercial refrigeration equipment, discussed the comments DOE received in response to the Framework document, and addressed issues including the scope of coverage of the rulemaking. The document also described the analytical framework that DOE used (and continues to use) in considering amended standards for commercial refrigeration equipment, including a description of the methodology, the analytical tools, and the relationships between the various analyses that are part of this rulemaking. Additionally, the preliminary analysis TSD presented in detail each analysis that DOE had performed for this equipment up to that point, including descriptions of inputs, sources, methodologies, and results. These analyses were as follows:

• A

market and technology assessment

addressed the scope of this rulemaking, identified existing and potential new equipment classes for commercial refrigeration equipment, characterized the markets for this equipment, and reviewed techniques and approaches for improving its efficiency;

• A

screening analysis

reviewed technology options to improve the efficiency of commercial refrigeration equipment, and weighed these options against DOE's four prescribed screening criteria;

• An

engineering analysis

estimated the manufacturer selling prices (MSPs) associated with more energy efficient commercial refrigeration equipment;

• An

energy use analysis

estimated the annual energy use of commercial refrigeration equipment;

• A

markups analysis

converted estimated MSPs derived from the engineering analysis to customer purchase prices;

• A

life-cycle cost analysis

calculated, for individual customers, the discounted savings in operating costs throughout the estimated average life of commercial refrigeration equipment, compared to any increase in installed costs likely to result directly from the imposition of a given standard;

• A

payback period analysis

estimated the amount of time it would take customers to recover the higher purchase price of more energy efficient equipment through lower operating costs;

• A

shipments analysis

estimated shipments of commercial refrigeration equipment over the time period examined in the analysis;

• A

national impact analysis

(NIA) assessed the national energy savings (NES), and the national NPV of total customer costs and savings, expected to result from specific, potential energy conservation standards for commercial refrigeration equipment; and

• A

preliminary manufacturer impact analysis

(MIA) took the initial steps in evaluating the potential effects on manufacturers of amended efficiency standards.

The public meeting announced in the March 2011 notice took place on April 19, 2011 (April 2011 preliminary analysis public meeting). At the April 2011 preliminary analysis public meeting, DOE presented the methodologies and results of the analyses set forth in the preliminary analysis TSD. Interested parties provided comments on the following issues: (1) Equipment classes; (2) technology options; (3) energy modeling; (4) installation, maintenance, and repair costs; (5) markups and distributions chains; (6) commercial refrigeration equipment shipments; and (7) test procedures. The comments received since publication of the March 2011 notice, including those received at the April 2011 preliminary analysis public meeting, have contributed to DOE's proposed resolution of the issues in this rulemaking as they pertain to commercial refrigeration equipment. This NOPR responds to the issues raised by the commenters.

In December 2012, AEMTCA established new standards for SOC.SC.M equipment with a compliance date of January 1, 2012. (42 U.S.C. 6313(c)(4)) The SOC.SC.M equipment had previously been classified under the category self-contained commercial refrigerators with transparent doors for which standards were established by EPACT 2005. (42 U.S.C. 6313(c)(2)) The standard established by AEMTCA for SOC.SC.M equipment reduces the stringency of the standard applicable to this equipment.

AEMTCA also directs DOE to determine, within three years of enactment of the new SOC.SC.M standard, whether this standard should be amended. (42 U.S.C. 6313(c)(4)(B)(i)) If DOE determines that the standard should be amended, then DOE must issue a final rule establishing an amended standard within this same three-year period. (42 U.S.C. 6313(c)(4)(B)(ii))

III. General Discussion

A. Test Procedures and Normalization Metrics

1. Test Procedures

On December 8, 2006, DOE published a final rule in which it adopted American National Standards Institute (ANSI)/Air-Conditioning and Refrigeration Institute (ARI) Standard 1200-2006, “Performance Rating of Commercial Refrigerated Display Merchandisers and Storage Cabinets,” as the DOE test procedure for this equipment. 71 FR 71340, 71369-70. ANSI/ARI Standard 1200-2006 requires performance tests to be conducted according to the American Society of Heating, Refrigerating, and Air-Conditioning Engineers (ASHRAE) Standard 72-2005, “Method of Testing Commercial Refrigerators and Freezers.” The standard also contains rating temperature specifications of 38 °F (±2 °F) for commercial refrigerators and refrigerator compartments, 0 °F (±2 °F) for commercial freezers and freezer compartments, and −5 °F (±2 °F) for commercial ice-cream freezers. During the 2006 test procedure rulemaking, DOE determined that testing at a −15 °F (±2 °F) rating temperature was more representative of the actual energy consumption of commercial freezers specifically designed for ice-cream application. 71 FR 71357 (Dec. 8, 2006). Therefore, in the test procedure final rule, DOE adopted a −15 °F (±2 °F) rating temperature for commercial ice-cream freezers, rather than the −5 °F (±2 °F) prescribed in the ANSI/ARI Standard 1200-2006. In addition, DOE adopted ANSI/Association of Home Appliance Manufacturers (AHAM) Standard HRF-1-2004, “Energy, Performance, and Capacity of Household Refrigerators, Refrigerator-Freezers, and Freezers,” for determining compartment volumes for this equipment. 71 FR 71369-70 (Dec. 8, 2006).

On February 21, 2012, DOE published a test procedure final rule (2012 test procedure final rule) in which it adopted several amendments to the DOE test procedure. This included an amendment to incorporate by reference ANSI/Air-Conditioning, Heating, and Refrigeration Institute (AHRI) Standard 1200-2010, “Performance Rating of Commercial Refrigerated Display Merchandisers and Storage Cabinets,” as the DOE test procedure for this equipment. 77 FR 10292, 10314 (Feb. 21, 2012). The 2012 test procedure final rule also included an amendment to incorporate by reference the updated ANSI/AHAM Standard HRF-1-2008,

“Energy, Performance, and Capacity of Household Refrigerators, Refrigerator-Freezers, and Freezers,” for determining compartment volumes for this equipment.

In addition, the 2012 test procedure final rule included several amendments designed to address certain energy efficiency features that were not accounted for by the previous DOE test procedure, including provisions for measuring the impact of night curtains

and lighting occupancy sensors and scheduled controls. 77 FR 10296-98 (Feb. 21, 2012). In the 2012 test procedure final rule, DOE also adopted amendments to allow testing of commercial refrigeration equipment at temperatures other than one of the three rating temperatures previously specified in the test procedure. Specifically, the 2012 test procedure final rule allows testing of commercial refrigeration equipment at its lowest application product temperature, for equipment that cannot be tested at the prescribed rating temperature. The 2012 test procedure final rule also allows manufacturers to test and certify equipment at the more-stringent temperatures and ambient conditions required by NSF for food safety testing. 77 FR 10305 (Feb. 21, 2012). (The NSF was founded in 1944 as the National Sanitation Foundation, and is now referred to simply as NSF.)

Night curtains are devices made of an insulating material, typically insulated aluminum fabric, designed to be pulled down over the open front of the case to decrease infiltration and heat transfer into the case when the merchandizing establishment is closed.

The test procedure amendments established in the 2012 test procedure final rule are required to be used in conjunction with any amended standards promulgated as a result of this energy conservation standard rulemaking. As such, use of the amended test procedure to show compliance with DOE energy conservation standards or make representations with respect to energy consumption of commercial refrigeration equipment is required on the compliance date of any revised energy conservation standards established as part of this rulemaking. 77 FR 10308 (Feb. 21, 2012).

DOE has initiated a test procedure rulemaking for commercial refrigeration equipment to address many issues raised by stakeholders since the publication of the 2012 test procedure final rule. This rulemaking will address the following issues:

• A number of new definitions related to commercial refrigeration equipment,

• A description of the proper configuration and use of energy management systems,

• Clarifications on the use of calculation methods, appropriate reporting requirements, and determination of the lowest application product temperature,

• Incorporation of Interpretations 1 through 5 to AHRI 1200-2010, and

• Updates and clarifications regarding the compliance dates of test procedure amendments adopted in the 2012 test procedure final rule by reorganizing the test procedure in two different appendices.

The issues that will be addressed in the test procedure rulemaking are consistent with the analysis in this NOPR.

2. Normalization Metrics

Both the January 2009 final rule and EPACT 2005 contain energy conservation standards for respective covered types of commercial refrigeration equipment, expressed in the form of equations developed as a function of unit size. This use of normalization metrics allows for a single standard-level equation developed for an equipment class to apply to a broad range of equipment sizes offered within that class by manufacturers. In the aforementioned commercial refrigeration equipment standards, the two normalization metrics used are refrigerated compartment volume, as determined using AHAM HRF-1-2004, and TDA, as determined using ANSI/ARI 1200-2006. In particular, the EPACT 2005 standards utilize volume as the normalization metric for all equipment types, with the exception of refrigerator-freezers with solid doors, for which it specifies adjusted volume. (42 U.S.C. 6313(c)(2)) The January 2009 final rule, meanwhile, utilized TDA as the normalization metric for all equipment with display capacity while specifying volume as the metric for solid-door (VCS and HCS) equipment. 74 FR 1093 (Jan. 9, 2009).

At the May 2010 Framework public meeting, interested parties raised several questions regarding the potential normalization metrics that could be used in amended standards. DOE also received stakeholder feedback pertaining to this issue following the publication of the Framework document. In the preliminary analysis, DOE suggested that it would consider retaining the normalization metrics in this rulemaking for the respective classes to which they were applied in EPCA (42 U.S.C. 6313(c)(2)-(3)) and the January 2009 final rule. 74 FR 1093 (Jan. 9, 2009). In chapter 2 of the preliminary analysis TSD, DOE presented its rationale for the continued use of TDA for equipment with display areas addressed in the January 2009 final rule and the continued use of volume as the metric for solid-door remote condensing equipment and ice-cream freezers, as well as for the equipment covered by EPACT 2005 standards. DOE did not receive any information or data while conducting the NOPR analyses that would alter this position, and thus DOE proposes continued use of the existing normalization metrics in today's notice.

B. Technological Feasibility

1. General

In each standards rulemaking, DOE conducts a screening analysis, which is based on information that the Department has gathered on all current technology options and prototype designs that could improve the efficiency of the products or equipment that are the subject of the rulemaking. As the first step in such analysis, DOE develops a list of design options for consideration, in consultation with manufacturers, design engineers, and other interested parties. DOE then determines which of these options for improving efficiency are technologically feasible. DOE considers a design option to be technologically feasible if it is used by the relevant industry or if a working prototype has been developed. Technologies incorporated in commercially available equipment or in working prototypes will be considered technologically feasible. 10 CFR 430, subpart C, appendix A, section 4(a)(4)(i) Although DOE considers technologies that are proprietary, it will not consider efficiency levels that can only be reached through the use of proprietary technologies (

i.e.,

a unique pathway), which could allow a single manufacturer to monopolize the market.

Once DOE has determined that particular design options are technologically feasible, it further evaluates each of these design options in light of the following additional screening criteria: (1) Practicability to manufacture, install, or service; (2) adverse impacts on product utility or availability; and (3) adverse impacts on health or safety. 10 CFR part 430, subpart C, appendix A, section 4(a)(4)(ii)-(iv) Chapter 4 of the NOPR TSD discusses the results of the screening analyses for commercial refrigeration equipment. Specifically, it presents the designs DOE considered, those it screened out, and those that are the bases for the TSLs considered in this rulemaking.

2. Maximum Technologically Feasible Levels

When DOE proposes to adopt (or not adopt) an amended or new energy conservation standard for a type or class of covered equipment such as commercial refrigeration equipment, it determines the maximum improvement in energy efficiency that is technologically feasible for such equipment. (

See

42 U.S.C. 6295(p)(1) and 6316(e)(1)) Accordingly, in the preliminary analysis, DOE determined the maximum technologically feasible (“max-tech”) improvements in energy efficiency for commercial refrigeration equipment in the engineering analysis using the design parameters that passed the screening analysis.

As indicated previously, whether efficiency levels exist or can be achieved in commonly used equipment is not relevant to whether they are considered max-tech levels. DOE considers technologies to be technologically feasible if they are incorporated in any currently available equipment or working prototypes. Hence, a max-tech level results from the combination of design options predicted to result in the highest efficiency level possible for an equipment class, with such design options consisting of technologies already incorporated in commercial equipment or working prototypes. DOE notes that it reevaluated the efficiency levels, including the max-tech levels, when it updated its results for this NOPR. See chapter 5 of the NOPR TSD for the results of the analyses, and a list of technologies included in max-tech equipment. Table III.1 shows the max-tech levels determined in the engineering analysis for commercial refrigeration equipment.

Table III.1—“Max-Tech” Levels for Commercial Refrigeration Equipment Primary Classes

Equipment class

“Max-Tech” level

kWh/day

VCT.RC.L

0.41 × TDA + 1.93

VOP.RC.M

0.6 × TDA + 2.99

SVO.RC.M

0.62 × TDA + 2.38

HZO.RC.L

0.55 × TDA + 6.7

HZO.RC.M

0.34 × TDA + 2.83

VCT.RC.M

0.07 × TDA + 0.66

VOP.RC.L

2.07 × TDA + 6.26

SOC.RC.M

0.39 × TDA + 0.08

VOP.SC.M

1.5 × TDA + 4.06

SVO.SC.M

1.5 × TDA + 3.97

HZO.SC.L

1.91 × TDA + 7.03

HZO.SC.M

0.74 × TDA + 5.35

HCT.SC.I

0.36 × TDA + 0.28

VCT.SC.I

0.5 × TDA + 2.44

VCS.SC.I

0.33 × V + 0.76

VCT.SC.M

0.03 × V + 0.97

VCT.SC.L

0.21 × V + 1.16

VCS.SC.M

0.02 × V + 0.41

VCS.SC.L

0.11 × V + 0.38

HCT.SC.M

0.01 × V + 0.38

HCT.SC.L

0.08 × V + 0.45

HCS.SC.M

0.01 × V + 0.18

HCS.SC.L

0.07 × V + 0.24

PD.SC.M

0.03 × V + 0.72

SOC.SC.M

0.32 × TDA + 0.53

C. Energy Savings

1. Determination of Savings

For each TSL, DOE projected energy savings from the products that are the subjects of this rulemaking, purchased during the 30-year period that begins in the year of compliance with amended standards (2017-2046). The savings are measured over the entire lifetime of products purchased in the 30-year period.

DOE used the NIA model to estimate the NES for equipment purchased over the period 2017-2046. The model forecasts total energy use over the analysis period for each representative equipment class at efficiency levels set by each of the five considered TSLs. DOE then compares the energy use at each TSL to the base-case energy use to obtain the NES. The NIA model is described in section IV.I of this notice and in chapter 10 of the NOPR TSD.

In the past, DOE presented energy savings results for only the 30-year period that begins in the year of compliance. In the calculation of economic impacts, however, DOE considered operating cost savings measured over the entire lifetime of products purchased during the 30-year period. DOE has chosen to modify its presentation of national energy savings to be consistent with the approach used for its national economic analysis.

DOE used its national impact analysis (NIA) spreadsheet model to estimate energy savings from amended standards for the products that are the subject of this rulemaking. The NIA spreadsheet model (described in section IV.I of this notice) calculates energy savings in site energy, which is the energy directly consumed by products at the locations where they are used. For electricity, DOE reports national energy savings in terms of the savings in the energy that is used to generate and transmit the site electricity. To calculate this quantity, DOE derives annual conversion factors from the model used to prepare the Energy Information Administration's (EIA)

Annual Energy Outlook

(

AEO

DOE has begun to also estimate full-fuel-cycle (FFC) energy savings. 76 FR 51282 (Aug. 18, 2011), as amended at 77 FR 49701 (August 17, 2012). The FFC metric includes the energy consumed in extracting, processing, and transporting primary fuels, and thus presents a more complete picture of the impacts of energy efficiency standards. DOE's approach is based on calculation of an FFC multiplier for each of the energy types used by covered products.

2. Significance of Savings

EPCA prohibits DOE from adopting a standard that would not result in significant additional energy savings. (42 U.S.C. 6295(o)(3)(B),(v) and 6316(e)(1)) While the term “significant” is not defined in EPCA, the U.S. Court of Appeals for the District of Columbia in

Natural Resources Defense Council

Herrington,

768 F.2d 1355, 1373 (D.C. Cir. 1985), indicated that Congress intended significant energy savings to be savings that were not “genuinely trivial.” The estimated energy savings in the 30-year analysis period for the TSLs considered in this rulemaking range from 0.236 to 1.278 quads (see section V.B.2 for additional details); therefore, DOE considers them significant within the meaning of section 325 of the Act.

D. Economic Justification

1. Specific Criteria

As discussed in section II.A, EPCA provides seven factors to be evaluated in determining whether a potential energy conservation standard is economically justified. (42 U.S.C. 6295(o)(2)(B)(i) and 6316(e)(1)) The following sections generally discuss how DOE is addressing each of those seven factors in this rulemaking. For further details and the results of DOE's analyses pertaining to economic justification, see sections IV and V of today's notice.

a. Economic Impact on Manufacturers and Commercial Customers

In determining the impacts of a potential new or amended energy conservation standard on manufacturers, DOE first determines its quantitative impacts using an annual cash flow approach. This includes both a short-term assessment (based on the cost and capital requirements associated with new or amended standards during the period between the announcement of a regulation and the compliance date of the regulation) and a long-term assessment (based on the costs and marginal impacts over the 30-year analysis period). The impacts analyzed include INPV (which values the industry based on expected future cash

flows), cash flows by year, changes in revenue and income, and other measures of impact, as appropriate. Second, DOE analyzes and reports the potential impacts on different types of manufacturers, paying particular attention to impacts on small manufacturers. Third, DOE considers the impact of new or amended standards on domestic manufacturer employment and manufacturing capacity, as well as the potential for new or amended standards to result in plant closures and loss of capital investment. Finally, DOE takes into account cumulative impacts of other DOE regulations and non-DOE regulatory requirements on manufacturers.

For individual customers, measures of economic impact include the changes in LCC and the PBP associated with new or amended standards. The LCC, which is also separately specified as one of the seven factors to be considered in determining the economic justification for a new or amended standard (42 U.S.C. 6295(o)(2)(B)(i)(II), and 6316(e)(1)), is discussed in the following section. For customers in the aggregate, DOE also calculates the NPV from a national perspective of the economic impacts on customers over the analysis period used in a particular rulemaking. For a description of the methodology used for assessing the economic impact on customers, see sections IV.H and IV.I; for results, see sections V.B.1 and V.B.2 of this notice. Additionally, chapters 8 and 10 and the associated appendices of the NOPR TSD contain a detailed description of the methodology and discussion of the results. For a description of the methodology used to assess the economic impact on manufacturers, see section IV.K; for results, see section V.B.2 of this notice. Additionally, chapter 13 of the NOPR TSD contains a detailed description of the methodology and discussion of the results.

b. Life-Cycle Costs

The LCC is the sum of the purchase price of equipment (including the cost of its installation) and the operating costs (including energy and maintenance and repair costs) discounted over the lifetime of the equipment. The LCC savings for the considered efficiency levels are calculated relative to a base-case scenario, which reflects likely trends in the absence of new or amended standards. DOE carried out the LCC analysis for this rulemaking by analyzing the LCC impacts on those customers who purchase the equipment in the year in which compliance with the new standard is required. To account for uncertainty and variability in specific inputs, such as equipment lifetime and discount rate, DOE uses a range of values, each with its own probability of selection. In addition to identifying distribution of customer impacts, DOE evaluates the LCC impacts of potential standards on identifiable subgroups of customers who may be disproportionately affected by a new national standard. For the results of DOE's analyses related to the LCC, see section V.B.1 of this notice and chapter 8 of the NOPR TSD; for LCC impacts on identifiable subgroups, see section V.B.1 of this notice and chapter 11 of the NOPR TSD.

c. Energy Savings

While significant conservation of energy is a statutory requirement for imposing an energy conservation standard, EPCA also requires DOE, in determining the economic justification of a standard, to consider the total projected energy savings that are expected to result directly from the standard. (42 U.S.C. 6295(o)(2)(B)(i)(III) and 6316(e)(1)) DOE uses NIA spreadsheet results in its consideration of total projected savings. For the results of DOE's analyses related to the potential energy savings, see section VI.B.3 of this notice and chapter 10 of the NOPR TSD.

d. Lessening of Utility or Performance of Equipment

In establishing classes of equipment, and in evaluating design options and the impact of potential standard levels, DOE seeks to develop standards that would not lessen the utility or performance of the equipment under consideration. None of the TSLs presented in today's NOPR would reduce the utility or performance of the equipment considered in the rulemaking. (42 U.S.C. 6295(o)(2)(B)(i)(IV) and 6316(e)(1)) During the screening analysis, DOE eliminated from consideration any technology that would adversely impact customer utility. For the results of DOE's analyses related to the potential impact of amended standards on equipment utility and performance, see section IV.D of this notice and chapter 4 of the NOPR TSD.

e. Impact of Any Lessening of Competition

EPCA directs DOE to consider the impact of any lessening of competition, as determined in writing by the Attorney General, that is likely to result from the imposition of a standard. (42 U.S.C. 6295(o)(2)(B)(i)(V) Specifically, it directs the Attorney General to determine in writing the impact, if any, of any lessening of competition likely to result from a proposed standard and to transmit such determination to the Secretary, not later than 60 days after the publication of a proposed rule, together with an analysis of the nature and extent of such impact. (42 U.S.C. 6295(o)(2)B(ii) and 6316(e)(1)) For the results of DOE's analysis related to lessening of competition, see section V.B.5 of this notice.

f. Need of the Nation To Conserve Energy

Another factor that DOE must consider in determining whether a new or amended standard is economically justified is the need for national energy and water conservation. (42 U.S.C. 6295(o)(2)(B)(i)(VI) and 6316(e)(1)) The energy savings from new or amended standards are likely to provide improvements to the security and reliability of the Nation's energy system. Reductions in the demand for electricity may also result in reduced costs for maintaining the reliability of the Nation's electricity system. DOE conducts a utility impact analysis to estimate how new or amended standards may affect the Nation's needed power generation capacity.

Energy savings from amended standards for commercial refrigeration equipment are also likely to result in environmental benefits in the form of reduced emissions of air pollutants and GHGs associated with energy production (

i.e.,

from power plants). For a discussion of the results of the analyses relating to the potential environmental benefits of the amended standards, see sections IV.N, IV.O and V.B.6 of this notice. DOE reports the expected environmental effects from the proposed standards, as well as from each TSL it considered for commercial refrigeration equipment, in the emissions analysis contained in chapter 13 of the NOPR TSD. DOE also reports estimates of the economic value of emissions reductions resulting from the considered TSLs in chapter 14 of the NOPR TSD.

g. Other Factors

EPCA allows the Secretary, in determining whether a new or amended standard is economically justified, to consider any other factors that the Secretary deems to be relevant. (42 U.S.C. 6295(o)(2)(B)(i)(VII) and 6316(e)(1)) In developing the TSLs set forth in this notice, DOE has also considered the comments submitted by interested parties. For the results of

DOE's analyses related to other factors, see section V.B.7 of this notice.

2. Rebuttable Presumption

As set forth in 42 U.S.C. 6295(o)(2)(B)(iii) and 6316(e)(1), EPCA provides for a rebuttable presumption that an energy conservation standard is economically justified if the additional cost to the customer of equipment that meets the new or amended standard level is less than three times the value of the first-year energy (and, as applicable, water) savings resulting from the standard, as calculated under the applicable DOE test procedure. DOE's LCC and PBP analyses generate values that calculate the PBP for customers of potential new and amended energy conservation standards. These analyses include, but are not limited to, the 3-year PBP contemplated under the rebuttable presumption test. However, DOE routinely conducts a full economic analysis that considers the full range of impacts to the customer, manufacturer, Nation, and environment, as required under 42 U.S.C. 6295(o)(2)(B)(i) and 6316(e)(1). The results of these analyses serve as the basis for DOE to evaluate the economic justification for a potential standard level definitively (thereby supporting or rebutting the results of any preliminary determination of economic justification). The rebuttable presumption payback calculation is discussed in section IV.H.12 of this notice and chapter 8 of the NOPR TSD.

IV. Methodology and Discussion of Comments

A. General Rulemaking Issues

During the April 2011 preliminary analysis public meeting and in subsequent written comments, stakeholders provided input regarding general issues pertinent to the rulemaking, such as issues of scope of coverage and DOE's authority in setting standards. These issues are discussed in this section.

1. Statutory Authority

In the preliminary analysis, DOE stated its position that EPCA prevents the setting of both energy performance standards and prescriptive design requirements (see chapter 2 of the preliminary analysis TSD

). DOE also stated its intent to amend the energy performance standards for commercial refrigeration equipment, and not to set prescriptive design requirements at this time (see chapter 2 of the preliminary analysis TSD). In a written comment, Earthjustice opined that DOE misread EPCA in suggesting that DOE does not have authority to establish design requirements for commercial refrigeration equipment. More specifically, Earthjustice asserted that DOE's interpretation of 42 U.S.C. 6311(18) ignores that EPCA uses the plural form in compelling this rulemaking to amend energy conservation “standards.” Further, Earthjustice stated, even if DOE were only authorized to promulgate a single standard or single design requirement in any one rulemaking, nothing in EPCA indicates that prior establishment of performance standards would foreclose the issuance of design requirements in a subsequent rulemaking, provided that those design requirements achieved the maximum technologically feasible and economically justified energy savings. (Earthjustice, No. 35 at pp. 4-5)

U.S. Department of Energy—Office of Energy Efficiency and Renewable Energy. Preliminary Technical Support Document (TSD): Energy Conservation Program for Certain Commercial and Industrial Equipment: Commercial Refrigeration Equipment. Chapter 2. Analytical Framework, Comments from Interested Parties, and DOE Responses. March 2011. Washington, DC

www.regulations.gov/#!documentDetail;D=EERE-2010-BT-STD-0003-0030

A notation in this form provides a reference for information that is in the docket of DOE's rulemaking to develop energy conservation standards for commercial refrigeration equipment (Docket No. EERE-2010-BT-STD-0003), which is maintained at

www.regulations.gov.

This notation indicates that the statement preceding the reference is document number 35 in the docket for the commercial refrigeration equipment energy conservation standards rulemaking, and appears at pages 4-5 of that document.

EPCA defines the phrase “energy conservation standard” as a performance standard that prescribes a minimum level of energy efficiency or a maximum quantity of energy use for a product or as a design requirement for a product. (42 U.S.C. 6311(18)(A)-(B)) Therefore, based on a clear reading of EPCA, DOE must use either a performance standard or a design (prescriptive) requirement in prescribing energy conservation standards. It has been DOE's longstanding interpretation that the term “standard” means either a performance standard or a design requirement, and that the plural term “standards” refers to the setting of a collective group of standards across all covered equipment or product classes. Thus, it is not DOE's interpretation of EPCA that the statute's use of the plural term “standards,” in referring to a collective group of equipment classes, grants DOE the authority to set both prescriptive and performance standards for a given class within that group. In the case of commercial refrigeration equipment, all of the equipment that is the subject of this rulemaking is currently covered either by a statutorily mandated performance standard or by a performance standard set by DOE in the January 2009 final rule. (42 U.S.C. 6313(c)(1)-(4)); 74 FR 1093 (Jan. 9, 2009). In this rulemaking, DOE is considering amendments to these performance standards for commercial refrigeration equipment, and is therefore not considering design requirements at this time.

2. January 2009 Final Rule Equipment

At the April 2011 preliminary analysis public meeting, AHRI stated that in 2005 when the legislation that was to become EPACT 2005 was drafted, the drafters' intent was not for DOE to start a rulemaking on remote cases in 2010. According to AHRI, the drafters' intent was that DOE start the rulemaking on self-contained units. AHRI pointed out that manufacturers would have to redesign products (those covered by the 2009 DOE final rule) twice in a 4-year period, first to meet the 2009 DOE standards in 2012, and then again to meet the 2013 standards in 2016. AHRI asked DOE to take that into account, a situation AHRI described as unprecedented. (AHRI, Public Meeting Transcript, No. 31 at pp. 204-05) AHRI elaborated on this situation in its written comment, expressing its belief that it is illogical that DOE decided to analyze equipment types for which standards exist, but with which manufacturers are not yet required to comply. AHRI stated that the intent of Congress was never to require DOE to start a rulemaking on this equipment, and questioned how DOE could possibly assess whether amended standards are appropriate before the January 2009 final rule standards reach the stage where manufacturers must comply. AHRI urged DOE to focus on self-contained refrigerators and freezers with doors in this rulemaking. (AHRI, No. 43 at pp. 1-2)

Similarly, Zero Zone expressed disappointment with the fact that the current rulemaking was initiated before the standards compliance date of January 1, 2012 specified in the January 2009 final rule. Zero Zone went on to state that waiting until after this compliance date to initiate a rulemaking would have allowed DOE to determine the accuracy of its models and the impacts on industry. (Zero Zone, No. 37 at p. 1)

The EPACT 2005 amendments to EPCA require DOE to conduct a rulemaking to determine whether to amend the standards for commercial refrigeration equipment established under 42 U.S.C. 6313(c), which covers both the standards prescribed by EPACT

2005 and the standards set by DOE in the January 2009 final rule. (42 U.S.C. 6313(c)(6)) If DOE determines that these standards should be amended, DOE must publish a final rule establishing such amended standards by January 1, 2013.

Id.

Regarding AHRI's comment, DOE is thus compelled by statute to conduct this rulemaking with a scope of coverage including the equipment specified in both EPACT 2005 and in the January 2009 final rule. In response to Zero Zone's comments concerning the burden imposed by amended standards, DOE has considered manufacturer impacts in the MIA, as required by 42 U.S.C. 6295(o)(2)(B)(i)(I) and 6316(e)(1). DOE has also used its manufacturer interviews as a forum to discuss and receive feedback on the inputs to and accuracy of its models.

3. Normalization Metrics

In chapter 2 of the preliminary analysis TSD, DOE stated its proposal to retain the current normalization metrics for all equipment classes and requested comment from interested parties. Traulsen agreed with DOE's tentative plan to use cabinet volume as the normalization metric for “appropriate” equipment, but noted that there are other (unspecified) design factors that need to be considered. (Traulsen, No. 45 at p. 2) Zero Zone stated that evaluation of the normalization metrics should take place after the January 2009 final rule compliance date. (Zero Zone, No. 37 at p. 4)

During the NOPR analyses, DOE took into account stakeholder input when reviewing normalization metrics for covered equipment. DOE agrees with Traulsen that volume is the appropriate normalization metric for most self-contained equipment classes. With respect to the comment by Zero Zone, the timing of this proceeding made it difficult for significant amounts of data on sales and other factors to be acquired after the January 2009 final rule compliance date of January 1, 2012. DOE took into account information regarding the size and composition of the commercial refrigeration equipment market obtained through manufacturer interviews, market research publications, and other sources during the NOPR stage.

4. Treatment of Blast Chillers, Thawing Cabinets, Prep Tables, Salad Bars, and Buffet Tables

In its written comment, Traulsen expressed concern that DOE may inadvertently include equipment such as prep tables, blast chillers, and thawing cabinets in standards it develops. (Traulsen, No. 45 at p. 1) During the ongoing rulemaking, DOE also received several inquiries from interested parties regarding the coverage, under current or amended energy conservation standards, of salad bars, buffet tables, and other refrigerated holding and serving equipment.

EPCA, in its definition of “commercial refrigerator, freezer, and refrigerator-freezer,” states that such equipment must display or store merchandise or other perishable materials horizontally, vertically, or semi-vertically, and must be designed for pull-down temperature applications or holding temperature applications, among other factors. (42 U.S.C. 6311(9)(A)) Moreover, 42 U.S.C. 6311(9) defines “holding temperature application” as specifically omitting blast chillers or freezers, and specifies that “pull-down temperature application” refers solely to equipment designed to cool 12 ounce beverage cans from 90 to 38 °F in 12 hours or less. Thus, blast chillers and thawing cabinets do not meet the relevant statutory definition, and will not be addressed in this rulemaking.

With regard to prep tables with open bins or trays, salad bars, and buffet tables, DOE does not currently have energy conservation standards that cover this equipment. DOE notes that some of this equipment is designed for the temporary placement of food during preparation or service, rather than storage or retailing, and may operate very differently from the commercial refrigeration equipment considered in this rulemaking. Moreover, DOE's current test procedure does not include provisions for testing this type of equipment. For example, some types of foodservice equipment (such as salad bars, buffet tables, and prep tables) do not have doors, drawers, or openings typical of conventional commercial refrigeration equipment. While DOE has the authority to set standards for other types of commercial refrigeration equipment (42 U.S.C. 6313(c)(5)(B)), this rulemaking is not currently considering standards for equipment types other than those covered by DOE's existing standards. 10 CFR 431.66

5. Dedicated Remote Condensing Units

Several stakeholders inquired whether equipment consisting of a refrigerated case served by a single, dedicated remote condensing unit that serves only that unit would be covered under DOE's proposed standards. True Manufacturing (True) stated that smaller units are more likely to have such a condensing unit, and that continuous cases

are almost exclusively rack condensing systems

due to the energy savings gained in the long term by rejecting heat outside of the building. (True, Public Meeting Transcript, No. 31 at pp. 268-69) Southern Store Fixtures stated that it is very difficult for the company to predict whether a given case that it builds will ultimately be connected to an individual condensing unit or to a compressor rack. (Southern Store Fixtures, Public Meeting Transcript, No. 31 at p. 268) Zero Zone commented that 20 to 40 percent of the units it sells are served by dedicated condensing units, and that the remainder are served by racks, noting that businesses such as convenience stores and dollar stores use dedicated condensing units in the interest of simplicity. (Zero Zone, Public Meeting Transcript, No. 31 at p. 269) In its written comment, Earthjustice referenced Zero Zone's statement that 20 to 40 percent of remote condensing commercial refrigeration equipment is served by dedicated remote condensing units, and stated that because there is a significant market share for such equipment, DOE should explore standards that address the performance of such units. (Earthjustice, No. 35 at p. 4)

In most supermarket and large food retail settings, multiple display cases from a manufacturer are attached together into a single continuous lineup without internal partitions; these are referred to as “continuous cases.”

Rack condensing systems utilize a “rack” of multiple compressors and a condenser that serves to deliver liquid refrigerant to a number of different pieces of equipment served by the single rack. For example, most supermarkets have one or more compressor racks to serve their display cases, walk-in coolers and freezers, and other equipment.

DOE understands that some stakeholders are concerned that shipments of equipment utilizing dedicated remote condensing units may comprise a nontrivial portion of the market. However, the DOE test procedure does not contain a methodology for testing such condensing units. DOE anticipates working with the industry in the future to develop testing methodologies that can be used in future commercial refrigeration equipment rulemakings. For this current rulemaking, display cases connected to dedicated remote condensers will be treated like any other piece of remote condensing equipment under the DOE test procedure, with the energy of the remote condensing unit calculated as specified in AHRI 1200 and added to the measured energy consumption of the display case. As there is no industry-accepted method of test for dedicated remote condensers, DOE proposes to continue to treat

equipment utilizing this condensing unit configuration in the same manner as all other display cases connected to remote condensers.

Also, as Southern Store Fixtures noted, it is often difficult or impossible for the display case manufacturer to know ahead of time whether a given case will be attached to a dedicated remote condensing unit or a remote condensing rack by an end user. In some cases, the dedicated condensing unit is produced by a separate manufacturer and purchased independently. As Zero Zone stated, the majority of remote condensing cases are still sold to be connected to a remote condensing rack system that serves multiple pieces of equipment. Thus, DOE believes that comparing remote condensing cases based on the calculated performance of a typical remote condensing rack, in the manner prescribed by AHRI 1200, is a consistent way to compare performance of remote condensing display cases.

In chapter 2 of the preliminary analysis TSD, DOE discussed the potential of addressing coverage of remote condensers in a separate future rulemaking. DOE believes that, should any such action take place in the future, such a proceeding would be the appropriate venue in which to investigate dedicated remote condensers.

6. Small Units

Traulsen stated that it believes that smaller units are effectively prohibited under current DOE regulations, and that it recognizes that legislative change is the proper avenue for resolution of this issue. (Traulsen, No. 45 at p. 5)

DOE understands manufacturer concerns regarding the performance of small units, and took steps to account for them in its analyses. In its engineering analysis, DOE selected specifications for units that it found to be representative of typical, high sales volume models for each of the equipment classes directly analyzed. These selections were based on market and industry research, and the representative unit specifications were presented to manufacturers for their feedback and input during manufacturer interviews. The representative units were then used as one analysis point in developing the standard-level equations for their respective classes. DOE also developed “offset factors” that form the second analysis point used in developing the linear equations that represent the equipment standards. The purpose of the offset factor is to account for energy consumption end effects inherent in equipment of all sizes so that certain groups of units, including small units, would not be disadvantaged by the standard-level equations. To understand how the offset accounts for size effects, consider the energy consumption of a single lighting fixture—a feature common to all sizes of VCT display cases. The development of offset factors resulted in energy allowances at zero case volume or TDA, thus preventing even the smallest cases from being disadvantaged by the standards. The procedure that DOE used to develop the offset factors implicitly assumes that small units are relatively less efficient than larger units, particularly in the case of the smallest-sized equipment. Therefore, DOE believes that its analysis adequately accounts for smaller units. A detailed discussion of offset factors can be found in chapter 5 of the NOPR TSD.

7. Consideration of Impact of Amended Standards

Traulsen stated that there are many niches of commercial refrigeration equipment that are essential to manufacturers and customers, and that setting overly aggressive standards may lead to inadvertent equipment design obsolescence. Traulsen thus urged DOE to take a conservative approach when setting mandatory standards. (Traulsen, No. 45 at p. 1)

DOE performed an MIA, as required by 42 U.S.C. 6295(o)(2)(B)(i)(I) and 6316(e)(1), in which it assessed both the qualitative issues of concern to manufacturers and the quantitative potential impacts to the commercial refrigeration equipment industry. These impacts were weighed and taken into consideration during the selection of the proposed standard level in an effort to minimize adverse impacts on the industry. DOE also notes it considers the design configurations offered in the commercial refrigeration equipment market in its analysis and selection of equipment classes. As required by EPCA, DOE does not set standards that eliminate equipment designs that deliver unique utility or features for consumers. (42 U.S.C. 6295(o)(4) and 6316(e)(1))

8. CO

Cascade Systems

Hussmann stated that, in California, Title 24

allows the use of CO

cascade systems,

and that compliance with both Title 24 and amended DOE standards could make development of a CO

cascade system difficult. (Hussmann, Public Meeting Transcript, No. 31 at p. 153) True stated that there is no DOE test procedure for cascade systems, and that there has been no consideration of cascade systems in the standards-setting process. (True, Public Meeting Transcript, No. 31 at p. 154)

“Title 24” refers to Title 24, part 6 of the California Code of Regulations, and includes California's energy efficiency standards for residential and nonresidential buildings. This is available at:

www.energy.ca.gov/title24/

A cascade system is a type of secondary-loop refrigeration cycle that uses a higher-temperature refrigerant to condense the secondary refrigerant, in this case carbon dioxide, which is then used to cool the refrigerated space.

DOE agrees with True that secondary coolant systems, including CO

cascade systems, are not being addressed in this rulemaking, partially due to the lack of an industry-accepted method of test for this type of equipment. DOE articulated its rationale in the preliminary analysis TSD chapter 2 and maintains the position in this notice.

9. Coverage of Existing Cases Undergoing Refurbishments or Retrofits

During the NOPR analysis period, DOE received a stakeholder inquiry as to whether the Department's energy conservation standards apply only to new equipment manufactured or imported after the compliance date, or to existing equipment undergoing retrofits and refurbishments as well.

DOE wishes to clarify that energy conservation standards apply only to new equipment, and not to previously installed equipment undergoing retrofits or refurbishments. As DOE stated in its Certification, Compliance and Enforcement final rule published on March 7, 2011, manufacturers and private labelers must certify to DOE that any covered equipment meets the applicable standard before distributing that equipment into U.S. commerce. DOE's authority covers newly manufactured equipment and does not extend to rebuilt and refurbished equipment. 76 FR 12422, 12426 and 12437 (March 7, 2011).

10. Components Shipped as After-Market Additions

DOE has received inquiries regarding open commercial refrigerated display cases that may be shipped with doors to be installed in the field. Stakeholders have sought guidance on whether equipment that is produced and shipped in this manner would be subject to the standards applicable to an open case or subject to the standards applicable to a closed case.

DOE's response to the issue of components shipped as after-market additions will be addressed in the on-going test procedure rulemaking.

11. Definition of Hybrid Equipment

During the NOPR analysis period, DOE received a comment regarding the definition of hybrid equipment.

Specifically, the stakeholder inquired about the proper definition of commercial hybrid refrigerator-freezer and the applicable standards.

DOE's response to the issue of hybrid equipment will be addressed in the on-going test procedure rulemaking.

12. Coverage of Commercial Refrigeration Equipment With Drawers

DOE has received several comments from interested parties regarding the coverage of commercial refrigeration equipment units with drawers. Specifically, interested parties inquired if commercial refrigeration equipment units with drawers were covered under the existing and proposed energy conservation standards for commercial refrigeration equipment and, so, (1) which equipment families they belong to; and (2) what the test procedure requirements are for these units.

DOE's response to the issue of commercial refrigeration equipment with drawers will be addressed in the on-going test procedure rulemaking.

B. Test Procedures

DOE received several comments that pertain only to the test procedure rulemaking. DOE responded to these and similar comments in the 2012 test procedure final rule. 77 FR 10298, 10300, and 10307 (Feb. 21, 2012). Specifically, DOE received comments from multiple interested parties that many cases are installed with remote lighting controls that are operated at the aisle or store level (Southern Store Fixtures, Public Meeting Transcript, No. 31 at pp. 190-91, 194; Zero Zone, Public Meeting Transcript, No. 31 at p. 196; California Investor Owned Utilities, No. 42 at p. 4) and, according to the Northwest Energy Efficiency Alliance (NEEA), that cases wired uniquely to receive a remote energy management system should receive credit in the DOE test procedure. (NEEA, Public Meeting Transcript, No. 31 at p. 195) DOE also received comments from interested parties that an accepted test method for secondary coolant systems, especially those with two-phase flow, had not been developed and validated. (True, Public Meeting Transcript, No. 31 at pp. 162-64; Southern Store Fixtures, Public Meeting Transcript, No. 31 at pp. 164-65; AHRI, Public Meeting Transcript, No. 31 at pp. 165-66) Because these comments pertain only to the test procedure for commercial refrigeration equipment and not the potential standards or analysis discussed in this rulemaking, DOE addressed these comments in the 2012 test procedure final rule and has not addressed them further here.

NEEA stated that DOE's efforts to conduct a robust standards analysis are hindered by DOE's failure to resolve some test procedure issues and the fact that test procedure limitations have resulted in the removal of some technologies from consideration. Among these issues, according to NEEA, are the inability of the test procedure to measure savings from anti-sweat heater controls and the screening out of variable-speed and variable-capacity components based on the perceived limitations of the test procedure. (NEEA, No. 36 at p. 1)

DOE recognizes stakeholders' desire that the DOE test procedure better measure the performance of variable-speed and variable-capacity devices. However, in the 2012 test procedure final rule, DOE stated that testing of part-load technologies would significantly increase the burden on manufacturers to test and certify equipment and is not justified given the minimal efficiency gains achieved by this equipment. 77 FR 10308 (Feb. 21, 2012). As such, DOE maintained that the fluctuations in refrigeration load experienced by equipment undergoing the DOE test procedure are sufficiently representative of average use, and that the establishment of additional test requirements would impose an undue burden on manufacturers. When evaluating amended energy conservation standards, DOE bases its engineering analysis on the energy efficiency of a unit as tested by the DOE test procedure. DOE has assessed the potential energy savings associated with technologies as tested under the test procedure established in DOE's 2012 test procedure final rule and considered technologies based on the factors prescribed by EPCA. (42 U.S.C. 6295(o)(2)(B)(i) and 6316(e)(1))

C. Market and Technology Assessment

When beginning an energy conservation standards rulemaking, DOE develops information that provides an overall picture of the market for the equipment concerned, including the purpose of the equipment, the industry structure, and market characteristics. This activity includes both quantitative and qualitative assessments based primarily on publicly available information (

e.g.,

manufacturer specification sheets, industry publications) and data submitted by manufacturers, trade associations, and other stakeholders. The subjects addressed in the market and technology assessment for this rulemaking include: (1) Quantities and types of equipment sold and offered for sale; (2) retail market trends; (3) equipment covered by the rulemaking; (4) equipment classes; (5) manufacturers; (6) regulatory requirements and non-regulatory programs (such as rebate programs and tax credits); and (7) technologies that could improve the energy efficiency of the equipment under examination. DOE researched manufacturers of commercial refrigeration equipment and made a particular effort to identify and characterize small business manufacturers. See chapter 3 of the NOPR TSD for further discussion of the market and technology assessment.

1. Equipment Classes

In evaluating and establishing energy conservation standards, DOE generally divides covered equipment into classes by the type of energy used, or by capacity or other performance-related feature that justifies a different standard for equipment having such a feature. (42 U.S.C. 6295(q) and 6316(e)(1)) In deciding whether a feature justifies a different standard, DOE must consider factors such as the utility of the feature to users.

Id.

DOE normally establishes different energy conservation standards for different equipment classes based on these criteria.

Commercial refrigeration equipment can be divided into various equipment classes categorized by specific physical and design characteristics. These characteristics impact equipment efficiency, determine the kind of merchandise that the equipment can be used to display, and affect how the customer can access that merchandise. Key physical and design characteristics of commercial refrigeration equipment are the operating temperature, the presence or absence of doors (

i.e.,

closed cases or open cases), the type of doors used (transparent or solid), the angle of the door or air curtain

(horizontal, semivertical, or vertical), and the type of condensing unit (remote condensing or self-contained). The following list shows the key characteristics of commercial refrigeration equipment that DOE developed as part of the January 2009 final rule (74 FR 1099-1100 (Jan. 9, 2009)), and used during the Framework and preliminary analysis for this rulemaking:

An air curtain is a continuously moving stream of air, driven by fans, which exits on one side of the opening in an open refrigerated case and re-enters on the other side via an intake grille. The function of the air curtain is to cover the opening in the case with this sheet of air, which minimizes the infiltration of warmer ambient air into the refrigerated space.

1. Operating Temperature

• Medium temperature (38 °F, refrigerators)

• Low temperature (0 °F, freezers)

• Ice-cream temperature (−15 °F, ice-cream freezers)

2. Door Type

• Equipment with transparent doors

• Equipment with solid doors

• Equipment without doors

3. Orientation (air-curtain or door angle)

• Horizontal

• Semivertical

• Vertical

4. Type of Condensing Unit

• Remote condensing

• Self-contained

Additionally, because EPCA specifically sets a separate standard for refrigerators with a self-contained condensing unit designed for pull-down temperature applications and transparent doors, DOE plans to create a separate equipment class for this equipment. (42 U.S.C. 6313(c)(3)) DOE included this equipment in the form of a separate family with a single class (PD.SC.M) for the preliminary analysis. A total of 49 equipment classes were created, and these are listed in chapter 3 of the NOPR TSD using the nomenclature developed in the January 2009 final rule. 74 FR 1100 (Jan. 9, 2009).

During the April 2011 preliminary analysis public meeting and in subsequent written comments, a number of stakeholders addressed issues related to proposed equipment classes and the inclusion of certain types of equipment in the analysis. These topics are discussed in this section.

a. Equipment Classification

Several stakeholders commented on the general equipment classification structure used by DOE in the preliminary analysis. Traulsen stated that, with respect to the currently defined classes of equipment, there are subcategories DOE failed to specify, including upright units (1-, 2-, and 3-section; reach-in; pass-through; roll-in; and roll-through) and undercounter units (categorized by length in inches). (Traulsen, No. 45 at p. 1) On the other hand, Zero Zone approved of DOE's proposed equipment classes, as presented in the preliminary analysis TSD. (Zero Zone, No. 37 at p. 4) AHRI stated that the equipment class nomenclature developed by DOE in the January 2009 final rule was appropriate. (AHRI, No. 43 at p. 2)

In response to Traulsen's comment, DOE recognizes that there are subcategories of equipment within certain equipment families and classes, each with varying geometries. However, DOE believes that the equipment classes it has developed and modeled are broad enough to account for the variety of equipment incorporated within each of them, including the unit types described in Traulsen's comment. In performing its engineering analysis, DOE selected representative unit sizes and feature sets for modeling so as to best represent a typical unit for each given class. Regarding the comments from Zero Zone and AHRI, DOE has retained the equipment classes and nomenclature adopted in the January 2009 final rule (74 FR 1100 (Jan. 9, 2009)) and used in the Framework document and preliminary analysis for this NOPR.

b. Application Temperature Equipment

DOE received feedback on the subject of application temperature equipment

at the April 2011 preliminary analysis public meeting and in written comments. NEEA stated that the difference between DOE rating temperatures and application temperatures can be significant, and commented that allowing manufacturers to demonstrate that equipment meets a standard defined by rating temperature by testing at (presumably higher) application temperatures would equate to a very lenient standard for such equipment. (NEEA, Public Meeting Transcript, No. 31 at pp. 26-27) NEEA added that, for such equipment, the difference between ambient conditions and internal conditions would be much lower than for equipment maintaining a temperature of 38 °F, and that daily energy use for this equipment would be lower as well. Thus, while NEEA agreed that cabinets should be tested at the lowest temperature they can achieve, NEEA stated that, if the standard for such cabinets is set equal to the level of energy use of cabinets designed to hold 38 °F, that equipment may be much less efficient than what could be cost-effectively possible were separate standards set for the equipment. (NEEA, No. 36 at p. 2) NEEA further asked why DOE was not proposing to set separate standards for application temperature equipment. (NEEA, Public Meeting Transcript, No. 31 at pp. 26-27) NEEA stated that, while DOE has dismissed concerns regarding application temperature equipment because it is roughly 2 percent of the market, NEEA has heard from manufacturers that it is a growing market segment and added that 2 percent is, in its opinion, a nontrivial portion of the market. (NEEA, No. 36 at pp. 1-2)

Application temperature equipment is equipment that is designed to operate at temperatures distinctly different from the DOE rating temperatures of 38 °F, 0 °F, and −15 °F. Examples include wine chillers and candy cases, which operate in the range of 45 to 60 °F.

Moreover, NEEA asserted that DOE failed to acknowledge the differences between high-temperature equipment (

e.g.,

floral cases) and ice storage cabinets, and suggested two new equipment classes for these products: One for equipment with cabinet temperature greater than 40 °F and one for ice storage cabinets that can operate outdoors and are designed to hold temperatures between 20 and 30 °F. (NEEA, No. 36 at p. 2; NEEA, Public Meeting Transcript, No. 31 at pp. 26-27) NEEA further opined that ice storage cabinets in particular are often used in environments not well represented by the test procedure conditions, namely outdoor environments. NEEA added that to allow the test procedure to not represent the operating conditions of this equipment would violate 42 U.S.C. 6295(2). (NEEA, No. 36 at pp. 1-2)

True stated that, during the test procedure public meeting, interested parties suggested that the lowest application temperature should include ice storage and be in the mid-twenties. (True, Public Meeting Transcript, No. 31 at p. 177) Traulsen commented that it did not have an issue with testing equipment at internal temperatures that are higher than the rating temperatures, such as 50 °F or 10 °F. However, Traulsen expressed concern regarding equipment that is designed to run at internal temperatures that are lower than the rating temperature, or ambient temperatures that are higher than the test ambient temperature. Specifically, Traulsen stated that this equipment inherently uses more energy at the design conditions (often very high ambient temperatures and relative humidities) and may also use more energy at the designated rating conditions (the temperature and relative humidity values specified by ASHRAE 72-2005) as well. Traulsen provided the examples of a piece of equipment designed to hold ice cream at −40 °F and a unit designed for 105 °F ambient conditions. (Traulsen, No. 45 at p. 2)

In the 2012 test procedure final rule, DOE adopted provisions that allow for the testing of commercial refrigeration equipment that cannot operate at its prescribed rating temperature at the “lowest application product temperature.” DOE defined “lowest application product temperature” as “the integrated average temperature closest to the specified rating temperature for a given piece of equipment achievable and repeatable, such that the integrated average temperature of a given unit is within ±2 °F of the reported lowest application

product temperature for that basic model.” DOE also applied this provision to all refrigerators, freezers, and ice-cream freezers. 77 FR 10302 (Feb. 21, 2012).

DOE maintains that units tested at the lowest application product temperature will still be required to meet the applicable energy conservation standard based on their equipment class. The required standard level will not change based on the different internal temperature at which a particular unit is tested. While DOE understands that this requirement makes it easier for a small number of units (that cannot be tested at the prescribed rating temperatures) to meet the current standards, DOE does not believe that establishing separate equipment categories for these niche types of equipment would be justified because the energy savings achievable with such standards would be relatively small. In response to NEEA's suggestion that ice chests designed to operate outdoors be tested at alternate ambient conditions, DOE notes that its test procedure prescribes only one ambient condition. DOE believes this ambient condition is adequately representative of the operating conditions for the majority of commercial refrigeration equipment. Additionally, DOE has seen no evidence that a unit designed to perform at stricter conditions than the DOE test procedure (

i.e.,

higher ambient temperature and/or humidity) would have difficulty meeting a standard at the conditions prescribed in the test procedure.

In response to NEEA's assertion that application temperature equipment is a growing commercial refrigeration equipment market segment, DOE has no data to substantiate the assertion. DOE has not collected shipments data indicating that such a trend exists, nor have manufacturer interviews indicated that this is the case. Application temperature equipment represents a niche equipment market, and this equipment has been in existence for a long time (

e.g.,

candy cases, wine cases, floral cases). DOE has no evidence indicating that this market segment will grow disproportionately to other equipment types.

DOE also agrees with Traulsen that testing these units at a higher integrated average temperature does not necessarily mean that the unit will use less energy. The variability in energy use and the impact of variation in integrated average temperature will vary based on case type, geometry, and configuration. This variation would make setting a consistent standard for high-temperature or intermediate-temperature equipment impractical, because any value chosen would not be representative of all cases.

c. Open Cases

At the April 2011 preliminary analysis public meeting and in written comments, numerous stakeholders revisited the issue of DOE's proposed decision to retain separate standards for open and closed cases. Earthjustice first raised the issue, inquiring about the evidence behind DOE's assertion that open cases provide distinct utility with respect to features such as unobstructed view and access to product, as well as simplified stocking, cleaning, and maintenance. Earthjustice continued by stating that it wished to renew its request that DOE continue grouping open and doored cases together, adding that any determination of utility is required to be based on substantial evidence. (Earthjustice, Public Meeting Transcript, No. 31 at pp. 23, 25) AHRI responded that the distinction between the two types of cases was made in the language of EPACT 2005, which was developed through negotiations among AHRI and other parties, including advocacy groups. (AHRI, Public Meeting Transcript, No. 31 at pp. 24-25) Southern Store Fixtures added that open and doored cases are two distinct types of equipment with different applications, and that they cannot be combined into a single category. Southern Store Fixtures also stated that substantial analysis and evidence would have to be provided in order to show that there would be no product loss or sales loss as a result of moving from open to doored cases. (Southern Store Fixtures, Public Meeting Transcript, No. 31 at pp. 28-29)

In further discussion at the public meeting, Earthjustice stated that it had submitted to DOE a study conducted by ASHRAE,

as well as a Swedish study, to support Earthjustice's assertion that product sales are unaffected by the presence of door on cases. (Earthjustice, Public Meeting Transcript, No. 31 at p. 29) However, Southern Store Fixtures stated that it would dispute the ASHRAE study regarding open cases, and that it would articulate its argument later. (Southern Store Fixtures, Public Meeting Transcript, No. 31 at pp. 29-30) Additionally, the Swedish study was retracted from submission due to copyright issues.

Fricke, B.A., and B.R. Becker.

Comparison of Vertical Display Cases: Energy and Productivity Impacts of Glass Doors Versus Open Vertical Display Cases.

December 2009. American Society of Heating, Refrigerating and Air-Conditioning Engineers, Atlanta, GA. Report No. RP-1402.

http://rp.ashrae.biz/researchproject.php?rp_id=580

Stakeholders also provided comments regarding the subject of metrics of utility. Pacific Gas and Electric (PG&E) stated that, in its opinion, sales would be the most obvious metric, along with the ability to keep product at the desired temperature. However, PG&E asked that DOE elaborate on how it would quantify what constitutes utility. (PG&E, Public Meeting Transcript, No. 31 at pp. 30-31) The California Investor Owned Utilities (CA IOUs) included a similar request in its written comment, asking that DOE clarify what it specifically considers as criteria to justify unique utility. CA IOUs also asked that DOE continue to assess options that would enable open cases to consume amounts of energy similar to those used by equivalent closed cases. (CA IOUs, No. 42 at p. 5) Zero Zone, continuing on the subject of utility, stated that, in its opinion, there may have been utility differences between open and doored cases at one time, but since that time it believed the market had changed and this difference no longer exists. As a result, Zero Zone supported the comments suggesting that DOE combine the open and doored display case classes. (Zero Zone, Public Meeting Transcript, No. 31 at p. 32)

The Appliance Standards Awareness Project (ASAP), while not commenting specifically on equipment utility, stated that it believed the issue of open versus closed cases is very important from an NES perspective, as the preliminary analysis documents showed that open cases consume two to three times as much energy as comparable doored cases. (ASAP, Public Meeting Transcript, No. 31 at p. 32) CA IOUs agreed with DOE's assessment that open, low-temperature vertical and semivertical cases represent small portions of the market. Further, it pointed out that the California Energy Commission (CEC) is proposing to require doors on all upright, low-temperature cases at the State level. (CA IOUs, No. 42 at p. 5)

During the preliminary analysis comment period, Earthjustice submitted a detailed comment outlining its position on the issue of open cases. Earthjustice expressed its belief that separate standards for open cases are neither warranted nor required by EPCA, as well as its opinion that such cases provide no capacity or performance features justifying separate standards, once again referencing the previously submitted ASHRAE and Swedish studies. Implicitly in response to statements made by AHRI at the public meeting, Earthjustice added that EPACT 2005's codification of standards for equipment with doors does not require DOE to maintain separate

classes for equipment without doors. (Earthjustice, No. 35 at p.1) Earthjustice expressed the belief that DOE's intention to adhere to its previous stance that the presence or absence of doors on cases affects case utility ignores the evidence that has been presented in the form of the aforementioned ASHRAE and Swedish sales studies, and that EPCA requires DOE's factual conclusions to be supported by substantial evidence which, according to Earthjustice, DOE has not provided. (Earthjustice, No. 35 at p. 2)

Earthjustice reiterated its disagreement with DOE's assertion in the preliminary analysis that open cases provide utility in the form of “unobstructed view of and access to product,” citing the two sales studies that it believed to conclude otherwise. Earthjustice also disagreed with DOE's statement that open cases simplify stocking, cleaning, and maintenance, questioning how the need to prop a door open would impede stocking a case. On the contrary, Earthjustice asserted, the presence of doors would reduce warm air infiltration and the opportunities for items to fall out of the case onto the store floor, thereby reducing stocking burdens and losses due to products damaged during stocking. Furthermore, Earthjustice stated that DOE has not suggested shorter life cycles for equipment with doors, something it believes would be a logical outcome were the presence of doors to impair cleaning and maintenance operations. (Earthjustice, No. 35 at p. 2)

Earthjustice then presented a legal argument, stating that, in maintaining that 42 U.S.C. 6295(o) prevents the merging of equipment classes for equipment with and without doors, DOE has misconstrued the statutory authority for whether separate classes are required. Earthjustice asserted that DOE has, in its preliminary analysis TSD, attempted to shift the evidentiary burden onto the stakeholders who support equivalent standards for the two equipment types. Earthjustice commented that, in dismissing the findings of the ASHRAE study, DOE has violated the plain language of EPCA, which requires that a preponderance of the evidence must support the position that open cases provide a unique feature in order for DOE to conclude that separate equipment classes are required. (Earthjustice, No. 35 at pp. 2-3)

Earthjustice suggested that, should DOE decide not to merge classes for open and closed cases, DOE should adopt standards reflecting the overlapping applications for the equipment. Earthjustice stated that because equipment with doors is economically advantageous on an LCC basis, encouraging a shift to equipment with doors will increase the monetary savings from this rulemaking. (Earthjustice, No. 35 at p. 3) By adopting highly cost-effective standards for equipment with doors as well as standards that would result in LCC increases for open cases, Earthjustice suggested, DOE could encourage consumers to purchase cases with transparent doors. Earthjustice stated that DOE has taken a market-transforming approach in the past. Specifically, Earthjustice referenced the small electric motors rulemaking (75 FR 10874 (March 9, 2010)), in which DOE maintained standards for two types of general purpose single-phase motors but tailored those standards to encourage the market to shift to one of those types. (Earthjustice, No. 35 at p. 3) Similarly, Earthjustice added, in the rulemaking for commercial clothes washers (75 FR 1122 (Jan. 8, 2010)), DOE adopted standards set at the max-tech level for top-loading washers, but less aggressive standards for front-loading washers, partially to encourage the growth of front-loader market share. In conclusion, Earthjustice suggested that DOE adopt the max-tech level for equipment without doors and a more economically advantageous standard for equipment with doors, thus encouraging the market to shift to doored cases. (Earthjustice, No. 35 at pp. 3-4)

DOE understands the concern of some stakeholders regarding the issue of open cases. While some stakeholders have reiterated their previous positions on this topic, DOE does not believe that any new data has been presented since the Framework document public meeting (May 2010) that would warrant a change in DOE's stance as outlined in chapter 2 of the preliminary analysis TSD. DOE maintains that to set standards discouraging users from purchasing open cases would violate its statutory charge to preserve the availability of features and performance characteristics currently on the market. While Earthjustice again cited the ASHRAE study and the Swedish study comparing sales from open and closed cases, DOE still maintains its position from the preliminary analysis. After having reviewed the ASHRAE study, DOE believes that because the data were collected only under very specific conditions in a controlled environment and with a limited range of merchandise types, the data are insufficient to drive a conclusion applicable across the broad wide range of open case applications and end uses. As one example, DOE points out that neither study includes fresh produce and packaged meat products in the analysis of impact on product sales, and that these are types of merchandise that manufacturers have mentioned as benefiting from the use of open cases.

Regarding the questions about the definition of utility raised by Earthjustice and PG&E, EPCA states that, in setting or amending standards, the Secretary must consider, among other factors, any lessening of the utility or performance of the covered products likely from the imposition of the standard. (42 U.S.C. 6295(o)(2)(B)(i)(IV) and 6316(e)(1)) EPCA further states that the Secretary may not prescribe an amended or new standard under this section if the Secretary finds (and publishes such finding) that interested persons have established by a preponderance of the evidence that the standard is likely to result in the unavailability in the United States in any covered product type (or class) of performance characteristics (including reliability), features, sizes, capacities, and volumes that are substantially the same as those generally available in the United States at the time of the Secretary's finding. (42 U.S.C. 6295(o)(4) and 6316(e)(1))

Thus, while the term “utility” is not specifically defined in EPCA, it is used in conjunction with the term “performance”; the statute further prohibits DOE from setting standards that result in the unavailability of performance characteristics or features from the U.S. market. In this case, DOE has determined that customer access to product is a distinct performance characteristic or feature in the case of commercial refrigeration equipment and believes, based on its research and discussions with experts and members of industry, that open cases provide more convenient access to products than do closed cases, as well as providing other measures of utility, such as ease of stocking and cleaning.

In response to the comment by Earthjustice that DOE violated the plain language of EPCA, which requires that a preponderance of the evidence must support the position that open cases provide a unique feature in order to conclude that separate equipment classes are required, DOE refers to the language found at 42 U.S.C. 6295(o)(4) and 6316(e)(1). This language states that the Secretary may not issue a standard if interested persons have established by a preponderance of the evidence that the standard is likely to result in the unavailability in the United States of any covered product type (or class) of performance characteristics (including

reliability), or features currently available. One statement suggesting that the elimination of open cases would have this effect was presented at the April 2011 preliminary analysis public meeting, when Southern Store Fixtures explicitly stated that open and doored cases are two different equipment types, adding that “substantial analysis and evidence would have to be provided” to ensure that there would be no detriment to performance by combining the classes. (Southern Store Fixtures, Public Meeting Transcript, No. 31 at pp. 28-29) DOE has agreed with this stance in its past and current proceedings, as evidenced by the retention of separate equipment types for open and closed cases in its analyses. At the commercial refrigeration equipment test procedure NOPR public meeting, Coca-Cola, a major purchaser of display cases, cited internal studies concluding that the presence of doors on displays near registers can decrease sales by 35 to 50 percent. (Docket No. EERE-2010-BT-TP-0034, Coca-Cola, No. 19 at p. 90) These study results stand in contrast to the assertion by Earthjustice that the two sales studies it provided show that open cases do not provide utility in the form of unobstructed view of and access to product. The conflict between the sets of data suggests that, while both conclusions may be correct in the specific contexts of the respective studies, in some applications the presence of doors on cases can adversely affect visibility and access to product. Therefore, elimination of open cases from the market would equate to the unavailability of this performance characteristic, in direct violation of (42 U.S.C. 6295(o)(2)(B)(i)(IV) and 6316(e)(1)).

In its manufacturer interviews, DOE spoke with several manufacturers who provided anecdotal data regarding the utility of open cases. They pointed to increased sales due to “impulse buys,” stating that users of open cases reported generating higher revenues out of those cases. Manufacturers also stated that open cases allow for vastly easier stocking of high-margin items including produce and meat. The ease of stocking these items is particularly important to retailers, because open cases are stocked continuously while shoppers are in the store, making simultaneous, unobstructed access to the case by both the employee and customer an important utility issue. Manufacturers reaffirmed during these interviews that unobstructed view of and access to product, as well as simplified stocking, as previously referenced by DOE, were significant attributes of open cases. Furthermore, the manufacturers pointed to better accommodation of non-standard-sized merchandise within these cases. The information that DOE has gathered regarding market perceptions at conferences and other venues has indicated that many grocery store managers and operators strongly prefer open cases to closed cases, as they perceive that product visibility from a distance is a very strong factor in sales. Engineers for large chain grocery stores have stated that their efforts to convert even part of the grocery store equipment from open cases to closed cases, during store remodeling, have been met with opposition from store managers due to their perception that open cases lead to higher sales compared to closed cases. This finding is in contrast to the statement by Zero Zone that utility differences between open and doored cases no longer exist. The statement by Zero Zone also conflicts with the internal study data quoted by Coca-Cola, in which that company noted a significant loss in sales due to the presence of doors on display cases in certain settings. As the result of a collective review of the data obtained through its public meetings, manufacturer interviews, and conferences, DOE believes that its position of setting separate standards for open and closed cases is reasonable and based on the distinct performance characteristics of each class, as shown by a preponderance of the evidence presented. DOE notes that manufacturers did not cite differences in maintenance and cleaning between open and closed cases, but DOE believes the other utility and performance factors cited, including ease of access to the product, increased visibility, and ease of use during operations and maintenance, are sufficient to warrant maintenance of two separate equipment classes.

DOE understands AHRI's statement that the distinction between case types was made in the EPACT 2005 language, which set standards for closed cases and required DOE to set standards for open cases (42 U.S.C. 6313(c)), and Earthjustice's response that the codification of separate standards does not require DOE to maintain different classes. However, DOE is restricted by EPCA from prescribing energy conservation standards in any manner that would lessen utility to the customer or result in the unavailability of performance characteristics or features currently on the market. (42 U.S.C. 6295(o)(2)(B)(IV), 6295(o)(4), and 6316(e)(1)) Therefore, DOE continues to consider open and doored cases to be two distinct equipment types due to the evident performance and feature differences between them.

DOE acknowledges ASAP's statement that open cases have been shown to consume more energy than doored cases and CA IOU's assertion that open, low-temperature cases comprise a small market share. However, independent of these factors, as stated above, DOE is forbidden by EPCA from setting standards that would result in the unavailability on the market of the performance characteristics and features that open cases exhibit. (42 U.S.C. 6295(o)(4) and 6316(e)(1)) Therefore, DOE, through its analyses, sought to develop separate proposed standard levels for open and closed cases that would result in the maximum economically justified and technologically feasible energy savings for the respective equipment.

Regarding Earthjustice's assertion that DOE failed to suggest shorter life cycles for commercial refrigeration equipment with doors, DOE points out that the replacement of doors is one of the factors contributing to repair costs (see chapter 8 of the NOPR TSD). Damage to doors does not necessarily shorten the life of the equipment itself.

With respect to Earthjustice's suggestion that DOE force a market shift from open to closed cases by adopting cost-effective standards for doored cases but less economically attractive standards for open cases, DOE is compelled by EPCA to examine the economic and technical justification of all equipment under the same criteria and with the same rigor. (42 U.S.C. 6295(o) and 6316(e)(1)) In other words, DOE must independently determine the maximum technologically feasible and economically justified standard level for each equipment class. Therefore, DOE examined all TSLs equally using the same quantitative metrics, such as LCC and national NPV, and selected a proposed standard level using these criteria. In response to the suggestion that DOE adopt a market-transforming approach in which it would intentionally shift market share toward doored cases, DOE believes that to do so would violate the EPCA provision barring DOE from setting standards that result in the lessening of utility or unavailability of performance characteristics. (42 U.S.C. 6295(o)(4) and 6316(e)(1)) Because DOE has determined that open cases present a unique set of performance characteristics and features to the market, to set standards eliminating their manufacture and sale would violate 42 U.S.C. 6295(o)(4) and 6316(e)(1). DOE notes that in the

rulemakings for small electric motors and commercial clothes washers that Earthjustice cited, DOE was careful to set standards such that they would not result in the unavailability of features or performance characteristics. For example, the commercial clothes washers final rule, published by DOE on January 8, 2010, states that the amended efficiency levels can be met by either top- or front-loading designs. In fact, the clothes washers final rule notes that there were vertical-axis top-loading and horizontal-axis frontloading washers on the market at the time that already met the higher standard. Thus, DOE concluded, consumers would have the same range of clothes washer options, including features valued by consumers such as door placement, capacity, water temperature, and adjustable load sizes. 75 FR 1122, 1133-34 (Jan. 8, 2010). In the case of commercial refrigeration equipment, DOE believes that separate equipment classes are necessary to preserve the unique features provided by open refrigerated display cases, established by interested parties as discussed above. DOE does not believe it would be possible to combine standards classes or arbitrarily set more aggressive standards for open cases without violating EPCA provisions regarding utility/product availability. (42 U.S.C. 6295(o)(2)(B) and 6316(e)(1)) As a result, DOE has maintained the position regarding utility of open cases that it asserted in the January 2009 final rule and in its preliminary analysis and framework document. 74 FR 1099 (Jan. 9, 2009).

DOE understands that there are other options available in the market to reduce the energy consumption of open cases, such as retrofitting doors to open cases, and that DOE's energy conservation standards may not be the only factor related to improving the energy efficiency of open cases. DOE believes that, in general, management staff of grocery stores is well aware of high energy costs because energy costs consistently figure as one of the top five issues in the Food Marketing Institute (FMI) Worry Index,

which is obtained through surveys of the food retailers regarding the most important issues in their businesses that cause them to “worry.” Some stores have retrofitted their open cases with transparent doors to achieve substantial savings in energy costs. DOE also recognizes that the market for retrofitting open, multi-deck display cases with transparent doors is steadily increasing. In addition, features such as night curtains and more-efficient air curtains are also available in the market to reduce the energy consumption of open cases.

FMI Research.

The Food Retailing Industry Speaks 2011.

2011. Food Marketing Institute, Arlington, VA.

In its NOPR analyses, DOE modeled open and closed display cases separately, and has included separate proposed standards for the two types of equipment in this notice.

d. Service Over Counter Equipment

AHRI voiced concerns about self-contained service over counter (SOC) equipment,

stating that DOE incorrectly determined that SOC equipment was covered by EPACT 2005 and that this error resulted in an overly stringent standard being applied to the equipment. (AHRI, No. 43 at p. 2) AHRI commented that it, working with other stakeholders, had proposed legislative language that defines SOC equipment and establishes minimum standards for that equipment, which is included in the Implementation of National Consensus Appliance Agreements Act of 2011, S. 398, 112th Cong. (2011). AHRI asked that DOE adopt the definition of SOC equipment that AHRI had proposed in that legislation, and also asked DOE to use TDA as a normalization metric for this equipment. (AHRI, No. 43 at p. 2)

“Service over counter” means equipment with sliding or hinged doors in the back intended for use by sales personnel for loading and retrieving items for sale, and fixed, sliding or hinged transparent panels in the front for displaying merchandise. The equipment has a height no greater than 66 inches and is intended to serve as a counter for transactions between sales personnel and customers.

With respect to the statement by AHRI that DOE has incorrectly determined that SOC equipment is within the scope of coverage of EPACT 2005, DOE disagrees, having determined that SOC.SC.M equipment meets the statutory definition of a self-contained commercial refrigerator with transparent doors in 42 U.S.C. 6311(9)(A). EPCA does not specify equipment subsets such as SOC equipment beyond defining the terms “commercial refrigerator,” “freezer,” and “refrigerator-freezer” and “self-contained condensing unit,” among other definitions related to this equipment. (42 U.S.C. 6311(9)) In December 2009, DOE's Office of Hearings and Appeals (OHA) responded to an application for exception relief from a manufacturer of SOC equipment. This manufacturer argued that it was entitled to relief because its SOC units could not meet the EPACT 2005 standards for self-contained equipment with doors. OHA responded that DOE did not have jurisdiction to consider such exceptions for equipment covered by the statutorily mandated standards. (Case No. TEE-0066, Dec. 29, 2009)

During the preliminary engineering analysis for this rulemaking, DOE confirmed that the EPACT 2005 standards for SOC.SC.M (42 U.S.C. 6313(c)(2)) could not be achieved at even the max-tech level (see chapter 2, section 2.2.1.5, of the preliminary analysis TSD). Therefore, DOE agrees with AHRI's comment that the standard set by EPACT 2005 was too stringent for equipment belonging to equipment class SOC.SC.M. Consequently, DOE had excluded SOC.SC.M equipment from the preliminary analysis.

DOE had also excluded SOC.SC.L, a low-shipments-volume equipment class, from the preliminary analysis as well, as it too is covered under standards prescribed by EPACT 2005 for freezers with transparent doors found at 10 CFR 431.66(b). Due to its similarity in design, construction, and performance to SOC.SC.M equipment, DOE presumed that it too would not be able to meet the standards set by EPACT 2005 for self-contained equipment with transparent doors.

In December 2012, during the NOPR analysis for this rulemaking, the American Energy Manufacturing Technical Corrections Act (AEMTCA), Public Law 112-210 (Dec. 18, 2012) amended EPCA to establish new standards for self-contained service over counter medium temperature commercial refrigerators. (42 U.S.C. 6313(c)(4)) The amendment reduces the stringency of the standard applicable to this equipment. AEMTCA prescribed the standard for SOC.SC.M equipment manufactured on or after January 1, 2012 as 0.6 × TDA + 1.0, expressed in kilowatt hours per day. (42 U.S.C. 6313(c)(4)(A))

AEMTCA also amended EPCA to direct DOE to determine, within 3 years of enactment of the new standard for SOC.SC.M, whether the standard should be amended. (42 U.S.C. 6313(c)(4)(B)(1) If DOE determines that the standard should be amended, then DOE must issue a final rule establishing an amended standard within this same 3-year period. (42 U.S.C. 6313(c)(4)(B))

DOE conducted the analysis for this determination of whether to amend the standard for equipment class SOC.SC.M as part of this NOPR analysis. The analysis was carried out in a manner similar to that of all the other equipment classes being analyzed as part of the current rulemaking. DOE used the standard established by AEMTCA as the baseline efficiency level for equipment class SOC.SC.M.

The results of the analysis indicated that if an amendment to the AEMTCA standard for equipment

class SOC.SC.M, based on same criteria established for all the other equipment classes of the current rulemaking,

would represent a reduction in energy consumption of roughly 30 percent as compared to the AEMTCA standard. Based on this result, DOE has proposed an amended standard for equipment class SOC.SC.M in this NOPR (see section I and section V.A.2).

This approach is similar to that adopted for all the other equipment classes, as explained in section IV.H.1.

The criteria for trial standard level selection can be found in section V.A.1, and discussion concerning the selection of the proposed standard level can be found in section V.C.

In response to AHRI's request that DOE use TDA as a normalization metric for this equipment, the January 2009 final rule standards for remote condensing SOC equipment were expressed using TDA as a normalization metric. 74 FR 1093 (Jan. 9, 2009). As AHRI suggested, DOE proposes in this NOPR to continue to use TDA as the normalization metric for SOC equipment.

DOE is also proposing to adopt a new definition of the “service over counter” equipment family, which is included in this notice. DOE based its proposed definition on the definition of self-contained service-over-counter refrigerators (SOC.SC.M) found in Paragraph (1) of section 4 of AEMTCA. (42 U.S.C. 6313(c)(1)(C)) However, DOE proposes to adopt a broader definition of SOC equipment that DOE believes is applicable to all of the equipment classes that belong to the SOC equipment family, not just the single SOC.SC.M equipment class described by the AEMTCA language. The proposed definition can be found in section 0 of this NOPR.

2. Technology Assessment

As part of the market and technology assessment performed for the NOPR analysis, DOE developed a comprehensive list of technologies that would be expected to improve the energy efficiency of commercial refrigeration equipment. Chapter 3 of the NOPR TSD contains a detailed description of each technology that DOE identified. Although DOE identified a complete list of technologies that improve efficiency, DOE only considered in its analysis technologies that would impact the efficiency rating of equipment as tested under the DOE test procedure. Therefore, DOE excluded several technologies from the analysis during the technology assessment because they do not improve the rated efficiency of equipment as measured under the specified test procedure. Technologies that DOE determined impact the rated efficiency were carried through to the screening analysis and are discussed in section IV.D.

a. Technologies Applicable to All Equipment

In the preliminary analysis market and technology assessment, DOE listed the following technologies that would be expected to improve the efficiency of all equipment: higher efficiency lighting, higher efficiency lighting ballasts, remote lighting ballast location, higher efficiency expansion valves, higher efficiency evaporator fan motors, variable-speed evaporator fan motors and evaporator fan motor controllers, higher efficiency evaporator fan blades, increased evaporator surface area, low-pressure differential evaporators, increased case insulation or improvements, defrost mechanisms, defrost cycle controls, vacuum insulated panels, and occupancy sensors for lighting controls. Not all of these technologies were considered in the preliminary engineering analysis; some were screened out or removed from consideration on technical grounds, as described in chapters 3 and 4 of the NOPR TSD. After the publication of the preliminary analysis, DOE received numerous stakeholder comments regarding these technologies, discussed below.

Lighting Technologies

In response to DOE's request for comment, Southern Store Fixtures questioned DOE's specification for light-emitting diode (LED) lighting because it appeared that LEDs had a lower efficacy in terms of lumens per watt compared to T8 fluorescent lighting (the standard baseline lighting technology) in DOE's model. (Southern Store Fixtures, Public Meeting Transcript, No. 31 at pp. 59-60) Zero Zone observed that while fluorescent lighting is a mature technology, LED lighting is constantly evolving. (Zero Zone, Public Meeting Transcript, No. 31 at p. 63) Additionally, Southern Store Fixtures suggested that the efficiency of the driver powering the LEDs be explicitly considered, as it is a key aspect of lighting energy consumption. (Southern Store Fixtures, Public Meeting Transcript, No. 31 at p. 62) True noted that light output from LEDs is highly directional, and the additional heat load from the LEDs increases the load on the compressor, which is less efficient than the lighting system. (True, Public Meeting Transcript, No. 31 at pp. 60-61)

Regarding the comment by Southern Store Fixtures, the output of LED light fixtures used in commercial refrigeration equipment is indeed lower in terms of lumens per watt when compared to T8 fluorescent bulbs. However, for commercial refrigerated display applications, the advantage of LED lighting lies in the directionality of its light output. While T8 lighting produces greater output in lumens, much of that light is directed toward the ambient space rather than the merchandise to be illuminated, and thus is wasted from a product merchandising perspective. LED lighting, on the other hand, is very directional, and the light can be aimed directly at the product on display. This difference allows for more conservative sizing of LED fixtures and, as a result, overall power consumption is lower compared to T8 fluorescent lamps.

DOE agrees with the comment by Zero Zone that LED lighting is an evolving technology. As a result, DOE has taken efforts to update its LED fixture cost estimates throughout the rulemaking process, gathering the most current data available from publicly available sources as well as from manufacturer interviews. Regarding Southern Store Fixtures' concern about driver power, this power consumption is considered in the engineering model and is incorporated into the calculation of calculated daily energy consumption (CDEC). Similarly, with respect to True's comment, the impact of lighting on case heat load, and thus compressor power consumption, is accounted for in the engineering model through the use of a multiplier to estimate the fraction of light produced that is retained inside the case as heat.

Lighting Controls

In addition to discussing lighting, stakeholders also commented on the location of lighting controls. Southern Store Fixtures observed that certain operators use central energy management systems to control the display case lighting, and asked if this approach would be considered instead of just the placement of occupancy sensors in individual display cases. The company added that when customers ask them to supply a case to be controlled by a central energy management system, the lights in the display cases must be wired separately from the other energy-consuming components. (Southern Store Fixtures, Public Meeting Transcript, No. 31 at pp. 190-91, 194) Further, Southern Store Fixtures pointed out that CEC is considering these central lighting systems in its proceedings. (Southern Store Fixtures, Public Meeting Transcript, No. 31 at p. 197) Zero Zone stated that it typically wires cases with a separate lighting circuit to allow for

independent lighting control, while NEEA stated that if a case is wired differently to interface with centralized controls, it should be treated identically to a self-contained set of controls. (Zero Zone, Public Meeting Transcript, No. 31 at p. 196; NEEA, Public Meeting Transcript, No. 31 at p. 195) CA IOUs supported the manufacturer assertion made during the April 2011 preliminary analysis public meeting that it is possible to distinguish between cases designed for remote energy controls and those that are not. (CA IOUs, No. 42 at p. 4) For this reason, the CA IOUs suggested that DOE develop a calculation to measure energy savings due to the use of such remote systems in the test procedure. (CA IOUs, No. 42 at p. 4)

DOE acknowledges that there are several ways to implement lighting controls (

e.g.,

individual case controls, controls for a case lineup, storewide energy management systems), and that allowing certain systems to be included in calculating energy consumption may set a precedent for how DOE defines the boundaries of covered equipment and what technologies are allocated energy savings for a piece of equipment in the test procedure. For example, cases set up to accept remote control systems have a dedicated circuit for lights so that the lights can be controlled separately from the rest of the case. However, this lighting circuit configuration does not inherently save energy and must be paired with an expensive energy management control system, which is sold separately from the piece of commercial refrigeration equipment, is produced by different manufacturers, and is not integral to the commercial refrigeration equipment. In addition, the existence of an energy management system does not necessarily mean it will be used with commercial refrigeration equipment; for example, energy management systems are used in many stores and offices to control room lighting and temperature set points.

DOE acknowledges that remote lighting controls do save energy and may be the more commonly used technology to dim or turn off lights. However, energy consumption for a piece of commercial refrigeration equipment must be determined using the DOE test procedure to measure the energy consumption of a representative unit, as shipped to customers. Because the remote energy management system is not part

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