Energy Conservation Program: Energy Conservation Standards for Commercial Refrigeration Equipment

Federal RegisterMar 28, 2014

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DEPARTMENT OF ENERGY

10 CFR Part 431

[Docket Number 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:

Final rule.

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 standards would be technologically feasible and economically justified, and would save a significant amount of energy. In this final rule, DOE is adopting more-stringent energy conservation standards for some classes of commercial refrigeration equipment. It has determined that the amended energy conservation standards for these products would result in significant conservation of energy, and are technologically feasible and economically justified.

DATES:

The effective date of this rule is May 27, 2014. Compliance with the amended standards established for commercial refrigeration equipment in today's final rule is required on March 27, 2017.

The incorporation by reference of certain publications listed in this final rule were approved by the Director of the Office of the Federal Register on January 9, 2009 and February 21, 2012.

ADDRESSES:

The docket, which includes

Federal Register

notices, public meeting attendee lists and transcripts, comments, and other supporting documents/materials, is available for review at

www.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

. The regulations.gov Web page will contain simple instructions on how to access all documents, including public comments, in the docket.

For further information on how to review the docket, contact Ms. Brenda Edwards at (202) 586-2945 or by email:

Brenda.Edwards@ee.doe.gov

FOR FURTHER INFORMATION CONTACT:

John Cymbalsky, 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: (202 287-1692. 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 Final Rule and Its Benefits

A. Benefits and Costs to Customers

B. Impact on Manufacturers

C. National Benefits and Costs

D. Conclusion

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. Savings in Operating Costs Compared To Increase in Price

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. Trial Standard Levels

2. Proposed Standard Levels

3. Rulemaking Timeline

4. Normalization Metrics

5. Conformance With Executive Orders and Departmental Policies

6. Offset Factors

B. Market and Technology Assessment

1. Equipment Classes

a. Equipment Subcategories

b. Floral 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

C. Screening Analysis

D. Engineering Analysis

1. Representative Equipment for Analysis

a. Representative Unit Selection

b. Baseline Models

2. Design Options

a. Fluorescent Lamp Ballasts

b. Condenser Fans

c. Evaporator Fans

d. Design Options Impacting Equipment Form Factor

e. Vacuum Insulated Panels (VIPs)

f. Variable-Speed Fan Motors

g. Improved Transparent Door Designs

h. High-Performance Coil Designs

i. Higher-Efficiency Fan Blades

j. ECM Fan Motors

k. Lighting Occupancy Sensors and Controls

l. Night Curtains

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. Release of Engineering Model for Review

b. Anti-Sweat Heater Power

c. Coil Performance Modeling

d. Compressor Performance Modeling

e. Insulation Modeling

f. Lighting Performance

g. Transparent Door Performance

h. Validation of Engineering Results

E. Markups Analysis

F. Life-Cycle Cost and Payback Period Analysis

1. Equipment Cost

2. Installation Costs

3. Maintenance and 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 Efficiency Distributions

11. Inputs to Payback Period Analysis

12. Rebuttable-Presumption Payback Period

G. Shipments

1. Impact of Standards on Shipments

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

1. Forecasted Efficiency in the Base Case and Standards Cases

2. National Energy Savings

3. Net Present Value of Customer Benefit

I. Customer Subgroup Analysis

J. 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. Volume Purchasing of Components

b. Refrigerants

c. Redesign Issues

d. LED Material Costs

e. GRIM

f. Cumulative Regulatory Burden

g. Certification Costs

h. Small Manufacturers

K. Emissions Analysis

L. 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

M. Utility Impact Analysis

N. Employment 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. Customer Subgroup Analysis

c. Rebuttable Presumption Payback

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. 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. Summary of National Economic Impact

8. Other Factors

C. Conclusions

1. Benefits and Burdens of Trial Standard Levels Considered for Commercial Refrigeration Equipment

2. Summary of Benefits and Costs (Annualized) of the Standards

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

M. Congressional Notification

VII. Approval of the Office of the Secretary

I. Summary of the Final Rule and Its Benefits

Title III, Part C

of the Energy Policy and Conservation Act of 1975 (EPCA or the Act), Public Law 94-163 (42 U.S.C. 6291-6309, as codified), added by Public Law 95-619, Title IV, section 441(a), established the Energy Conservation Program for Certain Industrial Equipment.

Pursuant to EPCA, any new or amended energy conservation standard that DOE prescribes for certain products, such as commercial refrigeration equipment, shall be designed to achieve the maximum improvement in energy efficiency that DOE determines is both technologically feasible and economically justified. (42 U.S.C. 6295(o)(2)(A)) Furthermore, 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 provisions discussed in this document, DOE is adopting amended energy conservation standards for commercial refrigeration equipment. The amended 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. These amended standards apply to all equipment listed in Table I.1 and manufactured in, or imported into, the United States on or after March 27, 2017.

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

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

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

[Compliance required starting March 27, 2017]

Equipment class*

Standard level**

†

Equipment class*

Standard level**

†

VOP.RC.M

0.64 × TDA + 4.07

VOP.RC.I

2.79 × TDA + 8.7

VOP.RC.L

2.2 × TDA + 6.85

SVO.RC.L

2.2 × TDA + 6.85

VOP.SC.M

1.69 × TDA + 4.71

SVO.RC.I

2.79 × TDA + 8.7

VCT.RC.M

0.15 × TDA + 1.95

HZO.RC.I

0.7 × TDA + 8.74

VCT.RC.L

0.49 × TDA + 2.61

VOP.SC.L

4.25 × TDA + 11.82

VCT.SC.M

0.1 × V + 0.86

VOP.SC.I

5.4 × TDA + 15.02

VCT.SC.L

0.29 × V + 2.95

SVO.SC.L

4.26 × TDA + 11.51

VCT.SC.I

0.62 × TDA + 3.29

SVO.SC.I

5.41 × TDA + 14.63

VCS.SC.M

0.05 × V + 1.36

HZO.SC.I

2.42 × TDA + 9

VCS.SC.L

0.22 × V + 1.38

SOC.RC.L

0.93 × TDA + 0.22

VCS.SC.I

0.34 × V + 0.88

SOC.RC.I

1.09 × TDA + 0.26

SVO.RC.M

0.66 × TDA + 3.18

SOC.SC.I

1.53 × TDA + 0.36

SVO.SC.M

1.7 × TDA + 4.59

VCT.RC.I

0.58 × TDA + 3.05

SOC.RC.M

0.44 × TDA + 0.11

HCT.RC.M

0.16 × TDA + 0.13

SOC.SC.M

0.52 × TDA + 1

HCT.RC.L

0.34 × TDA + 0.26

HZO.RC.M

0.35 × TDA + 2.88

HCT.RC.I

0.4 × TDA + 0.31

HZO.RC.L

0.55 × TDA + 6.88

VCS.RC.M

0.1 × V + 0.26

HZO.SC.M

0.72 × TDA + 5.55

VCS.RC.L

0.21 × V + 0.54

HZO.SC.L

1.9 × TDA + 7.08

VCS.RC.I

0.25 × V + 0.63

HCT.SC.M

0.06 × V + 0.37

HCS.SC.I

0.34 × V + 0.88

HCT.SC.L

0.08 × V + 1.23

HCS.RC.M

0.1 × V + 0.26

HCT.SC.I

0.56 × TDA + 0.43

HCS.RC.L

0.21 × V + 0.54

HCS.SC.M

0.05 × V + 0.91

HCS.RC.I

0.25 × V + 0.63

HCS.SC.L

0.06 × V + 1.12

SOC.SC.L

1.1 × TDA + 2.1

PD.SC.M

0.11 × V + 0.81

* 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 closed with transparent doors, VCS = vertical closed with solid doors, HCT = horizontal closed with transparent doors, HCS = horizontal closed with 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 final rule 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 today's 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 for which customers are impacted by the amended standards.

Life-cycle cost 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.

Payback period 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 cost. Further discussion can be found in chapter 8 of the final rule TSD.

Table I.2—Impacts of Today's Standards on Customers of Commercial Refrigeration Equipment

Equipment class*

Average LCC savings

2012$

Median PBP

years

VOP.RC.M

922

5.7

VOP.RC.L

6.1

VOP.SC.M

VCT.RC.M

542

2.1

VCT.RC.L

526

2.7

VCT.SC.M

226

5.3

VCT.SC.L

5001

1.1

VCT.SC.I

7.2

VCS.SC.M

363

1.4

VCS.SC.L

507

2.5

VCS.SC.I

113

5.0

SVO.RC.M

564

6.2

SVO.SC.M

SOC.RC.M

SOC.SC.M

HZO.RC.M

HZO.RC.L

HZO.SC.M

6.9

HZO.SC.L

HCT.SC.M

101

5.8

HCT.SC.L

293

2.5

HCT.SC.I

HCS.SC.M

5.5

HCS.SC.L

2.5

PD.SC.M

165

5.6

* 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 final rule TSD, Engineering Analysis, for a detailed discussion of primary and secondary equipment classes.

* For equipment classes VOP.SC.M, SVO.SC.M, SOC. RC.M, SOC. SC.M, HZO.RC.M, HZO.RC.L, HZO.SC.L, and HCT.SC.I, no efficiency levels above the baseline were found to be economically justifiable. Therefore, the standard levels contained in today's document for these equipment classes are the same as those set in the 2009 final rule. As a result, LCC savings and PBP values for these equipment classes are not relevant.

Note:

Equipment lifetimes are between 10 and 15 years for all equipment classes.

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 10.0 percent, DOE estimates that the INPV for manufacturers of commercial refrigeration equipment is $2,660.0 million in 2012$.

Under today's standards, DOE expects the industry net present value to decrease by 3.53 percent to 6.60 percent. Total industry conversion costs are expected to total $184.0 million. Additionally, based on DOE's interviews with the manufacturers of commercial refrigeration equipment, DOE does not expect significant loss of domestic employment.

All monetary values in this notice are expressed in 2012 dollars.

C. National Benefits and Costs

DOE's analyses indicate that today's 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 compliance with amended standards (2017-2046) amount to 2.89 quadrillion British thermal units (quads). The annualized energy savings (0.10 quads) are equivalent to 0.5 percent of total U.S. commercial primary energy consumption in 2014.

Based on U.S. Department of Energy, Energy Information Administration,

Annual Energy Outlook 2013

(AEO 2013) data.

The cumulative net present value (NPV) of total consumer costs and savings of today's standards for commercial refrigeration equipment ranges from $4.93 billion (at a 7-percent discount rate) to $11.74 billion (at a 3-percent discount rate).

This NPV expresses the estimated total value of future operating cost savings minus the estimated increased product costs for products purchased in 2016-2047.

All present value results reflect discounted to beginning of 2014.

In addition, today's standards are expected to have significant environmental benefits. The energy savings would result in cumulative emission reductions of approximately 142 million metric tons (Mt)

of carbon dioxide (CO

), 762 thousand tons of methane, 207 thousand tons of sulfur dioxide (SO

), 94 tons of nitrogen oxides

(NO

) and 0.25 tons of mercury (Hg).

Through 2030, the estimated energy savings would result in cumulative emissions reductions of 48 Mt of CO

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

and Hg are presented in short tons.

DOE calculated emissions reductions relative to the

AEO 2013

Reference case, which generally represents current legislation and environmental regulations for which implementing regulations were available as of December 31, 2012.

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.M. Using discount rates appropriate for each set of SCC values, DOE estimates that the net present monetary value of the CO

emissions reductions is between $1.0 billion and $14.0 billion. DOE also estimates that the net present monetary value of the NO

emissions reductions is $33 million at a 7-percent discount rate, and $104 million at a 3-percent discount rate.

Technical Update of the Social Cost of Carbon for Regulatory Impact Analysis Under Executive Order 12866.

Interagency Working Group on Social Cost of Carbon, United States Government. May 2013; revised November 2013.

http://www.whitehouse.gov/sites/default/files/omb/assets/inforeg/technical-update-social-cost-of-carbon-for-regulator-impact-analysis.pdf

DOE is investigating the valuation of avoided Hg and SO

emissions.

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

Table I.3—Summary of National Economic Benefits and Costs of Amended 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 closed with transparent doors, VCS = vertical closed with solid doors, HCT = horizontal closed with transparent doors, HCS = horizontal closed with 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.

In December 2012, AEMTCA amended EPCA by establishing 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))

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 at 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 document in the

Federal Register

announcing the availability of the Framework document, as well as a public meeting to discuss the document. The document 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 document.

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 a 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.

)

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.

On September 11, 2013, DOE published a notice of proposed rulemaking (NOPR) in this proceeding (September 2013 NOPR). 78 FR 55890. In the September 2013 NOPR, DOE addressed, in detail, the comments received in earlier stages of rulemaking, and proposed amended energy conservation standards for commercial refrigeration equipment. In conjunction with the September 2013 NOPR, DOE also published on its Web site the complete technical support document (TSD) for the proposed rule, which incorporated the analyses DOE conducted and technical documentation for each analysis. Also published on DOE's Web site were the engineering analysis spreadsheets, the LCC spreadsheet, and the national impact analysis standard spreadsheet. These materials are available at

http://www1.eere.energy.gov/buildings/appliance_standards/rulemaking.aspx/ruleid/27.

The standards which DOE proposed for commercial refrigeration equipment at the NOPR stage of this rulemaking are shown in Table II.3. They are provided solely for background informational purposes and differ from the amended standards set forth in this final rule.

Table II.3—Proposed Energy Conservation Standards for Commercial Refrigeration Equipment

[For compliance in 2017]

Equipment class*

Proposed level

** †

Equipment class *

Proposed standard level **

VCT.RC.L

0.43 × TDA + 2.03

VOP.RC.I

2.68 × TDA + 8.08

VOP.RC.M

0.61 × TDA + 3.03

SVO.RC.L

2.11 × TDA + 6.36

SVO.RC.M

0.63 × TDA + 2.41

SVO.RC.I

2.68 × TDA + 8.08

HZO.RC.L

0.57 × TDA + 6.88

HZO.RC.I

0.72 × TDA + 8.74

HZO.RC.M

0.35 × TDA + 2.88

VOP.SC.L

3.79 × TDA + 10.26

VCT.RC.M

0.08 × TDA + 0.72

VOP.SC.I

4.81 × TDA + 13.03

VOP.RC.L

2.11 × TDA + 6.36

SVO.SC.L

3.77 × TDA + 10.01

SOC.RC.M

0.39 × TDA + 0.08

SVO.SC.I

4.79 × TDA + 12.72

VOP.SC.M

1.51 × TDA + 4.09

HZO.SC.I

2.44 × TDA + 9.0

SVO.SC.M

1.5 × TDA + 3.99

SOC.RC.L

0.83 × TDA + 0.18

HZO.SC.L

1.92 × TDA + 7.08

SOC.RC.I

0.97 × TDA + 0.21

HZO.SC.M

0.75 × TDA + 5.44

SOC.SC.I

1.35 × TDA + 0.29

HCT.SC.I

0.49 × TDA + 0.37

VCT.RC.I

0.51 × TDA + 2.37

VCT.SC.I

0.52 × TDA + 2.56

HCT.RC.M

0.14 × TDA + 0.11

VCS.SC.I

0.35 × V + 0.81

HCT.RC.L

0.3 × TDA + 0.23

VCT.SC.M

0.04 × V + 1.07

HCT.RC.I

0.35 × TDA + 0.27

VCT.SC.L

0.22 × V + 1.21

VCS.RC.M

0.1 × V + 0.24

VCS.SC.M

0.03 × V + 0.53

VCS.RC.L

0.21 × V + 0.5

VCS.SC.L

0.13 × V + 0.43

VCS.RC.I

0.25 × V + 0.58

HCT.SC.M

0.02 × V + 0.51

HCS.SC.I

0.35 × V + 0.81

HCT.SC.L

0.11 × V + 0.6

HCS.RC.M

0.1 × V + 0.24

HCS.SC.M

0.02 × V + 0.37

HCS.RC.L

0.21 × V + 0.5

HCS.SC.L

0.12 × V + 0.42

HCS.RC.I

0.25 × V + 0.58

PD.SC.M

0.03 × V + 0.83

SOC.SC.L

0.67 × TDA + 1.12

SOC.SC.M

0.32 × TDA + 0.53

** “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.

In the September 2013 NOPR, DOE identified seven issues on which it was particularly interested in receiving comments and views of interested parties: light-emitting diode (LED) price projections, base case efficiency trends,

operating temperature ranges, offset factors for smaller equipment, extension of standards developed for the 25 primary classes to the remaining 24 secondary classes, standards for hybrid cases and wedges, and standard levels. 78 FR 55987 (September 11, 2013) After the publication of the September 2013 NOPR, DOE received written comments on these and other issues. DOE also held a public meeting in Washington, DC, on October 3, 2013, to hear oral comments on and solicit information relevant to the proposed rule. These comments are addressed in today's document.

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 at 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 at 71357 (December 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 at 71369-70 (December 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 (February 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 at 10296-98 (February 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 at 10305 (February 21, 2012).

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 NSF was founded in 1944 as the National Sanitation Foundation, and is now referred to simply as NSF.

The test procedure amendments established in the 2012 test procedure final rule are required to be used in conjunction with the amended standards promulgated in this energy conservation standards final rule. 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 the revised energy conservation standards established by today's document. 77 FR at 10308 (February 21, 2012).

DOE has initiated a test procedure rulemaking for commercial refrigeration equipment to revise and reorganize its test procedure for commercial refrigeration equipment in order to clarify certain terms, procedures, and compliance dates. A NOPR for this rulemaking was published on October 28, 2013. 78 FR 64206 (October 28. 2013). In the NOPR, DOE addressed:

• Several inquiries received from interested parties regarding the applicability of DOE's test procedure and current Federal energy conservation standards;

• The definitions of certain terms pertinent to commercial refrigeration equipment;

• The proper configuration and use of certain components and features of commercial refrigeration equipment when testing according to the DOE test procedure;

• The proper application of certain test procedure provisions;

• The compliance date of certain provisions specified in the DOE test procedure final rule published on February 21, 2012; and

• A number of test procedure clarifications which arose as a result of the negotiated rulemaking process for certification of commercial heating, ventilation, air conditioning, refrigeration, and water heating equipment.

DOE also held a public meeting in Washington, DC, on December 5, 2013, to hear oral comments on and solicit information relevant to the proposed rule.

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 the standard specifies adjusted volume. (42 U.S.C. 6313(c)(2)) The January 2009 final rule, meanwhile, utilizes 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 at 1093 (January 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 at 1093 (January 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 maintained this stance in the NOPR document and TSD. DOE did not receive any significant information or data while conducting the final rule analyses that would alter this position, and thus DOE includes continued use of the existing normalization metrics in today's document.

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 part 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 final rule 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 adopts (or does 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, 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 final rule. See chapter 5 of the 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

33.044

VOP.RC.M

35.652

SVO.RC.M

27.702

HZO.RC.L

31.078

HZO.RC.M

14.15

VCT.RC.M

10.988

VOP.RC.L

100.006

SOC.RC.M

21.560

VOP.SC.M

29.714

SVO.SC.M

25.400

HZO.SC.L

29.922

HZO.SC.M

13.748

HCT.SC.I

2.327

VCT.SC.I

18.106

VCS.SC.I

16.042

VCT.SC.M

5.148

VCT.SC.L

16.048

VCS.SC.M

3.028

VCS.SC.L

11.130

HCT.SC.M

0.614

HCT.SC.L

1.315

HCS.SC.M

0.981

HCS.SC.L

0.713

PD.SC.M

3.405

SOC.SC.M

26.119

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 a 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 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.H of this document and in chapter 10 of the final rule TSD.

DOE also presents a sensitivity analysis that considers impacts for products shipped in a 9-year period.

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 NIA spreadsheet model to estimate energy savings from amended standards for the equipment that is the subject of this rulemaking. The NIA spreadsheet model (described in section IV.H of this document) 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 also has begun to estimate full-fuel-cycle energy savings. 76 FR 51282 (August 18, 2011), as amended at 77 FR 49701 (August 17, 2012). The full-fuel-cycle (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 evaluation of FFC savings is driven in part by the National Academy of Science's (NAS) report on FFC measurement approaches for DOE's Appliance Standards Program.

The NAS report discusses that FFC was primarily intended for energy efficiency standards rulemakings where multiple fuels may be used by a particular product. In the case of this rulemaking pertaining to commercial refrigeration equipment, only a single fuel—electricity—is consumed by the equipment. DOE's approach is based on the calculation of an FFC multiplier for each of the energy types used by covered equipment. Although the addition of FFC energy savings in the rulemakings is consistent with the recommendations, the methodology for estimating FFC does not project how fuel markets would respond to this particular standard rulemaking. The FFC methodology simply estimates how much additional energy, and in turn how many tons of emissions, may be displaced if the estimated fuel were not consumed by the equipment covered in this rulemaking. It is also important to note that inclusion of FFC savings does not affect DOE's choice of proposed standards. 76 FR 51282 (August 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 (i.e., coal, natural gas, petroleum fuels), and thus presents a more complete picture of the impacts of energy efficiency standards. For more information on FFC energy savings, see section IV.H.2.

“Review of Site (Point-of-Use) and Full-Fuel-Cycle Measurement Approaches to DOE/EERE Building Appliance Energy- Efficiency Standards,” (Academy report) was completed in May 2009 and included five recommendations. A copy of the study can be downloaded at:

http://www.nap.edu/catalog.php?record_id=12670

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.”

D. Economic Justification

1. Specific Criteria

As discussed in section III.D.1, 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 III.C and V of today's document.

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. These measures are discussed further in the following section. For consumers in the aggregate, DOE also calculates the national net present value of the economic impacts applicable to a particular rulemaking. DOE also evaluates the LCC impacts of potential standards on identifiable subgroups of consumers that may be affected disproportionately by a national standard.

b. Savings in Operating Costs Compared To Increase in Price

EPCA requires DOE to consider the savings in operating costs throughout the estimated average life of the covered product compared to any increase in the price of the covered product that are likely to result from the imposition of the standard. (42 U.S.C. 6295(o)(2)(B)(i)(II) and 6316(e)(1)) DOE conducts this comparison in its LCC and PBP analysis.

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. To account for uncertainty and variability in specific inputs, such as product lifetime and discount rate, DOE uses a distribution of values, with probabilities attached to each value. For its analysis, DOE assumes that consumers will purchase the covered products in the first year of compliance with amended standards.

The LCC savings and the PBP 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 identifies the percentage of consumers estimated to receive LCC savings or experience an LCC increase, in addition to the average LCC savings associated with a particular standard level.

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 I.A.3 of this document and chapter 10 of the final rule 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. DOE has determined that none of the TSLs presented in today's final rule 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.C of this document and chapter 4 of the final rule TSD.

e. Impact of Any Lessening of Competition

EPCA requires DOE to consider any lessening of competition that is likely to result from setting new or amended standards for covered equipment. Consistent with its obligations under EPCA, DOE sought the views of the United States Department of Justice (DOJ). DOE asked DOJ to provide a written determination of the impact, if any, of any lessening of competition likely to result from the amended standards, together with an analysis of the nature and extent of such impact. 42 U.S.C. 6295(o)(2)(B)(i)(V) and (B)(ii).

To assist DOJ in making such a determination, DOE provided DOJ with copies of both the NOPR and NOPR TSD for review. DOJ subsequently determined that the amended standards are unlikely to have a significant adverse impact on competition.

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.K, IV.L and V.B.6 of this document. DOE reports the expected environmental effects from the amended standards, as well as from each TSL it considered for commercial refrigeration equipment, in the emissions analysis contained in chapter 13 of the final rule TSD. DOE also reports estimates of the economic value of emissions reductions resulting from the considered TSLs in chapter 14 of the final rule 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)) There were no other factors considered for today's final rule.

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.F.12 of this document and chapter 8 of the final rule TSD.

IV. Methodology and Discussion of Comments

A. General Rulemaking Issues

During the October 2013 NOPR public meeting, and in subsequent written comments, stakeholders provided input regarding general issues pertinent to the rulemaking, including the trial standard levels and proposed standard levels presented, the rulemaking timeline, the metrics used to normalize equipment size, and other subjects. These issues are discussed in this section.

1. Trial Standard Levels

In his comment, Mr. R. Kopp (Kopp) suggested that using continuous energy-efficiency cost-curves as opposed to discrete TSLs would provide a more accurate analysis. Further, he suggested that instead of setting a single TSL standard, DOE should adopt pathways to improve efficiency. (Kopp, No. 60 at p. 5)

In its engineering analysis, DOE utilized a design-option approach, in which it began by modeling baseline units and then modeled increasingly efficient designs up to max-tech by adding design options one at a time in order of ascending payback period. This methodology reflects the options available to manufacturers in increasing the efficiency of their equipment, which consist of piecewise design improvements corresponding to the design options modeled in the engineering analysis. Therefore, the efficiency levels generated from the engineering analysis and carried through the downstream analyses to the development of TSLs correspond to specific packages of technologies and design features which could be developed and built by manufacturers. Since the stepwise increments along the

cost-efficiency curve represent tangible efficiency improvements attainable through the implementation of design options, DOE asserts that a smooth cost-efficiency curve would not be realistic, as the areas on the curve between the current efficiency levels would not correspond to any design that exists. Therefore, DOE has retained the approach used in the NOPR in developing this final rule.

2. Proposed Standard Levels

Traulsen, Structural Concepts Corp. (Structural Concepts), National Rural Electric Cooperative Association (NRECA), and the Edison Electric Institute (EEI) asserted that TSL4, the level proposed in the NOPR, was not economically viable, noting that the marginal efficiency increase over TSL 3 did not justify the increased costs of compliance. (Traulsen, No. 65 at p. 16;

Structural Concepts, Public Meeting Transcript, No. 62 at p. 337; NRECA, No. 88 at p. 2; EEI, No. 89 at p. 4) Traulsen opined that any TSL with a payback period longer than 3 years was not feasible for most manufacturers. (Traulsen, No. 65 at p. 21) Further, NRECA and EEI urged DOE to select TSL 3 instead of TSL 4. However, the joint comments from the American Council for an Energy-Efficient Economy (ACEEE), National Resources Defense Council (NRDC), Appliance Standards Awareness Project (ASAP), Alliance to Save Energy (ASE), and Northwest Energy Efficiency Alliance (NEEA) (hereafter referred to as the “Joint Comment”) supported DOE's proposal to adopt TSL 4, noting that it represented maximum energy savings with a positive NPV. (Joint Comment, No. 91 at p. 1)

In the comment citation format used in this document, the citation first presents the name of the commenter, followed by the number on the docket corresponding to the document in which the comment is contained, followed by a reference to the page in that document on which the comment can be found.

Several manufacturers expressed an expected inability to meet the proposed standard levels, even with the best available technology. At the October public meeting, Zero Zone Inc. (Zero Zone) noted that there had been no significant technological advancements since the previous rulemaking which would make an amended standard feasible. (Zero Zone, Public Meeting Transcript, No. 62 at p. 62) Structural Concepts raised a similar concern, noting that despite using the most efficient technology currently available, its minimum attainable daily energy consumption was 30-40% above the proposed standard level. (Structural Concepts, Public Meeting Transcript, No. 62 at p. 133) Royal Vendors Inc. (Royal Vendors), in its written comment, noted that even with the most efficient currently-available technology, the maximum possible efficiency gain was 10% over the levels contained in the ENERGY STAR

Version 3 specification. However, the Joint Comment opined that most of these concerns were limited to pull-down equipment, and that if the standard for that class were revised, there would be no need to revise standards for other classes. (Joint Comment, No. 91 at p. 2) Additionally, manufacturers opined that the percentage reduction in energy consumption between the existing standard and the proposed rule was not achievable. Hussmann Corp. (Hussmann), True Manufacturing Co., Inc. (True), and Hoshizaki America, Inc. (Hoshizaki) all commented that the efficiency improvements in excess of 60%, as proposed for SC equipment and the VCT.RC.M class, were neither economically feasible nor technologically possible. (Hussmann, No. 77 at p. 10) (True, No. 76 at p. 1) (Hoshizaki, No. 84 at p. 1)

ENERGY STAR is a joint program of the U.S. Environmental Protection Agency (EPA) and DOE that establishes a voluntary rating, certification, and labeling program for highly energy efficient consumer products and commercial equipment. Information on the program is available at:

www.energystar.gov

Hoshizaki noted in its written comment that a large majority of currently ENERGY STAR-certified equipment would fail to meet the proposed standard. (Hoshizaki, No. 84 at p. 1) During the public meeting, Structural Concepts pointed out the relationship between the proposed standard and the ENERGY STAR Version 3.0 requirement, opining that it was impractical for a standard to be more stringent than the ENERGY STAR requirement. (Structural Concepts, Public Meeting Transcript, No. 62 at p. 305) The Joint Comment, however, noted that according to the ENERGY STAR-qualified products list, there already are products in five major self-contained equipment classes that meet or exceed the proposed standard. Further, the Joint Comment drew comparison to the 2009 final rule for residential refrigerators, noting that proceeding to be a precedent in which units on the market were not reaching the maximum technically feasible efficiency level modeled, since no product was using all the design options considered in DOE's analysis. (Joint Comment, No. 91 at p. 3) Additionally, joint comments from the California Investor Owned Utilities (CA IOUs) noted that all equipment currently listed in the CEC product database for the VOP.SC.M, SVO.SC.M, HZO.SC.M, and HZO.RC.M classes already met the proposed standard. (CA IOUs, No. 63 at p. 1)

Stakeholders noted that, in the proposed rule, the expected efficiency improvement over existing standards was more stringent for some equipment classes than for others. Lennox International Inc. (Lennox) urged DOE to set standards for VCT classes which had the same percentage reduction from existing standard levels as open-case classes, and suggested that stricter VCT standards would encourage consumers to switch from closed to open equipment. (Lennox, No. 73 at p. 4) Structural Concepts opined that the proposed change in MDEC for SOC equipment was too drastic, further noting that for SOC and VCS equipment classes, it is counterintuitive for DOE to propose a greater relationship between size and daily energy consumption for remote condensing units than for self-contained units, since SC units are inherently less efficient. (Structural Concepts, No. 85 at p. 3) Coca-Cola, Inc. (Coca-Cola) commented that the TSL 4 standard was more stringent for PD.SC.M units than for VCT.SC.M, and that this was counterintuitive. (Coca-Cola, Public Meeting Transcript, No. 62 at p. 100) The CA IOUs pointed out in its written comment that the current standards for PD.SC.M were set through a negotiated process, whereas the standards for other classes were modeled. (CA IOUs, No. 63 at p. 6) China commented that while DOE proposed stricter standards for the VCT.RC.M class since the 2009 final rule, DOE was not suggesting amended standards for the HZO class. (China, No. 92 at p. 3)

Another concern amongst manufacturers and consumers was the belief that the proposed standard levels were based on technology that was currently not available, but rather which DOE projected would be available at the time of required compliance with the proposed rule. Continental opined that it was impractical to develop standards based on currently unavailable technologies. (Continental, Public Meeting Transcript, No. 62 at p. 96) Coca-Cola commented that since the proposed standards were based on technology which was not yet available, the proposed standards, specifically TSL4 for VCT.SC.M units, were not technologically feasible. (Coca-Cola, Public Meeting Transcript, No. 62 at p. 74) True expressed agreement with Coca-Cola, stating that the proposed efficiency levels were beyond the level

of what industry can meet at the current time. (True, Public Meeting Transcript, No. 62 at p. 307) Lennox commented that the proposed standards for VCT units were unattainable with currently known technology and were not economically justified. Lennox further commented that under the proposed rule, only a very limited number of compliant VCT products would be produced and sold. (Lennox, No. 73 at p. 2) The North American Association of Food Equipment Manufacturers (NAFEM) noted that none of its member manufacturers were able to identify current technology options or prototype designs which met the proposed standard levels, and that using assumptions beyond what was available in the current market landscape would also improperly quantify the impact of the proposed rule on manufacturer costs. (NAFEM, No. 93 at p. 3)

Additionally, during the October public meeting Coca-Cola and True commented that food safety was of prime importance in the design of their equipment, and should take precedence over energy savings. (Coca-Cola, Public Meeting Transcript, No. 62 at p. 86) (True, Public Meeting Transcript, No. 62 at p. 350) National Restaurant Association (NRA) noted that the proposed standards had the potential to reduce cooling ability and recovery time for equipment subject to constant opening and closing, and that this reduced performance could compromise food safety. (NRA, No. 90 at p. 3) Similarly, NAFEM also noted that the implementation of the proposed standards would have potential negative effects on food safety for end-users. (NAFEM, No. 93 at p. 5)

DOE understands the concerns voiced by stakeholders regarding their future ability to meet standard levels as proposed in the NOPR. Between the NOPR and final rule stages, DOE revised and updated its analysis based on stakeholders comments received at the NOPR public meeting and in written comments. These updates included improvements to the modeling of equipment geometries, design specifications, and design option performance and costs so as to provide a more accurate model of baseline and higher-efficiency designs across the classes analyzed. After applying these updates, DOE amended its TSLs and standard level equations accordingly. With respect to the comments from Zero Zone, Structural Concepts, and Royal Vendors regarding the ability of technologies needed to meet the proposed standard level, DOE analyzed the available technologies in its market and technology assessment and screening analyses, and incorporated appropriate and available technology options in the modeling performed as part of its engineering analysis. Therefore, DOE believes that the technologies and designs included in the analysis accurately reflect what is available to industry for improving equipment efficiency.

In response to the Joint Comment, DOE notes that it evaluated equipment performance independently for each equipment class and thus did not revise standards for any one class solely based upon factors affecting another class. DOE believes that the updates and improvements to the modeling applied between the NOPR and final rule stages of this rulemaking have resulted in standard levels presented in today's final rule which address the concerns voiced by stakeholders after publication of the NOPR.

In response to stakeholder comments comparing the proposed standard levels to ENERGY STAR levels, DOE cautions against direct comparisons between its standards and those set forth by ENERGY STAR due to the different natures of the programs and how the two different sets of standard levels are set. ENERGY STAR is a voluntary program which derives its standard levels from market data based on the performance of certain models of equipment currently available for purchase. ENERGY STAR also does not model performance or include consumer economics in its standard-setting process. DOE sets its standards as applicable to all covered equipment and develops them through specific analyses of equipment performance and modeling of economic impacts and other downstream effects. Due to the different goals and methodologies of these two programs, a direct comparison may not be entirely relevant. However, during the final rule stage, for relevant equipment classes,

DOE did compare its engineering results to available ENERGY STAR data as a means of checking the modeled performance levels against empirical test data. With respect to the comparison by the California IOUs of performance of open cases to certified values from the CEC directory, DOE also cautions that this directory is not exhaustive. For example, a search of the directory shows that, for some equipment classes, only equipment from a single manufacturer is included. Therefore, while directory data is helpful in providing a check on DOE's results, DOE has performed independent modeling and analysis to derive its standard levels.

ENERGY STAR only maintains standard levels applying to equipment classes VCS.SC.M, VCS.SC.L, VCT.SC.M, VCT.SC.L, HCS.SC.M, HCS.SC.L, HCT.SC.M, and HCT.SC.L. Thus, these were the only classes for which a comparison between the DOE and ENERGY STAR levels could be made.

With respect to the concerns about the relative perceived stringencies of proposed standards for different classes, in the NOPR analyses, DOE examined each equipment class independently based on standard geometries and feature sets for representative units within the classes. DOE then conducted the engineering simulations and downstream economic analyses separately for each primary class examined. The results presented at the NOPR stage represent the suggested performance and cost values for each class based on the best available information at the time of that analysis. Therefore, DOE cautions against comparative examination of the relative stringencies of the various standard levels, as each was calculated independently and the performance and economic benefits of individual design options vary specific to each class. DOE also agrees with the California IOUs that previous standard levels should not necessarily be used as a check on current analytical results because the origins of those standards are not completely transparent, meaning that a direct comparison may be inappropriate due to differences between the methodologies used to set those standards and those used by DOE in the current rulemaking. At the final rule stage, DOE continued to examine each class independently based on the merits of the available efficiency-improving features, and has set amended standards for each class based on the results of those analyses.

In response to the assertions that DOE's standard levels were not based upon currently available technologies, but rather were dependent upon future potential technological developments, DOE maintains that all technology options and equipment configurations included in its NOPR reflect technologies currently in use in commercial refrigeration equipment or related equipment types. DOE has observed these design options and features used in current manufacturer models offered for sale. The specific inputs which it used to model these design options, such as compressor efficiency improvements over the market baseline, glass door U-factor, or heat exchanger UA, were provided to the public for comment in the NOPR TSD and engineering analysis spreadsheet, and DOE has updated those inputs according to stakeholder

feedback and other information available during the final rule stage.

DOE understands the concerns voiced by Coca-Cola, True, NAFEM, and NRA regarding food safety. DOE realizes that food safety is of the utmost importance to the industry, and is in fact a definitional aspect of the design of equipment for food storage temperatures. In its screening analysis, DOE is compelled by sections 4(b)(4) and 5(b) of the Process Rule

to eliminate from consideration any technology that presents unacceptable problems with respect to a specific set of criteria, including impacts on equipment utility. Therefore, DOE removed from consideration technologies and design options which could result in such adverse impacts. Additionally, in its engineering analysis, DOE modeled medium-temperature equipment as having an average product temperature of 38°F, consistent with the rating temperature specified in the DOE test procedure and below the 41°F requirement of the NSF 7

food safety rating procedure. Thus, the daily energy consumption values produced in the engineering analysis reflect a level of equipment performance which ensures preservation of the ability to maintain food safety temperatures.

Appendix A to subpart C of 10 CFR part 430, “Procedures, Interpretations, and Policies for Consideration of New or Revised Energy Conservation Standards for Consumer Products” is known as “The Process Rule.”

This refers to the NSF/ANSI 7 procedure used to test equipment performance for food safety.

3. Rulemaking Timeline

Some stakeholders felt that in light of the large number of analytical changes that could be required between the NOPR and final rule, DOE should extend the target date for publication of the final rule. Traulsen requested that DOE slow the rulemaking process down due to the aggressiveness of the final rule date. (Traulsen, Public Meeting Transcript, No. 62 at p. 347) Hillphoenix and Lennox also expressed the same concern, noting that a February 2014 deadline for publication of the final rule allowed insufficient time for the reevaluation of DOE's engineering analysis. (Hillphoenix, No. 71 at p. 3) (Lennox, No. 73 at p. 2) In contrast, the New York State Attorney General (NYSAG) commented that the delay in amending these efficiency standards not only violated Congressional mandates, but has also prolonged the time that inefficient products stay in the market. NYSAG further commented that these delays have led to avoidable pollution and waste of resources. (NYSAG, No. 92 at p. 1)

While DOE appreciates the input from commenters requesting that the timeline for this rulemaking be extended, none of the commenters has provided any details or specifics with regard to what specifically they believe would require extra time. In reviewing its analyses to date, the inputs received at the NOPR public meeting and in subsequent written comment, DOE believes that the time allotted is sufficient in order to allow for full and proper analysis required in order to develop the final rule. In fact, DOE conducted an efficient and thorough effort to promulgate the final rule within the constraints of the time allotted. With regard to NYSAG's comment, DOE notes that it has moved as efficiently as possible while conducting the thorough analysis required to set appropriate standards.

4. Normalization Metrics

Following publication of the NOPR, DOE received comment on the normalization metrics used to scale allowable daily energy consumption under the standard levels as a function of equipment size. Depending on the design and intended application of each equipment class, DOE proposed energy standard levels using either total display area or volume as a metric. Structural Concepts commented that DOE's metrics for the VCT and HCT families were inconsistent, since some proposed standards for classes within the families were based on total display area (TDA) while others were based on volume, NAFEM stated that industry participants use volume, rather than linear feet, to estimate total market size. (Structural Concepts, No. 85 at p. 3) (NAFEM, No. 93 at p. 6)

DOE understands that the selection of appropriate measures of case size is important to the standards-setting process across all covered equipment classes. For the self-contained equipment with doors for which standards were set in the EPACT 2005 legislation, volume was identified in the statute as the normalization metric. (42 U.S.C. 6313(c)(2)) For the equipment covered by the 2009 final rule, DOE selected the metrics of volume for equipment with solid doors and TDA for display-type equipment. Because radiation and conduction through doors are the primary heat transfer pathways for CRE equipment with transparent doors, DOE concluded that TDA is the metric that best quantifies this effect. Likewise, for equipment without doors, the majority of heat load occurs due to warm air infiltration, and DOE determined that TDA would also be the most appropriate metric for capturing these effects. DOE also stated its conclusion that for these equipment types, where the function is to display merchandise for sale, TDA best quantifies the ability of a piece of equipment to perform that function. On the other hand, equipment with solid doors is designed for storage, and volume was determined to be the most appropriate metric for quantifying the storage capacity of the unit. 72 FR 41177-78 (July 26, 2007).

DOE does not believe, based on its discussions with manufacturers and comments solicited over the course of this rulemaking that the fundamental concepts underlying the choices of TDA or volume as the normalization metric for any given class of equipment have changed. In line with the reasons stated above, DOE is retaining the current normalization metrics for the respective equipment classes, consisting of both the metrics set forth in the 2009 final rule and those prescribed by the EPACT 2005 standards for self-contained equipment with doors.

In response to the comment from NAFEM regarding the usage of linear feet, DOE wishes to clarify that it did not use linear feet of equipment as a measure of equipment size in its engineering analysis, nor as a metric when estimating total market size in its shipments analysis. Rather, DOE utilized linear feet as a normalization metric in the national impacts and other downstream analyses when accounting for the aggregate costs and benefits of today's final rule. DOE believes that the units used in making representations of equipment market size are accurate, and DOE did not modify them for the final rule analysis.

5. Conformance With Executive Orders and Departmental Policies

At the NOPR public meeting, and in a subsequent written comment, Traulsen opined that the proposed rule violates Executive Order 12866. Specifically, Traulsen stated that the rule failed to identify the failures of private markets or public institutions that warrant new agency action, since the industry had actively embraced voluntary efficiency goals and standards. (Traulsen, No. 65 at p.16) Section 1(b)(1) of Executive Order 12866 requires each agency to identify the problem that it intends to address, including, where applicable, the failures of private markets or public institutions that warrant new agency action, as well as to assess the significance of that problem. In section VI.A of today's document (and also in the NOPR), DOE has identified the problems that it has

addressed by amending energy conservation standards for commercial refrigeration equipment. For certain segments of the companies that purchase commercial refrigeration equipment, such as small grocers, these problems may include a lack of consumer information and/or information processing capability about energy efficiency opportunities in the commercial refrigeration equipment market. In addition, the market for commercial refrigeration equipment is affected by electricity prices that do not reflect all of the social and environmental costs associated with electricity use. When such externalities are not included in the decisions made by market actors, this is considered a market failure by economists.

Traulsen asserted that the proposed rule was in violation of Executive Order 13563 and the Information Quality Act since the assumptions in DOE's analysis did not use the best available techniques to quantify the benefits of the rule. (Traulsen, No. 65 at pp.16-17) DOE believes that the analysis described in today's document is based on the best available techniques that were suited to the data available to analyze commercial refrigeration equipment. Further, Traulsen did not point to any specific techniques in its comment that would have been superior to those employed by DOE.

NAFEM expressed concern that the proposed rule was in violation of Executive Orders because it had a disproportionate negative impact on small businesses, failed to consider non-regulatory alternatives, and since DOE had made no contact with end-users in order to understand impact on users. (NAFEM, No. 93 at p. 14) Traulsen stated that DOE should consider supplementing regulatory action with other forms of non-regulatory alternatives, such as expanded collaboration with ENERGY STAR, rebates, and incentive programs. (Traulsen, No. 65 at p. 15)

As discussed in section V.B.1.b of this document, DOE believes that today's rule would not have a disproportionate negative impact on small businesses. DOE did consider non-regulatory alternatives to amended standards, as described in detail in chapter 17 of the final rule TSD. Finally, DOE requested comment from the public and held public meetings that were attended by representatives of end-users of commercial refrigeration equipment (e.g., ACCA, Coca-Cola, and NAFEM).

NAFEM also opined that the proposed rule violated the Secretarial Policy Statement of Scientific Integrity, since the analysis was not independently peer-reviewed by qualified experts, underlying assumptions were not clearly explained, and since DOE failed to accurately contextualize uncertainties pertaining to non-regulatory alternatives. (NAFEM, No. 93 at p. 14)

The Secretary's March 23, 2012 “Secretarial Policy Statement of Scientific Integrity”

sets forth a policy for DOE employees and states, in relevant part, that “DOE will ensure that data and research used to support policy decisions are of high scientific and technical objectivity. Scientific and technical objectivity will be supported through independent peer review by qualified experts, where feasible and appropriate, and consistent with law.” With respect to DOE's analysis underlying this final rule, DOE has solicited and thoroughly considered comment and data from expert CRE manufacturers throughout the rulemaking process. DOE does not believe that any additional expert review of its analysis is either necessary or appropriate.

https://www.directives.doe.gov/references/secretarial_policy_statement_on_scientific_integrity/view.

Further, the assumptions used in DOE's analysis are described in detail in the NOPR TSD and in the final rule TSD. DOE is not aware of the uncertainties pertaining to non-regulatory alternatives mentioned only in a general sense by NAFEM.

6. Offset Factors

In presenting the NOPR standard levels, DOE adopted and modified the offset factors from the 2009 final rule and EPACT 2005 standard levels to define the energy consumption of a unit at zero volume or TDA, thus setting the y-intercepts of the linear standard level equations proposed at levels intended to represent “end effects” inherent in all equipment. Some stakeholders expressed disagreement with DOE's modeling of offset factors. Hillphoenix commented that offset factors were designed to account for factors which remained constant over a range of equipment sizes. Hillphoenix further commented that such factors as conduction end effects typically do not vary with size. (Hillphoenix, No. 71 at p. 2) Traulsen commented that DOE's modeled offset factors were not empirically determined. (Traulsen, No. 65 at p. 19) The Air-Conditioning, Heating, and Refrigeration Institute (AHRI) commented that it was impossible for stakeholders to compare the offset factors within the current rulemaking with the previous rulemaking's values. (AHRI, No. 75 at p. 14)

In developing offset factors for the NOPR, DOE scaled existing offset factors from the EPACT 2005 and 2009 final rule standard levels based on the percentage reduction in energy use modeled at the representative unit size. This allowed the NOPR standard level equations to reflect energy allowances which proposed a standard percentage reduction in allowable consumption across all equipment sizes. While DOE agrees with Traulsen that the offset factors were not empirically determined, the factors were based upon scaling proportional to modeled equipment performance and applied to the existing offset factors which have been well-established and vetted through development of and compliance with the existing standards containing them.

In response to the comment from Hillphoenix, DOE agrees that there are certain fixed effects which will be encountered by any piece of equipment, such as a minimum amount of conduction, or energy consumption attributable to the presence of a minimum of a single fan motor, for example. For the final rule, and in response to the concern of stakeholders, DOE adjusted its offset factors to account for these constant effects. In equipment for which DOE developed offset factors for use in standard level equations in its 2009 final rule, DOE retained the same offset factors in the development of the trial standard levels presented in today's document. DOE believes that the retention of these factors accurately reflects the presence of fixed end-effect behavior in this equipment, which remains independent of the design options elsewise implemented in the equipment. For the equipment for which standard levels were set by EPACT 2005, DOE had no background information as to how those offset factors were developed. Therefore, in developing trial standard levels for today's final rule, DOE adjusted those offset factors based on available data from directories of certified product performance. For more information on the development of offset factors, please see chapter 5 of the final rule TSD.

B. 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 final rule 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. 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 at 1099-1100 (January 9, 2009)), and used during 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 has created 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). A total of 49 equipment classes were created, and these are listed in chapter 3 of the TSD using the nomenclature developed in the January 2009 final rule. 74 FR at 1100 (January 9, 2009).

During the October 2013 NOPR 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 Subcategories

In their written comments, Continental, NAFEM, True and Traulsen all expressed concern that the equipment classes defined by DOE in the proposed rule did not sufficiently encompass various sub-classifications, especially with regard to pass-through and reach-in cases. (Continental, No. 87 at p. 1) (NAFEM, No. 93 at p. 7) (True, No. 76 at p. 3) (Traulsen, No. 65 at p. 16) Further, Traulsen and True pointed out that a multitude of custom-built and niche equipment exists, which would require further analysis in order to determine a viable standard. (Traulsen, No. 65 at p. 20) (True, No. 76 at p. 1)

In response to the concerns of interested parties, DOE believes that its existing equipment class structure is sufficient to account for the majority of variation in type and combination of equipment geometry, condensing unit configuration, and operating temperature. DOE provides allowances in its standards to account for the energy needs of different equipment sizes through its use of standard level equations constructed in the form of linear equations varying with equipment size (as measured by volume or TDA) and through its use of offset factors to represent energy end-effects. DOE also accommodates variation in operating temperature outside of its three rating temperatures through the use of a lowest application product temperature provision in its test procedure. 77 FR at 10305 (February 21, 2012)

b. Floral Equipment

In the context of niche equipment classes, the Society of American Florists (SAF) noted that the floral industry uses purpose-designed refrigeration equipment, including sliding door floral display coolers (self-contained), open air access floral display coolers (reach-in), countertop floral display coolers and long door floral display coolers (swinging or sliding doors, top-mounted or remote condensing unit). SAF further added that most of these units are custom-built, since floral cooling systems are balanced to keep humidity high, and that special low-velocity coils are utilized to blow air through the unit while maintaining temperature and high humidity levels—features not available in stock equipment. (SAF, No. 74 at p. 3)

DOE believes that its division of covered equipment into numerous classes is sufficiently broad to capture the level of differentiation present within the commercial refrigeration equipment market. The equipment types described in the comment from SAF would fall into a number of existing equipment classes for which DOE has conducted analyses in this rulemaking. Additionally, DOE has recognized the temperature issues which may be present in floral cases, and has accommodated those different operating temperatures by developing and implementing a provision in its test procedure allowing equipment which cannot reach the specified DOE rating temperature to be tested at its lowest application product temperature. 77 FR at 10305 (February 21, 2012)

2. Technology Assessment

As part of the market and technology assessment performed for the final rule 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 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.C.

a. Technologies Applicable to All Equipment

In the NOPR 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. These technologies are discussed in depth in chapter 3 of the NOPR TSD. Not all of these technologies were considered in the engineering analysis; some were screened out or removed from consideration on technical grounds. After the publication of the NOPR analysis, DOE received numerous stakeholder comments regarding these technologies, discussed below.

Low Pressure Differential Evaporators

Traulsen commented that low pressure differential evaporators would require larger spaces between fins and tubes, which could in turn reduce overall efficiency by allowing frost build-up. (Traulsen, No. 65 at p. 7) Low-pressure differential evaporators reduce energy consumption by reducing the power of evaporator fan motors, often by increasing the air gap between fins. However, as noted in chapter 5 of the NOPR TSD, in space-constrained equipment such as commercial refrigeration equipment, this reduction usually comes from a decrease in evaporator coil surface area, which generally requires a lower saturated evaporator temperature (SET) to achieve the same discharge air temperature and cooling potential. This, in turn, results in a reduction in compressor efficiency. Therefore, DOE agrees with Traulsen that low pressure differential evaporators are not a viable option for consideration in this rulemaking and did not consider them as a design option.

Defrost Mechanisms

Traulsen commented that in order for DOE to advocate for improved defrost sensors, new designs would need to be implemented, and that the compliance date suggested in the NOPR would not allow for the levels of research and development (R&D) necessary to achieve this improvement. (Traulsen, No. 65 at p. 8) DOE wishes to clarify that it did not consider advanced defrost sensors as a design option within the analyses conducted at the NOPR or final rule stages of this rulemaking. Much equipment currently manufactured already uses partial defrost cycle control in the form of cycle temperature-termination control. However, defrost cycle initiation is still scheduled at regular intervals. Full defrost cycle control would involve a method of detecting frost buildup and initiating defrost. This could be accomplished using an optical sensor or through use of a sensor to detect the temperature differential across the evaporator coil. However, DOE understands that both of these methods are currently unreliable due to fouling of the coil with dust and other surface contaminants, which becomes more of an issue as cases age. Because of these issues, DOE agrees with Traulsen's concerns and did not consider defrost cycle control as a design option at the NOPR or final rule stages. Instead, the defrost lengths modeled in the engineering analysis were based on defrost times gathered through review of manufacturer literature, manufacturer interviews, and data collected through laboratory testing of equipment currently available on the market.

Light Emitting Diode Lighting

After publication of the NOPR, Traulsen commented that DOE's assertion of consumer enthusiasm towards LEDs lacked basis in reality. Further, Traulsen commented that any weight given to this assertion in the calculations was null. (Traulsen, No. 65 at p. 4) During its analysis, DOE considered design options based on their availability on the market and on the screening criteria set forth by the Process Rule. In considering LED lighting as a design option, DOE did so after researching existing product offerings on the market and conferring with manufacturers in confidential interviews. DOE did not factor “consumer enthusiasm” into its decision to include LED lighting as asserted by Traulsen, but instead considered this design option based on the information available from the current equipment market and the technology's ability to reduce the measured energy consumption of covered equipment.

b. Technologies Relevant Only to Equipment With Doors

In chapter 3 of the NOPR TSD, DOE mentioned three technologies that could apply only to doored equipment: anti-fog films, anti-sweat heater controllers, and high performance doors. Not all of these technologies were considered in the NOPR engineering analysis, as some were screened out or removed from consideration on technical grounds. The following sections discuss stakeholder comments regarding these technologies.

Anti-Fog Films

Traulsen commented that while DOE called for the use of advanced hydrophobic materials in the form of anti-fog films to prevent condensation build-up, there were concerns with regard to the NSF certification of this feature. (Traulsen, No. 65 at p. 11) DOE wishes to clarify that, while it included anti-fog films for consideration in the NOPR market and technology assessment, it did not include them as a design option in the engineering analysis. For a full discussion of why DOE did not consider anti-fog films, please see chapter 5 of the NOPR TSD. DOE agrees with Traulsen's concerns, amongst others, and continued to exclude this technology from its analysis at the final rule stage.

Anti-Sweat Heater Controllers

In its statements at the NOPR public meeting, the California IOUs urged DOE to consider anti-sweat heater controllers as a design option due to their large savings potential. (CA IOUs, Public Meeting Transcript, No. 62 at p. 19) However, in its written comment, Traulsen pointed out that these may be impractical, since sensor technologies had high failure rates in kitchen environments. (Traulsen, No. 65 at p. 11)

DOE addressed consideration of this technology in chapter 4 of the NOPR TSD. Anti-sweat heater controllers modulate the operation of anti-sweat heaters by reducing heater power when

humidity is low, and operate most effectively when a constant ambient dew point cannot be maintained. However, in the context of the DOE test procedure, anti-sweat heater controllers solely serve to keep the power to the anti-sweat heaters at the levels necessary for the test conditions. These fixed conditions of 75 °F and 55 percent relative humidity are the conditions that ASHRAE has determined to be generally representative of commercial refrigeration equipment operating environments and which DOE has adopted in its test procedure. While anti-sweat heater controllers could modulate the anti-sweat power to a further extent in the field so as to account for more or less extreme ambient conditions, a system equipped with anti-sweat heater controllers will not likely exhibit significantly different performance at test procedure conditions than a unit with anti-sweat heaters tuned for constant 75/55 conditions. Because they would have no impact on measured energy consumption under the DOE test procedure, DOE did not consider anti-sweat heater controllers in the engineering analysis.

c. Technologies Applicable Only to Equipment Without Doors

In chapter 3 of the NOPR TSD, DOE mentioned two technologies, air-curtain design and night curtains, that potentially could be used to improve the efficiency of commercial refrigeration equipment without doors. Air curtain design was not considered in the NOPR engineering analysis, as it was screened out and removed from consideration because, according to the information available to DOE, advanced air curtain designs are still in research and development stages and are not yet available for use in the manufacture of commercial refrigeration equipment. The following sections address stakeholder comments regarding technologies applicable to equipment without doors.

Air-Curtain Design

In its written comment, Traulsen expressed concern over the use of advanced air curtain designs. (Traulsen, No. 65 at p. 11) DOE agrees with Traulsen that advanced air curtain designs are not currently a feasible option for use in commercial refrigeration equipment. Sections 4(a) and 5(b) of the Process Rule specifically set “practicability to manufacture, install, and service” as a criterion that should be satisfied for technology to be considered as a design option. In chapter 4 of the NOPR TSD, DOE explained that advanced air curtain designs are only in the research stage and, therefore, that it would be impracticable to manufacture, install, and service this technology on the scale necessary to serve the relevant market at the time an amended standard would become effective. For that reason, DOE screened out improved air curtains as a design option for improving the energy efficiency of commercial refrigeration equipment.

C. Screening Analysis

DOE uses four screening criteria to determine which design options are suitable for further consideration in a standards rulemaking. Namely, design options will be removed from consideration if they are not technologically feasible; are not practicable to manufacture, install, or service; have adverse impacts on product utility or product availability; or have adverse impacts on health or safety. 10 CFR part 430, subpart C, appendix A, sections (4)(a)(4) and (5)(b).

In comments received after the NOPR publication, Traulsen commented that, while DOE screened out certain technology options due to impacts on end-users, it was unclear why the same technology option was screened out for some equipment classes but not others. (Traulsen, No. 65 at p. 2)

During the screening analysis, DOE considered sections 4(b)(4) and 5(b) of the Process Rule, which provide guidance in determining whether to eliminate from consideration any technology that presents unacceptable problems with respect to certain criteria. These criteria include technological feasibility, practicability to manufacture, install, and service, impacts on equipment utility or equipment availability, and adverse impacts on health or safety. If DOE determines that a technology, or a combination of technologies, meet any of the criteria set forth in section 5(b) of the Process Rule, it will be eliminated from consideration. This screening process is applied to each candidate technology being considered, and is applicable across all equipment classes. Therefore, in response to the comment from Traulsen, DOE does not believe that it screened out any particular technology options for some classes but not others.

Based on all available information, DOE has concluded that: (1) All of the efficiency levels discussed in today's document are technologically feasible; (2) equipment at these efficiency levels could be manufactured, installed, and serviced on a scale needed to serve the relevant markets; (3) these efficiency levels would not force manufacturers to use technologies that would adversely affect product utility or availability; and (4) these efficiency levels would not adversely affect consumer health or safety. Thus, the efficiency levels that DOE analyzed and discusses in this document are all achievable through technology options that were “screened in” during the screening analysis.

D. Engineering Analysis

The engineering analysis determines the manufacturing costs of achieving increased efficiency or decreased energy consumption. DOE historically has used the following three methodologies to generate the manufacturing costs needed for its engineering analyses: (1) The design-option approach, which provides the incremental costs of adding to a baseline model design options that will improve its efficiency; (2) the efficiency-level approach, which provides the relative costs of achieving increases in energy efficiency levels, without regard to the particular design options used to achieve such increases; and (3) the cost-assessment (or reverse engineering) approach, which provides “bottom-up” manufacturing cost assessments for achieving various levels of increased efficiency, based on detailed data as to costs for parts and material, labor, shipping/packaging, and investment for models that operate at particular efficiency levels.

As discussed in the Framework document, preliminary analysis, and NOPR analysis, DOE conducted the engineering analyses for this rulemaking using a design-option approach for commercial refrigeration equipment. The decision to use this approach was made due to several factors, including the wide variety of equipment analyzed, the lack of numerous levels of equipment efficiency currently available in the market, and the prevalence of relatively easily implementable energy-saving technologies applicable to this equipment. More specifically, DOE identified design options for analysis, used a combination of industry research and teardown-based cost modeling to determine manufacturing costs, and employed numerical modeling to determine the energy consumption for each combination of design options used to increase equipment efficiency. DOE selected a set of 25 high-shipment classes, referred to as “primary” classes, to analyze directly in the engineering analysis. Additional details of the engineering analysis are available in chapter 5 of the final rule TSD.

1. Representative Equipment for Analysis

a. Representative Unit Selection

In performing its engineering analysis, DOE selected representative units for each primary equipment class to serve as analysis points in the development of cost-efficiency curves. In selecting these units, DOE researched the offerings of major manufacturers to select models that were generally representative of the typical offerings produced within the given equipment class. Unit sizes, configurations, and features were based on high-shipment-volume designs prevalent in the market. Using this data, a set of specifications was developed defining a representative unit for each primary equipment class. These specifications include geometric dimensions, quantities of components (such as fans), operating temperatures, and other case features that are necessary to calculate energy consumption. Modifications to the units modeled were made as needed to ensure that those units were representative of typical models from industry, rather than a specific unit offered by one manufacturer. This process created a representative unit for each equipment class with typical characteristics for physical parameters (

e.g.,

volume, TDA), and minimum performance of energy-consuming components (

e.g.,

fans, lighting).

b. Baseline Models

DOE created a set of baseline design specifications for each equipment class analyzed directly in the engineering model. Each set of representative baseline unit specifications, when combined with the lowest technological level of each design option applicable to the given equipment class, defines the energy consumption and cost of the lowest efficiency equipment analyzed for that class. Chapter 5 of the final rule TSD sets forth the specifications that DOE chose for each equipment class and discusses baseline models in greater detail.

One complexity involved in developing an engineering baseline was due to the variety of designs and technology options that manufacturers could utilize in order to meet the recently-implemented standards arising from EPACT 2005 and the 2009 final rule. Through its analyses, DOE determined that manufacturers were utilizing a wide variety of design paths in order to meet the necessary performance level. Therefore, in order to develop its engineering results for the current rule, DOE retained the engineering baseline and associated technologies used in its January 2009 final rule engineering analysis and expanded them to accommodate the new equipment classes covered by the standards initially established by EPCA. (42 U.S.C. 6313(c)(2)-(3)) DOE then added technologies to this baseline to develop its cost-efficiency curves, and ordered the technology options from lowest to highest payback period. The result was a set of cost-efficiency curves reflecting what DOE believes to be the most cost-effective means of meeting the existing standards, as well as that of attaining the higher levels of performance reflected in today's rule.

As a result, some of the engineering results represent levels of unit performance that are below the standard levels for equipment currently on the market and subject to DOE's existing standards. (10 CFR 431.66). However, in its LCC and other downstream analyses, DOE accounted for this fact by utilizing a standards baseline as the minimum efficiency level examined, thereby truncating the engineering design option levels so that the lowest efficiency point analyzed corresponded to the current standard level with which that particular model of equipment would have to comply. The exact procedure is described in section IV.F and additional details are provided in chapter 8 of the final rule TSD.

After publication of the NOPR and the NOPR public meeting, DOE received a number of comments from interested parties regarding its establishment of baseline models, and the features and design specifications included in those baseline models. The subsequent sections contain those comments and DOE's responses.

Composition of Baseline

Southern Store Fixtures Inc. (Southern Store Fixtures), AHRI, Hussmann and Structural Concepts expressed concern that, by keeping the baseline consistent between the previous rule and the proposed rule, DOE had failed to account for the efficiency improvement brought about by the previous standard, thereby overestimating the potential for energy savings. (Southern Store Fixtures, No. 67 at p. 2) (AHRI, No. 75 at p. 2) (Hussmann, No. 77 at p. 9) (Structural Concepts, No. 85 at p. 1) Additionally, AHRI noted that although the current rulemaking retains the baseline specifications and some related technologies from the previous rulemaking, there are differences in the baseline energy consumption across the two rulemakings. (AHRI, No. 75 at p. 4)

The Joint Comment pointed out that, for some equipment classes, many ENERGY STAR-qualified products were rated as being less efficient than the modeled baseline. Further, the Joint Comment urged DOE to re-evaluate the baseline levels for equipment classes for which the current standards were established by EPACT 2005. (Joint Comment, No. 91 at p. 5)

In response to the comments raised by interested parties regarding the modeled equipment baseline, DOE points out that there is currently no prescriptive requirement that commercial refrigeration equipment use any specific combination of features to meet the existing EPACT 2005 or 2009 final rule standard levels. For this reason, and in order to ensure a proper ordering of the implementation of efficiency-improving technologies in its engineering analysis, DOE started with an engineering baseline which was, in many cases, below the performance level mandated by the current standards. DOE then modeled equipment with increasingly higher levels of performance by implementing the applicable design options in order of ascending payback period. The result of this was a modeled configuration reflecting, based on the information available to DOE, the most cost-effective way to build a model which complies with the existing standards. Then, DOE continued to add the remaining design options until it reached the max-tech level. It was these additional efficiency levels above the performance level required by the existing standard that were considered as offering incremental efficiency improvements beyond the level required at the time of the analysis.

Energy savings and downstream impacts (such as life-cycle cost and national net present value results) were calculated based on a base case efficiency distribution in which minimum-efficiency products available today are assumed to comply with existing standards. Therefore the modeled design options up to the level of performance required by existing standards did not have any impact on the energy or cost savings attributed to the amended standards prescribed today, but rather, served only to align the engineering cost-efficiency curve with the technologies which present the shortest-payback options for reducing energy consumption. As a result, DOE believes that the assertion of some stakeholders that its methodology overstates the energy savings attributable to today's rule is inaccurate.

With regard to the specific technology modeling that was discussed by AHRI, DOE updated modeling of some baseline design options and components from the 2009 final rule to the current

rulemaking to ensure the most accurate possible depiction of components currently available on the market. In the final rule stage, DOE revisited these design option parameters based on stakeholder comments and further revised them where appropriate so as to ensure a greater degree of accuracy in the engineering model inputs. Therefore, DOE understands that there may be adjustments to the numerical outputs of the modeling of baseline units between rulemakings and rulemaking stages.

In response to the issue raised in the Joint Comment, DOE wishes to point out that the ENERGY STAR-qualified directory

is, by design, not necessarily an exhaustive source of information for all models available on the market. However, DOE has adjusted its modeling of baseline units in the final rule stage of the analysis and, in conducting comparisons between its engineering results and market data such as the ENERGY STAR directory, has found agreement between the performance results obtained from its engineering analysis and the data points contained in the ENERGY STAR directory.

Available

http://www.energystar.gov/certified-products/certified-products.

Condensate Pan Heaters

In their written comments, manufacturers provided input on the modeling of condensate pan heaters in baseline and higher-performance units. Traulsen noted that closed door refrigerators were modeled in the NOPR engineering analysis as not requiring electric condensate pan heaters, while freezers were modeled as using this component, even though refrigerators face the same physical limitations as freezers. Further, Traulsen commented that DOE should consider the power required to bring condensate pan heaters to operating temperature and the idle power consumption of empty condensate pans when reviewing energy conservation strategies. Further, Traulsen expressed the belief that electric condensate pan heaters are an important feature which cannot be ignored. (Traulsen, No. 65 at p. 1) Similarly, Hussmann also commented that in self-contained medium-temperature units, manufacturers are required to use condensate evaporator pans, the lack of which would reduce utility to end-users. (Hussmann, No. 77 at p. 7)

In response to the comments provided by Traulsen and Hussmann, DOE revisited its engineering analysis and added condensate pan heaters for medium-temperature vertical closed-door cases to its analytical model. Additionally, in response to Traulsen's suggestion, DOE added a factor of an additional 10% pan energy consumption to its modeling of condensate pan energy use in order to account for the energy needed to bring the pan up to temperature. However, DOE did not add further energy in its engineering simulation to account for idle consumption of empty condensate pans, as DOE understands that most condensate pan heaters use float switches or other sensor devices to activate the pan heater only when the water level is sufficiently high to require it, minimizing operation of heaters with empty pans.

Defrost

In its written comment, Traulsen provided additional information to assist in DOE's modeling of defrost systems. Traulsen commented that while the DOE model assumed that all VCT.SC.M and VCS.SC.M units employ off-cycle defrost systems, this is not true in real-life applications. Traulsen further commented that, for most refrigerator models, it uses an electric defrost element. Traulsen further noted that if electric defrost were included, all theoretical models would fail to meet the proposed standard. Additionally, Traulsen commented that DOE's model seems to ignore desired features such as hot-gas defrost and electric defrost systems, even though they are widely available in the market.

Traulsen commented that defrost cycles tend to terminate when the evaporator coil reaches a predetermined temperature, but the time period required for melting all accumulated frost varies with the mass of the evaporator coil and surrounding components. Further, Traulsen noted that the DOE spreadsheet appears not to account for these accommodations, and fails to account for increased defrost length when using enhanced evaporator coils, which have a 50% higher mass than the baseline coil designs. Traulsen commented that, in the DOE NOPR engineering model, defrost heater wattage only varied in proportion to the length of the cabinet, and not with the cabinet height or volume. Furthermore, Traulsen noted that the heater wattage calculated for full-height closed door cabinets appear to be too high. (Traulsen, No. 65 at p. 11) Structural Concepts commented that the multipliers used to model defrost cycles should differ between open and closed type cases. (Structural Concepts, No. 85 at p. 3)

After the NOPR public meeting and upon receipt of comments, DOE researched defrost mechanisms applied in medium-temperature applications. Specifically, DOE investigated this subject through review of manufacturer literature such as manuals and replacement parts catalogs, as well as through testing and teardown of selected units. The results of this investigation contradicted Traulsen's assertion that electric defrost is commonly used in medium-temperature units, as DOE did not find evidence of this. Additionally, examination of public certification databases such as the ENERGY STAR directory showed equipment performance levels inconsistent with the use of substantial amounts of electric defrost. Therefore, DOE did not find sufficient evidence to warrant adding the modeling of electric defrost to its engineering analysis. With respect to the discussion of hot gas defrost, DOE understands that this feature is currently used by some manufacturers in the market, but did not explicitly model it due to concerns raised through comments and in manufacturer interviews regarding reliability issues with this feature.

In response to the comments from Traulsen and Structural Concepts regarding defrost cycle lengths, DOE based its modeling of defrost cycles for various equipment classes based on a number of sources, including manufacturer literature, manufacturer interviews, and testing of equipment currently on the market. Thus DOE agrees that the defrost length values should vary by equipment class, and has modeled them as such in its engineering analysis. With respect to Traulsen's comment on additional defrost power being needed for larger evaporator coils, DOE constrained the size of the evaporator coils modeled in the final rule analysis, thus mitigating concern over this issue. Additionally, in the final rule engineering analysis, for vertical freezers, DOE adjusted the modeled defrost heater wattages based on inputs from Traulsen's comment and other sources. DOE believes that these changes better reflects the actuality of defrost mechanisms utilized in these equipment classes.

Lighting Configurations

Hillphoenix commented that the number of shelves, and therefore shelf lights, varies greatly for SVO cases depending on the height of the case. Hillphoenix further commented that there exist “extreme configuration differences” among cases within the same class. (Hillphoenix, No. 71 at p. 4)

In developing its engineering analysis for this rulemaking, DOE collected data on common designs within the industry. This information included specifications on lighting configurations and formed the basis for the representative units modeled within the engineering analysis. Based on input collected over the course of the current rulemaking and in the development of the 2009 final rule, DOE believes that its design specifications, including lighting configurations, are accurate and representative of the various covered classes, including SVO cases. Additionally, DOE notes that for SVO cases, the allowable energy consumption under the existing and amended standards is a function of TDA. Cases with greater height, such as those suggested by Hillphoenix, would have a greater measured total display area and thus would be allowed a proportionally larger amount of energy. Therefore, DOE believes that its existing analytical methodology accounts for the concerns raised by Hillphoenix.

Infiltration Loads

Manufacturers opined that DOE's modeling of air infiltration caused by door openings could be improved. Continental Refrigerator (Continental), Hussmann, and Traulsen all commented that air exchange during door openings significantly affects system energy consumption. (Hussmann, No. 77 at p. 3) (Traulsen, No. 65 at p. 10) (Continental, No. 87 at p. 2) Specifically, True commented that door openings and the resultant air exchange could account for between 15% and 25% of a unit's energy consumption. (True, Public Meeting Transcript, No. 62 at p. 151)

Traulsen commented that the energy consumption formulas for closed door models fail to account for gasket losses (heat gain or added load), and that it was concerned with the use of the air infiltration load models applied, especially with respect to closed door units, since real world conditions can vary from those experienced during the ASHRAE test procedure. (Traulsen, No. 65 at p. 10) Moreover, Continental noted that the percentage of air that is exchanged varies greatly with the configuration and type of cabinet. Continental further commented that the DOE model did not provide sufficient explanation of how air infiltration loads were calculated for different cabinet types. (Continental, Public Meeting Transcript, No. 62 at p. 123) Structural Concepts commented that the multipliers used to model infiltration should differ between open and closed type cases. (Structural Concepts, No. 85 at p. 3) ACEEE commented that tracer gas analysis, a well-established technology, could be used to analyze the actual air exchange that occurs during door openings. (ACEEE, Public Meeting Transcript, No. 62 at p. 154)

DOE understands the significance of air infiltration and is aware of its impact on the modeled energy consumption of commercial refrigeration equipment. In response to these comments, DOE reviewed its modeled infiltrated air mass values between the NOPR and final rule stages of the rulemaking. Specifically, DOE adjusted the values for a variety of classes to better align with new information presented in stakeholder comments and other sources. This included adjustments to account for the impacts of the respective air densities at the three DOE rating temperatures, and scaling to better simulate the impacts of case geometry. For full details on the infiltration levels modeled, please refer to chapter 5 and appendix 5A of the final rule TSD.

With respect to the comment from True regarding the percentage of case heat load attributable to infiltration, DOE's engineering model provides a specific breakdown of the constituent components of the case heat loads modeled in its simulation. A review of the DOE engineering model shows the contribution of infiltration to case heat load for closed-door units to be in line with the figures provided by True. In response to the comment from Traulsen, DOE believes that gasket losses are accounted for in its infiltrated air mass values. These values were derived from manufacturer literature based upon test performance under ASHRAE conditions, and thus would encapsulate all phenomena, including gasket losses, encountered by the unit which contribute to the infiltration load during operation. The engineering model simulates performance under the DOE test procedure, and thus changes which may be encountered in the field such as those noted by Traulsen are not specifically relevant to the calculated daily energy consumption values used for standards setting purposes. Therefore, DOE does not see a need to change its methodology to account for this attribute.

DOE agrees with Continental and Structural Concepts that wide variation in infiltration is observed among different equipment classes, particularly between open and closed cases. DOE believes that its updated air infiltration values better account for differences that exist in infiltration loads among cases of different configurations, geometries, sizes, and operating temperatures.

With respect to the comment from ACEEE, DOE understands that tracer gas analysis could be used in a controlled laboratory environment to possibly determine infiltration rates into commercial refrigeration equipment. However, within the scope, time frame, and resources of this rulemaking process, DOE did not pursue that method to further investigate infiltration effects. Instead, DOE continued to base its approach on infiltration load values calculated from manufacturer literature, and adjusted those values based upon comments received after publication of the NOPR. DOE believes that this is an accurate approach, consistent with methodologies employed in other past and current rulemakings, which is substantiated by the best available data as of the time of this analysis.

2. Design Options

After conducting the screening analysis and removing from consideration technologies that did not warrant inclusion on technical grounds, DOE included the remaining technologies as design options in the energy consumption model for its engineering analysis:

• Higher efficiency lighting and occupancy sensors for VOP, SVO, and SOC equipment families (horizontal fixtures);

• higher efficiency lighting and occupancy sensors for VCT and PD equipment families (vertical fixtures);

• improved evaporator coil design;

• higher efficiency evaporator fan motors;

• improved case insulation;

• improved doors for VCT equipment family, low temperature and ice-cream temperature (hinged);

• improved doors for VCT and PD equipment families, medium temperature (hinged);

• improved doors for HCT equipment family, low temperature and ice-cream temperature (sliding);

• improved doors for HCT equipment family, medium temperature (sliding);

• improved doors for SOC equipment family, medium temperature (sliding);

• improved condenser coil design (for self-contained equipment only);

• higher efficiency condenser fan motors (for self-contained equipment only);

• higher efficiency compressors (for self-contained equipment only); and

• night curtains (equipment without doors only).

After publication of the NOPR, DOE received a number of comments on its choice and implementation of certain design options within the engineering analysis. The following sections address these stakeholder comments.

a. Fluorescent Lamp Ballasts

Traulsen commented that markets have already trended towards electronic (solid-state) ballasts to modulate power provided by T8 lights. Traulsen raised concern that DOE analysis might therefore be unfairly overstating savings from the adoption of TSL4 by including electronic ballasts as a design option in its analysis. (Traulsen, No. 65 at p. 4)

DOE understands that electronic ballasts are ubiquitous in the commercial refrigeration equipment market within cases that use fluorescent lighting and agrees with the comment presented by Traulsen. In its NOPR engineering analysis, DOE modeled the baseline design option in cases with lighting as comprised of T8 fluorescent fixtures with electronic ballasts. At improved levels of efficiency, DOE implemented super-T8 fluorescent lighting, LED lighting, and LED lighting with occupancy sensors. DOE did not model magnetic ballasts within its NOPR engineering analysis. Given the comments received at the NOPR stage, DOE retained this stance in its final rule engineering analysis.

With regard to Traulsen's assertion that DOE might be overstating savings, DOE wishes to clarify that energy savings and downstream impacts (such as life-cycle cost and national net present

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