Energy Conservation Program for Appliance Standards: Energy Conservation Standards for Residential Furnaces and Commercial Water Heaters
Federal RegisterJan 15, 2021
Ask Donna
What actually matters in this document.
Text
DEPARTMENT OF ENERGY
10 CFR Parts 430 and 431
RIN 1904-AE39
Energy Conservation Program for Appliance Standards: Energy Conservation Standards for Residential Furnaces and Commercial Water Heaters
AGENCY:
Office of Energy Efficiency and Renewable Energy, Department of Energy.
ACTION:
Notification of final interpretive rule.
SUMMARY:
In response to a petition for rulemaking submitted on October 18, 2018 (Gas Industry Petition), the Department of Energy (DOE or the Department) published that petition in the
Federal Register
on November 1, 2018, for public review and input. DOE subsequently published in the
Federal Register
a proposed interpretive rule on July 11, 2019, and a supplemental notice of proposed interpretive rule on September 24, 2020. After carefully considering the public comments on its proposals, DOE has decided to issue a final interpretive rule determining that, in the context of residential furnaces, commercial water heaters, and similarly-situated products/equipment, use of non-condensing technology (and associated venting) constitute a performance-related “feature” under the Energy Policy and Conservation Act (EPCA) that cannot be eliminated through adoption of an energy conservation standard. In light of this final interpretation, published elsewhere in this issue of the
Federal Register
, DOE withdraws its March 12, 2015 proposed rule and September 23, 2016 supplemental proposed rule for energy conservation standards for non-weatherized gas furnace and mobile home gas furnaces, as well as its May 31, 2016 proposed rule for energy conservation standards for commercial water heating equipment.
DATES:
This final interpretive rule is effective January 15, 2021.
ADDRESSES:
The docket, which includes
Federal Register
notices, public comments, and other supporting documents/materials, is available for review at
http://www.regulations.gov.
All documents in the docket are listed in the
http://www.regulations.gov
index. However, not all documents listed in the index may be publicly available, such as information that is exempt from public disclosure.
The docket web page can be found at
http://www.regulations.gov/docket?D=EERE-2018-BT-STD-0018.
The docket web page contains instructions on how to access all documents, including public comments, in the docket.
For further information on how to review the docket, contact the Appliance and Equipment Standards Program staff at (202) 586-6636 or by email:
ApplianceStandardsQuestions@ee.doe.gov.
FOR FURTHER INFORMATION CONTACT:
Ms. Lysia Bowling, Senior Advisor, U.S. Department of Energy, Office of Energy Efficiency and Renewable Energy, 1000 Independence Avenue SW, Washington, DC 20585. Telephone: (202) 430-1257. Email:
Lysia.Bowling@ee.doe.gov.
Mr. Eris Stas, U.S. Department of Energy, Office of the General Counsel, 1000 Independence Avenue SW, Washington, DC 20585. Telephone: (202) 586-5827. Email:
Eric.Stas@hq.doe.gov.
SUPPLEMENTARY INFORMATION:
Table of Contents
I. Background
II. Summary Description
A. Relevant Statutory Provisions
B. DOE's Historical Interpretation
C. The Gas Industry Petition
D. DOE's Proposed Interpretive Rule
E. DOE's Supplemental Proposed Interpretive Rule
III. Response to Comments
A. Legal Authority
1. Legal Authority To Set Separate Product/Equipment Classes Based Upon Condensing and Non-Condensing Technologies
a. Comments Supporting the Proposed Interpretation
b. Comments Opposing the Proposed Interpretation
i. Support for DOE's Prior Interpretation
ii. Violation of Legal Standards
iii. Aesthetics
iv. Delay
v. Regulatory Burden/Litigation/Uncertainty/Preemption
vi. Other Negative Effects of a Change in Interpretation
1. Legal Authority To Set “Small” Furnace Product Classes
2. Market Trends
3. Requests for Clarification
B. Comments Regarding Economics-Related Issues
1. Consumer Impacts
a. Legal Arguments
b. Factual Arguments
2. Fuel Switching
3. Other Economic Issues
C. Analytical Issues
D. Other Issues
1. AFUE2
2. Environmental and Climate Policy Issues
3. Other Requested Relief
4. Final Agency Action
IV. DOE's Final Interpretation
V. Conclusion
VI. Approval of the Office of the Secretary
I. Background
On October 18, 2018, the Department received a petition for rulemaking submitted by the American Public Gas Association (APGA), Spire, Inc., the Natural Gas Supply Association (NGSA), the American Gas Association (AGA), and the National Propane Gas Association (NPGA), collectively referred to as the “Gas Industry Petitioners,” asking DOE to: (1) Issue an interpretive rule stating that DOE's proposed energy conservation standards for residential furnaces
1
and commercial water heaters
2
would result in the unavailability of “performance characteristics” within the meaning of the Energy Policy and Conservation Act
3
(EPCA; 42 U.S.C. 6291
et seq.
), as amended (
i.e.,
by setting standards which can only be met by products/equipment using condensing combustion technology and thereby precluding the distribution in commerce of products/equipment using non-condensing combustion technology) and (2) withdraw the proposed energy conservation standards for residential furnaces
4
and commercial water heaters
5
based upon such findings. DOE published the petition in the
Federal Register
on November 1, 2018 (83 FR 54883) and requested public comment, with a comment period scheduled to close on January 30, 2019. DOE received two requests from interested parties seeking an extension of the comment period in order to develop additional data relevant to the petition. DOE
granted those requests through publication in the
Federal Register
of a notice extending the comment period on the notice of petition for rulemaking until March 1, 2019. 84 FR 449 (Jan. 29, 2019).
1
The Gas Industry Petitioners refer to a notice of proposed rulemaking for residential non-weatherized gas furnaces and mobile home furnaces published in the
Federal Register
on March 12, 2015 (80 FR 13120), as well as a supplemental notice of proposed rulemaking published in the
Federal Register
on September 23, 2016 (81 FR 65720). These DOE proposals may be found in the docket at Docket No. EERE-2014-BT-STD-0031-0032 and Docket No. EERE-2014-BT-STD-0031-0230, respectively.
2
The Gas Industry Petitioners refer to a notice of proposed rulemaking for commercial water heating equipment published in the
Federal Register
on May 31, 2016 (81 FR 34440). This DOE proposal may be found in the docket at Docket No. EERE-2014-BT-STD-0042-0018.
3
All references to EPCA in this document refer to the statute as amended through America's Water Infrastructure Act of 2018, Public Law 115-270 (Oct. 23, 2018).
4
Standards for non-weatherized residential furnaces were published in a notice of proposed rulemaking at 80 FR 13120 (March 12, 2015) (Docket No. EERE-2014-BT-STD-0031-0032) and in a supplemental notice of proposed rulemaking at 81 FR 65720 (Sept. 23, 2016) (Docket No. EERE-2014-BT-STD-0031-0230).
5
Standards for commercial water heating equipment were published in a notice of proposed rulemaking at 81 FR 34440 (May 31, 2016) (Docket No. EERE-2014-BT-STD-0042).
The 90-day public comment period, including the 30-day extension to submit comments, invited public input in order to better understand stakeholder perspectives and increase transparency around a complex issue involving DOE's legal authority. DOE received comments from a variety of stakeholders, including representatives from gas industry associations, appliance manufacturers, the manufactured housing industry, efficiency advocates, consumer advocates, State organizations and Attorneys General, and individuals (mostly form letter comments). In general, the gas industry associations and the manufactured housing industry supported the petition, and the advocates and State officials opposed it. Furnace and water heater manufacturer reactions to the petition were generally mixed.
After carefully considering the comments on the petition, DOE published a notice of proposed interpretive rule in the
Federal Register
on July 11, 2019, to provide the public additional information about DOE's tentative interpretation of EPCA's “features” provision
6
in the context of condensing vs. non-condensing furnaces and water heaters, as informed by public comments. 84 FR 22011. The proposed interpretive rule tentatively determined that, in the context of residential furnaces, commercial water heaters, and similarly-situated products/equipment, use of non-condensing technology (and associated venting) may constitute a performance-related “feature” under EPCA that cannot be eliminated through adoption of an energy conservation standard. If such interpretation were to be finalized, DOE anticipated that in future rulemakings for affected products/equipment, it would suffice to consider setting product/equipment classes based upon the key distinction of the appliance's utilization of condensing or non-condensing technology. (The proposed interpretive rule, in which DOE responded to comments on the notice of petition for rulemaking, is discussed in further detail in section II.D of this document.) Once again, DOE received comments from a variety of stakeholders, including representatives from gas industry associations, the housing industry, appliance manufacturers, utilities, environmental and efficiency advocates, consumer advocates, State organizations and Attorneys General, and individuals. Consistent with the opinions expressed in response to the petition, in general, the gas industry associations, the housing industry, and most manufacturers supported the proposed interpretive rule, and the advocates and State officials opposed it. Specifically, DOE received comments on the proposed interpretive rule from:
6
See
42 U.S.C. 6295(o)(4); 42 U.S.C. 6313(a)(6)(B)(iii)(II)(aa); and as applicable in certain cases through 42 U.S.C. 6316(a)).
Table I.1—Entities Submitting Written Comment on the Proposed Interpretive Rule
Commenter
Affiliation
Advocates Joint Comment:
Energy Efficiency and Consumer Advocates.
Appliance Standards Awareness Project (ASAP).
Alliance to Save Energy (ASE).
American Council for an Energy-Efficient Economy (ACEEE).
Consumer Federation of America (CFA).
National Consumer Law Center (NCLC).
Air-Conditioning, Heating & Refrigeration Institute (AHRI).
Trade Association.
A.O. Smith Corporation (A.O. Smith).
Industry.
Attorneys General Joint Comment (AGs Joint Comment):
State/Local Governments.
State of New York.
State of California.
State of Colorado.
District of Columbia.
State of Illinois.
State of Maine.
State of Maryland.
Commonwealth of Massachusetts.
State of Minnesota.
State of New Jersey.
State of Oregon.
State of Vermont.
State of Washington.
Corporation Counsel of the City of New York.
Bradford White Corporation (BWC).
Industry.
Burnham Holdings, Inc. (BHI).
Industry.
California Energy Commission (CEC).
State Government.
California Investor-Owned Utilities (CA IOUs):
Utilities.
Pacific Gas and Electric Co. (PG&E).
San Diego Gas and Electric (SDG&E.
Southern California Edison (SCE).
Carrier Corporation (Carrier).
Industry.
Ceres BICEP Network (Ceres).
Business Coalition.
Consumer Federation of America and National Consumer Law Center (CFA/NCLC).
Consumer Advocates.
Crown Boiler Company (Crown Boiler).
Industry.
Environmentalists Joint Comment:
Environmental Advocates.
Natural Resources Defense Council (NRDC).
Sierra Club.
Earthjustice.
Lennox International, Inc. (Lennox).
Industry.
Weil-McLain.
Industry.
Anonymous.
Unaffiliated.
Anonymous.
Unaffiliated.
Sarah G.
Unaffiliated.
Kathy McCardwell.
Unaffiliated.
Elizabeth Reed.
Unaffiliated.
Suzanne Sorkin.
Unaffiliated.
Laura Woods.
Unaffiliated.
In the course of considering the public comments on its proposed interpretation, comments from U.S. Boiler, BHI, and Crown Boiler presented DOE with an alternative approach that did not focus on “non-condensing” technology as the performance-related feature. While the commenters suggesting this alternative were generally supportive of the proposed interpretation, they expressed concern that unless subsequent DOE rulemakings implement the interpretation through product/equipment classes focused on venting compatibility (particularly preservation of Category I venting), many of the same problems identified in the Gas Industry Petition may still arise. In order to gather further information and comment on this specific issue, DOE published a supplemental notice of proposed interpretation in the
Federal Register
on September 24, 2020 (the September 2020 SNOPIR), which proposed alternative approaches to product/equipment class setting in this context. 85 FR 60090. (The supplemental proposed interpretive rule is discussed in further detail in section II.E of this document.)
In response to its supplemental proposed interpretive rule, DOE received comments from:
Table I.2—Entities Submitting Written Comment on the Supplemental Proposed Interpretive Rule
Commenter
Affiliation
Advocates Joint Comment II
Energy Efficiency and Consumer Advocates.
Appliance Standards Awareness Project (ASAP)
American Council for an Energy-Efficient Economy (ACEEE)
Consumer Federation of America (CFA)
National Consumer Law Center (NCLC)
Air-Conditioning, Heating & Refrigeration Institute (AHRI)
Trade Association.
A.O. Smith Corporation (A.O. Smith)
Industry.
Attorneys General Joint Comment (AGs Joint Comment II)
State/Local Governments.
State of New York
State of California
State of Colorado
District of Columbia
State of Illinois
State of Maine
State of Maryland
Commonwealth of Massachusetts
State of Minnesota
State of Nevada
State of Oregon
State of Vermont
State of Washington
Corporation Counsel of the City of New York
Bradford White Corporation (BWC)
Industry.
California Investor-Owned Utilities (CA IOUs)
Utilities.
Pacific Gas and Electric Co. (PG&E)
San Diego Gas and Electric (SDG&E)
Southern California Edison (SCE)
Carrier Corporation (Carrier)
Industry.
Crown Boiler Company (Crown Boiler)
Industry.
Electrify Now
Energy Efficiency and Environmental Advocates.
Lennox International, Inc. (Lennox)
Industry.
Mortex Products, Inc. (Mortex)
Industry.
Natural Resources Defense Council (NRDC)
Environmental Advocate.
Nortek Global HVAC (Nortek)
Industry.
Northwest Energy Efficiency Alliance (NEEA)
Energy Efficiency Advocates.
Petitioners
et al.
Joint Comment II
Utilities, Trade Associations.
Spire, Inc.
Spire Missouri, Inc.
American Public Gas Association (APGA)
American Gas Association (AGA)
National Propane Gas Association (NPGA)
National Gas Supply Association (NGSA)
National Association of Home Builders (NAHB)
Plumbing-Heating-Cooling Contractors National Association
U.S. Boiler Company (USB)
Industry.
Anonymous
Unaffiliated.
Lee Hannah
Unaffiliated.
All comments—on both the proposed interpretive rule and the supplemental proposed interpretive rule—were carefully and fully considered by DOE. Informed by these comments and reconsideration of the substantial evidence in the relevant rulemaking dockets, the Department is issuing this final interpretive rule to state DOE's interpretation of EPCA's “features” provision in the context of condensing vs. non-condensing furnaces, water heaters, and similarly-situated covered products/equipment (and associated venting). The following sections of this final interpretive rule set forth the relevant legal authority, describe the Department's historical interpretation of EPCA's “features” provision as applied to condensing vs. non-condensing products/equipment, provide summary of and responses to comments received on both the proposed interpretive rule and supplemental proposed interpretive rule, and recite DOE's revised interpretation of the relevant statutory provision.
Through this final interpretive rule, DOE is not making any changes to its existing regulations in the Code of Federal Regulations (CFR) or policies regarding individual appliance standards rulemakings, and it cannot and will not take any enforcement action pursuant to its revised interpretation until after the effective date of a final legislative rule, published in the
Federal Register
, amending the applicable product/equipment classes and energy conservation standards, as necessary. Consequently, this final interpretive rule does not change or revise any current policies or legal requirements with respect to residential furnaces, commercial water heaters, or similarly-situated covered products/equipment. Decisions about how this interpretation will apply to existing products/equipment utilizing condensing/non-condensing technologies will be the subject of subsequent actions.
II. Summary Description
A. Relevant Statutory Provisions
In this final interpretive rule, DOE explains its historical interpretation regarding the evaluation of what constitutes a product “feature” which cannot be eliminated under EPCA, specifically in the context of residential furnaces and commercial water heaters. For covered consumer products, the key statutory provision at issue can be found at 42 U.S.C. 6295(o)(4), which provides that the Secretary may not prescribe an amended or new standard under this section if the Secretary finds (and publishes such finding) that interested persons have established by a preponderance of the evidence that the standard is likely to result in the unavailability in the United States in any covered product type (or class) of performance characteristics (including reliability), features, sizes, capacities, and volumes that are substantially the same as those generally available in the United States at the time of the Secretary's finding.
Where the Secretary finds such “performance characteristics (including reliability), features, sizes, capacities, and volumes” (collectively referred to hereafter as “features”) to exist, the statute provides a remedy at 42 U.S.C. 6295(q)(1), which states that a rule prescribing an energy conservation standard for a type (or class) of covered products shall specify a level of energy use or efficiency higher or lower than that which applies (or would apply) for such type (or class) for any group of covered products which have the same function or intended use, if the Secretary determines that covered products within such group—(A) consume a different kind of energy from that consumed by other covered products within such group (or class); or (B) have a capacity or other performance-related feature which other products within such type (or class) do not have and such feature justifies a higher or lower standard from that which applies (or will apply) to other products within such type (or class). In making a determination under 42 U.S.C. 6295(q)(1) concerning whether a performance-related feature justifies the establishment of a higher or lower standard, the Secretary shall consider such factors as the utility to the consumer of such a feature, and such other factors as the Secretary deems appropriate.
These provisions also apply to covered non-ASHRAE
7
commercial and industrial equipment through the crosswalk provision at 42 U.S.C.
6316(a). (Under the statute, “ASHRAE equipment” refers to small commercial package air conditioning and heating equipment, large commercial package air conditioning and heating equipment, very large commercial package air conditioning and heating equipment, packaged terminal air conditioners (PTACs), packaged terminal heat pumps (PTHPs), warm-air furnaces, packaged boilers, storage water heaters, instantaneous water heaters, or unfired hot water storage tanks, which are addressed by ASHRAE in ASHRAE Standard 90.1,
Energy Standard for Buildings Except Low-Rise Residential Buildings.
)
7
“ASHRAE” refers to the American Society of Heating, Refrigerating and Air-Conditioning Engineers.
ASHRAE equipment has its own separate statutory scheme under EPCA, with the default situation being that DOE must adopt the level set forth in ASHRAE Standard 90.1 unless the Department has clear and convincing evidence to adopt a more-stringent standard (
see
42 U.S.C. 6313(a)(6)). Under 42 U.S.C. 6313(a)(6)(B)(iii)(II)(aa), there is a similar “features” provision which states, “The Secretary may not prescribe an amended standard under this subparagraph if the Secretary finds (and publishes the finding) that interested persons have established by a preponderance of the evidence that a standard is likely to result in the unavailability in the United States in any product type (or class) of performance characteristics (including reliability, features, sizes, capacities, and volumes) that are substantially the same as those generally available in the United States at the time of the finding of the Secretary.” However, it is noted that this provision contains the specific limitation that it applies to an amended standard prescribed
under this subparagraph
(
i.e.,
when DOE is acting under its authority to set a more-stringent standard). There is no companion “features” provision under 42 U.S.C. 6313(a)(6)(A), which is the provision that would apply when DOE is adopting the levels set by ASHRAE. Congress was clearly aware of the features issue, and it chose to act in the context of DOE standard setting, but not ASHRAE standard setting. There is likewise no companion provision to 42 U.S.C. 6295(q)(1) for ASHRAE equipment.
B. DOE's Historical Interpretation
With this statutory background in mind, in the March 12, 2015 notice of proposed rulemaking (NOPR) for energy conservation standards for residential furnaces, DOE set forth in detail its rationale for why it did not considering the venting of non-condensing furnaces to constitute a product “feature” under 42 U.S.C. 6295(o)(4). 80 FR 13120, 13137-13138.
As discussed previously, when evaluating and establishing energy conservation standards, the statute requires DOE to divide covered products into product classes by the type of energy used, by capacity, or by other performance-related features that justify a different standard. In making a determination regarding whether a performance-related feature justifies a different standard, DOE must consider factors such as the utility to the consumer of the feature and other factors DOE determines are appropriate. (42 U.S.C. 6295(q)) Historically, DOE has viewed utility as an aspect of the product that is accessible to the layperson and is based on user operation, rather than performing a theoretical function. This interpretation has been implemented consistently in DOE's previous rulemakings by determining utility through the value the item brings to the consumer, rather than through analyzing more complicated design features, or costs that anyone, including the consumer, manufacturer, installer, or utility companies may bear. DOE reasoned that this approach is consistent with EPCA's requirement for a separate and extensive analysis of economic justification for the adoption of any new or amended energy conservation standard (
see
42 U.S.C. 6295(o)(2)(A)-(B) and (3)).
Under EPCA, DOE has typically addressed consumer utility by establishing separate product classes or otherwise taken action when a consumer may value a product feature based on the consumer's everyday needs. For instance, DOE determined that it would be impermissible in light of 42 U.S.C. 6295(o)(4) to include elimination of oven door windows as a technology option to improve the energy efficiency of cooking products.
8
DOE reached this conclusion based upon how consumers typically use the product: Peering through the oven window to judge if an item is finished cooking, as opposed to checking the timer and/or indicator light or simply opening the oven door (which could waste more energy) to see if the item is finished cooking. DOE has also determined that consumers may value other qualities such as ability to self-clean,
9
size,
10
and configuration.
11
This determination, however, can change depending on technological developments and shifts in consumer behavior/preferences, and it is conceivable that certain products may disappear from the market entirely due to shifting consumer demand. DOE stated that it has determined such value on a case-by-case basis through its own research, as well as public comments received.
8
63 FR 48038, 48041 (Sept. 8, 1998).
9
73 FR 62034, 62048 (Oct. 17, 2008) (separating standard ovens and self-cleaning ovens into different product classes).
10
77 FR 32307, 32319 (May 31, 2012) (creating a separate product class for compact front-loading residential clothes washers).
11
75 FR 59469, 59487 (Sept. 27, 2010) (creating a separate product class for refrigerators with bottom-mounted freezers).
DOE offered a cautionary note that disparate products may have very different consumer utilities, thereby making direct comparisons difficult and potentially misleading. For instance, in a 2011 rulemaking, DOE created separate product classes for vented and ventless residential clothes dryers based on DOE's recognition of the “unique utility” that ventless clothes dryers offer to consumers. 76 FR 22454, 22485 (April 21, 2011). This utility could be characterized as the ability to have a clothes dryer in a living area where vents are impossible to install (
e.g.,
an apartment in a high-rise building). As explained in that April 2011 direct final rule technical support document, ventless dryers can be installed in locations where venting dryers would be precluded due to venting restrictions.
But in another rulemaking regarding water heaters, DOE found that water heaters that utilize heat pump technology did not need to be put in a separate product class from conventional types of hot water heaters that utilize electric resistance technology, even though water heaters utilizing heat pumps require the additional installation of a condensate drain that a hot water heater utilizing electric resistance technology does not require. 74 FR 65852, 65871 (Dec. 11, 2009). DOE found that regardless of these installation factors, the heat pump water heater and the conventional water heater still had the same utility to the consumer: Providing hot water.
Id.
In both cases, DOE made its finding based on consumer type and utility type, rather than technology utilized that impacts product efficiency.
In its March 2015 energy conservation standards rulemaking proposal for residential furnaces, DOE expressed concern that tying the concept of “feature” to a specific technology would
effectively lock-in the currently existing technology as the ceiling for product efficiency and eliminate DOE's ability to address technological advances that could yield significant consumer benefits in the form of lower energy costs while providing the same functionality for the consumer. DOE stated that it was very concerned that determining features solely on product technology could undermine the Department's Appliance Standards Program. DOE reasoned that if it is required to maintain separate product classes to preserve less-efficient technologies, future advancements in the energy efficiency of covered products would become largely voluntary, an outcome which seems inimical to Congress's purposes and goals in enacting EPCA. 80 FR 13120, 13138 (Mar. 12, 2015).
Turning to the product at issue in that 2015 furnaces rulemaking, DOE noted that residential furnaces are currently divided into several product classes. For example, furnaces are separated into product classes based on their fuel source (gas, oil, or electricity), which is required by statute. In the most recent rulemaking for that covered product, DOE analyzed only two product classes for residential furnaces: (1) Non-weatherized gas-fired furnaces (NWGFs) and (2) mobile home gas-fired furnaces (MHGFs). DOE did not additionally separate NWGFs and MHGFs into condensing and noncondensing product classes.
Id.
In that 2015 furnaces rulemaking, DOE tentatively concluded that the methods by which a furnace is vented did not provide any separate performance-related impacts, and, therefore, that DOE had no statutory basis for defining a separate class based on venting and drainage characteristics. DOE reasoned that NWGF and MHGF venting methods did not provide unique utility to consumers beyond the basic function of providing heat, which all furnaces perform. Using this logic, the possibility that installing a non-condensing furnace may be less costly than a condensing furnace due to the difference in venting methods did not justify separating the two types of NWGFs into different product classes. Unlike the consumers of ventless dryers, which DOE had determined to be a performance-related feature based on the impossibility of venting in certain circumstances (
e.g.,
high-rise apartments), DOE reasoned that consumers of condensing NWGFs are homeowners that may either use their existing venting or have a feasible alternative to obtain heat. In other words, homeowners would still be able to obtain heat regardless of the venting. In contrast, DOE reasoned that a resident of a high-rise apartment or condominium building that is not architecturally designed to accommodate vented clothes dryers would have no option in terms of installing and enjoying the utility of a dryer in their home unless he or she used a ventless dryer.
Id.
As explained previously, DOE's conclusion in the March 12, 2015 NOPR was that the utility of a furnace involves providing heat to a consumer. DOE reasoned that such utility is provided by any type of furnace, but to the extent that a consumer has a preference for a particular fuel type (
e.g.,
gas), improvements in venting technology may eventually allow a consumer to obtain the efficiency of a condensing furnace using the existing venting in a residence by sharing venting space with water heaters. DOE postulated that this update in technology would significantly reduce the cost burden associated with installing condensing furnaces and reduce potential instances of “orphaned” water heaters, where the furnace and water heater can no longer share the same venting (due to the furnace being a Category IV, condensing product and the water heater being a Category I, noncondensing product). In other words, when mature, this technology could allow consumers to switch from a non-condensing furnace to a condensing furnace in a greater variety of applications, such as urban row houses. For more information, interested parties were asked to consult appendix 8L of the NOPR TSD.
Id.
C. The Gas Industry Petition
As noted previously, on October 18, 2018, DOE received a petition from the Gas Industry Petitioners asking DOE to: (1) Issue an interpretive rule stating that DOE's proposed energy conservation standards for residential furnaces and commercial water heaters would result in the unavailability of “performance characteristics” within the meaning of the Energy Policy and Conservation Act, as amended (
i.e.,
by setting standards which can only be met by products/equipment using condensing combustion technology) and (2) withdraw the proposed energy conservation standards for residential furnaces and commercial water heaters based upon such findings. In their petition, the Gas Industry Petitioners argue that DOE misinterpreted its mandate under section 325(o)(4) of EPCA by failing to consider as a “feature” of the subject residential furnaces and commercial water heating equipment the compatibility of a product/equipment with conventional atmospheric venting systems, the ability to operate without generating liquid condensate requiring disposal via a plumbing connection, and the ability to operate with other commonly vented appliances. Consequently, the Gas Industry Petitioners assert that DOE's proposals would make unavailable non-condensing products/equipment with such features, which currently exist in the marketplace, in contravention of the statute. The petition makes a number of technical, legal, and economic arguments in favor of its suggested interpretation, and it points to DOE's past precedent related to space constraints and differences in available electrical power supply (and associated installation costs) as supporting its call to find that non-condensing technology amounts to a performance-related “feature.” Based upon these arguments, the Gas Industry Petitioners concluded that DOE should issue an interpretive rule treating non-condensing technology as a “feature” under EPCA, withdraw its rulemaking proposals for both residential furnaces and commercial water heaters, and proceed on the basis of this revised interpretation.
D. DOE's Proposed Interpretive Rule
As discussed in section I of this document, DOE published a notice of proposed interpretive rule in the
Federal Register
on July 11, 2019. 84 FR 33011. The substance of that proposed interpretation (summarized in the following paragraphs) was presented in that document. 84 FR 33011, 33020-33021 (July 11, 2019).
In its proposed interpretive rule, the Department noted that in consideration of public comments and other information received on the Gas Industry Petition, DOE proposed to revise its interpretation of EPCA's “features” provision in the context of condensing and non-condensing technology used in furnaces, water heating equipment, and similarly-situated appliances (where permitted by EPCA). Based on those comments and for the reasons set forth fully in that document, DOE proposed to interpret prospectively the statute to provide that adoption of energy conservation standards that would limit the market to natural gas, propane gas and/or oil-fired furnaces, water heaters, or similarly-situated products/equipment (where permitted by EPCA) that use condensing combustion technology would result in the unavailability of a performance related feature within the meaning of 42 U.S.C. 6295(o)(4) and 42 U.S.C. 6313(a)(6)(B)(iii)(II)(aa) (and as
applicable in certain cases through 42 U.S.C. 6316(a)).
As explained in the proposed interpretive rule, the statute accords the Secretary of Energy considerable discretion in terms of determining whether a performance characteristic of a covered product/equipment amounts to a performance-related feature which cannot be eliminated through adoption of an energy conservation standard. DOE stated that it has taken the opportunity presented by the Gas Industry Petition to reconsider its historical interpretation of EPCA's “features” provision in the context of condensing and non-condensing technologies used by certain gas appliances. A number of factors convinced DOE to propose a revision to its interpretation.
First, DOE acknowledged that it has, in the past, taken space constraints and similar limitations into account when setting product classes (
e.g.,
PTACs, ventless clothes dryers). For example, DOE was sensitive to the costs associated with requiring expensive building modifications when it decided to set separate equipment classes for standard size PTACs and non-standard size PTACs. 73 FR 58772, 58782 (Oct. 7, 2008). DOE stated that it expects that similar expenses would occur here, if DOE were to hold to its historical interpretation, at least for some subset of installations. Although limited data were provided to address the actual costs that consumers and commercial customers would face to modify their existing category I venting, there is little doubt that some number of such installations would be quite costly. These more complicated/costly installations are documented as part of DOE's analysis of the venting costs for residential furnaces, which considered potential venting modifications that could be required when replacing an existing category I furnace with a condensing (category IV) furnace (
see
appendix 8D of the 2016 SNOPR TSD for further details).
Second, DOE stated that it has in the past focused on the consumer's interaction with the product/equipment in deciding whether a performance feature is at issue. In the context of residential furnaces and commercial water heaters, DOE has focused on the primary function of the appliance (
e.g.,
providing heat to a home or potable hot water) in establishing the nexus to the consumer. In the past, DOE opined that consumers were only interested in obtaining heat or hot water from the appliance, so they would not care about the mechanism for generating that end product. However, commenters have made clear that in at least some cases, the physical changes associated with a condensing appliance may change a home's aesthetics (
e.g.,
by adding new venting into the living space or decreasing closet or other storage space), thereby impacting consumer utility even under DOE's prior approach.
Third, DOE noted that it has been the Department's policy to remain neutral regarding competing energy sources in the marketplace. As certain commenters have pointed out, and as DOE's own analyses have shown, some enhanced level of fuel switching is likely to accompany standard setting using DOE's prior interpretation. Many consumers who are currently gas customers may show a preference for that fuel type and would be negatively impacted by a standard that requires the purchase of a condensing unit to the extent they feel compelled to change to a different fuel type. DOE explained that it seeks neither to determine winners and losers in the marketplace nor to limit consumer choice.
Finally, DOE stated that it is very concerned about ensuring energy affordability, particularly for persons with low incomes. Although energy efficiency improvements may pay for themselves over time, there is typically a significant increase in upfront costs associated with furnaces and water heaters using condensing technology. For consumers with difficult installation situations (
e.g.,
inner-city row houses), there would be the added cost of potentially extensive venting modifications. In certain cases, commenters have argued that accommodating condensing products may not even be possible. Although DOE continues to believe that costs are properly addressed in the economic analysis portion of its rulemakings, it stated that it remains cognizant of such issues. DOE stated that it has tentatively concluded that the other reasons discussed immediately above are sufficient in and of themselves to justify the Department's proposed change in interpretation, but it acknowledged these cost impacts in order to be fully transparent in terms of the agency's thinking.
The agency reasoned that creating separate product classes for condensing and non-condensing furnaces, water heaters, and similarly-situated products/equipment (where permitted by EPCA) would prevent many of these potential problems. Although DOE's proposed revised approach may have some impact on overall energy saving potential as a result of establishing separate product/equipment classes, the Department noted that that is not the touchstone of EPCA's “features” provision; through that provision, Congress expressed its will that certain product utilities will take priority over additional energy-saving measures. (For example, DOE did not eliminate the oven window which consumers found useful.) With that said, DOE expressed its belief that any potentially negative programmatic impacts of its revised interpretation are likely to be limited. DOE reasoned that the proposed interpretation would be likely to impact only a limited set of appliances, and DOE noted that market trends have favored the growing reach of condensing furnaces, even as non-condensing alternatives have remained available. DOE stated that it has every reason to believe that such trends will continue.
DOE sought to clarify the limitations of its proposed revised interpretation, based upon the existing statutory provisions. As noted, additional, subsequent DOE action would be required before the interpretation in the proposed interpretive rule could be implemented. The proposed interpretive rule, even once finalized, would not alter the Department's current regulations. DOE anticipates continued engagement and productive involvement of members of the public and the regulated community in subsequent activities that may follow this interpretation.
As discussed in the proposed interpretive rule, DOE decided to grant the Gas Industry Petition to the extent that it proposed to prospectively interpret the statute to provide that adoption of energy conservation standards that would limit the market of natural gas and/or propane gas furnaces, water heaters, or similarly-situated products/equipment (where permitted by EPCA) to appliances that use condensing combustion technology would result in the unavailability of a performance related feature within the meaning of 42 U.S.C. 6295(o)(4) and 42 U.S.C. 6313(a)(6)(B)(iii)(II)(aa) (and as applicable in certain cases through 42 U.S.C. 6316(a)). The proposal clarified that such interpretation would apply to all applicable residential products, non-ASHRAE commercial equipment, and ASHRAE equipment where DOE adopts a level more stringent than the ASHRAE level.
DOE stated in the 2019 proposed interpretive rule that it is denying the Gas Industry Petition as it pertains to those rulemakings where ASHRAE sets standard levels that trigger DOE to consider and adopt those level (unless DOE finds clear and convincing evidence to adopt more-stringent levels), due to lack of authority. DOE
also denied the Gas Industry Petition's request for DOE to withdraw the proposed rules for residential furnaces and commercial water heaters as unnecessary. DOE stated that if the interpretive rule were to be finalized, it would anticipate developing supplemental notices of proposed rulemaking (SNOPRs) that would implement the new legal interpretation for those two rulemakings that were the subject of the petition for rulemaking.
E. DOE's Supplemental Proposed Interpretive Rule
As noted in section I of this document, DOE published a notice of supplemental proposed interpretive rule in the
Federal Register
on September 24, 2020. 85 FR 60090. DOE's supplemental proposal was designed to gather further information in response to comments from U.S. Boiler, BHI, and Crown Boiler, suggesting an alternative approach that did not focus on “non-condensing” technology as the performance-related feature. While the commenters suggesting this alternative were generally supportive of the proposed revised interpretation, they expressed concern that unless subsequent DOE rulemakings implement the interpretation through product/equipment classes focused on venting compatibility (particularly preservation of Category I venting), many of the same problems identified in the Gas Industry Petition may still arise. (USB, No. 78 at pp. 1-2; BHI, No. 83 at pp. 1-2; Crown Boiler, No. 79 at pp. 1-2) In order to gather further information and comment on this issue, DOE proposed alternative approaches to product/equipment class setting in this context, as explained in the September 24, 2020 notice of supplemental proposed interpretation at 85 FR 60090, 60094-60095, and as summarized in the following paragraphs.
In the supplemental proposed interpretive rule, DOE initially responded to these comments from USB, BHI, and Crown Boiler by noting that, while separate from the product/equipment, the venting system is inextricably linked to the design of the appliance. Because the venting system is a separate component from the product, DOE initially sought to focus on non-condensing operation as the performance-related characteristic of the appliance itself. However, after further considering these commenters' concerns, DOE stated its intention to explore whether interpreting non-condensing operation to be a feature might still result in a reduction of utility for certain consumers, because some non-condensing appliances require connection to venting systems other than Category I and may result in many of the installation issues that DOE seeks to address through this interpretive rulemaking.
As a result, in the supplemental proposed interpretation, DOE further considered what constitutes a “feature” or “performance-related characteristic” under EPCA, and in particular, whether such feature might be based on venting system compatibility of the appliance. Because the most significant concerns regarding venting system compatibility involve use of gas appliances that are not compatible with Category I venting in place of gas appliances that are compatible with Category I venting, DOE considered whether compatibility with Category I venting should be a protected feature under EPCA. Moreover, DOE also considered whether
any
impact to venting system compatibility resulting from increasing product or equipment efficiency standards would cause the aforementioned issues. For example, it is conceivable that if a more-stringent standard results in an appliance compatible with Category III venting systems being replaced with an appliance that is only compatible with Category IV venting systems, many of the same issues might arise as have been identified for the replacement of appliances compatible with Category I venting systems. Thus, compatibility with venting systems of any type could conceivably be a feature that consumers desire and which DOE must consider when evaluating more-stringent standards. Under such an interpretation, compatibility with each existing venting technology would be a feature under EPCA that could require separate classes based on compatibility with venting systems for each venting category, and uncategorized venting systems could also require separate classes.
DOE noted that the first approach (
i.e.,
considering only Category I venting compatibility as a performance-related feature) has the benefit of potentially simplifying the regulatory scheme in comparison to the latter approach, which could require classification of appliances in each venting category separately. The first approach would result in more streamlined regulations and product/equipment classes for gas appliances, as compared to the latter approach, while resolving the most significant issues involved with venting system compatibility. The latter approach potentially would address more comprehensively possible issues related to the compatibility of an appliance with venting systems, but it would make the regulatory scheme more complex and could result in elevated compliance burdens, as the number of product/equipment classes for vented appliances could increase greatly (
e.g.,
each current class of gas appliance could require further segmentation by each of the four categories of venting and also could need to account for gas appliances that are compatible with uncategorized venting systems). DOE stated that both approaches would have the benefit of not limiting the Department to consideration of the combustion technology that provides the function of the appliance (
e.g.,
condensing, non-condensing), about which some commenters have expressed concerns. Instead, DOE's focus would be to ensure compatibility with existing venting, thereby allowing DOE to be responsive to potential future technological advances in venting system compatibility.
Based on these considerations, DOE stated that it was considering an alternative interpretation (with two potential variations), in addition to the interpretation proposed in the July 2019 notice of proposed interpretive rule. As discussed previously, the July 2019 notice of proposed interpretive rule proposed that adoption of energy conservation standards that would limit the market to natural gas and/or propane gas furnaces, water heaters, or similarly-situated products/equipment (where permitted by EPCA) that use condensing combustion technology would result in the unavailability of a performance-related feature within the meaning of 42 U.S.C. 6295(o)(4) and 42 U.S.C. 6313(a)(6)(B)(iii)(II)(aa) (and as applicable in certain cases through 42 U.S.C. 6316(a)). In the notice of supplemental proposed interpretation, DOE also proposed an interpretation that an appliance's compatibility with a venting system is a performance-related characteristic of that appliance under EPCA. Specifically, DOE stated that it is also considering an interpretation that, based on current appliance/venting system compatibility limitations, the adoption of energy conservation standards that would limit the market to natural gas and/or propane gas furnaces, water heaters, or similarly-situated products/equipment (where permitted by EPCA) that are incompatible with any existing venting systems available on the market would result in the unavailability of a performance related feature within the meaning of 42 U.S.C. 6295(o)(4) and 42 U.S.C. 6313(a)(6)(B)(iii)(II)(aa) (and as applicable in certain cases through 42 U.S.C. 6316(a)). DOE stated that it considered limiting its proposal to
include only that compatibility with Category I venting systems is a feature, as suggested by the commenters, and seeks comment on doing so. In addition, DOE indicated that it is considering a broader approach taking into consideration all venting categories since concerns similar to those that gave rise to the petition could conceivably occur for appliances that are compatible with venting systems other than Category I. The Department noted that after examining the totality of public comments on this issue and the potential approaches, it will consider adopting either of these alternative or the original proposed approach, as appropriate, in its final interpretation.
The comment period on the September 24, 2020 supplemental proposed interpretive rule was originally scheduled to end on October 26, 2020. However, on September 25, 2020 and October 6, 2020, DOE received two requests for extension of the comment period (from A.O. Smith and Lennox, respectively), asserting that additional time is needed because the supplemental proposed interpretive rule addresses multiple product types and raises complex issues. On September 29, 2020, DOE received a comment from the submitters of the Gas Industry Petition seeking prompt action on their petition. Balancing these competing requests, DOE determined it appropriate to extend the public comment period on the supplemental proposed interpretive rule until November 9, 2020. Notification of the extension of the public comment period was published in the
Federal Register
on October 22, 2020. 85 FR 67312.
III. Response to Comments
DOE received a number of comments with divergent views on the Department's proposed interpretive rule and supplemental proposed interpretive rule related to the Gas Industry Petition, with some supporting the proposal and others in opposition.
12
Comments from gas industry associations, certain trade associations, and some individual manufacturers generally expressed support for the proposed interpretive rule. Comments from environmental and efficiency advocacy organizations, consumer advocacy organizations, other manufacturers, certain States and Attorneys General, and a few members of the public generally opposed it. The following sections of this final interpretive rule summarize the comments received on the proposed interpretive rule and supplemental proposed interpretive rule and provide DOE's responses to those comments. Then, consistent with its statutory authority and after considering the comments received along with all other available information, DOE sets forth its final interpretation. To aid in organizing the comments, this section categorizes public comments on the proposed interpretive rule and supplemental proposed interpretive rule in terms of legal authority, economic issues, analytical matters, and other related issues.
12
DOE notes that it received two comments which appear to relate to a separate DOE rulemaking for revisions to the Department's waiver/interim waiver process for test procedures (Docket No. EERE-2019-BT-NOA-0011). Apparently, these comments were either submitted or posted to the wrong docket. DOE has referred these comments to staff of the Appliance Standards Program for placement in the correct docket.
A. Legal Authority
As DOE explained in section II.B of this document, for the purposes of EPCA, DOE has in prior instances considered product/equipment “features” in the context of a consumer's interaction with the appliance in question. With the submission of the Gas Industry Petition, DOE had the opportunity to re-evaluate its prior interpretation and to seek public input to further inform the agency's consideration, particularly in regards to its technical implications, as well as the needs of consumers (including those with low incomes). While DOE continues to embrace the concept of a “feature” being tied to a consumer's interaction with an appliance, the Department has come to see that it has been too narrow in its focus on what constitutes such consumer interaction with residential furnaces, commercial water heaters, and similarly-situated products/equipment that utilize non-condensing technology (and associated Category I venting). For the reasons explained subsequently, in future rulemakings, DOE will carefully examine the range of consumer impacts (based upon the record evidence in a given rulemaking) and may establish separate product/equipment classes for appliances using non-condensing technology (and associated venting), consistent with this final interpretive rule.
DOE is issuing this interpretation as an interpretive rule within the meaning of the Administrative Procedure Act. 5 U.S.C. 551(4); 5 U.S.C. 553(b)(A). In issuing its proposed interpretation, DOE solicited public comment regarding the Department's views on a specific legal question: Whether non-condensing technology (and associated venting) constitutes a performance-related “feature” under 42 U.S.C. 6295(o)(4),
13
as could support a separate product/equipment class under 42 U.S.C. 6295(q)(1),
14
including the authority that Congress conferred on DOE through those provisions.
13
For non-ASHRAE equipment, the “features” provision at 42 U.S.C. 6295(o)(4) is applicable through 42 U.S.C. 6316(a); for ASHRAE equipment where DOE is setting more-stringent standards, the “features” provision at 42 U.S.C. 6313(a)(6)(B)(iii)(II)(aa) applies.
14
For non-ASHRAE equipment, the class provision at 42 U.S.C. 6295(q)(1) is applicable through 42 U.S.C. 6316(a).
1. Legal Authority To Set Separate Product/Equipment Classes Based Upon Condensing and Non-Condensing Technologies
As discussed, the Gas Industry Petition raised the issue of whether non-condensing technology, including associated venting, constitutes a “performance characteristic” or “feature” under 42 U.S.C. 6295(o)(4), and if it is, whether it justifies a separate product/equipment class under 42 U.S.C. 6295(q)(1). Not unlike the submissions on the notice of petition, commenters on the proposed interpretive rule expressed strongly held but conflicting views regarding DOE's legal authority to determine non-condensing technology used in furnaces and water heaters, including the associated venting, to be a “performance characteristic” or “feature” within the meaning of the statute, and whether as a “performance characteristic” or “feature” it would justify a separate product/equipment class and energy conservation standard.
a. Comments Supporting the Proposed Interpretation
A number of commenters expressed support for DOE's proposed interpretive rule and recommended that the Department take action to finalize its interpretation along the lines proposed. (Petitioners
et al.
Joint Comment, No. 80 at p. 2; Weil-McLain, No. 86 at p. 1; AHRI, No. 91 at p. 1; Carrier, No. 92 at p. 1; BHI, No. 83 at pp. 1-2; USB, No. 78 at p. 1; BWC, No. 77 at pp. 1-2; Nortek, No. 71 at p. 1; Mortex, No. 72 at p. 1) Crown Boiler and USB stated that adoption of an energy conservation standard at levels requiring the use of condensing technology would result in the unavailability of a performance-related feature under EPCA. (Crown Boiler, No. 79 at p. 1; USB, No. 78 at p. 1)
Several commenters argued that DOE's proposed interpretive rule would enhance consumer choice. (Mortex, No. 72 at p. 1; Carrier, No. 92 at p. 1; Nortek,
No. 71 at p. 1) Other commenters found that DOE's proposed interpretation offers greater consumer utility, particularly in those applications where venting represents a significant challenge. (AHRI, No. 91 at p. 1) Regarding residential furnaces, AHRI argued that in some applications, conversion to use of venting compatible with condensing systems would create problems that cannot be “simplistically rolled into an economic analysis.” More specifically, the trade association argued that a separate product class would assist consumers who require like-for-like replacement of their existing furnace due to size or drainage constraints or water heater co-venting (a point echoed by Nortek, No. 71 at pp. 1-2, and Carrier, No. 92 at p. 1). According to AHRI, “EPCA prohibits eliminating product utility precisely to prevent the disproportionate harm to a subset of unlucky consumers.” (AHRI, No. 91 at p. 2) Making the same point, Nortek reasoned that because consumers are already moving in the direction of condensing furnaces, banning non-condensing furnaces is not necessary and would only serve to disproportionately harm those consumers for whom venting changes would be difficult or impossible. (Nortek, No. 71 at pp. 1-2)
Regarding commercial water heaters, AHRI argued that Commercial Buildings Energy Consumption Survey (CBECS) data suggest that over half of commercial buildings were constructed prior to the introduction of condensing venting requirements, which means that many of these commercial buildings face the same venting challenges as some residences. AHRI pointed to examples where mechanical rooms are built into the core of the building (thereby preventing the side-wall venting sometimes required by condensing equipment), so such building owners would be forced to either switch fuels or to use up valuable retail, restaurant, or office space for an enlarged or relocated mechanical room to accommodate new drainage or different venting configurations. Especially since there is already a market trend toward condensing commercial water heaters, AHRI argued that it is neither necessary nor advisable to require condensing equipment in all applications. Instead, the commenter stated that establishment of a separate class for non-condensing equipment would preserve the ability of commercial consumers facing difficult installation situations to make like-for-like replacements and to avert the need to reconstruct a mechanical room, add unsightly piping, or switch to an electric water heater, all without impacting the overall trend toward installation of more-efficient condensing water heaters. (AHRI, No. 91 at p. 3)
Regarding residential and commercial boilers, AHRI noted that DOE's proposed interpretation provides an important safety measure for gas-fired products/equipment that assures safer use and installation. More specifically, AHRI commented that gas-fired boilers are not simply divided into condensing and non-condensing models but are split into four different categories based on venting type (Category I-IV). AHRI stated that Category I venting is at the crux of DOE's proposed interpretation, because that is the type of venting which is difficult to substitute for another type once installed. The commenter added that a minimum energy conservation standard that “pushes the efficiency envelope” may cause nominally non-condensing equipment to become incompatible with Category I venting and could result in the unsafe installation or use of misapplied equipment. AHRI stressed that safety of venting is unquestionably a performance-related feature. Once again, AHRI stated that the boilers market in new construction is trending toward condensing equipment and venting, so the performance feature of Category I venting is most necessary for the replacement market. The commenter also suggested that further increases in the minimum energy conservation standards for boilers should be examined carefully, because those standards are already near the level where venting challenges similar to those for condensing equipment could arise. (AHRI, No. 91 at pp. 4-5) Mortex made similar arguments in the context of furnaces, suggesting that DOE's proposed interpretation would promote flexibility and safety by not forcing an upgrade to a condensing furnaces in some applications where non-condensing venting remains the best choice. (Mortex, No. 72 at p. 1)
The Petitioners
et al.
Joint Comment asserted that energy conservation standards that would make atmospherically-vented products unavailable to consumers would do more to promote electrification (
i.e.,
a shift to electric appliances) than to promote the efficiency of gas products, because many consumers would feel that they have no choice but to give up their gas appliances in favor of electric alternatives. These commenters characterized the situation as one where the imposition of a standard that effectively bans atmospherically-vented gas appliances would result not in the sale of an increased number of more efficient gas products, but in the sale of fewer gas products overall. The Gas Industry Petitioners argued that they are not opposed to condensing technology generally or market trends favoring such technology, nor are they seeking to create missed opportunities for consumers, businesses, and governments, as some of their opponents have claimed. Instead, these commenters stated that they are simply making the case that condensing products are not suitable for all installations and that it is the opponents of the petition who are the ones seeking to deny consumers the products which best serve their needs. (Petitioners
et al.
Joint Comment, No. 80 at pp. 3-4)
Regarding the consumer utility of atmospherically-vented appliances, the Petitioners
et al.
Joint Comment stated that for some consumers, the consumer utility provided by the proposed interpretive rule would be the same utility as DOE found with ventless clothes dryers (
i.e.,
the ability to have the product installed at all). The comment argued that for other consumers, the utility may be similar to that found for “space-constrained” appliances (
i.e.,
the ability to have the product fit without the need for building modifications). For yet other consumers, the comment stated that the utility may be preventing the need to scrap another perfectly good appliance (
e.g.,
an orphaned water heater). The Petitioners
et al.
Joint Comment added that other consumers may find utility in an appliance which obviates the need for undesirable building modifications (
e.g.,
sacrifice of an existing interior living space, balcony, or window—concerns which can also arise in the context of new construction.
15
) These commenters concluded that there is no basis for characterizing these losses of utility as a mere matter of cost, rather than performance-related characteristics under EPCA's “features” provision. (Petitioners
et al.
Joint Comment, No. 80 at pp. 10-11)
15
The Petitioners
et al.
Joint Comment provided a figure depicting multi-family housing and stated that a building design using atmospherically-vented products eliminates the need for vent-studded columns of vertically-stacked utility spaces along the outside wall of the building, as well as the resulting loss of available window or balcony space.
Pointing to EPCA's statutory standards for direct heating equipment which are differentiated “principally in their manner of installation,” the Petitioners
et al.
Joint Comment argued that “it is absurd to suggest that Congress intended to ensure the continued availability of products with sizes—but not products with venting or
other performance characteristics—needed to `fit in standard building spaces' without the need for building modifications.” (Petitioners
et al.
Joint Comment, No. 80 at p. 12) Applying this principle in the present context, the Petitioners
et al.
Joint Comment stated that condensing products are at least typically larger than comparable atmospherically-vented products, and that even small differences can have significant practical impacts, such as cases where a furnace and air handler must fit inside a confined space with required clearance on all sides. (Petitioners
et al.
Joint Comment, No. 80 at p. 13) Along these same lines, BWC opined that because condensing technology generally requires greater surface area, the size of the product/equipment is likely to increase, and this can cause issues related to size and aesthetics within the home or business. The commenter suggested that this could pose real world problems, such as with mechanical rooms that are no longer large enough to house an appliance using condensing technology. BWC added that the issue of aesthetic impacts also extends to commercial applications, not just residential ones, with the commenter arguing that venting running through the finished space of a school, office building, or hospital could likewise be a significant detriment to their usable space. (BWC, No. 77 at pp. 1-2)
Although USB generally agreed with DOE's revised interpretation, the commenter argued that DOE has erred in focusing on “non-condensing” technology as the performance-related feature, suggesting that the agency should instead focus on Category I venting. According to USB, Category II, III, and IV (as well as non-categorized direct vent furnaces and boilers) are currently available using non-condensing technology, but many of the same problems may arise. USB stated that non-condensing Category II, III, and IV appliances generally share the same venting consumer utility issues as condensing appliances and equipment, and that they can theoretically operate at higher efficiencies than Category I. However, the commenter argued that elimination of models using Category I venting (under a standard level that could only be met by products/equipment using Category II, III, or IV venting) would create the same problems which DOE has sought to address through its revised interpretation. USB commented that vent categorization has been recognized for over 20 years by manufacturers, utilities, and code enforcement officials as the best way to determine how to safely vent appliances. (USB, No. 78 at pp. 1-2) BHI made essentially identical arguments to those raised by USB, and Crown Boiler offered a similar comment that DOE should focus product classes based upon type of venting used, rather than the use of condensing or non-condensing technology. (BHI, No. 83 at pp. 1-2; Crown Boiler, No. 79 at pp. 1-2)
AHRI also made the point that DOE has already established product classes which are differentiated based upon the features of condensing and non-condensing products—specifically in the context of furnace fan standards (
i.e.,
fan efficiency rating (FER);
see
10 CFR 430.32(y)). The furnace fan product classes are distinguished by: (1) Fuel type; (2) whether the furnace is weatherized, and (3) whether its heat exchanger condenses the flue gases to water (
i.e.,
condensing/non-condensing). (AHRI, No. 91 at p. 2; similar point made by Carrier, No. 92 at p. 2 and Nortek, No. 71 at p. 2)
In response, DOE would start by reiterating that it is the Department's position to remain neutral in terms of the available fuel sources. Obviously, whenever the agency takes regulatory action, there is the potential for market shifts based upon consumer reaction, but DOE acts in keeping with the statute, which is at the core of this market neutrality principle. In other words, following the statute where it leads is not only the proper approach from a legal standpoint, but it helps ensure fair and unbiased treatment to all market participants, with impacts deemed as favorable or unfavorable arguably balancing out over time. Thus, in line with this principle, DOE rejects the arguments of certain commenters (
e.g.,
Lennox, No. 87 at p. 1; Ceres, No. 69 at p. 2 (discussed respectively at sections III.A.1.b.v and III.B.1.b of this document)) that the Department is favoring the gas industry through its revised interpretation. DOE is making an informed determination applying the law to the facts presented and in light of the competing, well-argued comments from interested parties.
As stated previously, DOE has decided to revise its prior interpretation of whether non-condensing technology (and associated venting) constitutes a “feature” under EPCA, concluding that products/equipment with such characteristics can be deemed as having a protected feature where supported by available evidence in the context of individual standards rulemakings. The reasons for the Department's change in position largely arise from a reevaluation of the arguments made in these comments and new information presented by the Petitioners, as well as evidence already contained in existing rulemaking dockets (
e.g.,
residential furnaces, commercial water heaters). As explained in the paragraphs that follow, DOE has come to understand that such models offer distinct consumer utility beyond their primary function of providing warm air or hot water, particularly in difficult installation situations. Their continued availability would also be expected to maintain a robust level of consumer choice. DOE will touch upon each of these topics in turn.
First, DOE has come to see that a consumer's interaction with a furnace or water heaters can go beyond the appliance's primary function of providing warm air or water. If the replacement of an appliance necessitates additional piping or venting in the usable space of a home or business, major modifications to a utility room, or encroachment upon an existing window or patio, the consumer will assuredly be aware of such interaction with the appliance. Even in new construction, if a builder has to modify designs to accommodate a condensing furnace, thereby losing usable space, that builder and potential customers will perceive this difference. Thus, a consumer may reasonably prefer to retain this residential or commercial space and pay the costs associated with a less-efficient, non-condensing appliance. DOE similarly acknowledges the difficulties faced by consumers who require like-for-like replacement of their existing furnace due to size or drainage constraints or water heater co-venting. The Department also takes AHRI's point (focused on commercial water heaters), that based upon CBECS data, over half of commercial buildings were constructed prior to the introduction of condensing venting requirements, which means that many of these commercial buildings face the same venting challenges as some residences. DOE further takes note of AHRI's examples where mechanical rooms are built into the core of the building (thereby preventing the side-wall venting sometimes required by condensing equipment), so such building owners could be forced to use up valuable retail, restaurant, or office space for an enlarged or relocated mechanical room to accommodate new drainage or different venting configurations.
Although DOE does not have precise numbers in terms of the frequency of these difficult installation situations, commenters have previously provided examples of older, inner-city row
houses presenting significant re-venting issues, such as those in Philadelphia, Newark and Baltimore, of which there are many. DOE also has data in its existing rulemaking dockets related to fuel switching that may result from adoption of a standard that can only be met through use of condensing technology; DOE reasons that such estimates could serve as a proxy for those difficult installations, although other explanations are also expected to be included in that total (
e.g.,
decisions made for purely economic reasons). For example, as the CEC pointed out, the September 2016 residential furnaces SNOPR reported that at the proposed level, 7.9 percent of consumers would switch from gas furnaces to heat pumps or electric furnaces under a condensing standard (a number which could reach 16 percent at the max-tech level). 81 FR 65720, 65813 (Sept. 23, 2016). The precise number of difficult installation situations is not required for DOE to reasonably conclude that the magnitude of such occurrences would not be
de minimis.
DOE agrees with AHRI's comment that in some applications, conversion to use of venting compatible with condensing systems would create problems that cannot be “simplistically rolled into an economic analysis” and that “EPCA prohibits eliminating product utility precisely to prevent the disproportionate harm to a subset of unlucky consumers.” (AHRI, No. 91 at pp. 1-2)
DOE acknowledges that some portion of difficult installations referenced in the Petitioners
et al.
Joint Comment may involve size constraints, because as the commenters point out, condensing technology generally requires greater surface area, so the size of the product/equipment in some cases could increase. Data referenced by the Petitioners
et al.
Joint comment demonstrate that such constraints could negatively impact a home or business, such as where a mechanical room is no longer large enough to house an appliance using condensing technology, or where the running of venting lines through the finished space of a school, office building, or hospital could detrimentally impact their usable space. In this regard, this situation is analogous to that which DOE faced when setting separate classes and standards for space-constrained air conditioners and heat pumps (
see
10 CFR 430.32(c)) and standard-size packaged terminal air conditioners and heat pumps (
see
10 CFR 431.97(c)). A consumer's expectation to be able to obtain a replacement appliance that is compatible with existing venting is to some extent an issue of size as well. “Size” is also one of the bases for making a “features” determination under 42 U.S.C. 6295(o)(4).
As to AHRI's point that the proposed interpretation would further safety in the context of installing gas-fired residential and commercial boilers, DOE presumes that boilers (and other types of products/equipment for which both condensing and non-condensing technologies are available) can be and are being installed safely in the field by contractors and other service professionals. DOE acknowledges the safety concerns that AHRI points out, namely that boilers are generally split into four different categories based on venting type (Category I-IV), and a minimum energy conservation standard that “pushes the efficiency envelope” may cause nominally non-condensing equipment to become incompatible with Category I venting and could result in the unsafe installation or use of misapplied equipment. Deterioration of venting due to corrosive condensate could allow carbon monoxide to enter the inhabited space, thereby presenting a safety risk. However, the Department is aware of no substantial evidence to suggest that installers are improperly installing condensing appliances and thereby triggering associated safety concerns. However, DOE agrees with AHRI and Mortex that DOE's proposed interpretation might prevent rare cases of contractor error.
In response to AHRI, DOE acknowledges that existing furnace fan standards already establish product classes which are differentiated based, in part, upon the use of condensing or non-condensing technology (
i.e.,
fan efficiency rating (FER);
see
10 CFR 430.32(y)). Specifically, the furnace fan product classes are distinguished by: (1) Fuel type; (2) whether the furnace is weatherized, and (3) whether its heat exchanger condenses the flue gases to water (
i.e.,
condensing/non-condensing). There was no objection among public commenters about the inclusion of a condensing/non-condensing criteria in the furnace fans class designations at the time of the furnace fans final rule.
16
16
As DOE explained in the final rule, “DOE did not receive comment or additional information on the proposed product classes, [and] thus, DOE is not making changes to the product classes in this Final Rule.” 79 FR 38130, 38150 (July 3, 2014).
As discussed previously, the comments submitted by USB, BHI, and Crown Boiler on the July 2019 proposed interpretive rule, while generally supportive, raised questions as to whether DOE's proposed approach could be successfully implemented as initially drafted. These commenters argued that because DOE's proposed interpretation focused on the distinction between an appliance's use of condensing versus non-condensing technology, the same installation challenges may still arise unless DOE took steps to maintain compatibility with a product's intended venting (particularly Category I venting). DOE was interested in the views of other interested parties on the thoughts expressed by USB, BHI, and Crown Boiler, because the Department does not wish to adopt an interpretation that would not be workable in practice and that would ultimately leave the problem raised in the Gas Industry Petition unresolved. Consequently, DOE proceeded to issue the September 2020 SNOPIR, which is more fully discussed in section II.E of this document, in order to receive public input on this topic. In short, in the September 2020 SNOPIR, DOE presented two alternative approaches to implementing its proposed interpretation (
i.e.,
regarding how to set product/equipment classes for the appliances impacted by this interpretation). One alternative was to maintain compatibility with all existing venting types intended for the covered appliance. The other alternative was to ensure compatibility with Category I venting, the type most commonly associated with non-condensing products/equipment. DOE also noted that, depending upon the input received, the Department might also move to adopt the approach originally presented in its July 2019 proposed interpretive rule.
DOE received 18 sets of comments in response to the September 2020 SNOPIR (
see
section I, Table I.2 of this document for a complete list of commenters on the September 2020 SNOPIR). Stakeholders that opposed DOE's July 2019 proposal tended to object to the September 2020 SNOPIR for many of the same reasons recited in their earlier comments, and any such broader, overarching objections are addressed elsewhere in this final interpretive rule. The balance of the arguments raised in comments directly addressed the issues presented in the September 2020 SNOPIR and are set forth in the paragraphs that follow. DOE appreciates the valuable insights provided by all commenters on the matter of venting compatibility initially raised by USB, BHI, and Crown Boiler.
In broad overview of the comments received on the SNOPIR, there was virtually no support for the proposed approach to maintain compatibility with all existing venting types (although one commenter did express some support as a secondary preference). There was
limited support for the proposed approach to maintain compatibility with Category I venting, with two commenters favoring that approach and another naming it a secondary preference. DOE's initial proposal to establish product/equipment classes based upon the use of condensing or non-condensing technology had the broadest support of the three alternatives presented, with five commenters preferring that approach. One group of commenters (which included many of the entities filing the original Gas Industry Petition) did not express a preference for any of the three approaches presented, arguing that a proper course should be determined in the context of individual product/equipment rulemakings. Finally, as noted, there were also ten commenters who opposed DOE's July 2019 proposed interpretive rule, and that opposition extended to the September 2020 SNOPIR as well.
DOE will first address the proposed approach of establishing product/equipment classes so as to maintain appliance compatibility with all existing venting types intended for that appliance.
Crown Boiler and USB explained their rationale for why they do not support a class structure based upon ensuring compatibility with all existing venting categories (
e.g.,
Categories II and III). The commenters stated that Category II venting systems are extremely rare, mostly because of the problems associated with relying on the buoyancy of low-temperature flue gases and/or a draft inducer located at the vent system terminal for proper venting. Crown Boiler and USB added that because there is no upper efficiency limit for Category II venting, any effort to protect a class of Category II vented appliances would create a problem for DOE in determining whether a proposed standard would preclude the use of this vent system. As to Category III venting systems, Crown Boiler and USB questioned the need to explicitly act to preserve this venting option, despite its more widespread use. More specifically, the commenters argued that Category III venting systems can, in some cases, utilize Category IV venting. Also, because most Category III venting is used to vent an appliance through a side wall, Crown Boiler and USB asserted that the most problematic installation situations would not arise. Furthermore, Crown Boiler and USB argued that because Category III vent systems operate with positive pressure, they are rarely, if ever, used to vent multiple appliances (due to the risk of flue products entering the interior space from the pressurized vent system through an off-cycle appliance), so the issue of “orphaned” appliances should not be applicable to Category III appliances. Crown Boiler and USB acknowledged that their comments about Category III appliances are generalizations and that there may be a few instances where such appliances are difficult or impossible to reuse or replace, but they reasoned that those rare instances would not merit the additional regulatory complexity associated with guaranteeing Category III venting compatibility. (Crown Boiler, No. 103 at pp. 2-3; USB, No. 105 at pp. 1-2)
Crown Boiler and USB further argued that addressing appliances with uncategorized venting would be even more problematic. Examples include direct vent appliances and uncertified gas appliances (such as a boiler designed primarily to use fuel oil which is installed with a gas conversion burner). Crown Boiler and USB argued that because these unusual vent systems are generally replaced along with the appliance, there would be no need to preserve or reuse them, thereby making it preferable to leave them unaddressed in favor of regulatory simplicity. (Crown Boiler, No. 103 at p. 3; USB, No. 105 at p. 2)
For these reasons, Crown Boiler and USB concluded that DOE should not pursue further the proposed approach of establishing product/equipment classes so as to maintain appliance compatibility with all existing venting types intended for that appliance. (DOE notes that other commenters also provided input as to why this alternative approach should be abandoned, but their reasoning likewise extended to DOE's other alternative proposal to establish product/equipment classes so as to maintain appliance compatibility with Category I venting. Those arguments will be presented following discussion of Crown Boiler's and USB's arguments in favor of an approach to maintain Category I venting compatibility.)
Crown Boiler and USB then went on to explain why they support the proposed approach of establishing product/equipment classes to maintain appliance compatibility with Category I venting as the performance-related feature, for the reasons (largely identical) that follow.
17
These commenters stated that this approach would address their previously raised concerns regarding the matter of venting compatibility, while simplifying the interpretive rule by not advancing the more complex option of trying to ensure compatibility with all existing venting category applications. (Crown Boiler, No. 103 at p. 1; USB, No. 105 at p. 1) Crown Boiler reasoned that because American National Standards Institute (ANSI) safety standards provide a test method to ascertain the appropriate type of venting so as to ensure that the appliance in question can be vented safely, the vent category is both an essential design requirement and “
an objective performance characteristic of the above appliance and not just of the vent system to which it is connected.
” The commenter further noted that the vent category is found on the appliance's rating plate and in the third-party certification report. (Crown Boiler, No. 103 at p. 2 (emphasis in original))
17
As discussed further in section III.A.4 of this document, DOE notes that in seeking clarification on the July 2019 proposed interpretive rule, Weil-McLain also suggested that the Department should make class distinctions based on an appliance's venting category (as defined in the National Fuel Gas Code NFPA 54), rather than using the terms “condensing” and “non-condensing.” The commenter pointed to what the National Fuel Gas Code refers to as Category I vented appliances, which operate with a non-positive vent static pressure and with a vent temperature which avoids excessive condensate production in the vent. Thus, Weil-McLain suggested that going forward, DOE should tie the performance-related feature to the term “Category I Vented Appliance” in its interpretation. (Weil-McLain, No. 86 at pp. 1-2) However, DOE points out that although Weil-McLain expressed this opinion in response to the July 2019 proposed interpretive rule, the company did not comment on the September 2020 SNOPIR where this matter was discussed in further detail. Consequently, DOE can only presume that Weil-McLain continues to maintain this position.
Crown Boiler and USB added that DOE should define any gas appliance venting performance characteristics in terms of the test procedure in the appropriate ANSI safety standard, rather than the definitions in the National Fuel Gas Code, because the latter source uses vague terms such as “excessive condensate” and vague conditions under which such condensation might occur. Thus, as an example, Crown Boiler and USB recommended defining a Category I class of residential boilers as “ `those boilers which have been determined to be Category I using the test method in ANSI Z21.13.' ” (Crown Boiler, No. 103 at p. 3; USB, No. 105 at p. 2)
Other commenters (who also support DOE's revised interpretation as a general matter) disagreed with Crown Boiler's and USB's position, arguing that even an approach limiting venting compatibility to Category I is too complicated and fraught with potential problems. Consequently, the commenters expressed support for DOE to adopt the approach in its original proposal, which would define the
performance-related feature (and subsequent class setting) in terms of condensing or non-condensing operation of the subject appliance. This viewpoint was expressed by Nortek, BWC, AHRI, Mortex,
18
and Carrier. (Nortek, No. 107 at p. 1; BWC, No. 108 at p. 2; AHRI, No. 109 at pp. 1, 5; Mortex, No. 111 at p. 2; Carrier, No. 110 at p. 1) The following discussion explains these commenters' rationale for opposing a venting compatibility-based approach to defining a performance-related feature under EPCA, as well as their rationale for supporting DOE's original proposal. Commenters who generally oppose DOE's revised interpretation (
e.g.,
NRDC, A.O. Smith, Lennox, CA IOUs, Advocates Joint Comment II, and NEEA) also provided reasoning as to why it would be inadvisable to adopt the alternative approaches presented in the September 2020 SNOPIR, and these comments are summarized in the paragraphs that follow as well.
18
If DOE's original proposed interpretation is not adopted, Mortex then expressed support for either of the two alternative interpretations presented in the September 2020 SNOPIR based on venting compatibility. Mortex stated that any of these approaches would preserve the performance-related features of its mobile home gas furnaces, which are designed for use with Category I venting systems. (Mortex, No. 111 at p. 2)
One line of argument surrounded the complexity of a regulatory framework based upon venting compatibility. Nortek, AHRI, and Lennox argued that categorization of appliances by venting system is a complex matter, and in application, it can vary for different product/equipment types, as determined according to the applicable ANSI safety standards. According to these three commenters, venting, condensate generation, and efficiency are among several factors that determine how a boiler, water heater, or furnace is designed, safety-certified, and installed. Thus, Nortek, AHRI, and Lennox stated that they do not find venting to be an inherent product feature, but rather an installation requirement that may vary depending upon the design and application of the product. (Nortek, No. 107 at p. 2; AHRI, No. 109 at p. 2; Lennox, No. 114 at p. 5)
Another line of argument involved the potential for appliances to be certified for use with multiple venting categories or ones that do not have a designated venting category. Relatedly, BWC argued that if DOE were to adopt a highly segmented class structure based upon venting compatibility, further complications would be likely to arise in terms of setting efficiency regulations for gas-fired products. For example, the commenter pointed to certain water heaters that are listed with multiple venting categories, which leaves it to a plumbing contractor's discretion to determine the most appropriate venting for a given installation situation. Because more than one efficiency requirement could apply in such cases, BWC stated that the alternative approaches presented in the September 2020 SNOPIR would not be practical, either generally or from a technical perspective. Similarly, BWC added that operational conditions for a type of appliance may affect the selection of venting category, so the installing contractor will need to be aware of and take appropriate action regarding the sizing and selection of proper vent materials. BWC also stated that the alternative approaches presented in the September 2020 SNOPIR failed to address products that do not have a venting category (
i.e.,
non-categorized products), such as ones that are direct vent or installed outdoors. (BWC, No. 108 at p. 1)
A.O. Smith stated that venting category definitions vary by appliance type, and it commented that some models can carry certification with multiple venting categories. A.O. Smith also stated that the non-condensing characterization is broader than the Category I venting certification. (A.O. Smith, No. 113 at p. 4) The CA IOUs made a similar point about gas appliances capable of being configured to work with more than one category of venting system, and they reasoned that this would make it impossible for compatibility of a product category with a specific venting system to be designated as a protected feature under EPCA. (CA IOUs, No. 117 at p. 5)
Similar to the points raised by Crown Boiler and USB, AHRI also noted that complexities that could arise from seeking to maintain venting compatibility for water heaters using Category II or Category III venting, and similar to BWC, AHRI commented as to the difficulty in classifying water heater models that can have multiple categorizations depending upon design. AHRI added that similar to water heaters, boilers may be subject to more than one venting characterization, depending upon how they are installed in the field. According to the commenter, some non-condensing boilers operate at positive vent pressure, which requires Category III venting. The trade association suggested that these concerns could lead to a regulatory structure that is not easy to understand and implement at the point of manufacture. (AHRI, No. 109 at p. 4) Carrier also stated that some boilers and water heaters can use multiple vent categories, although it noted that this is a small subset of products. (Carrier, No. 110 at p. 2)
For the reasons stated, Nortek and AHRI concluded that dividing product/equipment classes by venting categories would unnecessarily complicate the approach to class setting, and AHRI expressed concern that such an approach could have unintended consequences. (Nortek, No. 107 at p. 2; AHRI, No. 109 at pp. 2, 5) Other commenters also remarked as to the complexity surrounding a regulatory structure based on venting categories. (Carrier, No. 110 at p. 2; Lennox, No. 114 at p. 5) Carrier added that such an approach may not achieve a result different from DOE's original proposal. (Carrier, No. 110 at p. 2) Consequently, Nortek and AHRI opined that a blanket rule encompassing all gas appliances that turns on venting categories may not capture detailed technical nuances, or it may overly complicate the product classes, thereby resulting in unintended regulatory burden or market impacts. (Nortek, No. 107 at p. 2; AHRI, No. 109 at p. 2) Lennox also argued that such an approach would further segment the already unduly complicated residential furnaces product class structure in DOE's original proposal, thereby compounding the problem, and significantly increase regulatory burden without any apparent benefit to consumers or manufacturers. (Lennox, No. 114 at pp. 1, 5)
BWC advised that if DOE ultimately decides to pursue one of the alternate paths to defining the performance-related feature, as set forth in its September 2020 SNOPIR, the Department should convene a stakeholder meeting to parse out the implementation issues that may arise in the context of different types of products and to discuss how to proceed. (Nortek, No. 108 at p. 2)
A.O. Smith disagreed with the alternate approaches to the feature determination focused on venting compatibility as presented in the September 2020 SNOPIR, because venting is not applied at the point of manufacture, nor is it known what the installation circumstances may be for a given residence or commercial building. The commenter argued that EPCA grants DOE authority to regulate covered products and equipment at the point of manufacture, which does not extend to the point of installation. Thus, A.O. Smith questioned whether DOE has authority to differentiate product/equipment classes based upon categories of venting materials. (A.O. Smith, No. 113 at p. 4)
Another line of arguments suggested that the alternative approaches based upon venting compatibility set forth in the September 2020 SNOPIR may encounter problems with changing building safety codes. NRDC argued that such approaches are not feasible, practical, or necessary, stating that even current standards are not universally consistent with every type of ventilation system found in every building because of different codes and standards put in place over time. (NRDC, No. 112 at pp. 2-3) To this point, the CA IOUs argued that in many cases, safety codes may have changed by the time a gas-fired appliance needs to be replaced, so the existing venting would need to be changed, regardless of the type of venting with which the appliance may be compatible. (CA IOUs, No. 117 at p. 4)
The Advocates Joint Comment II also argued that DOE's professed intent in the September 2020 SNOPIR about maintaining venting compatibility is not achievable. These commenters stated that there are currently many situations where there are no products on the market compatible with the existing venting system due to current safety requirements. For example, the Advocates Joint Comment II pointed to DOE's own past rulemakings in explaining that the National Fuel Gas Code has lining requirements that effectively require all chimneys to be lined in order to install a new gas furnace or boiler; however, prior to 1995, building codes did not require such lining of chimneys, so homes built before 1995 would need to have their chimneys lined in order to install a new non-condensing furnace that is compatible with Category I venting. Similarly, the Advocates Joint Comment II stated that DOE's past rulemakings have found that with Type B vents, when a new non-condensing furnace or boiler that is compatible with Category I venting replaces an existing natural draft non-condensing product, in almost all cases, the vent connectors need to be replaced or the entire venting system needs to be resized. These commenters noted that DOE has traditionally accounted for such changes in its analysis of installation costs and suggested that that was the correct approach. However, the Advocates Joint Comment II argued that even if venting compatibility were to be considered a performance-related feature, the availability of products compatible with Category I venting would not necessarily ensure compatibility with existing venting systems, for the reasons explained above. (Advocates Joint Comment II, No. 118 at pp. 3-4)
Furthermore, the CA IOUs added that the concept of discrete classes of gas appliances which can be defined by compatibility with specific venting systems does not match what is occurring in the field. The CA IOUs explained that in the commercial sector, there are already venting systems that are compatible with gas-fired appliances designed for Category I-IV venting systems, and there is an ongoing trend to upgrade all commercial venting systems to those that comply with Underwriters Laboratory (UL) 1738,
Special Gas Vents,
for condensing appliances. Accordingly, the CA IOUs opined that as universal venting systems become more widespread, concerns about the compatibility of gas appliances with different venting systems will continue to become less relevant. (CA IOUs, No. 117 at p. 4)
NRDC stated that instead of pursuing the proposed approaches, DOE should consider and evaluate alternative venting technologies to solve difficult installation scenarios, both those on the market and under development. (NRDC, No. 112 at pp. 2-3) NRDC and NEEA criticized the approach in the September 2020 SNOPIR as potentially freezing venting technologies in place and limiting innovation in both venting strategies and equipment design, thereby harming consumers through higher energy costs and reduced product features. (NRDC, No. 112 at p. 3; NEEA, No. 119 at p. 3)
Beyond these technical comments focused on the merits of DOE's alternative proposals tying the performance-related feature to maintaining venting compatibility, the commenters essentially fell into three camps in terms of their recommendations for how DOE should move forward. Several commenters recommended that DOE adopt its original proposal to establish product/equipment classes on the basis of the subject gas appliance's utilization of condensing/non-condensing technology for purposes of 42 U.S.C. 6295(o)(4). This approach was favored by Nortek, BWC, AHRI, Carrier, and Mortex. (Nortek, No. 107 at p. 1; BWC, No. 108 at p. 2; AHRI, No. 109 at pp. 1, 5; Carrier, No. 110 at p. 1; Mortex, No. 111 at p. 2) Another group recommended that DOE abandon not only the approaches presented in the September 2020 SNOPIR, but the approach in the July 2019 proposed interpretive rule as well, largely based upon the legal, technical, and policy arguments raised in their earlier comments. This pathway was favored by NRDC, A.O. Smith, Lennox, the AGs Joint Comment, the CA IOUs, the Advocates Joint Comment II, and NEEA. (NRDC, No. 112 at p. 2; A.O. Smith, No. 113 at p. 2; Lennox, No. 114 at p. 1; AGs Joint Comment II, No. 115 at p. 1; CA IOUs, No. 117 at p. 1; Advocates Joint Comment II, No. 118 at p. 1; NEEA, No. 119 at p. 1) Finally, the organizations submitting the Petitioners
et al.
Joint Comment II argued that the issues of venting compatibility raised in the September 2020 SNOPIR do not need to be addressed at the present time in order to resolve the core issue of applying the “unavailability” provision of EPCA to the specific proposed standards for residential furnaces and commercial water heaters, as requested by the Gas Industry Petition. Instead, these commenters argued that these important issues are more appropriately addressed in the context of the development of new standards for residential furnaces, commercial water heaters, and other gas or propane-fueled products/equipment. (Petitioners
et al.
Joint Comment II, No. 116 at pp. 4, 6) The residual comments of these three groups are summarized in the paragraphs that follow.
Commenters supporting adoption of DOE's original proposal to establish product/equipment classes on the basis of the subject gas appliance's utilization of condensing/non-condensing technology made the following additional points. For furnaces currently on the market, Nortek, AHRI, and Carrier stated that they are all already divided into non-condensing/Category I and condensing/Category IV, so there is no substantive distinction between the two. Of the two, these commenters prefer categorization based upon a “condensing/non-condensing” distinction, because furnaces are already divided in that manner for purposes of DOE's energy conservation standards for furnace fans. (Nortek, No. 107 at pp. 2-3; AHRI, No. 109 at p. 3; Carrier, No. 110 at p. 2) Carrier also stated that it continues to believe that non-condensing operation is the key performance-related feature at issue. (Carrier, No. 110 at p. 2) AHRI opined that a “non-condensing” product class should be sufficient to capture all boilers requiring Category I venting, but it nonetheless encouraged DOE to explicitly incorporate the ability to use existing venting categories associated with atmospheric venting. (AHRI, No. 109 at p. 5)
Nortek and AHRI added that finalizing DOE's interpretation based upon a “condensing/non-condensing” distinction, as originally proposed, would not preclude the Department from considering and analyzing venting
applications when creating product/equipment classes during the course of individual energy conservation standards rulemakings, as necessary. These commenters argued that a thorough, product-specific definition and technology-focused characteristics should be evaluated to create functional product/equipment classes that might vary for different types of appliances. (Nortek, No. 107 at p. 2; AHRI, No. 109 at p. 2) Finally, AHRI stated that tolerances and operational characteristics of the product-specific test procedure must be considered in future rulemakings to ensure that any energy conservation standards are safe, functional, and cost-effective. (AHRI, No. 109 at p. 2)
Mortex cautioned that in moving forward with standard setting for revised energy conservation standards for residential gas furnaces, including mobile home gas furnaces, DOE must take into account the product class structure established for residential furnace fans manufactured on or after July 3, 2019 (codified at 10 CFR 430.32(y)). Mortex argued that pursuant to 42 U.S.C. 6295(m)(4)(B), any revised energy conservation standards for non-condensing, non-weatherized mobile home gas furnaces must not preclude the continued sale of mobile home gas furnaces containing furnace fans that comply with the new furnace fan standards, because under that provision, EPCA prohibits DOE from subjecting manufacturers to a new standard for a product with respect to which other new standards have been required during the prior 6-year period. The commenter argued that this requirement can only be met by ensuring that any revised energy conservation standards applicable to non-weatherized mobile home gas furnaces permit the continued sale of non-condensing mobile home gas furnaces. (Mortex, No. 111 at p. 2)
Commenters supporting withdrawal of DOE's July 2019 proposed interpretive rule and September 2020 SNOPIR made the following additional points. NRDC opposes and urged DOE to withdraw both the July 2019 proposed interpretive rule and the September 2020 SNOPIR, because the commenter argued that both suffer from technical and legal issues which the Department has failed to address. NRDC and Lennox renewed and reiterated many of the arguments raised in their earlier comments to this docket, because the commenters stated that those same objections apply regardless of whether the performance characteristics at issue involve the use of condensing technologies or venting compatibility. (NRDC, No. 112 at p. 2; Lennox, No. 114 at pp. 7-8) Other commenters did the same, and as mentioned previously, such arguments are addressed elsewhere in this document.
Lennox criticized DOE's September 2020 SNOPIR as being “overtly vague and unsupported,” and in particular, the commenter faulted the alternate approach which would consider the creation of separate product classes for any existing venting system available on the market as ambiguous and ill-defined, such that it deprives stakeholders the opportunity to comment. For example, Lennox questioned whether DOE's proposal would include specialty or unique ventilation types. (Lennox, No. 114 at pp. 1, 3, 6) Lennox also faulted DOE's proposals for making what it calls “speculative and unsupported statements,” such as the number and cost of problematic installations and DOE's expectation regarding limited negative programmatic impacts resulting from its proposed interpretation. Accordingly, the commenter argued that DOE's lack of analysis and supporting data once again deny stakeholders the opportunity to comment on the September 2020 SNOPIR. (Lennox, No. 114 at p. 3) Lennox added that the September 2020 SNOPIR offers no meaningful cost analysis or quantification of installation issues, so it argued that DOE has no record basis to move forward with its proposed interpretive rule. (Lennox, No. 114 at p. 4) Similarly, the CA IOUs requested that DOE quantify the potential negative impacts of its proposal in the September 2020 SNOPIR for residential furnaces, commercial water heaters, and other similarly-situated products/equipment. (CA IOUs, No. 117 at p. 4)
In addition, A.O. Smith alleged that DOE is improperly attempting to use venting categorization in the features provision as a proxy for how to consider increased installation cost in its rulemakings. Instead, the commenter argued that such installation cost considerations belong in DOE's economic analysis. (A.O. Smith, No. 113 at p. 3) Furthermore, A.O. Smith argued that DOE's proposed interpretation, if applied to maintain Category I venting, would eliminate more-efficient non-condensing products from the market, which would restrict the opportunity for incremental gains in efficiency for non-condensing appliances through Federal regulation. (A.O. Smith, No. 113 at pp. 4-5)
Commenters supporting finalization of the core “features” determination under EPCA and deferral of implementation issues (
e.g.,
class setting) to individual product/equipment rulemakings made the following additional points. The Petitioners
et al.
Joint Comment II argued that the issues of venting compatibility raised in the September 2020 SNOPIR do not need to be addressed at the present time in order to resolve the core issue of applying the “unavailability” provision of EPCA to the specific proposed standards, as requested by the Gas Industry Petition. Instead, these commenters argued that these important issues are more appropriately addressed in the context of the development of new standards for residential furnaces, commercial water heaters, and other gas or propane-fueled products/equipment. (Petitioners
et al.
Joint Comment II, No. 116 at pp. 4, 6) The Advocates Joint Comment II also stated that venting considerations for each product potentially covered by DOE's interpretation are different, so such impacts must be considered in the context of individual rulemakings, which can consider the specific circumstances of each product (although the advocates still consider venting to be a matter for DOE's economic analysis). (Advocates Joint Comment II, No. 118 at p. 5)
In conducting inquiries in these individual rulemakings, the Petitioners
et al.
Joint Comment II stated that the Department should consider product class definitions for residential products which reflect venting requirements that are established and codified under national consensus standards, and then DOE should assess the need for separate minimum efficiency standards for these classes. These commenters stated that for the subject residential furnaces and commercial water heaters, these appliances are design-certified for safety based on the venting characteristics. According to these commenters, there are four venting criteria specified in the applicable industry consensus standards for residential furnaces and commercial water heaters, as identified in ANSI Z21.47,
Gas-Fired Central Furnaces,
and ANSI Z21.10.3,
Gas-Fired Water Heaters,
respectively. The Petitioners
et al.
Joint Comment II added that the installation codes for gas furnaces—ANSI Z223.1/NFPA 54,
National Fuel Gas Code,
and the
International Fuel Gas Code
—include requirements for proper installation (
e.g.,
vent sizing, termination, and clearance requirements). The commenters surmised that these product categories would provide an appropriate starting point for DOE's technical and economic analysis to determine whether separate minimum efficiency standards are
appropriate for each equipment class. The Petitioners
et al.
Joint Comment II recommended that these issues should be addressed in individual product rulemakings under DOE's Process Rule
19
and using the most current information available. (Petitioners
et al.
Joint Comment II, No. 116 at pp. 7-8)
19
See
10 CFR part 430, subpart C, appendix A,
Procedures, Interpretations, and Policies for Consideration of New or Revised Energy Conservation Standards and Test Procedures for Consumer Products and Certain Commercial/Industrial Equipment.
The Petitioners
et al.
Joint Comment II stressed that action on the Gas Industry Petition is a matter of some urgency, because litigation has been filed seeking to compel final action in a number of energy conservation standards rulemaking proceedings, including the proceedings in which proposals were issued that are the subject of the Gas Industry Petition. As a result, the Petitioners
et al.
Joint Comment II argued that DOE should clarify the situation by withdrawing its prior rulemaking proposals for residential furnace and commercial water heater energy conservation standards, because those proposals cannot not be legally finalized as proposed if the Department promulgates a final interpretive rule along the lines of that set forth in the July 2019 proposed interpretive rule. (Petitioners
et al.
Joint Comment II, No. 116 at p. 5)
In light of the above arguments, it has become apparent to DOE that its alternative proposals to establish product/equipment classes based upon maintaining venting compatibility drew little public support, and problems may arise from adopting them as an overarching approach. Support for maintaining compatibility with Category I venting was limited to only Crown Boiler and USB, and no commenter spoke in favor of an approach to maintain compatibility with all existing venting types. However, a broad cross-section of industry stakeholders with considerable technical expertise confirmed their understanding that DOE's original proposal to define the subject performance-related feature as the appliance's condensing or non-condensing operation would represent a workable approach to implementing DOE's revised interpretation.
Based upon DOE's careful review of the comments received, the Department has decided it is not appropriate to move forward with either of the two alternative approaches based upon venting compatibility presented in the September 2020 SNOPIR, but to instead adopt its original proposal presented in the July 2019 proposed interpretive rule, which focused on an appliance's condensing or non-condensing operation. Comments on the September 2020 SNOPIR have convinced the agency that its alternative proposals would have increased the complexity and regulatory burden of its regulatory framework with little benefit. Because DOE is no longer pursuing these alternative approaches, the Department finds it unnecessary to address all of the technical arguments and other contentions against making maintenance of venting compatibility a touchstone of its “features” determination. DOE is also persuaded by the stakeholder comments that have positively assessed the implementation potential of DOE's revised interpretation along the lines of its original proposal.
DOE agrees with the commenters who suggested that DOE should move to resolve the “core issue” at the heart of the Gas Industry Petition in this final interpretive rule, while reserving appliance-specific implementation issues (including class setting) for review and analysis in the context of individual product rulemakings. DOE has concluded that such an approach would best serve all parties, including manufacturers and consumers. Individual product rulemakings will have the requisite mix of interested stakeholders, technical experts, a comprehensive record with product-specific data (including a review of relevant industry consensus standards), and the full suite of analyses for class and standard setting. In that venue, DOE and interested stakeholders will be better able to address any relevant technical matters or product-specific nuances, including the tolerances and operational characteristics of test procedures mentioned by AHRI, and any lingering concerns related to the issue initially raised by USB, BHI, and Crown Boiler.
Because the approach in DOE's earlier proposals for residential furnaces and commercial water heaters are inconsistent with this final interpretation and, therefore, will require revision, DOE has decided to grant the request in the Petitioners
et al.
Joint Comment II for the withdrawal of those proposals. Published elsewhere in this issue of the
Federal Register
,
DOE withdraws its March 12, 2015 proposed rule and September 23, 2016 supplemental proposed rule for energy conservation standards for non-weatherized gas furnace and mobile home gas furnaces, as well as its May 31, 2016 proposed rule for energy conservation standards for commercial water heating equipment. DOE's decision to withdraw its earlier proposals is discussed in further detail in section III.D.3 of this document.
Regarding arguments challenging the technical/legal/policy bases for the September 2020 SNOPIR, DOE found many of these comments to essentially be re-statements of their comments submitted in response to the July 2019 proposed interpretive rule, rather than specifically focused on the particulars of DOE's supplemental proposed interpretation. Accordingly, those concerns are cited and addressed elsewhere in this document.
As to Mortex's concern about the statutory prohibition on applying new standards to a covered product for which other new standards have been required within the prior six-year period (42 U.S.C. 6295(m)(4)(B)), DOE would point out that, given that requirements for furnace fans came into effect on July 3, 2019, and given the anticipated five-year lead time for amended standards for residential furnaces (including mobile home gas furnaces), it is anticipated that more than six years will have passed by the time any new furnaces standards would come into effect.
b. Comments Opposing the Proposed Interpretation
Other commenters strongly opposed and urged withdrawal of DOE's proposed revised interpretation regarding whether non-condensing technology and associated venting constitutes a “feature” under EPCA. (CA IOUs, No. 85 at p. 1; CFA/NCLC, No. 93 at p. 1; AGs Joint Comment, No. 82 at p. 2; NRDC, No. 94 at p. 1; Advocates Joint Comment, No. 95 at p. 1; Environmentalists Joint Comment, No. 90 at p.1: AGs Joint Comment II, No. 115 at p. 2) These commenters raised a number of arguments which are set forth and addressed in the paragraphs that follow.
i. Support for DOE's Prior Interpretation
Several commenters expressed support for DOE's prior position, as presented in past rulemaking documents published in the
Federal Register
,
which concluded that non-condensing technology (and associated venting capabilities) do not merit a “feature” designation and the establishment of a separate product class with a different energy conservation standard. (Ceres, No. 69 at p. 3; Lennox, No. 87 at p. 4; A.O. Smith, No. 88 at p. 2; NRDC, No. 94 at pp. 4-5; CA IOUs, No. 85 at p. 3; A.O. Smith, No. 113 at p. 2; Lennox, No. 114 at pp. 6-7; AGs Joint Comment II, No. 115 at p. 2; CA IOUs, No. 117 at p. 1; NEEA, No. 119 at p. 1) In making that point, the
AGs Joint Comment argued that DOE's proposed interpretive rule would effectively grandfather inefficient designs. (AGs Joint Comment, No. 82 at p. 3) The AGs Joint Comment pointed to and even quoted from a number of DOE's past rulemakings which articulated the rationale for finding that venting capabilities (and any related costs) are not a performance-related feature under EPCA. Specifically, these commenters cited to language contained in the [March 12,] 2015 NOPR and [September 23,] 2016 SNOPR for residential furnaces, the 2009 final rule for residential water heaters,
20
and the 2015 final rule for residential clothes dryers.
21
In short, the AGs Joint Comment (and other commenters) agreed with DOE's historic view that a furnace's or water heater's manner of venting does not provide consumers unique utility separate and apart from its basic function of providing heat or hot water. (AGs Joint Comment, No. 82 at pp. 3, 8-10; A.O. Smith, No. 88 at pp. 2, 4; NRDC, No. 94 at pp. 4-5; CA IOUs, No. 85 at pp. 2-3; NRDC, No. 112 at p. 2) NRDC added that when DOE acts to reverse a long-held interpretation, as it seeks to do with the proposed interpretation for condensing/non-condensing products/equipment, DOE has the burden of proof to clearly explain and justify its rationale. (NRDC, No. 94 at p. 3)
20
DOE notes that this final rule was actually published in the
Federal Register
on April 16, 2010.
21
DOE notes that this final rule was actually published in the
Federal Register
on April 21, 2011.
In response, DOE disagrees with these commenters' view that the Department's revised interpretation is inappropriate or lacking in evidentiary basis, and DOE notes that numerous other commenters on the proposed interpretive rule held a contrary opinion. As explained elsewhere in this document, the Gas Industry Petition gave DOE the opportunity to revisit its prior interpretation, and the information provided in that petition and in subsequent comments thereon caused DOE to reevaluate prior data and, ultimately, its position. These commenters cannot reasonably claim that the rulemaking dockets for residential furnaces, commercial water heaters, and other similarly-situated products/equipment are lacking in data. Because data is always subject to interpretation, it is not reasonable for these commenters to demand that a revised interpretation must rely solely upon new data. Here, the petitioners did present the Department with new arguments, perspectives, and information that were useful to DOE in reexamining its position. More specifically, the petitioners explained how the shift to energy conservation standards set at a condensing level could necessitate significant modifications to both new and existing buildings, such that interior residential or commercial space may need to be sacrificed, additional unattractive venting would need to be added, or desirable window or patio space could be lost. These new arguments demonstrate ongoing impacts that would be noticed and likely perceived negatively by consumers, and this reasoning is in addition to the other arguments and data previously submitted by the petitioners and considered by DOE during the course of various rulemakings. As noted, DOE also relied upon the significant data already in these rulemaking dockets to assess its prior interpretation as to whether non-condensing technology (and associated venting) constitutes a performance-related “feature” for purposes of EPCA. Based upon the totality of the information, DOE has determined that the change in interpretation reflected in this final interpretive rule is appropriate under the statute.
Regarding the assertion in the AGs Joint Comment that the revised interpretation would grandfather inefficient designs, that same argument could be ventured virtually every time a determination is made under EPCA's “features” provision. An oven without a window in the door would be more efficient than one that retains that feature.
22
However, the statute, by the very nature of its “features” provision, makes clear that efficiency will not be paramount in all situations. In fact, the words of the statute make clear that is the precise purpose of the “features” provision. In that provision, EPCA prohibits the Secretary from prescribing a new or amended standard (
i.e.,
imposing a standard for a product where a standard did not previously exist or increasing the stringency of an existing standard) if doing so is likely to result in the unavailability of a performance characteristic, feature,
etc.
substantially the same as those generally available in the absence of the Secretary prescribing a new or amended standard.
See
42 U.S.C. 6295(o)(4). Thus, DOE finds this argument in the AGs Joint Comment to be contrary to the statute.
22
In its energy conservation standards rulemaking for cooking products that culminated in the September 8, 1998 final rule (63 FR 48038), DOE explained its rationale for initially considering a design option to eliminate oven door windows as a means to improve energy efficiency in the technical support document (TSD) for that rulemaking. (See Volume E, Chapter 1, Engineering Analysis, section 1.4.1, Design Options for Ovens, pp. I-22 to I-23. (Available at:
https://beta.regulations.gov/document/EERE-2006-STD-0048-0027;
(select EE-RM-90-201 COMMENT OOA2-4).
ii. Violations of Legal Standards
Related to their support of DOE's prior interpretation, a number of commenters challenged DOE's proposed interpretation on a variety of legal grounds. For example, these commenters faulted the Department's proposal as being arbitrary and capricious; contrary to law; and contrary to precedent and factually unsupported. DOE recognizes that such topics are often intertwined. However, given the rather voluminous nature of these submitted arguments, DOE has segmented the discussion into these broad categories for response in the subsections that follow.
Arbitrary & Capricious
A number of commenters characterized DOE's proposed reversal of its prior interpretation and dismissal of its prior concerns as arbitrary and capricious and an abuse of discretion, despite DOE's stated expectation that the programmatic impacts of its revised interpretation are likely to be limited (which was characterized as a claim alleged to be lacking in data and analysis). (AGs Joint Comment, No. 82 at pp. 2, 7-10; CEC, No. 89 at p. 3; AGs Joint Comment II, No. 115 at p. 2; CA IOUs, No. 117 at p. 3) The CEC predicted that without sufficient record evidence to support its decision (
i.e.,
changed interpretation), a court would overturn such agency action as arbitrary and capricious. Overall, the commenter expressed its belief that DOE's proposed interpretation is contrary to the preponderance of evidence in the record, particularly since DOE improperly conflates economic and performance characteristics. Accordingly, the CEC concluded that DOE's historical interpretation on this matter is both consistent with the evidence and reflects congressional intent to improve energy efficiency and protect human health. (CEC, No. 89 at p. 7)
DOE disagrees with these commenters' notion that the Department lacks sufficient evidence to support a revised interpretation, thereby rendering the agency vulnerable to a legal challenge claiming arbitrary and capricious action. As noted previously, the petitioners presented new information and arguments explaining how the shift to energy conservation standards set at a condensing level
could necessitate significant modifications to both new and existing buildings, such that interior residential or commercial space may need to be sacrificed, additional unattractive venting would need to be added, or desirable window or patio space could be lost. These new arguments demonstrate ongoing impacts that would be noticed and likely perceived negatively by consumers, and this reasoning is in addition to the other arguments and data previously submitted by the petitioners and considered by DOE during the course of various rulemakings. In sum, DOE's existing rulemaking dockets are replete with evidence bearing on this matter. DOE appropriately reassessed that information in response to the submitted petition for rulemaking and, based upon the totality of the available information, came to the reasoned conclusion that its revised interpretation better comports with the statute, as explained in this document.
Contrary to Law
Other commenters characterized DOE's proposed interpretation as contrary to law. (Lennox, No. 87 at p. 4; AGs Joint Comment, No. 82 at pp. 2-3; A.O. Smith, No. 88 at p. 2; CEC, No. 89 at p. 3; NRDC, No. 94 at p. 4; A.O. Smith, No. 113 at p. 2; AGs Joint Comment II, No. 115 at p. 1) The AGs Joint Comment asserted that DOE's proposed interpretation is contrary to law under 5 U.S.C. 706(2), and that a plain reading of EPCA and review of public comments make clear that venting technology is not a performance-related feature under the statute. Consequently, these commenters reasoned that DOE cannot create a separate product class for non-condensing products on that basis which would be subject to lower efficiency requirements. (AGs Joint Comment, No. 82 at p. 7; AGs Joint Comment II, No. 115 at p. 2) Lennox added that Congress set initial energy conservation standards for residential furnaces with product classes based on capacity and fuel source, but it did not segment classes by condensing and non-condensing technology, so the commenter argued that DOE should not do so now. (Lennox, No. 87 at p. 3)
In response, DOE's proposed interpretive rule is in accordance with the pertinent statutory provisions of EPCA. As commenters acknowledged, the statute does not define the terms “feature” or “performance-related feature,” so resolution of this ambiguity is left to the agency's discretion as a matter of statutory interpretation. Over the more than 30-year life of the Appliance Standards Program, DOE has made numerous “features” determinations, so the Department has expertise in weighing issues of consumer utility. Size constraints and building modifications to a dwelling or business seem clearly within the bounds of product characteristics that would matter to an average consumer, and have mattered in the past to DOE without objection (
see e.g.,
76 FR 22454, 22485 (April 21, 2011) (
discussing
ventless and compact clothes dryers); 76 FR 37408, 37446 (June 27, 2011) (
discussing
space-constrained residential central air conditioners and heat pumps)). DOE also rejects Lennox's argument that just because Congress based initial furnace standards on capacity and fuel source that modifications to that existing class structure would be forever off limits. Such argument would render the “features” provisions at 42 U.S.C. 6295(o)(4) and 42 U.S.C. 6313(a)(6)(B)(iii)(II)(aa) superfluous, so DOE declines to adopt Lennox's suggested approach. Although DOE has found the Gas Industry Petition to encompass a number of complex issues, DOE has concluded that its revised interpretation set forth in this final interpretive rule is well grounded in current law.
Lennox opined that DOE would be violating the legal standard pronounced by the Supreme Court that for an agency to change a regulatory interpretation, it must articulate a “ `rational connection between the facts found and the choices made' ” (
citing Motor Vehicle Mfrs. Ass'n
v.
State Farm Mut. Auto. Ins. Co.,
463 U.S. 29, 52 (1983)). (Lennox, No. 87 at p. 4) Similarly, A.O. Smith's comments claim that DOE's proposed interpretation deviates from the Department's past precedent without sufficient justification, administrative record support, or reasoned explanation. The commenter stated that DOE must provide a reasonable basis for its new interpretation, but it concluded that none of the Department's justifications are reasonable. (A.O. Smith, No. 88 at p. 6) First, A.O. Smith challenged the Department's tentative findings in the proposed interpretation related to space constraints, distinguishing DOE's past regulatory actions related to PTACs and ventless clothes dryers. The commenter acknowledged that the statute does expressly recognize “size” as a relevant factor under EPCA's “features” provision (
see
42 U.S.C. 6295(o)(4); 42 U.S.C. 6313(a)(6)(B)(iii)(II)(aa)), but it argued that DOE's proposed interpretation, as it relates to commercial water heaters and similarly situated products, does not turn on size (given the wide availability of water heaters in a wide variety of diameters, heights, and footprints), but rather on condensing technology itself. (A.O. Smith, No. 88 at pp. 6-7) A.O. Smith also distinguished DOE's creation of distinct product classes for vented and ventless clothes dryers, noting that the presence or absence of vents in the residential space was a proxy for moisture removal designs (necessary to prevent mold growth and other health concerns). The commenter argued that without adequate venting or a ventless dryer option, some consumers would be unable to have a dryer at all (
e.g.,
high-rise condo residents), but that situation would not apply to commercial water heaters, because commercial settings can accommodate condensing technology. Furthermore, A.O. Smith argued that DOE has proffered no new facts or changed circumstances to support its new conclusion, but instead, the company asserted that the Department has failed to acknowledge the wide variety of vent and intake air pipes that exist and that may accommodate differing condensing water heater installations, all of which should be properly considered in DOE's economic analyses. (A.O. Smith, No. 88 at pp. 7-8, 10)
In response, DOE has articulated a rational and reasonable basis for its proposed change of interpretation. As mentioned previously, DOE's prior interpretation did not adequately account for the consumer utility of non-condensing appliances (and associated venting) in difficult installation situations. Commenters have also identified benefits related to expanded consumer choice. DOE disputes A.O. Smith's statements that the difficult installation situations examined do not pertain to size constraints, as well as its attempt to imply that alternate venting and piping would offer a panacea for the larger problem identified. Gas industry commenters provided considerable information in these regards to the residential furnaces, commercial water heaters, and other dockets, and DOE's own analyses showed that difficult installation situations exist, with many cases reflected in the Department's investigation of fuel switching. The Gas Industry Petition provided occasion for DOE to revisit its prior interpretation, and the agency has concluded that it erred in failing to consider consumer utility more broadly in this context. The Department would argue that there already was and is extensive evidence in the record bearing on this issue as would support DOE's change of course.
While DOE outlines the general factual basis and legal principles in this final interpretive rule, the Department will make a more explicit statement of the evidentiary basis for separate product/equipment classes and standards for non-condensing products/equipment in the context of a specific energy conservation standards rulemaking for each appliance impacted by this revised interpretation. Such detailed information resides in those individual rulemaking dockets and cannot be comprehensively addressed here. However, an expanded statement of the basis for regulatory action is appropriate before such rulemakings alter existing regulatory requirements.
According to A.O. Smith, DOE's proposed interpretation conflicts with the Department's statutory obligations pursuant to EPCA and would undermine the Appliance Standards Program. It argued that although EPCA does not define the term “feature,” DOE cannot adopt a definition that conflicts with its statutory obligations to improve energy efficiency and the statutorily-mandated process for setting new and amended standards. A.O. Smith alleged that such reinterpretation would have profound negative consequences for energy efficiency and consumer choice. More specifically, the commenter asserted that it would impose an artificial ceiling on efficiency and create a loophole by locking in an outdated and inefficient technology with no consumer benefit. According to A.O. Smith, the logical consequence of DOE's reinterpretation would be the establishment of separate standards, but because non-condensing commercial water heaters can only be made minimally more efficient than the levels in the current energy conservation standards, the commenter concluded that no further standard would likely be cost-effective, thereby leaving these products “effectively unregulated.” The commenter predicted that in its next commercial water heaters rulemaking, DOE would set a condensing standard of no less than 95 percent thermal efficiency, and as a result, manufacturers who are unable to meet the more-stringent standards for condensing commercial water heaters would revert to producing non-condensing models which enjoy a lower standard, all of which would have the effect of increasing condensing appliance costs and shrinking the market for high-efficiency products. (A.O. Smith, No. 88 at pp. 10-11; A.O. Smith, No. 113 at p. 5)
DOE cannot agree with the interpretation of EPCA that A.O. Smith seeks to advance, because it is inconsistent with the legal obligations set forth under the statute's “features” provision. The “features” provision was enacted by Congress to maintain important aspects of appliances' utility to consumers even if some measure of energy savings would be lost. To apply a litmus test of “no lost energy savings” or some vague “fidelity to the statute” standard would render EPCA's “features” provision rarely used, if not impossible to use—the very definition of “superfluous.” Whereas A.O. Smith accuses DOE's proposed interpretive rule of undermining the Appliance Standards Program, the commenter's suggested approach would undermine the statute by giving DOE unlimited authority to override one of the checks-and-balances Congress explicitly enacted. A.O. Smith mischaracterizes Congress's judgment to put elimination of “performance-related features” beyond the Department's regulatory reach as DOE's effort to create an artificial ceiling on standards or to create a loophole for inefficient technology. That is simply not the case; rather, DOE is following clear statutory direction to protect consumer utility, even if that means foregoing the potential opportunity for increased energy efficiency, and is applying facts to those words in a specific circumstance. Also, contrary to what A.O. Smith suggests, DOE's proposal would enhance consumer choice by maintaining a greater variety of appliances on the market. Nothing about creating separate product classes for condensing and non-condensing products in any way requires a consumer to purchase any particular product. As A.O. Smith recognizes, the market today consists of both condensing and non-condensing products, and consumers are perfectly free to make the choice to purchase the more efficient product when doing so fits their needs. This interpretation does nothing to change that purchasing decision.
DOE also takes issue with other of A.O. Smith's assertions. First, A.O. Smith argues that because non-condensing commercial water heaters are near the limits of their energy efficiency, they would be “effectively unregulated.” This is untrue both factually and in terms of what the statute requires. Non-condensing water heaters would still be subject to standards at the current levels (or higher if a subsequent rulemaking periodically reviewing existing standards determines that further technical improvements can be made to non-condensing technology as would justify an amended standard). In addition, nowhere does the statute require or establish an expectation that there shall be a never-ending cycle of increasingly more-stringent standards. Such a reading of the statute is belied by the fact that the statute expressly provides for notices of determination that standards for a product do
not
need to be amended where such standards would not result in significant energy savings, would not be technologically feasible, and/or would not be cost-effective. (42 U.S.C. 6295(m)(1)(A))
In addition, DOE does not agree with A.O. Smith's prediction that manufacturers who are unable to meet a more-stringent standard for condensing commercial water heaters would revert to producing non-condensing models which are subject to a lower standard, thereby shrinking the market for high-efficiency products. As discussed in greater detail in section III.A.3 of this document, current market trends show consumers moving strongly towards condensing products based upon their substantial demonstrated energy savings. Manufacturers have every incentive to adjust their product lines and processes in response to this market demand, even if the condensing appliances come to have their own higher standard. In the current market, consumers are already choosing to pay a premium for condensing appliances to achieve greater energy savings, and A.O. Smith has offered no rational basis supported by evidence to show this trend would reverse or that other manufacturers would rush to forego prior investment in condensing products to chase a declining market for non-condensing products. For those same reasons, A.O. Smith has failed to provide evidence demonstrating that any price increases for condensing appliances under a separate energy conservation standard would appreciably differ from price increases under a unified energy conservation standard set at a condensing level.
The Environmentalists Joint Comment argued that the Department has failed to demonstrate that a violation of EPCA would occur by adoption of an energy conservation standard that can only be met by use of condensing technology. (Environmentalists Joint Comment, No. 90 at p. 1) Along these lines, the Environmentalists Joint Comment stated that energy conservation standards that can only be met by use of condensing technology would not lead to minimal demand for gas appliances, which they assert is the legal test for DOE to take action under EPCA's “features” provisions at 42 U.S.C. 6295(o)(4) and 42 U.S.C. 6313(a)(6)(B)(iii)(II). These commenters asserted that in order for
the features provision to come into play, a DOE standard would need to leave the market with no alternative performance characteristics, features, sizes, capacities, or volumes that are “substantially the same” as those that would be eliminated from the market. They opined that Congress intended DOE to balance the preservation of product utility with the energy-saving objectives of the statute. In explaining their position, the Environmentalists Joint Comment quoted from the legislative history accompanying those statutory provisions: “ ‘A valid standard may entail some minor loss of characteristics, features, sizes, etc.; for this reason, the Act requires that `substantially the same,' though not necessarily identical, characteristics or features should continue to be available.’ H. Rep. 100-11 at 23 (1987).” “[T]he Senate Energy and Natural Resources Committee explained that, in the context of residential gas furnaces, section 325(o)(4) [42 U.S.C. 6295(o)(4)] would forbid a standard from `being set at a level that would increase the price to the point that the product would be noncompetitive and that would result in minimal demand for the product.' S. Rpt. 100-6 at 8-9 (Jan. 30, 1987),
reprinted in
1987 U.S.C.C.A.N. 52, 59.” Relying on this language, the Environmentalists Joint Comment concluded that DOE's proposed interpretation is impermissible because it does not meet this test, arguing not only that the Department has failed to demonstrate that condensing standards for both residential furnaces and commercial water heaters would result in minimal demand for these types of gas appliances, but also that the record in those rulemakings establish that fuel switching would be less than 10 percent. (Environmentalists Joint Comment, No. 90 at p. 2)
The Petitioners
et al.
Joint Comment sought to refute comments suggesting that EPCA's “features” provision would only apply if the unavailability of the performance characteristic or feature at issue would completely destroy the market for the covered product/equipment. The Petitioners
et al.
Joint Comment argued that opponents of the Gas Industry Petition have misinterpreted the legislative history and that standards for residential furnaces which result in the unavailability of a performance characteristic would still be precluded under the statute, even if it would not fully eliminate the market for gas furnaces. (Petitioners
et al.
Joint Comment, No. 80 at pp. 18-19) Likewise, the Petitioners
et al.
Joint Comment disputed the arguments of NRDC and Earthjustice that the placement of parentheses marks in EPCA's two “features” provisions (42 U.S.C. 6295(o)(4) and 42 U.S.C. 6313(a)(6)(B)(iii)(II)) indicate a substantive or material difference between those two provisions. These commenters argued that those opponents of the petition—lacking any explicit language or legislative history to show a difference between these two provisions—rely on improper, extra-statutory qualifications in an attempt to exclude atmospherically vented products from the “features” provisions' applicability. (Petitioners
et al.
Joint Comment, No. 80 at p. 19)
In response, DOE agrees with the Petitioners
et al.
Joint Comment that these commenters have misconstrued the application of EPCA's “features” provision and the relevant legislative history. While DOE agrees that adoption of an energy conservation standard may compel minor changes and modifications to an appliance without triggering the protections of the statute's “features” provisions, it does not seem to be a reasonable reading to bar application of the “features” provision and its protections, except in an extreme case where a regulation would vitiate demand for a gas-fired appliance entirely. Here, the loss of feature would not be minor, because elimination of non-condensing appliances (and the introduction of associated venting requirements) would have the significant negative consequences previously discussed for those consumers facing difficult installation situations, a subgroup which could be upwards of 10 percent of households with gas-fired furnaces (based upon fuel switching data), as one example. (81 FR 65720; Sept. 23, 2016) Furthermore, a Draconian reading requiring the potential elimination of all gas-fired appliances would once again threaten to read the “features” provision out of existence, as a practical matter. This cannot be what Congress intended, so DOE declines to follow this path.
The Environmentalists Joint Comment echoed the rationale in past DOE rulemakings that the consumer utility of a residential furnace is to provide heat to a dwelling and that the consumer utility of a commercial water heater is to provide hot water, functional outputs which do not change with type of venting. Along these lines, they sought to link the function of these appliances to the statutory definitions of “furnace” at 42 U.S.C. 6291(23) and “storage water heater” at 42 U.S.C. 6311(12)(A). According to the Environmentalists Joint Comment, properly installed condensing gas appliances exhibit the same or substantially the same attributes as non-condensing appliances. (Environmentalists Joint Comment, No. 90 at p. 3) Consequently, the Environmentalists Joint Comment concluded that DOE's proposed determination failed to demonstrate any performance-related features of non-condensing gas appliances that require protection from standards. (Environmentalists Joint Comment, No. 90 at p. 2)
As discussed in section III.A.1.a of this document, DOE has determined that a consumer's interaction with and utility from a non-condensing appliance can go beyond such unit's ability to provide hot air or water, particularly in difficult installation situations where eventual replacement of the appliance would necessitate structural modifications to a dwelling or business (
e.g.,
loss of usable living/retail/storage space, addition of unsightly piping or venting to the finished space, or loss of a window(s)). The Environmentalists Joint Comment seeks to tie the statutory “features” determination to the appliance's primary function by focusing on the statutory definitions at 42 U.S.C. 6291 and 42 U.S.C. 6311. However, DOE finds that to be an improper reading of statute. The commenters' theory ignores the fact that pursuant to 42 U.S.C. 6295(q), DOE is bound to focus on the performance-related feature, rather than the overall function of the appliance. For example, DOE has determined an oven window to be a feature, although it does nothing to actually bake the cake placed inside the oven. Similarly, DOE has determined the angle of access of a residential clothes washer to be a feature, although it does nothing to make one's clothes cleaner. Under the Environmentalists Joint Comment's theory, such features offering distinct utility to consumers would no longer deserve protection because they are not directly mentioned in a statutory definition. Such reading would render EPCA's “features” and class-setting provisions significantly and improperly diminished, because a feature is unlikely to ever be mentioned in such definition. If the performance-related characteristic were so uniform and ubiquitous as to be part of the general product definition, it would arguably come “standard” rather than being a “feature.” Accordingly, DOE declines to adopt this suggested reading of the statute.
Contrary to Precedent & Factually Unsupported
A number of commenters stated that DOE's proposed interpretation is
contrary to DOE precedent and factually unsupported. (Lennox, No. 87 at p. 4; AGs Joint Comment, No. 82 at p. 3; CEC, No. 89 at p. 3) NRDC asserted that DOE's justification in its proposed interpretive rule is insufficient and not supported by data or research, arguing that neither the Gas Industry Petitioners nor any other commenter provided new arguments, data, or evidence sufficient to justify a reversal of DOE's existing policy. (NRDC, No. 94 at pp. 3, 5) The AGs Joint Comment characterized DOE's proposed interpretive rule as a radical departure from DOE's historical interpretation of EPCA's “features” provision. They stated that DOE has already specifically addressed and rejected the arguments raised in the Gas Industry Petition in a number of rulemakings, and they added that the Department has failed to identify any valid reasons for it proposed change of position (
e.g.,
dismissing as insufficient DOE's rationales related to aesthetics, compatibility of co-vented appliances, and economic factors). (AGs Joint Comment, No. 82 at p. 7) The CEC faulted DOE for not offering any new relevant evidence, reasoning, or facts to support its proposed change of interpretation. (CEC, No. 89 at p. 5) Lennox added that DOE's proposal is not factually supported and relies on speculation, particularly with regards to the Department's tentative conclusions that new venting may change a home's aesthetics or that some consumers may have a preference for gas heating. The commenter similarly faulted DOE's cost analysis as lacking in data and speculative, even as it attacked costs as an inappropriate consideration for product class setting. (Lennox, No. 87 at p. 4; Lennox, No. 114 at p. 3)
As stated previously, DOE disagrees with these commenters' view that the Department's revised interpretation is inappropriate because it diverges from past precedent or that it is lacking in evidentiary basis. The Gas Industry Petition gave DOE the opportunity to revisit its prior interpretation, and the information provided in that petition and in subsequent comments thereon caused DOE to reevaluate prior data and, ultimately, its position. These commenters cannot reasonably claim that the rulemaking dockets for residential furnaces, commercial water heaters, and other similarly-situated products/equipment are lacking in data. Here, however, the petitioners presented the Department with new arguments, perspectives, and information that were useful to DOE in reexamining its position. However, DOE also relied upon the significant data already in these rulemaking dockets to assess its prior interpretation as to whether non-condensing technology (and associated venting) constitutes a performance-related “feature” for purposes of EPCA. Based upon the totality of the information, DOE has determined that the change in interpretation reflected in this final interpretive rule is appropriate under the statute.
The CA IOUs commented that product classification and performance standards should never be inoperative or superfluous, but argued that that is precisely what DOE's proposed classifications for residential furnaces and commercial water heaters would do, because a performance standard with separate levels for both condensing and non-condensing products would represent no new standards or savings, but would instead simply codify the
status quo.
(CA IOUs, No. 85 at p. 5) Reciting the statutory objectives of EPCA, the CA IOUs stated that DOE's performance standards should promote innovation and embrace new technologies and opportunities as they become cost-effective for consumers. In order to ensure that DOE does not set a precedent here regarding “features” that weakens the Department's ability to set effective efficiency standards, the CA IOUs urged DOE to clearly distinguish between differences that are aspects of inherent technical product design and differences that materially impact the way users interact with the products. To this end, the commenters urged DOE to establish a consistent definition of “performance-related feature” to guide future inquiries as to whether a given aspect of a product is a performance-related feature under EPCA. The CA IOUs supported DOE's prior interpretation that such feature would be “accessible to the layperson and is based on user operation,” and they further argued that the agency should limit itself to consideration of product classes currently available on the market, based upon input from industry and other stakeholders. These commenters stated that DOE should not establish new product classes based upon its own original interpretations or a determination that certain product classes should theoretically exist. (CA IOUs, No. 85 at p. 3)
In response, DOE agrees with the CA IOUs that statutory provisions should never be made inoperative or superfluous, yet that is precisely the action the CA IOUs would ask the agency to take vis-à-vis EPCA's “features” provision. Where DOE has determined the existence of a performance-related feature under EPCA, setting a separate product/equipment class and standard to protect such feature is precisely what the statute envisions. Such action is only “codifying the
status quo”
in the sense that it is protecting the feature from elimination as the statute directs. As noted elsewhere in this document, although EPCA seeks to promote energy savings, energy efficiency, and related product innovation, Congress also made a decision to protect important “features” by enacting the “features” provision, even at the expense of potential energy savings.
Regarding the CA IOUs' suggestion that DOE develop a definition for “performance-related feature,” DOE has concluded that it would not be feasible to do so. Given the multitude of covered products and equipment for which DOE is responsible, the Department has found the concept of “feature” to be very case-specific. No single definition could effectively capture the potential for features across such a broad array of consumer products and commercial equipment. That is why when assessing “features,” DOE developed the concept of consumer utility and how the consumer interacts with the product/equipment. DOE continues to apply that approach here in the context of non-condensing appliances (and associated venting), having determined that in cases of difficult installation requiring reconfiguration and/or loss of usable living space of a home or retail space of a business, the consumer would become very conscious of and appreciate the ability to purchase appliances with non-condensing operation. This determination is akin to DOE's prior determinations with regard to finding as features windows in oven doors and top-loading access to clothes washers. DOE has found that expanded choice would be important to such consumers, and accordingly, the Department has determined this to be a “feature” under the statute which may not be eliminated.
A.O. Smith opined that condensing water heaters could replace non-condensing ones in every commercial setting (
i.e.,
technically feasible); however, A.O. Smith does admit that “there are certain circumstances where installing a condensing model may be cost-prohibitive due to significant installation costs.” Rather than making an overly broad features determination, the commenter suggested that such costs should be addressed by “examining subgroups of installations in DOE's economic models” and that DOE might “decline to set a standard for a particular subclass [of consumers], where supported by the facts and
economic analysis.” (A.O. Smith, No. 88 at p. 3; A.O. Smith, No. 113 at p. 3)
Although DOE appreciates A.O. Smith's acknowledgment of the difficult installation situations at issue, the commenter offered no data to support its assertion that it would be technically feasible to substitute a condensing commercial water heater in all commercial applications, nor would that conclusion, if found to be true, necessarily resolve other concerns raised in the Gas Industry Petition about undesired modifications to the residential or commercial space. Moreover, the Department does not find the commenter's suggested solution to be a workable one. As those familiar with the Appliance Standards Program are aware, DOE has authority to set energy conservation standards for covered products and equipment which must be met by manufacturers before an appliance may be distributed in commerce. The Department does not regulate product use, absent specific congressional direction (
e.g.,
grid-enabled water heaters). Thus, while DOE may have the ability to analyze impacts of standards on subclasses of consumers, and may use disproportionate impacts on a subclass of individuals as a basis for determining a standard is not economically justified, DOE has no authority to set standards by subclasses of consumers. Moreover, A.O. Smith's suggestion is a false choice because DOE has no ability to ensure that products of a certain standard level are purchased by only those consumers in an intended subgroup.
The CEC stated that DOE discussed its analysis of venting costs for residential furnaces, but it ignored the significant data provided by energy efficiency advocates and others supporting DOE's prior interpretation related to features. Specifically, the CEC pointed to what it described as multiple data points demonstrating that only 1% to 5% of homes would present difficult or costly installation issues. Consequently, the CEC concluded that DOE has insufficient information to outweigh the data provided by proponents of DOE's historical interpretation. (CEC, No. 89 at p. 3)
Once again, the Petitioners
et al.
Joint Comment sought to respond to certain criticisms of opponents of the proposed interpretation. In this area, the Petitioners
et al.
Joint Comment argued that opponents of the petition seek to dismiss the substantial difference in performance characteristics offered by atmospherically vented products by making the assertion that such differences amount to nothing more than installation characteristics, a distinction which the joint comment stated is without basis. Instead, the Petitioners
et al.
Joint Comment charged that it is the opponents of the petition who are ignoring the data, adding that a study commissioned by opponents of the petition repeatedly acknowledged that installation of condensing appliances frequently presents non-economic problems for purchasers, although the report seeks to characterize them as only aesthetic concerns. Instead, the Petitioners
et al.
Joint Comment countered that a condensing standard would leave many consumers facing the need to sacrifice interior living space, a balcony, or a window simply to replace an existing gas appliance. The Petitioners
et al.
Joint Comment also faulted opponents' study for only classifying a building modification as “significant” if it more than doubles the total system cost of a retrofit, an unreasonable approach which masks the extent of the disruptive impacts which the Gas Industry Petition seeks to prevent. (Petitioners
et al.
Joint Comment, No. 80 at pp. 20-21)
The Petitioners
et al.
Joint Comment challenged DOE's prior rationale (to which other commenters continue to adhere) suggesting that it is possible to install condensing
This text is long and has been trimmed here. Open the source document for the complete record.
This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.