# Energy Conservation Program: Energy Conservation Standards for Distribution Transformers > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/fr%3A2022-28590 ## Record - **Collection:** Federal Register - **Document type:** Proposed Rule - **Published:** January 11, 2023 - **Citation:** 88 FR 1722 ## Text DEPARTMENT OF ENERGY 10 CFR Part 431 [EERE-2019-BT-STD-0018] RIN 1904-AE12 Energy Conservation Program: Energy Conservation Standards for Distribution Transformers AGENCY: Office of Energy Efficiency and Renewable Energy, Department of Energy. ACTION: Notice of proposed rulemaking and announcement of public meeting. SUMMARY: The Energy Policy and Conservation Act, as amended (“EPCA”), prescribes energy conservation standards for various consumer products and certain commercial and industrial equipment, including distribution transformers. EPCA also requires the U.S. Department of Energy (“DOE”) to periodically determine whether more-stringent, standards would be technologically feasible and economically justified, and would result in significant energy savings. In this notice of proposed rulemaking (“NOPR”), DOE proposes amended energy conservation standards for distribution transformers, and also announces a public meeting to receive comment on these proposed standards and associated analyses and results. DATES: DOE will hold a public meeting via webinar on Thursday, February 16, 2023, from 1:00 p.m. to 4:00 p.m. See section VII, “Public Participation,” for webinar registration information, participant instructions and information about the capabilities available to webinar participants. Comments: DOE will accept comments, data, and information regarding this NOPR no later than March 13, 2023. Comments regarding the likely competitive impact of the proposed standard should be sent to the Department of Justice contact listed in the ADDRESSES section on or before February 10, 2023. Interested persons are encouraged to submit comments using the Federal eRulemaking Portal at www.regulations.gov. Follow the instructions for submitting comments. Alternatively, interested persons may submit comments, identified by docket number EERE-2019-BT-STD-0018, by any of the following methods: Email: DistributionTransfromers2019STD0018@ee.doe.gov. Include the docket number EERE-2019-BT-STD-0018 in the subject line of the message. Postal Mail: Appliance and Equipment Standards Program, U.S. Department of Energy, Building Technologies Office, Mailstop EE-5B, 1000 Independence Avenue SW, Washington, DC 20585-0121. Telephone: (202) 287-1445. If possible, please submit all items on a compact disc (“CD”), in which case it is not necessary to include printed copies. Hand Delivery/Courier: Appliance and Equipment Standards Program, U.S. Department of Energy, Building Technologies Office, 950 L'Enfant Plaza SW, 6th Floor, Washington, DC 20024. Telephone: (202) 287-1445. If possible, please submit all items on a CD, in which case it is not necessary to include printed copies. No telefacsimiles (“faxes”) will be accepted. For detailed instructions on submitting comments and additional information on this process, see section IV of this document. Docket: The docket for this activity, which includes Federal Register notices, comments, and other supporting documents/materials, is available for review at www.regulations.gov. All documents in the docket are listed in the 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 www.regulations.gov/docket/EERE-2019-BT-STD-0018. The docket web page contains instructions on how to access all documents, including public comments, in the docket. See section VII of this document for information on how to submit comments through www.regulations.gov. EPCA requires the Attorney General to provide DOE a written determination of whether the proposed standard is likely to lessen competition. The U.S. Department of Justice Antitrust Division invites input from market participants and other interested persons with views on the likely competitive impact of the proposed standard. Interested persons may contact the Division at energy.standards@usdoj.gov on or before the date specified in the DATES section. Please indicate in the “Subject” line of your email the title and Docket Number of this proposed rule. FOR FURTHER INFORMATION CONTACT: Mr. Jeremy Dommu, U.S. Department of Energy, Office of Energy Efficiency and Renewable Energy, Building Technologies Office, EE-5B, 1000 Independence Avenue SW, Washington, DC 20585-0121. Telephone: (202) 586-9870. Email: ApplianceStandardsQuestions@ee.doe.gov. Mr. Matthew Ring, U.S. Department of Energy, Office of the General Counsel, GC-33, 1000 Independence Avenue SW, Washington, DC 20585-0121. Telephone: (202) 586-2555. Email: matthew.ring@hq.doe.gov. For further information on how to submit a comment, review other public comments and the docket, or participate in the public meeting, contact the Appliance and Equipment Standards Program staff at (202) 287-1445 or by email: ApplianceStandardsQuestions@ee.doe.gov. SUPPLEMENTARY INFORMATION: Table of Contents I. Synopsis of the Proposed Rule A. Benefits and Costs to Consumers B. Impact on Manufacturers C. National Benefits and Costs 1. Liquid-Immersed Distribution Transformers 2. Low-Voltage Dry-Type Distribution Transformers 3. Medium Voltage Dry-Type Distribution Transformers D. Conclusion II. Introduction A. Authority B. Background 1. Current Standards 2. History of Standards Rulemaking for Distribution Transformers C. Deviation From Appendix A III. General Discussion A. Equipment Classes and Scope of Coverage B. Test Procedure C. Technological Feasibility 1. General 2. Maximum Technologically Feasible Levels D. Energy Savings 1. Determination of Savings 2. Significance of Savings E. Economic Justification 1. Specific Criteria a. Economic Impact on Manufacturers and Consumers b. Savings in Operating Costs Compared to Increase in Price (LCC and PBP) c. Energy Savings d. Lessening of Utility or Performance of Products e. Impact of Any Lessening of Competition f. Need for National Energy Conservation g. Other Factors 2. Rebuttable Presumption IV. Methodology and Discussion of Related Comments A. Market and Technology Assessment 1. Scope of Coverage a. Autotransformers b. Drive (Isolation) Transformers c. Special-Impedance Transformers d. Tap Range of 20 Percent or More e. Sealed and Nonventilated Transformers f. Step-Up Transformers g. Uninterruptible Power Supply Transformers h. Voltage Specification i. kVA Range 2. Equipment Classes a. Pole- and Pad-Mounted Transformers b. Submersible Transformers c. Multi-Voltage-Capable Distribution Transformers d. High-Current Distribution Transformers e. Data Center Distribution Transformer f. BIL Rating g. Other Types of Equipment 3. Test Procedure 4. Technology Options 5. Electrical Steel Technology and Market Assessment a. Amorphous Steel Market and Technology b. Grain-Oriented Electrical Steel Market and Technology 6. Distribution Transformer Production Market Dynamics B. Screening Analysis 1. Screened-Out Technologies 2. Remaining Technologies C. Engineering Analysis 1. Representative Units 2. Efficiency Analysis a. Design Option Combinations b. Data Validation c. Baseline Energy Use d. Higher Efficiency Levels e. Load Loss Scaling f. kVA Scaling 3. Cost Analysis a. Electrical Steel Prices b. Scrap Factor c. Other Material Costs d. Cost Mark-Ups 4. Cost-Efficiency Results D. Markups Analysis E. Energy Use Analysis 1. Hourly Load Model a. Hourly Per-Unit Load (PUL) b. Joint Probability Distribution Function (JPDF) 2. Monthly Per-Unit Load (PUL) 3. Future Load Growth 4. Harmonic Content/Non-Linear Loads F. Life-Cycle Cost and Payback Period Analysis 1. Equipment Cost 2. Efficiency Levels 3. Modeling Distribution Transformer Purchase Decision a. Basecase Equipment Selection b. Total Owning Cost (“TOC”) and Evaluators c. Non-Evaluators and First Cost Purchases 4. Installation Costs 5. Annual Energy Consumption 6. Electricity Prices a. Hourly Electricity Costs 7. Maintenance and Repair Costs 8. Equipment Lifetime 9. Discount Rates 10. Energy Efficiency Distribution in the No-New-Standards Case 11. Payback Period Analysis G. Shipments Analysis 1. Equipment Switching 2. Trends in Distribution Transformer Capacity (kVA) H. National Impact Analysis 1. Equipment Efficiency Trends 2. National Energy Savings 3. Net Present Value Analysis I. Consumer Subgroup Analysis 1. Utilities Serving Low Customer Populations 2. Utility Purchasers of Vault (Underground) and Subsurface Installations J. Manufacturer Impact Analysis 1. Overview 2. Government Regulatory Impact Model and Key Inputs a. Manufacturer Production Costs b. Shipments Projections c. Product and Capital Conversion Costs d. Manufacturer Markup Scenarios 3. Manufacturer Interviews a. Material Shortages and Prices b. Use of Amorphous Materials c. Larger Distribution Transformers 4. Discussion of MIA Comments a. Small Businesses b. Capital Equipment K. Emissions Analysis 1. Air Quality Regulations Incorporated in DOE's Analysis L. Monetizing Emissions Impacts 1. Monetization of Greenhouse Gas Emissions a. Social Cost of Carbon b. Social Cost of Methane and Nitrous Oxide 2. Monetization of Other Emissions Impacts M. Utility Impact Analysis N. Employment Impact Analysis V. Analytical Results and Conclusions A. Trial Standard Levels B. Economic Justification and Energy Savings 1. Economic Impacts on Individual Consumers a. Life-Cycle Cost and Payback Period b. Consumer Subgroup Analysis c. Rebuttable Presumption Payback 2. Economic Impacts on Manufacturers a. Industry Cash Flow Analysis Results b. Direct Impacts on Employment c. Impacts on Manufacturing Capacity d. Impacts on Competition e. Impacts on Subgroups of Manufacturers f. Cumulative Regulatory Burden 3. National Impact Analysis a. Significance of Energy Savings b. Net Present Value of Consumer Costs and Benefits c. Indirect Impacts on Employment 4. Impact on Utility or Performance of Products 5. Impact of Any Lessening of Competition 6. Need of the Nation To Conserve Energy 7. Other Factors 8. Summary of Economic Impacts C. Conclusion 1. Benefits and Burdens of TSLs Considered for Liquid-Immersed Distribution Transformers Standards 2. Benefits and Burdens of TSLs Considered for Low-Voltage Dry-Type Distribution Transformers Standards 3. Benefits and Burdens of TSLs Considered for Medium-Voltage Dry-Type Distribution Transformers Standards 4. Annualized Benefits and Costs of the Proposed Standards for Liquid-Immersed Distribution Transformers 5. Annualized Benefits and Costs of the Proposed Standards for Low-Voltage Distribution Transformers 6. Annualized Benefits and Costs of the Proposed Standards for Medium-Voltage Distribution Transformers 7. Benefits and Costs of the Proposed Standards for All Considered Distribution Transformers D. Reporting, Certification, and Sampling Plan VI. Procedural Issues and Regulatory Review A. Review Under Executive Orders 12866 and 13563 B. Review Under the Regulatory Flexibility Act 1. Description of Reasons Why Action Is Being Considered 2. Objectives of, and Legal Basis for, Rule 3. Description on Estimated Number of Small Entities Regulated 4. Description and Estimate of Compliance Requirements Including Differences in Cost, if Any, for Different Groups of Small Entities 5. Duplication, Overlap, and Conflict With Other Rules and Regulations 6. Significant Alternatives to the Rule C. Review Under the Paperwork Reduction Act D. Review Under the National Environmental Policy Act of 1969 E. Review Under Executive Order 13132 F. Review Under Executive Order 12988 G. Review Under the Unfunded Mandates Reform Act of 1995 H. Review Under the Treasury and General Government Appropriations Act, 1999 I. Review Under Executive Order 12630 J. Review Under the Treasury and General Government Appropriations Act, 2001 K. Review Under Executive Order 13211 L. Information Quality VII. Public Participation A. Attendance at the Public Meeting B. Procedure for Submitting Prepared General Statements for Distribution C. Conduct of the Public Webinar D. Submission of Comments E. Issues on Which DOE Seeks Comment VIII. Approval of the Office of the Secretary I. Synopsis of the Proposed Rule The EPCA, 1 (42 U.S.C. 6291-6317, as codified) authorizes DOE to regulate the energy efficiency of a number of consumer products and certain industrial equipment. Title III, Part B 2 of EPCA (42 U.S.C. 6291-6309, as codified), established the Energy Conservation Program for “Consumer Products Other Than Automobiles.” Title III, Part C 3 of EPCA (42 U.S.C. 6311-6317, as codified), added by Public Law 95-619, Title IV, section 411(a), established the Energy Conservation Program for Certain Industrial Equipment. The Energy Policy Act of 1992, Public Law 102-486, amended EPCA and directed DOE to prescribe energy conservation standards for those distribution transformers for which DOE determines such standards would be technologically feasible, economically justified, and would result in significant energy savings. (42 U.S.C. 6317(a)) The Energy Policy Act of 2005, Public Law 109-58, amended EPCA to establish energy conservation standards for low-voltage dry-type distribution transformers. (42 U.S.C. 6295(y)) 1 All references to EPCA in this document refer to the statute as amended through the Energy Act of 2020, Public Law 116-260 (Dec. 27, 2020), which reflect the last statutory amendments that impact Parts A and A-1 of EPCA. 2 For editorial reasons, upon codification in the U.S. Code, Part B was re-designated Part A. 3 For editorial reasons, upon codification in the U.S. Code, Part C was re-designated Part A-1. While EPCA includes provisions regarding distribution transformers in both Part A and Part A-1, for administrative convenience DOE has established the test procedures and standards for distribution transformers in 10 CFR part 431, Energy Efficiency Program for Certain Commercial and Industrial Equipment. DOE refers to distribution transformers generally as “covered equipment” in this document. Pursuant to EPCA, any new or amended energy conservation standard must be designed to achieve the maximum improvement in energy efficiency that DOE determines is technologically feasible and economically justified. (42 U.S.C. 6316(a); 42 U.S.C. 6295(o)(2)(A)) Furthermore, the new or amended standard must result in a significant conservation of energy. (42 U.S.C. 6316(a); 42 U.S.C. 6295(o)(3)(B)) EPCA also provides that not later than 6 years after issuance of any final rule establishing or amending a standard, DOE must publish either a notice of determination that standards for the product do not need to be amended, or a notice of proposed rulemaking including new proposed energy conservation standards (proceeding to a final rule, as appropriate). (42 U.S.C. 6316(a); 42 U.S.C. 6295(m)) In accordance with these and other statutory provisions discussed in this document, DOE proposes amended energy conservation standards for distribution transformers. The proposed standards, which are expressed in efficiency as a percentage, are shown in Table I.1 of this document. These proposed standards, if adopted, would apply to all distribution transformers listed in Table I.1, Table I.2, and Table I.3 manufactured in, or imported into, the United States starting on the date 3 years after the publication of the final rule for this rulemaking. Table I.1—Proposed Energy Conservation Standards for Low-Voltage Dry-Type Distribution Transformers Single-phase kVA Efficiency (%) Three-phase kVA Efficiency (%) 15 98.84 15 98.72 25 98.99 30 98.93 37.5 99.09 45 99.03 50 99.14 75 99.16 75 99.24 112.5 99.24 100 99.30 150 99.29 167 99.35 225 99.36 250 99.40 300 99.41 333 99.45 500 99.48 750 99.54 1,000 99.57 Table I.2—Proposed Energy Conservation Standards for Liquid-Immersed Distribution Transformers Single-phase kVA Efficiency (%) Three-phase kVA Efficiency (%) 10 98.96 15 98.92 15 99.05 30 99.06 25 99.16 45 99.13 37.5 99.24 75 99.22 50 99.29 112.5 99.29 75 99.35 150 99.33 100 99.40 225 99.38 167 99.46 300 99.42 250 99.51 500 99.48 333 99.54 750 99.52 500 99.59 1,000 99.54 667 99.62 1,500 99.58 833 99.64 2,000 99.61 2,500 99.62 3,750 99.66 5,000 99.68 Table I.3—Proposed Energy Conservation Standards for Medium-Voltage Dry-Type Distribution Transformers Single-phase kVA BIL * 20-45 kV Efficiency (%) 46-95 kV Efficiency (%) ≥96 kV Efficiency (%) Three-phase kVA BIL * 20-45 kV Efficiency (%) 46-95 kV Efficiency (%) ≥96 kV Efficiency (%) 15 98.29 98.07 15 97.74 97.45 25 98.49 98.30 30 98.11 97.86 37.5 98.64 98.47 45 98.29 98.07 50 98.74 98.58 75 98.49 98.31 75 98.86 98.71 98.68 112.5 98.67 98.52 100 98.94 98.80 98.77 150 98.78 98.66 167 99.06 98.95 98.92 225 98.94 98.82 98.71 250 99.16 99.05 99.02 300 99.04 98.93 98.82 333 99.23 99.13 99.09 500 99.18 99.09 99.00 500 99.30 99.21 99.18 750 99.29 99.21 99.12 667 99.34 99.26 99.23 1,000 99.35 99.28 99.20 833 99.38 99.31 99.28 1,500 99.43 99.37 99.29 2,000 99.49 99.42 99.35 2,500 99.52 99.47 99.40 3,750 99.58 99.53 99.47 5,000 99.62 99.58 99.51 * BIL means basic impulse insulation level. A. Benefits and Costs to Consumers Table I.4 presents DOE's evaluation of the monetized impacts of the proposed standards on consumers of distribution transformers, as measured by the average life-cycle cost (“LCC”) savings and the simple payback period (“PBP”). 4 The average LCC savings are positive for all equipment classes in all cases, with the exception of representative unit 14, and the PBP is less than the average lifetime of distribution transformers, which is estimated to be 32 years ( see section IV.F.8 of this document). 4 The average LCC savings and simple PBP refer to consumers that are affected by a standard and are measured relative to the efficiency distribution in the no-new-standards case, which depicts the market in the compliance year in the absence of new or amended standards. The determination of the distribution of efficiencies in the no-new-standards case is a function of the units selected from the consumer choice model. ( see section IV.F.3 of this document). In the context of this NOPR, the term consumer refers to different populations that purchase and bear the operating costs of distribution transformers. Consumers vary by transformer type; for medium-voltage liquid-immersed distribution transformers the term consumer refers to electric utilities; for low- and medium-voltage dry-type distribution transformers the term consumer refers to commercial and industrial entities. Table I.4—Impacts of Proposed Energy Conservation Standards on Consumers of Distribution Transformers Equipment class Representative unit Average LCC savings (2021$) Simple payback period (years) 1 1 72 16.0 1 2 131 10.1 1 3 1,029 12.2 2 4 511 11.9 2 5 1,543 13.8 2 17 6,594 15.8 12 15 * n.a. * n.a. 12 16 * n.a. * n.a. 3 6 147 11.7 4 7 564 8.9 4 8 722 11.8 6 9 887 2.4 6 10 653 11.4 8 11 226 11.9 8 12 3,051 1.1 8 18 22,797 8.1 10 13 228 12.4 10 14 −2,856 26.1 10 19 8,082 11.3 * No-new standards are currently being proposed for equipment class 12, “n.a” indicates that there are no consumer savings. DOE's analysis of the impacts of the proposed standards on consumers is described in section IV.F of this document. B. Impact on Manufacturers The industry net present value (“INPV”) is the sum of the discounted cash flows to the industry from the base year through the end of the analysis period (2022-2056). Using a real discount rate of 7.4 percent for liquid-immersed distribution transformers, 11.1 percent for low-voltage dry-type (“LVDT”) distribution transformers, and 9.0 percent for medium-voltage dry-type (“MVDT”) distribution transformers, DOE estimates that the INPV for manufacturers of distribution transformers in the case without amended standards is $1,384 million in 2021$ for liquid-immersed distribution transformers, $194 million in 2021$ for LVDT distribution transformers, and $87 million in 2021$ for MVDT distribution transformers. Under the proposed standards, the change in INPV is estimated to range from -18.1 percent to -10.9 percent for liquid-immersed distribution transformers which represents a change in INPV of approximately −$251.3 million to −$151.0 million; from -31.4 percent to -17.2 percent for LVDT distribution transformers, which represents a change in INPV of approximately −$61.0 million to −$33.5 million; and -3.0 percent to -0.9 percent for MVDT distribution transformers, which represents a change in INPV of approximately −$2.7 million to −$0.8 million. In order to bring products into compliance with amended standards, it is estimated that the industry would incur total conversion costs of $270.6 million for liquid-immersed distribution transformer, $69.4 million for LVDT distribution transformers, and $3.1 million for MVDT distribution transformers. DOE's analysis of the impacts of the proposed standards on manufacturers is described in section IV.J of this document. The analytic results of the manufacturer impact analysis (“MIA”) are presented in section V.B.2 of this document. C. National Benefits and Costs 5 5 All monetary values in this document are expressed in 2021 dollars. 1. Liquid-Immersed Distribution Transformers DOE's analyses indicate that the proposed energy conservation standards for liquid-immersed distribution transformers would save a significant amount of energy. Relative to the case without amended standards, the lifetime energy savings for liquid-immersed distribution transformers purchased in the 30-year period that begins in the anticipated year of compliance with the amended standards (2027-2056) amount to 8.02 quadrillion British thermal units (“Btu”), or quads. 6 This represents a fleet savings of 36 percent relative to the energy use of these products in the case without amended standards (referred to as the “no-new-standards case”). 6 The quantity refers to full-fuel-cycle (“FFC”) energy savings. FFC energy savings includes the energy consumed in extracting, processing, and transporting primary fuels ( i.e., coal, natural gas, petroleum fuels), and, thus, presents a more complete picture of the impacts of energy efficiency standards. For more information on the FFC metric, see section IV.H.2 of this document. The cumulative net present value (“NPV”) of total consumer benefits of the proposed standards for distribution transformers ranges from 0.26 billion (2021$) (at a 7-percent discount rate) to 5.30 billion (2021$) (at a 3-percent discount rate). This NPV expresses the estimated total value of future operating-cost savings minus the estimated increased product costs for distribution transformers purchased in 2027-2056. In addition, the proposed standards for liquid-immersed distribution transformers are projected to yield significant environmental benefits. DOE estimates that the proposed standards would result in cumulative emission reductions (over the same period as for energy savings) of 256.27 million metric tons (“Mt”) 7 of carbon dioxide (“CO 2 ”), 99.71 thousand tons of sulfur dioxide (“SO 2 ”), 403.57 thousand tons of nitrogen oxides (“NO X ”), 1,846.56 thousand tons of methane (“CH 4 ”), 2.32 thousand tons of nitrous oxide (“N 2 O”), and 0.65 tons of mercury (“Hg”). 8 7 A metric ton is equivalent to 1.1 short tons. Results for emissions other than CO 2 are presented in short tons. 8 DOE calculated emissions reductions relative to the no-new-standards case, which reflects key assumptions in the Annual Energy Outlook 2022 (“ AEO2022” ). AEO2022 represents current federal and state legislation and final implementation of regulations as of the time of its preparation. See section IV.K of this document for further discussion of AEO2022 assumptions that effect air pollutant emissions. DOE estimates climate benefits from a reduction in greenhouse gases (GHG) using four different estimates of the social cost of CO 2 (“SC-CO 2 ”), the social cost of methane (“SC-CH 4 ”), and the social cost of nitrous oxide (“SC-N 2 O”). Together these represent the social cost of GHG (SC-GHG). DOE used interim SC-GHG values developed by an Interagency Working Group on the Social Cost of Greenhouse Gases (IWG), 9 as discussed in section IV.L. of this document. For presentational purposes, the climate benefits associated with the average SC-GHG at a 3-percent discount rate are $8.66 billion. DOE does not have a single central SC-GHG point estimate and it emphasizes the importance and value of considering the benefits calculated using all four SC-GHG estimates. 10 9 See Interagency Working Group on Social Cost of Greenhouse Gases, Technical Support Document: Social Cost of Carbon, Methane, and Nitrous Oxide. Interim Estimates Under Executive Order 13990, Washington, DC, February 2021. https://www.whitehouse.gov/wp-content/uploads/2021/02/TechnicalSupportDocument_SocialCostofCarbonMethaneNitrousOxide.pdf. 10 On March 16, 2022, the Fifth Circuit Court of Appeals (No. 22-30087) granted the federal government's emergency motion for stay pending appeal of the February 11, 2022, preliminary injunction issued in Louisiana v. Biden, No. 21-cv-1074-JDC-KK (W.D. La.). As a result of the Fifth Circuit's order, the preliminary injunction is no longer in effect, pending resolution of the federal government's appeal of that injunction or a further court order. Among other things, the preliminary injunction enjoined the defendants in that case from “adopting, employing, treating as binding, or relying upon” the interim estimates of the social cost of greenhouse gases—which were issued by the Interagency Working Group on the Social Cost of Greenhouse Gases on February 26, 2021—to monetize the benefits of reducing greenhouse gas emissions. As reflected in this rule, DOE has reverted to its approach prior to the injunction and present monetized greenhouse gas abatement benefits where appropriate and permissible under law. DOE also estimates health benefits from SO 2 and NO X emissions reductions. 11 DOE estimates the present value of the health benefits would be $4.69 billion using a 7-percent discount rate, and $15.57 billion using a 3-percent discount rate. 12 DOE is currently only monetizing (for SO 2 and NO X ) PM 2.5 precursor health benefits and (for NO X ) ozone precursor health benefits, but will continue to assess the ability to monetize other effects such as health benefits from reductions in direct PM 2.5 emissions. 11 DOE estimated the monetized value of SO 2 and NO X emissions reductions associated with electricity savings using benefit per ton estimates from the EPA. e. See section IV.L.2 of this document for further discussion. 12 DOE estimates the economic value of these emissions reductions resulting from the considered TSLs for the purpose of complying with the requirements of Executive Order 12866. Table I.5 summarizes the monetized benefits and costs expected to result from the proposed standards for liquid-immersed distribution transformers. In the table, total benefits for both the 3-percent and 7-percent cases are presented using the average GHG social costs with 3-percent discount rate, but the Department emphasizes the importance and value of considering the benefits calculated using all four SC-GHG cases. The estimated total net benefits using each of the four cases are presented in section V.B.8 of this document. Table I.5—Summary of Monetized Benefits and Costs of Proposed Energy Conservation Standards for Liquid-Immersed Distribution Transformers (TSL 4) Billion ($2021) 3% discount rate Consumer Operating Cost Savings 12.77 Climate Benefits * 8.66 Health Benefits ** 15.57 Total Benefits † 37.01 Consumer Incremental Product Costs ‡ 7.48 Net Benefits 29.53 7% discount rate Consumer Operating Cost Savings 4.28 Climate Benefits * (3% discount rate) 8.66 Health Benefits ** 4.69 Total Benefits † 17.63 Consumer Incremental Product Costs ‡ 4.02 Net Benefits 13.61 This table presents the costs and benefits associated with distribution transformers shipped in 2027-2056. These results include benefits to consumers which accrue after 2056 from the products shipped in 2027-2056. * Climate benefits are calculated using four different estimates of the social cost of carbon (SC-CO2), methane (SC-CH4), and nitrous oxide (SC-N2O) (model average at 2.5 percent, 3 percent, and 5 percent discount rates; 95th percentile at 3 percent discount rate), as shown in Table V.73, Table V.74, and Table V.75. Together these represent the global social cost of greenhouse gases (SC-GHG). For presentational purposes of this table, the climate benefits associated with the average SC-GHG at a 3 percent discount rate are shown, but the Department does not have a single central SC-GHG point estimate. See section. IV.L of this document for more details. On March 16, 2022, the Fifth Circuit Court of Appeals (No. 22-30087) granted the federal government's emergency motion for stay pending appeal of the February 11, 2022, preliminary injunction issued in Louisiana v. Biden, No. 21-cv-1074-JDC-KK (W.D. La.). As a result of the Fifth Circuit's order, the preliminary injunction is no longer in effect, pending resolution of the federal government's appeal of that injunction or a further court order. Among other things, the preliminary injunction enjoined the defendants in that case from “adopting, employing, treating as binding, or relying upon” the interim estimates of the social cost of greenhouse gases—which were issued by the Interagency Working Group on the Social Cost of Greenhouse Gases on February 26, 2021—to monetize the benefits of reducing greenhouse gas emissions. As reflected in this rule, DOE has reverted to its approach prior to the injunction and present monetized greenhouse gas abatement benefits where appropriate and permissible under law. ** Health benefits are calculated using benefit-per-ton values for NO X and SO 2 . DOE is currently only monetizing (for SO 2 and NO X ) PM 2.5 precursor health benefits and (for NO X ) ozone precursor health benefits but will continue to assess the ability to monetize other effects such as health benefits from reductions in direct PM 2.5 emissions. The health benefits are presented at real discount rates of 3 and 7 percent. See section IV.L of this document for more details. † Total and net benefits include consumer, climate, and health benefits. For presentation purposes, total and net benefits for both the 3-percent and 7-percent cases are presented using the average SC-GHG with 3-percent discount rate, but the Department does not have a single central SC-GHG point estimate. DOE emphasizes the importance and value of considering the benefits calculated using all four SC-GHG estimates. See Table V.69 for net benefits using all four SC-GHG estimates. ‡ Costs include incremental equipment costs as well as installation costs. The benefits and costs of the proposed standards can also be expressed in terms of annualized values. The monetary values for the total annualized net benefits are (1) the reduced consumer operating costs, minus (2) the increase in product purchase prices and installation costs, plus (3) the value of the benefits of GHG and NO X and SO 2 emission reductions, all annualized. 13 The national operating savings are domestic private U.S. consumer monetary savings that occur as a result of purchasing the covered products and are measured for the lifetime of distribution transformers shipped in 2027-2056. The benefits associated with reduced emissions achieved as a result of the proposed standards are also calculated based on the lifetime of liquid-immersed distribution transformers shipped in 2027-2056. 13 To convert the time-series of costs and benefits into annualized values, DOE calculated a present value in 2021, the year used for discounting the NPV of total consumer costs and savings. For the benefits, DOE calculated a present value associated with each year's shipments in the year in which the shipments occur ( e.g., 2030), and then discounted the present value from each year to 2021. Using the present value, DOE then calculated the fixed annual payment over a 30-year period, starting in the compliance year, that yields the same present value. Estimates of annualized benefits and costs of the proposed standards are shown in Table I.6. The results under the primary estimate are as follows. Using a 7-percent discount rate for consumer benefits and costs and health benefits from reduced NOx and SO 2 emissions, and the 3-percent discount rate case for climate benefits from reduced GHG emissions, the estimated cost of the standards proposed in this rule is $424.8 million per year in increased equipment costs, while the estimated annual benefits are $451.9 million in reduced equipment operating costs, $497.4 million in climate benefits, and $495.3 million in health benefits. In this case. The net benefit would amount to $1,019.8 million per year. Table I.6—Annualized Benefits and Costs of Proposed Energy Conservation Standards for Liquid-Immersed Distribution Transformers (TSL 4) Category Million (2021$/year) Primary estimate Low-net-benefits estimate High-net-benefits estimate 3% discount rate Consumer Operating Cost Savings 733.5 686.9 789.9 Climate Benefits * 497.4 478.9 519.5 Health Benefits ** 894.3 860.5 934.8 Total Benefits † 2,125.3 2,026.3 2,244.2 Consumer Incremental Product Costs ‡ 429.5 449.0 413.2 Net Benefits 1,695.8 1,577.3 1,831.0 7% discount rate Consumer Operating Cost Savings 451.9 425.7 482.2 Climate Benefits * (3% discount rate) 497.4 478.9 519.5 Health Benefits ** 495.3 477.9 515.3 Total Benefits † 1,444.7 1,382.5 1,517.0 Consumer Incremental Product Costs ‡ 424.8 442.1 409.9 Net Benefits 1,019.8 940.5 1,107.2 This table presents the costs and benefits associated with distribution transformers shipped in 2027-2056. These results include benefits to consumers which accrue after 2056 from the products shipped in 2027-2056. * Climate benefits are calculated using four different estimates of the social cost of carbon (SC-CO2), methane (SC-CH4), and nitrous oxide (SC-N2O) (model average at 2.5 percent, 3 percent, and 5 percent discount rates; 95th percentile at 3 percent discount rate), as shown in Table V.73, Table V.74, and Table V.75. Together these represent the global social cost of greenhouse gases (SC-GHG). For presentational purposes of this table, the climate benefits associated with the average SC-GHG at a 3 percent discount rate are shown, but the Department does not have a single central SC-GHG point estimate. See section. IV.L of this document for more details. On March 16, 2022, the Fifth Circuit Court of Appeals (No. 22-30087) granted the federal government's emergency motion for stay pending appeal of the February 11, 2022, preliminary injunction issued in Louisiana v. Biden, No. 21-cv-1074-JDC-KK (W.D. La.). As a result of the Fifth Circuit's order, the preliminary injunction is no longer in effect, pending resolution of the federal government's appeal of that injunction or a further court order. Among other things, the preliminary injunction enjoined the defendants in that case from “adopting, employing, treating as binding, or relying upon” the interim estimates of the social cost of greenhouse gases—which were issued by the Interagency Working Group on the Social Cost of Greenhouse Gases on February 26, 2021—to monetize the benefits of reducing greenhouse gas emissions. As reflected in this rule, DOE has reverted to its approach prior to the injunction and present monetized greenhouse gas abatement benefits where appropriate and permissible under law. ** Health benefits are calculated using benefit-per-ton values for NO X and SO 2 . The benefits are based on the low estimates of the monetized value. DOE is currently only monetizing (for SO X and NO X ) PM 2.5 precursor health benefits and (for NO X ) ozone precursor health benefits but will continue to assess the ability to monetize other effects such as health benefits from reductions in direct PM 2.5 emissions. See section IV.L of this document for more details. † Total and net benefits include consumer, climate, and health benefits. For presentation purposes, total and net benefits for both the 3-percent and 7-percent cases are presented using the average SC-GHG with 3-percent discount rate, but the Department does not have a single central SC-GHG point estimate. DOE emphasizes the importance and value of considering the benefits calculated using all four SC-GHG estimates. See Table V.69 for net benefits using all four SC-GHG estimates. ‡ Costs include incremental equipment costs as well as installation costs. 2. Low-Voltage Dry-Type Distribution Transformers DOE's analyses indicate that the proposed energy conservation standards for low-voltage dry-type distribution transformers would save a significant amount of energy. Relative to the case without amended standards, the lifetime energy savings for low-voltage dry-type distribution transformers purchased in the 30-year period that begins in the anticipated year of compliance with the amended standards (2027-2056) amount to 2.47 quadrillion British thermal units (“Btu”), or quads. 14 This represents a fleet savings of 47 percent relative to the energy use of these products in the case without amended standards (referred to as the “no-new-standards case”). 14 The quantity refers to full-fuel-cycle (“FFC”) energy savings. FFC energy savings includes the energy consumed in extracting, processing, and transporting primary fuels ( i.e., coal, natural gas, petroleum fuels), and, thus, presents a more complete picture of the impacts of energy efficiency standards. For more information on the FFC metric, see section IV.H.2 of this document. The cumulative net present value (“NPV”) of total consumer benefits of the proposed standards for low-voltage dry-type distribution transformers ranges from 2.63 billion (2021$) (at a 7-percent discount rate) to 9.63 billion (2021$) (at a 3-percent discount rate). This NPV expresses the estimated total value of future operating-cost savings minus the estimated increased product costs for low-voltage dry-type distribution transformers purchased in 2027-2056. In addition, the proposed standards for low-voltage dry-type distribution transformers are projected to yield significant environmental benefits. DOE estimates that the proposed standards would result in cumulative emission reductions (over the same period as for energy savings) of 77.57 million metric tons (“Mt”) 15 of carbon dioxide (“CO 2 ”), 92.81 thousand tons of sulfur dioxide (“SO 2 ”), 123.44 thousand tons of nitrogen oxides (“NO X ”), 567.30 thousand tons of methane (“CH 4 ”), 0.70 thousand tons of nitrous oxide (“N 2 O”), and 0.19 tons of mercury (“Hg”). 16 15 A metric ton is equivalent to 1.1 short tons. Results for emissions other than CO 2 are presented in short tons. 16 DOE calculated emissions reductions relative to the no-new-standards case, which reflects key assumptions in the Annual Energy Outlook 2022 (“ AEO2022” ). AEO2022 represents current federal and state legislation and final implementation of regulations as of the time of its preparation. See section IV.K of this document for further discussion of AEO2022 assumptions that effect air pollutant emissions. DOE estimates climate benefits from a reduction in greenhouse gases (GHG) using four different estimates of the social cost of CO 2 (“SC-CO 2 ”), the social cost of methane (“SC-CH 4 ”), and the social cost of nitrous oxide (“SC-N 2 O”). Together these represent the social cost of GHG (SC-GHG). DOE used interim SC-GHG values developed by an Interagency Working Group on the Social Cost of Greenhouse Gases (IWG), 17 as discussed in section IV.L of this document. For presentational purposes, the climate benefits associated with the average SC-GHG at a 3-percent discount rate are $2.77 billion. (DOE does not have a single central SC-GHG point estimate and it emphasizes the importance and value of considering the benefits calculated using all four SC-GHG estimates.) 17 See Interagency Working Group on Social Cost of Greenhouse Gases, Technical Support Document: Social Cost of Carbon, Methane, and Nitrous Oxide. Interim Estimates Under Executive Order 13990, Washington, DC, February 2021. https://www.whitehouse.gov/wp-content/uploads/2021/02/TechnicalSupportDocument_SocialCostofCarbonMethaneNitrousOxide.pdf. DOE also estimates health benefits from SO 2 and NO X emissions reductions. 18 DOE estimates the present value of the health benefits would be $1.53 billion using a 7-percent discount rate, and $4.91 billion using a 3-percent discount rate. 19 DOE is currently only monetizing (for SO 2 and NO X ) PM 2.5 precursor health benefits and (for NO X ) ozone precursor health benefits, but will continue to assess the ability to monetize other effects such as health benefits from reductions in direct PM 2.5 emissions. 18 DOE estimated the monetized value of SO 2 and NO X emissions reductions associated with electricity savings using benefit per ton estimates from the EPA. See section IV.L.2 of this document for further discussion. 19 DOE estimates the economic value of these emissions reductions resulting from the considered TSLs for the purpose of complying with the requirements of Executive Order 12866. Table I.7 summarizes the monetized benefits and costs expected to result from the proposed standards for low-voltage dry-type distribution transformers. In the table, total benefits for both the 3-percent and 7-percent cases are presented using the average GHG social costs with 3-percent discount rate, but the Department emphasizes the importance and value of considering the benefits calculated using all four SC-GHG cases. The estimated total net benefits using each of the four cases are presented in section V.B.8 of this document. Table I.7—Summary of Monetized Benefits and Costs of Proposed Energy Conservation Standards for Low-Voltage Dry-Type Distribution Transformers (TSL 5) Billion ($2021) 3% discount rate Consumer Operating Cost Savings 13.45 Climate Benefits * 2.77 Health Benefits ** 4.91 Total Benefits † 21.13 Consumer Incremental Product Costs ‡ 3.82 Net Benefits 17.31 7% discount rate Consumer Operating Cost Savings 4.69 Climate Benefits * (3% discount rate) 2.77 Health Benefits ** 1.53 Total Benefits † 8.99 Consumer Incremental Product Costs ‡ 2.05 Net Benefits 6.94 Note: This table presents the costs and benefits associated with distribution transformers shipped in 2027-2056. These results include benefits to consumers which accrue after 2056 from the products shipped in 2027-2056. * Climate benefits are calculated using four different estimates of the social cost of carbon (SC-CO 2 ), methane (SC-CH 4 ), and nitrous oxide (SC-N 2 O) (model average at 2.5 percent, 3 percent, and 5 percent discount rates; 95th percentile at 3 percent discount rate), as shown in Table V.73, Table V.74, and Table V.75. Together these represent the global social cost of greenhouse gases (SC-GHG). For presentational purposes of this table, the climate benefits associated with the average SC-GHG at a 3 percent discount rate are shown, but the Department does not have a single central SC-GHG point estimate. See section. IV.L of this document for more details. On March 16, 2022, the Fifth Circuit Court of Appeals (No. 22-30087) granted the federal government's emergency motion for stay pending appeal of the February 11, 2022, preliminary injunction issued in Louisiana v. Biden, No. 21-cv-1074-JDC-KK (W.D. La.). As a result of the Fifth Circuit's order, the preliminary injunction is no longer in effect, pending resolution of the federal government's appeal of that injunction or a further court order. Among other things, the preliminary injunction enjoined the defendants in that case from “adopting, employing, treating as binding, or relying upon” the interim estimates of the social cost of greenhouse gases—which were issued by the Interagency Working Group on the Social Cost of Greenhouse Gases on February 26, 2021—to monetize the benefits of reducing greenhouse gas emissions. As reflected in this rule, DOE has reverted to its approach prior to the injunction and present monetized greenhouse gas abatement benefits where appropriate and permissible under law. ** Health benefits are calculated using benefit-per-ton values for NO X and SO 2 . DOE is currently only monetizing (for SO 2 and NO X ) PM 2.5 precursor health benefits and (for NO X ) ozone precursor health benefits but will continue to assess the ability to monetize other effects such as health benefits from reductions in direct PM 2.5 emissions. The health benefits are presented at real discount rates of 3 and 7 percent. See section IV.L of this document for more details. † Total and net benefits include consumer, climate, and health benefits. For presentation purposes, total and net benefits for both the 3-percent and 7-percent cases are presented using the average SC-GHG with 3-percent discount rate, but the Department does not have a single central SC-GHG point estimate. DOE emphasizes the importance and value of considering the benefits calculated using all four SC-GHG estimates. See Table V.69 for net benefits using all four SC-GHG estimates. ‡ Costs include incremental equipment costs as well as installation costs. The benefits and costs of the proposed standards can also be expressed in terms of annualized values. The monetary values for the total annualized net benefits are (1) the reduced consumer operating costs, minus (2) the increase in product purchase prices and installation costs, plus (3) the value of the benefits of GHG and NO X and SO 2 emission reductions, all annualized. 20 The national operating savings are domestic private U.S. consumer monetary savings that occur as a result of purchasing the covered products and are measured for the lifetime of low-voltage dry-type distribution transformers shipped in 2027-2056. The benefits associated with reduced emissions achieved as a result of the proposed standards are also calculated based on the lifetime of low-voltage dry-type distribution transformers shipped in 2027-2056. 20 To convert the time-series of costs and benefits into annualized values, DOE calculated a present value in 2021, the year used for discounting the NPV of total consumer costs and savings. For the benefits, DOE calculated a present value associated with each year's shipments in the year in which the shipments occur ( e.g., 2030), and then discounted the present value from each year to 2021. Using the present value, DOE then calculated the fixed annual payment over a 30-year period, starting in the compliance year, that yields the same present value. Estimates of annualized benefits and costs of the proposed standards are shown in Table I.8. The results under the primary estimate are as follows. Using a 7-percent discount rate for consumer benefits and costs and health benefits from reduced NO X and SO 2 emissions, and the 3-percent discount rate case for climate benefits from reduced GHG emissions, the estimated cost of the standards proposed in this rule is $216.9 million per year in increased equipment costs, while the estimated annual benefits are $495.0 million in reduced equipment operating costs, $159.2 million in climate benefits, and $162.1 million in health benefits. In this case. The net benefit would amount to $599.4 million per year. Table I.8—Annualized Benefits and Costs of Proposed Energy Conservation Standards for Low-Voltage Dry Type Distribution Transformers (TSL 5) Category Million (2021$/year) Primary estimate Low-net-benefits estimate High-net-benefits estimate 3% discount rate Consumer Operating Cost Savings 772.1 716.9 831.3 Climate Benefits * 159.2 151.6 165.9 Health Benefits ** 281.8 268.3 293.9 Total Benefits † 1,213.1 1,136.7 1,291.1 Consumer Incremental Product Costs ‡ 219.3 228.7 208.7 Net Benefits 993.8 908.0 1,082.4 7% discount rate Consumer Operating Cost Savings 495.0 462.8 528.7 Climate Benefits * (3% discount rate) 159.2 151.6 165.9 Health Benefits ** 162.1 154.9 168.2 Total Benefits † 816.3 769.3 862.8 Consumer Incremental Product Costs ‡ 216.9 225.2 207.3 Net Benefits 599.4 544.1 655.5 This table presents the costs and benefits associated with distribution transformers shipped in 2027-2056. These results include benefits to consumers which accrue after 2056 from the products shipped in 2027-2056. * Climate benefits are calculated using four different estimates of the social cost of carbon (SC-CO 2 ), methane (SC-CH 4 ), and nitrous oxide (SC-N 2 O) (model average at 2.5 percent, 3 percent, and 5 percent discount rates; 95th percentile at 3 percent discount rate), as shown in Table V.73, Table V.74, and Table V.75. Together these represent the global social cost of greenhouse gases (SC-GHG). For presentational purposes of this table, the climate benefits associated with the average SC-GHG at a 3 percent discount rate are shown, but the Department does not have a single central SC-GHG point estimate. See section. IV.L of this document for more details. On March 16, 2022, the Fifth Circuit Court of Appeals (No. 22-30087) granted the federal government's emergency motion for stay pending appeal of the February 11, 2022, preliminary injunction issued in Louisiana v. Biden, No. 21-cv-1074-JDC-KK (W.D. La.). As a result of the Fifth Circuit's order, the preliminary injunction is no longer in effect, pending resolution of the federal government's appeal of that injunction or a further court order. Among other things, the preliminary injunction enjoined the defendants in that case from “adopting, employing, treating as binding, or relying upon” the interim estimates of the social cost of greenhouse gases—which were issued by the Interagency Working Group on the Social Cost of Greenhouse Gases on February 26, 2021—to monetize the benefits of reducing greenhouse gas emissions. As reflected in this rule, DOE has reverted to its approach prior to the injunction and present monetized greenhouse gas abatement benefits where appropriate and permissible under law. ** Health benefits are calculated using benefit-per-ton values for NO X and SO 2 . The benefits are based on the low estimates of the monetized value. DOE is currently only monetizing (for SO X and NO X ) PM 2.5 precursor health benefits and (for NO X ) ozone precursor health benefits but will continue to assess the ability to monetize other effects such as health benefits from reductions in direct PM 2.5 emissions. See section IV.L of this document for more details. † Total and net benefits include consumer, climate, and health benefits. For presentation purposes, total and net benefits for both the 3-percent and 7-percent cases are presented using the average SC-GHG with 3-percent discount rate, but the Department does not have a single central SC-GHG point estimate. DOE emphasizes the importance and value of considering the benefits calculated using all four SC-GHG estimates. See Table V.69 for net benefits using all four SC-GHG estimates. ‡ Costs include incremental equipment costs as well as installation costs. 3. Medium Voltage Dry-Type Distribution Transformers DOE's analyses indicate that the proposed energy conservation standards for medium-voltage dry-type distribution transformers would save a significant amount of energy. Relative to the case without amended standards, the lifetime energy savings for medium-voltage dry-type distribution transformers purchased in the 30-year period that begins in the anticipated year of compliance with the amended standards (2027-2056) amount to 0.12 quadrillion British thermal units (“Btu”), or quads. 21 This represents a fleet savings of 24 percent relative to the energy use of these products in the case without amended standards (referred to as the “no-new-standards case”). 21 The quantity refers to full-fuel-cycle (“FFC”) energy savings. FFC energy savings includes the energy consumed in extracting, processing, and transporting primary fuels ( i.e., coal, natural gas, petroleum fuels), and, thus, presents a more complete picture of the impacts of energy efficiency standards. For more information on the FFC metric, see section IV.H.2 of this document. The cumulative net present value (“NPV”) of total consumer benefits of the proposed standards for medium-voltage dry-type distribution transformers ranges from 0.04 billion (2021$) (at a 7-percent discount rate) to 0.21 billion (2021$) (at a 3-percent discount rate). This NPV expresses the estimated total value of future operating-cost savings minus the estimated increased product costs for medium-voltage dry-type distribution transformers purchased in 2027-2056. In addition, the proposed standards for medium-voltage dry-type distribution transformers are projected to yield significant environmental benefits. DOE estimates that the proposed standards would result in cumulative emission reductions (over the same period as for energy savings) of 3.71 million metric tons (“Mt”) 22 of carbon dioxide (“CO 2 ”), 1.43 thousand tons of sulfur dioxide (“SO 2 ”), 5.93 thousand tons of nitrogen oxides (“NO X ”), 27.29 thousand tons of methane (“CH 4 ”), 0.03 thousand tons of nitrous oxide (“N 2 O”), and 0.01 tons of mercury (“Hg”). 23 22 A metric ton is equivalent to 1.1 short tons. Results for emissions other than CO 2 are presented in short tons. 23 DOE calculated emissions reductions relative to the no-new-standards case, which reflects key assumptions in the Annual Energy Outlook 2022 (“ AEO2022” ). AEO2022 represents current federal and state legislation and final implementation of regulations as of the time of its preparation. See section IV.K of this document for further discussion of AEO2022 assumptions that effect air pollutant emissions. DOE estimates climate benefits from a reduction in greenhouse gases (GHG) using four different estimates of the social cost of CO 2 (“SC-CO 2 ”), the social cost of methane (“SC-CH 4 ”), and the social cost of nitrous oxide (“SC-N 2 O”). Together these represent the social cost of GHG (SC-GHG). DOE used interim SC-GHG values developed by an Interagency Working Group on the Social Cost of Greenhouse Gases (IWG), 24 as discussed in IV.L of this document. For presentational purposes, the climate benefits associated with the average SC-GHG at a 3-percent discount rate are $0.13 billion. (DOE does not have a single central SC-GHG point estimate and it emphasizes the importance and value of considering the benefits calculated using all four SC-GHG estimates.) 24 See Interagency Working Group on Social Cost of Greenhouse Gases, Technical Support Document: Social Cost of Carbon, Methane, and Nitrous Oxide. Interim Estimates Under Executive Order 13990, Washington, DC, February 2021. https://www.whitehouse.gov/wp-content/uploads/2021/02/TechnicalSupportDocument_SocialCostofCarbonMethaneNitrousOxide.pdf. DOE also estimates health benefits from SO 2 and NO X emissions reductions. 25 DOE estimates the present value of the health benefits would be $0.07 billion using a 7-percent discount rate, and $0.24 billion using a 3-percent discount rate. 26 DOE is currently only monetizing (for SO 2 and NO X ) PM 2.5 precursor health benefits and (for NO X ) ozone precursor health benefits, but will continue to assess the ability to monetize other effects such as health benefits from reductions in direct PM 2.5 emissions. 25 DOE estimated the monetized value of SO 2 and NO X emissions reductions associated with electricity savings using benefit per ton estimates from the EPA. See section IV.L.2 of this document for further discussion. 26 DOE estimates the economic value of these emissions reductions resulting from the considered TSLs for the purpose of complying with the requirements of Executive Order 12866. Table I.9 summarizes the monetized benefits and costs expected to result from the proposed standards for medium-voltage dry-type distribution transformers. In the table, total benefits for both the 3-percent and 7-percent cases are presented using the average GHG social costs with 3-percent discount rate, but the Department emphasizes the importance and value of considering the benefits calculated using all four SC-GHG cases. The estimated total net benefits using each of the four cases are presented in section V.B.8 of this document. Table I.9—Summary of Monetized Benefits and Costs of Proposed Energy Conservation Standards for Medium-Voltage Dry-Type Distribution Transformers (TSL 2) Billion ($2021) 3% discount rate Consumer Operating Cost Savings 0.41 Climate Benefits * 0.13 Health Benefits ** 0.24 Total Benefits † 0.77 Consumer Incremental Product Costs ‡ 0.19 Net Benefits 0.58 7% discount rate Consumer Operating Cost Savings 0.14 Climate Benefits * (3% discount rate) 0.13 Health Benefits ** 0.07 Total Benefits † 0.35 Consumer Incremental Product Costs ‡ 0.10 Net Benefits 0.24 This table presents the costs and benefits associated with distribution transformers shipped in 2027-2056. These results include benefits to consumers which accrue after 2056 from the products shipped in 2027-2056. * Climate benefits are calculated using four different estimates of the social cost of carbon (SC-CO 2 ), methane (SC-CH 4 ), and nitrous oxide (SC-N 2 O) (model average at 2.5 percent, 3 percent, and 5 percent discount rates; 95th percentile at 3 percent discount rate), as shown in Table V.73, Table V.74, and Table V.75. Together these represent the global social cost of greenhouse gases (SC-GHG). For presentational purposes of this table, the climate benefits associated with the average SC-GHG at a 3 percent discount rate are shown, but the Department does not have a single central SC-GHG point estimate. See section. IV.L of this document for more details. On March 16, 2022, the Fifth Circuit Court of Appeals (No. 22-30087) granted the federal government's emergency motion for stay pending appeal of the February 11, 2022, preliminary injunction issued in Louisiana v. Biden, No. 21-cv-1074-JDC-KK (W.D. La.). As a result of the Fifth Circuit's order, the preliminary injunction is no longer in effect, pending resolution of the federal government's appeal of that injunction or a further court order. Among other things, the preliminary injunction enjoined the defendants in that case from “adopting, employing, treating as binding, or relying upon” the interim estimates of the social cost of greenhouse gases—which were issued by the Interagency Working Group on the Social Cost of Greenhouse Gases on February 26, 2021—to monetize the benefits of reducing greenhouse gas emissions. As reflected in this rule, DOE has reverted to its approach prior to the injunction and present monetized greenhouse gas abatement benefits where appropriate and permissible under law. ** Health benefits are calculated using benefit-per-ton values for NO X and SO 2 . DOE is currently only monetizing (for SO 2 and NO X ) PM 2.5 precursor health benefits and (for NO X ) ozone precursor health benefits but will continue to assess the ability to monetize other effects such as health benefits from reductions in direct PM 2.5 emissions. The health benefits are presented at real discount rates of 3 and 7 percent. See section IV.L of this document for more details. † Total and net benefits include consumer, climate, and health benefits. For presentation purposes, total and net benefits for both the 3-percent and 7-percent cases are presented using the average SC-GHG with 3-percent discount rate, but the Department does not have a single central SC-GHG point estimate. DOE emphasizes the importance and value of considering the benefits calculated using all four SC-GHG estimates. See Table V.69 for net benefits using all four SC-GHG estimates. ‡ Costs include incremental equipment costs as well as installation costs. The benefits and costs of the proposed standards can also be expressed in terms of annualized values. The monetary values for the total annualized net benefits are (1) the reduced consumer operating costs, minus (2) the increase in product purchase prices and installation costs, plus (3) the value of the benefits of GHG and NO X and SO 2 emission reductions, all annualized. 27 The national operating savings are domestic private U.S. consumer monetary savings that occur as a result of purchasing the covered equipment and are measured for the lifetime of medium-voltage dry-type distribution transformers shipped in 2027-2056. The benefits associated with reduced emissions achieved as a result of the proposed standards are also calculated based on the lifetime of medium-voltage dry-type distribution transformers shipped in 2027-2056. 27 To convert the time-series of costs and benefits into annualized values, DOE calculated a present value in 2021, the year used for discounting the NPV of total consumer costs and savings. For the benefits, DOE calculated a present value associated with each year's shipments in the year in which the shipments occur ( e.g., 2030), and then discounted the present value from each year to 2021. Using the present value, DOE then calculated the fixed annual payment over a 30-year period, starting in the compliance year, that yields the same present value. Estimates of annualized benefits and costs of the proposed standards are shown in Table I.10. The results under the primary estimate are as follows. Using a 7-percent discount rate for consumer benefits and costs and health benefits from reduced NO X and SO 2 emissions, and the 3-percent discount rate case for climate benefits from reduced GHG emissions, the estimated cost of the standards proposed in this rule is $10.8 million per year in increased equipment costs, while the estimated annual benefits are $14.9 million in reduced equipment operating costs, $7.6 million in climate benefits, and $7.8 million in health benefits. The net benefit would amount to $19.5 million per year. Table I.10—Annualized Benefits and Costs of Proposed Energy Conservation Standards for Medium-Voltage Dry-Type Distribution Transformers (TSL 2) Category Million (2021$/year) Primary estimate Low-net-benefits estimate High-net-benefits estimate 3% discount rate Consumer Operating Cost Savings 23.3 22.2 25.8 Climate Benefits * 7.6 7.5 8.2 Health Benefits ** 13.5 13.2 14.5 Total Benefits † 44.4 42.9 48.5 Consumer Incremental Product Costs ‡ 11.0 11.7 10.7 Net Benefits 33.5 31.1 37.7 7% discount rate Consumer Operating Cost Savings 14.9 14.3 16.4 Climate Benefits * (3% discount rate) 7.6 7.5 8.2 Health Benefits ** 7.8 7.6 8.3 Total Benefits † 30.3 29.4 32.9 Consumer Incremental Product Costs ‡ 10.8 11.6 10.6 Net Benefits 19.5 17.9 22.2 This table presents the costs and benefits associated with distribution transformers shipped in 2027-2056. These results include benefits to consumers which accrue after 2056 from the products shipped in 2027-2056. * Climate benefits are calculated using four different estimates of the social cost of carbon (SC-CO 2 ), methane (SC-CH 4 ), and nitrous oxide (SC-N 2 O) (model average at 2.5 percent, 3 percent, and 5 percent discount rates; 95th percentile at 3 percent discount rate), as shown in Table V.73, Table V.74, and Table V.75. Together these represent the global social cost of greenhouse gases (SC-GHG). For presentational purposes of this table, the climate benefits associated with the average SC-GHG at a 3 percent discount rate are shown, but the Department does not have a single central SC-GHG point estimate. See section. IV.L of this document for more details. On March 16, 2022, the Fifth Circuit Court of Appeals (No. 22-30087) granted the federal government's emergency motion for stay pending appeal of the February 11, 2022, preliminary injunction issued in Louisiana v. Biden, No. 21-cv-1074-JDC-KK (W.D. La.). As a result of the Fifth Circuit's order, the preliminary injunction is no longer in effect, pending resolution of the federal government's appeal of that injunction or a further court order. Among other things, the preliminary injunction enjoined the defendants in that case from “adopting, employing, treating as binding, or relying upon” the interim estimates of the social cost of greenhouse gases—which were issued by the Interagency Working Group on the Social Cost of Greenhouse Gases on February 26, 2021—to monetize the benefits of reducing greenhouse gas emissions. As reflected in this rule, DOE has reverted to its approach prior to the injunction and present monetized greenhouse gas abatement benefits where appropriate and permissible under law. ** Health benefits are calculated using benefit-per-ton values for NO X and SO 2 . The benefits are based on the low estimates of the monetized value. DOE is currently only monetizing (for SO X and NO X ) PM 2.5 precursor health benefits and (for NO X ) ozone precursor health benefits but will continue to assess the ability to monetize other effects such as health benefits from reductions in direct PM 2.5 emissions. See section IV.L of this document for more details. † Total and net benefits include consumer, climate, and health benefits. For presentation purposes, total and net benefits for both the 3-percent and 7-percent cases are presented using the average SC-GHG with 3-percent discount rate, but the Department does not have a single central SC-GHG point estimate. DOE emphasizes the importance and value of considering the benefits calculated using all four SC-GHG estimates. See Table V.69 for net benefits using all four SC-GHG estimates. ‡ Costs include incremental equipment costs as well as installation costs. DOE's analysis of the national impacts of the proposed standards is described in sections IV.H, IV.K and IV.L of this document. D. Conclusion DOE has tentatively concluded that the proposed standards represent the maximum improvement in energy efficiency that is technologically feasible and economically justified, and would result in the significant conservation of energy. Specifically, with regards to technological feasibility products achieving these standard levels are already commercially available for all product classes covered by this proposal. As for economic justification, DOE's analysis shows that for each equipment class the benefits of the proposed standards exceed the burdens of the proposed standards. Using a 7-percent discount rate for consumer benefits and costs and NO X and SO 2 reduction benefits, and a 3-percent discount rate case for GHG social costs, the estimated annual cost of the proposed standards for distribution transformers is $652.5 million per year in increased distribution transformer costs, while the estimated annual benefits are $961.8 million in reduced distribution transformer operating costs, $664.2 million in climate benefits and $665.2 million in health benefits. The net benefit amounts to $1,638.7 million per year. Table I.11—Annualized Benefits and Costs of Proposed Energy Conservation Standards for All Distribution Transformers at Proposed Standard Levels Category Million (2021$/year) Primary estimate Low-net-benefits estimate High-net-benefits estimate 3% discount rate Consumer Operating Cost Savings 1,528.9 1,426.0 1,647.0 Climate Benefits * 664.2 638.0 693.6 Health Benefits ** 1,189.6 1,142.0 1,243.2 Total Benefits † 3,382.8 3,205.9 3,583.8 Consumer Incremental Product Costs ‡ 659.8 689.4 632.6 Net Benefits 2,723.1 2,516.4 2,951.1 7% discount rate Consumer Operating Cost Savings 961.8 902.8 1,027.3 Climate Benefits * (3% discount rate) 664.2 638.0 693.6 Health Benefits ** 665.2 640.4 691.8 Total Benefits † 2,291.3 2,181.2 2,412.7 Consumer Incremental Product Costs ‡ 652.5 678.9 627.8 Net Benefits 1,638.7 1,502.5 1,784.9 Note: This table presents the costs and benefits associated with distribution transformers shipped in 2027-2056. These results include benefits to consumers which accrue after 2056 from the products shipped in 2027-2056. * Climate benefits are calculated using four different estimates of the social cost of carbon (SC-CO 2 ), methane (SC-CH 4 ), and nitrous oxide (SC-N 2 O) (model average at 2.5 percent, 3 percent, and 5 percent discount rates; 95th percentile at 3 percent discount rate), as shown in Table V.73, Table V.74, and Table V.75. Together these represent the global social cost of greenhouse gases (SC-GHG). For presentational purposes of this table, the climate benefits associated with the average SC-GHG at a 3 percent discount rate are shown, but the Department does not have a single central SC-GHG point estimate. See section. IV.L of this document for more details. On March 16, 2022, the Fifth Circuit Court of Appeals (No. 22-30087) granted the Federal government's emergency motion for stay pending appeal of the February 11, 2022, preliminary injunction issued in Louisiana v. Biden, No. 21-cv-1074-JDC-KK (W.D. La.). As a result of the Fifth Circuit's order, the preliminary injunction is no longer in effect, pending resolution of the Federal government's appeal of that injunction or a further court order. Among other things, the preliminary injunction enjoined the defendants in that case from “adopting, employing, treating as binding, or relying upon” the interim estimates of the social cost of greenhouse gases—which were issued by the Interagency Working Group on the Social Cost of Greenhouse Gases on February 26, 2021—to monetize the benefits of reducing greenhouse gas emissions. In the absence of further intervening court orders, DOE will revert to its approach prior to the injunction and present monetized benefits where appropriate and permissible under law. **Health benefits are calculated using benefit-per-ton values for NO X and SO 2 . The benefits are based on the low estimates of the monetized value. DOE is currently only monetizing (for SO X and NO X ) PM 2.5 precursor health benefits and (for NO X ) ozone precursor health benefits but will continue to assess the ability to monetize other effects such as health benefits from reductions in direct PM 2.5 emissions. See section IV.L of this document for more details. † Total and net benefits include consumer, climate, and health benefits. For presentation purposes, total and net benefits for both the 3-percent and 7-percent cases are presented using the average SC-GHG with 3-percent discount rate, but the Department does not have a single central SC-GHG point estimate. DOE emphasizes the importance and value of considering the benefits calculated using all four SC-GHG estimates. See Table V.69 for net benefits using all four SC-GHG estimates. ‡ Costs include incremental equipment costs as well as installation costs. Table I.12—Summary of Monetized Benefits and Costs of Proposed Energy Conservation Standards for All Distribution Transformers at Proposed Standard Levels Billion ($2021) 3% discount rate Consumer Operating Cost Savings 26.63 Climate Benefits * 11.56 Health Benefits ** 20.72 Total Benefits † 58.91 Consumer Incremental Product Costs ‡ 11.49 Net Benefits 47.42 7% discount rate Consumer Operating Cost Savings 9.11 Climate Benefits * (3% discount rate) 11.56 Health Benefits ** 6.29 Total Benefits † 26.97 Consumer Incremental Product Costs ‡ 6.17 Net Benefits 20.79 This table presents the costs and benefits associated with distribution transformers shipped in 2027-2056. These results include benefits to consumers which accrue after 2056 from the products shipped in 2027-2056. * Climate benefits are calculated using four different estimates of the social cost of carbon (SC-CO 2 ), methane (SC-CH 4 ), and nitrous oxide (SC-N 2 O) (model average at 2.5 percent, 3 percent, and 5 percent discount rates; 95th percentile at 3 percent discount rate), as shown in Table V.73, Table V.74, and Table V.75. Together these represent the global social cost of greenhouse gases (SC-GHG). For presentational purposes of this table, the climate benefits associated with the average SC-GHG at a 3 percent discount rate are shown, but the Department does not have a single central SC-GHG point estimate. See section. IV.L of this document for more details. On March 16, 2022, the Fifth Circuit Court of Appeals (No. 22-30087) granted the Federal government's emergency motion for stay pending appeal of the February 11, 2022, preliminary injunction issued in Louisiana v. Biden, No. 21-cv-1074-JDC-KK (W.D. La.). As a result of the Fifth Circuit's order, the preliminary injunction is no longer in effect, pending resolution of the Federal government's appeal of that injunction or a further court order. Among other things, the preliminary injunction enjoined the defendants in that case from “adopting, employing, treating as binding, or relying upon” the interim estimates of the social cost of greenhouse gases—which were issued by the Interagency Working Group on the Social Cost of Greenhouse Gases on February 26, 2021—to monetize the benefits of reducing greenhouse gas emissions. In the absence of further intervening court orders, DOE will revert to its approach prior to the injunction and present monetized benefits where appropriate and permissible under law. ** Health benefits are calculated using benefit-per-ton values for NO X and SO 2 . DOE is currently only monetizing (for SO 2 and NO X ) PM 2.5 precursor health benefits and (for NO X ) ozone precursor health benefits but will continue to assess the ability to monetize other effects such as health benefits from reductions in direct PM 2.5 emissions. The health benefits are presented at real discount rates of 3 and 7 percent. See section IV.L of this document for more details. † Total and net benefits include consumer, climate, and health benefits. For presentation purposes, total and net benefits for both the 3-percent and 7-percent cases are presented using the average SC-GHG with 3-percent discount rate, but the Department does not have a single central SC-GHG point estimate. DOE emphasizes the importance and value of considering the benefits calculated using all four SC-GHG estimates. See Table V.69 for net benefits using all four SC-GHG estimates. ‡ Costs include incremental equipment costs as well as installation costs. The significance of energy savings offered by a new or amended energy conservation standard cannot be determined without knowledge of the specific circumstances surrounding a given rulemaking. 28 For example, some covered products and equipment, including distribution transformers, have substantial energy consumption occur during periods of peak energy demand. The impacts of these products on the energy infrastructure can be more pronounced than products with relatively constant demand. Accordingly, DOE evaluates the significance of energy savings on a case-by-case basis. 28 Procedures, Interpretations, and Policies for Consideration in New or Revised Energy Conservation Standards and Test Procedures for Consumer Products and Commercial/Industrial Equipment, 86 FR 70892, 70901 (Dec. 13, 2021). As previously mentioned, the standards are projected to result in estimated national energy savings of 10.60 quad. Based on the amount of FFC savings, the corresponding reduction in GHG emissions, and need to confront the global climate crisis, DOE has initially determined the energy savings from the proposed standard levels are “significant” within the meaning of 42 U.S.C. 6295(o)(3)(B). A more detailed discussion of the basis for these tentative conclusions is contained in the remainder of this document and the accompanying TSD. DOE also considered more-stringent energy efficiency levels as potential standards, and is still considering them in this rulemaking. However, DOE has tentatively concluded that the potential burdens of the more-stringent energy efficiency levels would outweigh the projected benefits. Based on consideration of the public comments DOE receives in response to this document and related information collected and analyzed during the course of this rulemaking effort, DOE may adopt energy efficiency levels presented in this document that are either higher or lower than the proposed standards, or some combination of level(s) that incorporate the proposed standards in part. II. Introduction The following section briefly discusses the statutory authority underlying this proposed rule, as well as some of the relevant historical background related to the establishment of standards for distribution transformers. A. Authority EPCA authorizes DOE to regulate the energy efficiency of a number of consumer products and certain industrial equipment. Title III, Part B of EPCA (42 U.S.C. 6291-6309, as codified), established the Energy Conservation Program for “Consumer Products Other Than Automobiles.” Title III, Part C of EPCA (42 U.S.C. 6311-6317, as codified), added by Public Law 95-619, Title IV, section 411(a), established the Energy Conservation Program for Certain Industrial Equipment. The Energy Policy Act of 1992, Public Law 102-486, amended EPCA and directed DOE to prescribe energy conservation standards for those distribution transformers for which DOE determines such standards would be technologically feasible, economically justified, and would result in significant energy savings. (42 U.S.C. 6317(a)) The Energy Policy Act of 2005, Public Law 109-58, amended EPCA to establish energy conservation standards for low-voltage dry-type distribution transformers. (42 U.S.C. 6295(y)) EPCA further provides that, not later than 6 years after the issuance of any final rule establishing or amending a standard, DOE must publish either a notice of determination that standards for the product do not need to be amended, or a NOPR including new proposed energy conservation standards (proceeding to a final rule, as appropriate). (42 U.S.C. 6316(e)(1); 42 U.S.C. 6295(m)(1)) The energy conservation program under EPCA consists essentially of four parts: (1) testing, (2) labeling, (3) the establishment of Federal energy conservation standards, and (4) certification and enforcement procedures. Relevant provisions of EPCA specifically include definitions (42 U.S.C. 6311; 42 U.S.C. 6291), test procedures (42 U.S.C. 6314; 42 U.S.C. 6293), labeling provisions (42 U.S.C. 6315; 42 U.S.C. 6294), energy conservation standards (42 U.S.C. 6313; 42 U.S.C. 6295), and the authority to require information and reports from manufacturers (42 U.S.C. 6316; 42 U.S.C. 6296). Federal energy efficiency requirements for covered equipment established under EPCA generally supersede State laws and regulations concerning energy conservation testing, labeling, and standards. (42 U.S.C. 6316(a) and (b); 42 U.S.C. 6297) DOE may, however, grant waivers of Federal preemption for particular State laws or regulations, in accordance with the procedures and other provisions set forth under EPCA. (See 42 U.S.C. 6316(a) (applying the preemption waiver provisions of 42 U.S.C. 6297)) Subject to certain criteria and conditions, DOE is required to develop test procedures to measure the energy efficiency, energy use, or estimated annual operating cost of each covered equipment. (42 U.S.C. 6316(a), 42 U.S.C. 6295(o)(3)(A) and 42 U.S.C. 6295(r)) Manufacturers of covered equipment must use the Federal test procedures as the basis for: (1) certifying to DOE that their equipment complies with the applicable energy conservation standards adopted pursuant to EPCA (42 U.S.C. 6316(a); 42 U.S.C. 6295(s)), and (2) making representations about the efficiency of that equipment (42 U.S.C. 6314(d)). Similarly, DOE must use these test procedures to determine whether the equipment complies with relevant standards promulgated under EPCA. (42 U.S.C. 6316(a); 42 U.S.C. 6295(s)) The DOE test procedures for distribution transformers appear at title 10 of the Code of Federal Regulations (“CFR”) part 431, subpart K, appendix A. DOE must follow specific statutory criteria for prescribing new or amended standards for covered equipment, including distribution transformers. Any new or amended standard for a covered product must be designed to achieve the maximum improvement in energy efficiency that the Secretary of Energy determines is technologically feasible and economically justified. (42 U.S.C. 6316(a); 42 U.S.C. 6295(o)(2)(A) and 42 U.S.C. 6295(o)(3)(B)) Furthermore, DOE may not adopt any standard that would not result in the significant conservation of energy. (42 U.S.C. 6295(o)(3)) Moreover, DOE may not prescribe a standard: (1) for certain products, including distribution transformers, if no test procedure has been established for the product, or (2) if DOE determines by rule that the standard is not technologically feasible or economically justified. (42 U.S.C. 6316(a); 42 U.S.C. 6295(o)(3)(A)-(B)) In deciding whether a proposed standard is economically justified, DOE must determine whether the benefits of the standard exceed its burdens. (42 U.S.C. 6316(a); 42 U.S.C. 6295(o)(2)(B)(i)) DOE must make this determination after receiving comments on the proposed standard, and by considering, to the greatest extent practicable, the following seven statutory factors: (1) The economic impact of the standard on manufacturers and consumers of the products subject to the standard; (2) The savings in operating costs throughout the estimated average life of the covered products in the type (or class) compared to any increase in the price, initial charges, or maintenance expenses for the covered products that are likely to result from the standard; (3) The total projected amount of energy (or as applicable, water) savings likely to result directly from the standard; (4) Any lessening of the utility or the performance of the covered products likely to result from the standard; (5) The impact of any lessening of competition, as determined in writing by the Attorney General, that is likely to result from the standard; (6) The need for national energy and water conservation; and (7) Other factors the Secretary of Energy (“Secretary”) considers relevant. (42 U.S.C. 6316(a); 42 U.S.C. 6295(o)(2)(B)(i)(I)-(VII)) Further, EPCA establishes a rebuttable presumption that a standard is economically justified if the Secretary finds that the additional cost to the consumer of purchasing a product complying with an energy conservation standard level will be less than three times the value of the energy savings during the first year that the consumer will receive as a result of the standard, as calculated under the applicable test procedure. (42 U.S.C. 6316(a); 42 U.S.C. 6295(o)(2)(B)(iii)) EPCA also contains what is known as an “anti-backsliding” provision, which prevents the Secretary from prescribing any amended standard that either increases the maximum allowable energy use or decreases the minimum required energy efficiency of a covered product. (42 U.S.C. 6316(a); 42 U.S.C. 6295(o)(1)) Also, the Secretary may not prescribe an amended or new standard if interested persons have established by a preponderance of the evidence that the standard is likely to result in the unavailability in the United States 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. (42 U.S.C. 6316(a); 42 U.S.C. 6295(o)(4)) Additionally, EPCA specifies requirements when promulgating an energy conservation standard for a covered product that has two or more product classes. DOE must specify a different standard level for a type or class of product that has the same function or intended use, if DOE determines that products within such group: (A) consume a different kind of energy from that consumed by other covered products within such type (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. (42 U.S.C. 6316(a); 42 U.S.C. 6295(q)(1)) In determining whether a performance-related feature justifies a different standard for a group of products, DOE must consider such factors as the utility to the consumer of the feature and other factors DOE deems appropriate. Id. Any rule prescribing such a standard must include an explanation of the basis on which such higher or lower level was established. (42 U.S.C. 6316(a); 42 U.S.C. 6295(q)(2)) B. Background 1. Current Standards In a final rule published on April 18, 2013 (“April 2013 Standards Final Rule”), DOE prescribed the current energy conservation standards for distribution transformers manufactured on and after January 1, 2016. 78 FR 23336, 23433. These standards are set forth in DOE's regulations at 10 CFR 431.196 and are repeated in Table II.1, Table II.2, Table II.3. Table II.1—Federal Energy Conservation Standards for Low-Voltage Dry-Type Distribution Transformers Single-phase kVA Efficiency (%) Three-phase kVA Efficiency (%) 15 97.70 15 97.89 25 98.00 30 98.23 37.5 98.20 45 98.40 50 98.30 75 98.60 75 98.50 112.5 98.74 100 98.60 150 98.83 167 98.70 225 98.94 250 98.80 300 99.02 333 98.90 500 99.14 750 99.23 1,000 99.28 Table II.2—Federal Energy Conservation Standards for Liquid-Immersed Distribution Transformers Single-phase kVA Efficiency (%) Three-phase kVA Efficiency (%) 10 98.70 15 98.65 15 98.82 30 98.83 25 98.95 45 98.92 37.5 99.05 75 99.03 50 99.11 112.5 99.11 75 99.19 150 99.16 100 99.25 225 99.23 167 99.33 300 99.27 250 99.39 500 99.35 333 99.43 750 99.40 500 99.49 1,000 99.43 667 99.52 1,500 99.48 833 99.55 2,000 99.51 2,500 99.52 Table II.3—Federal Energy Conservation Standards for Medium-Voltage Dry-Type Distribution Transformers Single-phase kVA BIL 20-45 kV Efficiency (%) 46-95 kV Efficiency (%) ≥96 kV Efficiency (%) Three-phase kVA BIL 20-45 kV Efficiency (%) 46-95 kV Efficiency (%) ≥96 kV Efficiency (%) 15 98.1 97.86 15 97.5 97.18 25 98.33 98.12 30 97.9 97.63 37.5 98.49 98.3 45 98.1 97.86 50 98.6 98.42 75 98.33 98.13 75 98.73 98.57 98.53 112.5 98.52 98.36 100 98.82 98.67 98.63 150 98.65 98.51 167 98.96 98.83 98.80 225 98.82 98.69 98.57 250 99.07 98.95 98.91 300 98.93 98.81 98.69 333 99.14 99.03 98.99 500 99.09 98.99 98.89 500 99.22 99.12 99.09 750 99.21 99.12 99.02 667 99.27 99.18 99.15 1,000 99.28 99.2 99.11 833 99.31 99.23 99.20 1,500 99.37 99.3 99.21 2,000 99.43 99.36 99.28 2,500 99.47 99.41 99.33 2. History of Standards Rulemaking for Distribution Transformers On June 18, 2019, DOE published notice that it was initiating an early assessment review to determine whether any new or amended standards would satisfy the relevant requirements of EPCA for a new or amended energy conservation standard for distribution transformers and a request for information (“RFI”). 84 FR 28239 (“June 2019 Early Assessment Review RFI”). On August 27, 2021, DOE published a notification of a webinar and availability of a preliminary technical support document, which announced the availability of its analysis for distribution transformers. 86 FR 48058 (“August 2021 Preliminary Analysis”) The purpose of the August 2021 Preliminary Analysis was to make publicly available the initial technical and economic analyses conducted for distribution transformers, and present initial results of those analyses. DOE did not propose new or amended standards for distribution transformers at that time. The initial technical support document (“TSD”) and accompanying analytical spreadsheets for the August 2021 Preliminary Analysis provided the analyses DOE undertook to examine the potential for amending energy conservation standards for distribution transformers and provided preliminary discussions in response to a number of issues raised by comments to the June 2019 Early Assessment Review RFI. It described the analytical methodology that DOE used, and each analysis DOE had performed. On November 11, 2021, DOE published a notice reopening the comment period an additional 30 days. 86 FR 63318. DOE received comments in response to the August 2021 Preliminary Analysis from the interested parties listed in Table II.4. Table II.4—August 2021 Preliminary Analysis Written Comments Commenter(s) Abbreviation Docket No. Commenter type Electric Research and Manufacturing Cooperative, Inc ERMCO 45 Manufacturer. Powersmiths, Inc Powersmiths 46 Manufacturer. Copper Development Association CDA 47 Trade Organization. Schneider Electric Schneider 49 Manufacturer. National Electrical Manufacturers Association NEMA 50 Trade Organization. Northwest Energy Efficiency Alliance NEEA 51 Efficiency Organization. Appliance Standards Awareness Project, American Council for an Energy-Efficient Economy, Natural Resources Defense Council Efficiency Advocates 52 Efficiency Organization. Metglas, Inc Metglas 53 Steel Manufacturer. Carte International, Inc Carte 54 Manufacturer. Eaton Corporation Eaton 55 Manufacturer. Edison Electric Institute EEI 56 Utilities. Cleveland-Cliffs Steel Corporation Cliffs 57 Steel Manufacturer. Greenville Electric Utility System GEUS 58 Utilities. Howard Industries, Inc Howard 59 Manufacturer. A parenthetical reference at the end of a comment quotation or paraphrase provides the location of the item in the public record. 29 29 The parenthetical reference provides a reference for information located in the docket of DOE's rulemaking to develop energy conservation standards for distribution transformers. (Docket No. EERE-2019-BT-STD-0018, which is maintained at www.regulations.gov ). The references are arranged as follows: (commenter name, comment docket ID number, page of that document). C. Deviation From Appendix A In accordance with section 3(a) of 10 CFR part 430, subpart C, appendix A (“appendix A”), DOE notes that it is deviating from the provision in appendix A regarding the NOPR stage for an energy conservation standard rulemaking. Section 6(f)(2) of appendix A specifies that the length of the public comment period for a NOPR will vary depending upon the circumstances of the particular rulemaking, but will not be less than 75 calendar days. For this NOPR, DOE is providing a 60-day comment period, as required by EPCA. 42 U.S.C. 6316(a); 42 U.S.C. 6295(p). As stated previously, DOE requested comment in the June 2019 Early Assessment Review RFI on the technical and economic analyses and provided stakeholders a 45-day comment period. 84 FR 28239. Additionally, DOE provided a 75-day comment period for the August 2021 Preliminary Analysis. 86 FR 48058. DOE also reopened the comment period for the August 2021 Preliminary Analysis for an additional 30-days. 86 FR 63318. DOE has relied on many of the same analytical assumptions and approaches as used in the preliminary assessment presented in the TSD. Therefore, DOE believes a 60-day comment period is appropriate and will provide interested parties with a meaningful opportunity to comment on the proposed rule. III. General Discussion DOE developed this proposal after considering oral and written comments, data, and information from interested parties that represent a variety of interests. The following discussion addresses issues raised by these commenters. A. Equipment Classes and Scope of Coverage When evaluating and establishing energy conservation standards, DOE divides covered products into equipment classes by the type of energy used or by capacity or other performance-related features that justify differing standards. In making a determination whether a performance-related feature justifies a different standard, DOE must consider such factors as the utility of the feature to the consumer and other factors DOE determines are appropriate. (42 U.S.C. 6316(a); 42 U.S.C. 6295(q)) The distribution transformer equipment classes considered in this proposed rule are discussed in further detail in section IV.A.2 of this document. This proposed rule covers distribution transformers which are currently defined as a transformer that (1) has an input voltage of 34.5 kV or less; (2) has an output voltage of 600 V or less; (3) is rated for operation at a frequency of 60 Hz; and (4) Has a capacity of 10 kVA to 2500 kVA for liquid-immersed units and 15 kVA to 2500 kVA for dry-type units; but (5) The term “distribution transformer” does not include a transformer that is an autotransformer, drive (isolation) transformer, grounding transformer, machine-tool (control transformer, nonventilated transformer, rectified transformer, regulating transformer, sealed transformer, special-impedance transformer, testing transformer, transformer with tap range of 20 percent or more; uninterruptible power supply transformer; or welding transformer. 10 CFR 431.192 The scope of coverage of this proposed rule is discussed in further detail in section IV.A.1 of this document. B. Test Procedure EPCA sets forth generally applicable criteria and procedures for DOE's adoption and amendment of test procedures. (42 U.S.C. 6314(a)) Manufacturers of covered products must use these test procedures to certify to DOE that their product complies with energy conservation standards and to quantify the efficiency of their product. DOE's current energy conservation standards for distribution transformers are expressed in terms of percentage efficiency at rated per-unit load (PUL). ( See 10 CFR 431.193; 10 CFR part 431, subpart K, appendix A (“appendix A”).) On September 14, 2021, DOE published a test procedure final rule for distribution transformers that revised definitions for certain terms, updated provisions based on the latest versions of relevant industry test standards, maintained PUL for the certification of efficiency and added provisions for representing efficiency at alternative PULs and reference temperatures. 89 FR 51230 (“September 2021 TP Final Rule”). DOE determined that the amendments to the test procedure adopted in the September 2021 TP Final Rule do not alter the measured efficiency of distribution transformers or require retesting or recertification solely as a result of DOE's adoption of the amendments to the test procedure. Id. at 89 FR 51249. C. Technological Feasibility 1. General In each energy conservation standards rulemaking, DOE conducts a screening analysis based on information gathered on all current technology options and prototype designs that could improve the efficiency of the products or equipment that are the subject of the rulemaking. As the first step in such an analysis, DOE develops a list of technology options for consideration in consultation with manufacturers, design engineers, and other interested parties. DOE then determines which of those means for improving efficiency are technologically feasible. DOE considers technologies incorporated in commercially available products or in working prototypes to be technologically feasible. 10 CFR 431.4; 10 CFR part 430, subpart C, appendix A, sections 6(b)(3)(i) and 7(b)(1) (“Process Rule”). After DOE has determined that particular technology options are technologically feasible, it further evaluates each technology option in light of the following additional screening criteria: (1) practicability to manufacture, install, and service; (2) adverse impacts on product utility or availability; (3) adverse impacts on health or safety, and (4) unique-pathway proprietary technologies. 10 CFR 431.4; Sections 6(c)(3)(ii)-(v) and 7(b)(2)-(5) of the Process Rule. Section IV.B of this document discusses the results of the screening analysis for distribution transformers, particularly the designs DOE considered, those it screened out, and those that are the basis for the standards considered in this proposed rule. For further details on the screening analysis for this proposed rule, see chapter 4 of the NOPR technical support document (“TSD”). 2. Maximum Technologically Feasible Levels When DOE proposes to adopt an amended standard for a type or class of covered product, it must determine the maximum improvement in energy efficiency or maximum reduction in energy use that is technologically feasible for such product. (42 U.S.C. 6316(a); 42 U.S.C. 6295(p)(1)) Accordingly, in the engineering analysis, DOE determined the maximum technologically feasible (“max-tech”) improvements in energy efficiency for distribution transformers, using the design parameters for the most efficient products available on the market or in working prototypes. The max-tech levels that DOE determined for this rulemaking are described in section IV.C.2.e of this proposed rule and in chapter 5 of the NOPR TSD. D. Energy Savings 1. Determination of Savings For each trial standard level (“TSL”), DOE projected energy savings from application of the TSL to distribution transformer purchased in the 30-year period that begins in the year of compliance with the proposed standards (2027-2056). 30 The savings are measured over the entire lifetime of distribution transformers purchased in the previous 30-year period. 31 DOE quantified the energy savings attributable to each TSL as the difference in energy consumption between each standards case and the no-new-standards case. The no-new-standards case represents a projection of energy consumption that reflects how the market for a product would likely evolve in the absence of amended energy conservation standards. 30 Each TSL is composed of specific efficiency levels for each product class. The TSLs considered for this NOPR are described in section V.A of this document. DOE conducted a sensitivity analysis that considers impacts for products shipped in a 9-year period. 31 Savings are determined for equipment shipped over the 30-year analysis period of 2027 through 2056. Distribution transformers have a maximum lifetime of 60 years; therefore savings are determined for equipment that survive, and accrue savings through 2115. DOE used its national impact analysis (“NIA”) model to estimate national energy savings (“NES”) from potential amended or new standards for distribution transformers. The NIA model (described in section IV.H of this document) calculates energy savings in terms of site energy, which is the energy directly consumed by products at the locations where they are used. For electricity, DOE reports national energy savings in terms of primary energy savings, which is the savings in the energy that is used to generate and transmit the site electricity. DOE also calculates NES in terms of FFC energy savings. The FFC metric includes the energy consumed in extracting, processing, and transporting primary fuels ( i.e., coal, natural gas, petroleum fuels), and thus presents a more complete picture of the impacts of energy conservation standards. 32 DOE's approach is based on the calculation of an FFC multiplier for each of the energy types used by covered products or equipment. For more information on FFC energy savings, see section IV.H.2 of this document. 32 The FFC metric is discussed in DOE's statement of policy and notice of policy amendment. 76 FR 51282 (Aug. 18, 2011), as amended at 77 FR 49701 (Aug. 17, 2012). 2. Significance of Savings To adopt any new or amended standards for a covered product, DOE must determine that such action would result in significant energy savings. (42 U.S.C. 6295(o)(3)(B)) The significance of energy savings offered by a new or amended energy conservation standard cannot be determined without knowledge of the specific circumstances surrounding a given rulemaking. 33 For example, some covered products and equipment have most of their energy consumption occur during periods of peak energy demand. The impacts of these products on the energy infrastructure can be more pronounced than products with relatively constant demand. 33 The numeric threshold for determining the significance of energy savings established in a final rule published on February 14, 2020 (85 FR 8626, 8670), was subsequently eliminated in a final rule published on December 12, 2021 (86 FR 70892, 70906). Accordingly, DOE evaluates the significance of energy savings on a case-by-case basis, taking into account the significance of cumulative FFC national energy savings, the cumulative FFC emissions reductions, and the need to confront the global climate crisis, among other factors. Based on the amount of FFC savings, the corresponding reduction in emissions, and need to confront the global climate crisis, DOE has initially determined the energy savings from the proposed standard levels are “significant” within the meaning of 42 U.S.C. 6316(a); 42 U.S.C. 6295(o)(3)(B). E. Economic Justification 1. Specific Criteria As noted previously, EPCA provides seven factors to be evaluated in determining whether a potential energy conservation standard is economically justified. (42 U.S.C. 6316(a); 42 U.S.C. 6295(o)(2)(B)(i)(I)-(VII))) The following sections discuss how DOE has addressed each of those seven factors in this rulemaking. a. Economic Impact on Manufacturers and Consumers In determining the impacts of a potential amended standard on manufacturers, DOE conducts an MIA, as discussed in section IV.J of this document. DOE first uses an annual cash-flow approach to determine the quantitative impacts. This step includes both a short-term assessment—based on the cost and capital requirements during the period between when a regulation is issued and when entities must comply with the regulation—and a long-term assessment over a 30-year period. The industry-wide impacts analyzed include (1) INPV, which values the industry on the basis of expected future cash flows, (2) cash flows by year, (3) changes in revenue and income, and (4) other measures of impact, as appropriate. Second, DOE analyzes and reports the impacts on different types of manufacturers, including impacts on small manufacturers. Third, DOE considers the impact of standards on domestic manufacturer employment and manufacturing capacity, as well as the potential for standards to result in plant closures and loss of capital investment. Finally, DOE takes into account cumulative impacts of various DOE regulations and other regulatory requirements on manufacturers. For individual consumers, measures of economic impact include the changes in LCC and PBP associated with new or amended standards. These measures are discussed further in the following section. For consumers in the aggregate, DOE also calculates the national net present value of the consumer costs and benefits expected to result from particular standards. DOE also evaluates the impacts of potential standards on identifiable subgroups of consumers that may be affected disproportionately by a standard. b. Savings in Operating Costs Compared To Increase in Price (LCC and PBP) EPCA requires DOE to consider the savings in operating costs throughout the estimated average life of the covered product in the type (or class) compared to any increase in the price of, or in the initial charges for, or maintenance expenses of, the covered product that are likely to result from a standard. (42 U.S.C. 6316(a); 42 U.S.C. 6295(o)(2)(B)(i)(II)) DOE conducts this comparison in its LCC and PBP analysis. The LCC is the sum of the purchase price of a product (including its installation) and the operating expense (including energy, maintenance, and repair expenditures) discounted over the lifetime of the product. The LCC analysis requires a variety of inputs, such as product prices, product energy consumption, energy prices, maintenance and repair costs, product lifetime, and discount rates appropriate for consumers. To account for uncertainty and variability in specific inputs, such as product lifetime and discount rate, DOE uses a distribution of values, with probabilities attached to each value. The PBP is the estimated amount of time (in years) it takes consumers to recover the increased purchase cost (including installation) of a more-efficient product through lower operating costs. DOE calculates the PBP by dividing the change in purchase cost due to a more-stringent standard by the change in annual operating cost for the year that standards are assumed to take effect. For its LCC and PBP analysis, DOE assumes that consumers will purchase the covered products in the first year of compliance with new or amended standards. The LCC savings for the considered efficiency levels are calculated relative to the case that reflects projected market trends in the absence of new or amended standards. DOE's LCC and PBP analysis is discussed in further detail in section IV.F of this document. c. Energy Savings Although significant conservation of energy is a separate statutory requirement for adopting an energy conservation standard, EPCA requires DOE, in determining the economic justification of a standard, to consider the total projected energy savings that are expected to result directly from the standard. (42 U.S.C. 6316(a); 42 U.S.C. 6295(o)(2)(B)(i)(III)) As discussed in section III.D of this document, DOE uses the NIA models to project national energy savings. d. Lessening of Utility or Performance of Products In establishing product classes and in evaluating design options and the impact of potential standard levels, DOE evaluates potential standards that would not lessen the utility or performance of the considered products. (42 U.S.C. 6316(a); 42 U.S.C. 6295(o)(2)(B)(i)(IV)) Based on data available to DOE, the standards proposed in this document would not reduce the utility or performance of the products under consideration in this rulemaking. e. Impact of Any Lessening of Competition EPCA directs DOE to consider the impact of any lessening of competition, as determined in writing by the Attorney General, that is likely to result from a proposed standard. (42 U.S.C. 6316(a); 42 U.S.C. 6295(o)(2)(B)(i)(V)) It also directs the Attorney General to determine the impact, if any, of any lessening of competition likely to result from a proposed standard and to transmit such determination to the Secretary within 60 days of the publication of a proposed rule, together with an analysis of the nature and extent of the impact. (42 U.S.C. 6316(a); 42 U.S.C. 6295(o)(2)(B)(ii)) DOE will transmit a copy of this proposed rule to the Attorney General with a request that the Department of Justice (“DOJ”) provide its determination on this issue. DOE will publish and respond to the Attorney General's determination in the final rule. DOE invites comment from the public regarding the competitive impacts that are likely to result from this proposed rule. In addition, stakeholders may also provide comments separately to DOJ regarding these potential impacts. See the ADDRESSES section for information to send comments to DOJ. f. Need for National Energy Conservation DOE also considers the need for national energy and water conservation in determining whether a new or amended standard is economically justified. (42 U.S.C. 6316(a); 42 U.S.C. 6295(o)(2)(B)(i)(VI)) The energy savings from the proposed standards are likely to provide improvements to the security and reliability of the Nation's energy system. Reductions in the demand for electricity also may result in reduced costs for maintaining the reliability of the Nation's electricity system. DOE conducts a utility impact analysis to estimate how standards may affect the Nation's needed power generation capacity, as discussed in section IV.M of this document. DOE maintains that environmental and public health benefits associated with the more efficient use of energy are important to take into account when considering the need for national energy conservation. The proposed standards are likely to result in environmental benefits in the form of reduced emissions of air pollutants and greenhouse gases (“GHGs”) associated with energy production and use. DOE conducts an emissions analysis to estimate how potential standards may affect these emissions, as discussed in section IV.K; the estimated emissions impacts are reported in section V.B.6 of this document. DOE also estimates the economic value of emissions reductions resulting from the considered TSLs, as discussed in section IV.L of this document. g. Other Factors In determining whether an energy conservation standard is economically justified, DOE may consider any other factors that the Secretary deems to be relevant. (42 U.S.C. 6316(a); 42 U.S.C. 6295(o)(2)(B)(i)(VII)) To the extent DOE identifies any relevant information regarding economic justification that does not fit into the other categories described previously, DOE could consider such information under “other factors.” 2. Rebuttable Presumption As set forth in 42 U.S.C. 6295(o)(2)(B)(iii), EPCA creates a rebuttable presumption that an energy conservation standard is economically justified if the additional cost to the consumer of a product that meets the standard is less than three times the value of the first year's energy savings resulting from the standard, as calculated under the applicable DOE test procedure. DOE's LCC and PBP analyses generate values used to calculate the effects that proposed energy conservation standards would have on the payback period for consumers. These analyses include, but are not limited to, the 3-year payback period contemplated under the rebuttable-presumption test. In addition, DOE routinely conducts an economic analysis that considers the full range of impacts to consumers, manufacturers, the Nation, and the environment, as required under 42 U.S.C. 6316(a); 42 U.S.C. 6295(o)(2)(B)(i). The results of this analysis serve as the basis for DOE's evaluation of the economic justification for a potential standard level (thereby supporting or rebutting the results of any preliminary determination of economic justification). The rebuttable presumption payback calculation is discussed in section IV.F.11 of this proposed rule. IV. Methodology and Discussion of Related Comments This section addresses the analyses DOE has performed for this rulemaking with regard to distribution transformers. Separate subsections address each component of DOE's analyses. DOE used several analytical tools to estimate the impact of the standards proposed in this document. The first tool is a model that calculates the LCC savings and PBP of potential amended or new energy conservation standards. The national impacts analysis uses a second model set that provides shipments projections and calculates national energy savings and net present value of total consumer costs and savings expected to result from potential energy conservation standards. DOE uses the third spreadsheet tool, the Government Regulatory Impact Model (“GRIM”), to assess manufacturer impacts of potential standards. These tools are available in the docket for this rulemaking: www.regulations.gov/docket/EERE-2019-T-STD-0018. Additionally, DOE used output from the latest version of the Energy Information Administration's (“EIA's”) Annual Energy Outlook (“ AEO ”), a widely known energy projection for the United States, for the emissions and utility impact analyses. A. Market and Technology Assessment DOE develops information in the market and technology assessment that provides an overall picture of the market for the products concerned, including the purpose of the products, the industry structure, manufacturers, market characteristics, and technologies used in the products. This activity includes both quantitative and qualitative assessments, based primarily on publicly available information. The subjects addressed in the market and technology assessment for this rulemaking include (1) a determination of the scope of the rulemaking and product classes, (2) manufacturers and industry structure, (3) existing efficiency programs, (4) shipments information, (5) market and industry trends; and (6) technologies or design options that could improve the energy efficiency of distribution transformers. The key findings of DOE's market assessment are summarized in the following sections. See chapter 3 of the NOPR TSD for further discussion of the market and technology assessment. 1. Scope of Coverage The current definition for a distribution transformer codified in 10 CFR 431.192 is the following: Distribution transformer means a transformer that—(1) Has an input voltage of 34.5 kV or less; (2) Has an output voltage of 600 V or less; (3) Is rated for operation at a 60 Hz; and (4) Has a capacity of 10 kVA to 2500 kVA for liquid-immersed units and 15 kVA to 2500 kVA for dry-type units; but (5) The term “distribution transformer” does not include a transformer that is an—(i) Autotransformer; (ii) Drive (isolation) transformer; (iii) Grounding transformer; (iv) Machine-tool (control) transformer; (v) Nonventilated transformer; (vi) Rectifier transformer; (vii) Regulating transformer; (viii) Sealed transformer; (ix) Special-impedance transformer; (x) Testing transformer; (xi) Transformer with tap range of 20 percent or more; (xii) Uninterruptible power supply transformer; or (xiii) Welding transformer. DOE received several comments regarding the definition of “distribution transformer” and the definitions of equipment excluded from the definition. These detailed comments are discussed below. a. Autotransformers The EPCA definition of distribution transformer excludes “a transformer that is designed to be used in a special purpose application and is unlikely to be used in general purpose applications, such as . . . [an] auto-transformer . . .” (42 U.S.C. 6291(35)(b)(ii)) In response to comments received as part of the June 2019 Early Assessment Review RFI that suggested DOE include “low-voltage autotransformers” within the scope of distribution transformers, DOE noted that autotransformers do not provide galvanic isolation 34 and thus would be unlikely to be used in at least some general-purpose applications. (August 2021 Preliminary Analysis TSD at p. 2-5) In the August 2021 Preliminary Analysis TSD, DOE requested comment regarding the potential use of autotransformers as substitutes for general-purpose distribution transformers. Id. 34 i.e., autotransformers contain a continuous, current-carrying electrical pathway that “isolation” transformers do not, which is perceived as a safety compromise in some applications. Schneider commented that while voltage conversion can be done with an autotransformer, autotransformers cannot derive a neutral, lower source impedance, or phase shift to remove triplen ( i.e., multiples-of-three) harmonics, meaning an autotransformer risks sacrificing power quality if used in place of a general-purpose distribution transformer. (Schneider, No. 59 at p. 2) Schneider added that because of these power quality concerns, autotransformers would be unlikely to be used in commercial buildings but could be used in some subsegments and smaller commercial jobs—a possibility supported by manufacturers' adding autotransformers to standard product catalogs. (Schneider, No. 49 at p. 2) Schneider commented that it recommends autotransformers in subsegments that require wye-wye connections 35 and that segment is growing and will continue to grow if autotransformers remain exempt. (Schneider, No. 49 at p. 2) Schneider commented that that are no technical limitations for autotransformer to meet standards and asserted that the exclusion was related to how efficiency was calculated and tested. Schneider recommended subjecting them to the current efficiency standards based on their nameplate kVA. (Schneider, No. 49 at pp. 2-3) Schneider commented that in typical applications ( i.e., 480Y/277 and 208Y/120) autotransformers would be 60 percent the size and 20-25 percent less expensive. In non-typical applications, units would be 20 percent the size and 50 percent less expensive. (Schneider, No. 49 at p. 3) 35 Wye connection refers to four distribution transformer terminals, three of which are connected to one power phase and the fourth connected to all three power phases. NEMA commented that it is not aware of autotransformers being used in place of distribution transformers. (NEMA, No. 50 at p. 3) Stakeholder comments suggest that there may be certain applications in which an autotransformer may be substitutable for an isolation transformer. However, the comments also suggest such substitution is limited to specific applications ( e.g., wye-wye connections) and not common enough to be regarded as general practice. Further, DOE did not receive any feedback counter to its statement in the August 2021 Preliminary Analysis TSD that autotransformers do not provide galvanic isolation and thus would be unlikely to be used in at least some general-purpose applications. Based on this feedback, DOE is not proposing to amend the exclusion of autotransformers under the distribution transformer definition. DOE will monitor the market and may reevaluate this exclusion if evidence exists to support growing use of autotransformers based on lower purchase price than would be warranted by technical considerations alone. b. Drive (Isolation) Transformers In the August 2021 Preliminary Analysis TSD, DOE noted that the EPCA definition of distribution transformers excludes a transformer that is designed to be used in a special purpose application and is unlikely to be used in general purpose applications, such as a drive transformer. (42 U.S.C. 6291(35)(b)(ii)) DOE stated that it did not have any data indicating that “drive isolation transformers” were being widely used in generally purpose applications and as such, considered them statutorily excluded. DOE requested comment and data as to the extent to which “drive isolation transformers” are used in generally purpose applications. (August 2021 Preliminary Analysis TSD at p. 2-6) Schneider and Eaton commented that drive isolation transformers have historically been sold with nonstandard low-voltage ratings, corresponding to typical motor input voltages, and as such are unlikely to be used in general-purpose applications. (Schneider, No. 49 at p. 3; Eaton, No. 55 at p. 3) NEMA commented that drive isolation transformers are not sold in great quantities and not widely used in general purpose applications. (NEMA, No. 50 at p. 3) Schneider and Eaton commented that recently there has been some increase in drive isolation transformers specified as having either a “480Y/277” or “208Y/120” voltage secondary, making it more difficult to ascertain whether these transformers are being used in general distribution applications. (Schneider No. 49 at p. 3; Eaton, No. 55 at p. 3) Schneider commented that only 6-pulse drive isolation transformers 36 can serve general purpose applications. (Schneider, No. 49 at p. 4) Eaton added that there is a minor concern that consumers will increasingly discover that drive isolation transformers can be used in certain general-purpose applications, putting manufacturers in the position of suspecting but not being able to ascertain circumvention without being sure of end use. (Eaton, No. 55 at p. 3) Eaton commented that a DOE compliant general-purpose transformer would be 16 percent more expensive than a drive isolation transformer that could be used in its place, while the losses for the drive isolation transformer at 50 percent PUL were 55 percent greater. (Eaton, No. 55 at p. 3) 36 Drive-isolation transformers employ rectifier diodes to mitigate drive harmonics by phase shifting secondary voltages. [Text truncated at 120,000 characters. The full text is on the page linked above.] --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/fr%3A2022-28590. Public record. Not legal advice.