Trade Regulation Rule; Labeling and Advertising of Home Insulation

FEDERAL TRADE COMMISSION

16 CFR Part 460

Trade Regulation Rule; Labeling and Advertising of Home

Insulation

AGENCY: Federal Trade Commission.

ACTION: Proposed rule and request for public comments.

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SUMMARY: The Federal Trade Commission (the ``Commission'') is

requesting public comments about the overall costs and benefits and the

continuing need for its Trade Regulation Rule Concerning the Labeling

and Advertising of Home Insulation (the ``R-value Rule'' or ``Rule''),

16 CFR part 460, as well as whether the Rule, if retained, should be

amended to include new test procedures or specific requirements for new

products, as a part of its systematic review of all current Commission

regulations and guides. In addition, the Commission seeks comments on

whether to adopt a non-substantive amendment to the Rule that would

permit the use of an additional test procedure to determine the R-

values of home insulation products. All interested persons are hereby

given notice of the opportunity to submit written data, views and

arguments concerning the Commission's review of the R-value Rule and

the proposed non-substantive amendment.

DATES: Written comments will be accepted until June 6, 1995.

ADDRESSES: Comments should be directed to: Secretary, Federal Trade

Commission, Room H-159, Sixth Street and Pennsylvania Avenue NW.,

Washington, DC 20580. Comments about the R-value Rule should be

identified as ``R-value Rule, 16 CFR part 460--Comment.''

FOR FURTHER INFORMATION CONTACT:

Kent C. Howerton, Attorney, Federal Trade Commission, Room S-4631,

Sixth Street and Pennsylvania Avenue NW., Washington, DC 20580,

telephone (202) 326-3013, FAX (202) 326-3259.

SUPPLEMENTARY INFORMATION:

I. Introduction

The Commission requests public comments about the overall costs and

benefits of the R-value Rule, and its overall regulatory and economic

impact, as well as whether the Rule should be updated to included new

test procedures or specific requirements for [[Page 17493]] new

products, as a part of it systematic review of all current Commission

regulations and guides. In addition, the Commission proposes adopting a

non-substantive amendment to the Rule that would allow use of an

additional test procedure to determine the R-value of home insulation

products. The Commission also solicits comments concerning the proposed

non-substantive amendment.

II. Background

The Commission promulgated the R-value Rule under Section 18 of the

FTC Act in 1979. The Rule became effective on September 30, 1980. Among

other things, the Rule requires that manufacturers disclosed the R-

value (``thermal performance'') of each one insulation product, based

on tests conducted according to one of four specified American Society

of Testing and Materials (``ASTM'') test procedures.\1\ When the

Commission promulgated the Rule, it determined that ASTM R-value test

procedures C-177, C-236, and C-518 were highly accurate and

reproducible steady-state methods for determining the R-values of home

insulation products. 44 FR 50218, at 50226 note 189. In the original

Rule, the Commission stated that it also would accept the use of C-976

once it was adopted as an ASTM test procedure. ASTM adopted C-976 in

1982. The Rule, therefore, now officially recognizes tests using any of

these four test procedures.

\1\The test procedures are ASTM C-177 and ASTM C-518 (which use

hot and cold ``plates'' to determine R-values for homogeneous

``mass'' insulation products, like fiberglass batts and loose-fill

cellulose), and ASTM C-236 and ASTM C-976 (which use ``hot boxes''

to determine R-values for heterogeneous insulation systems, like

multi-panel aluminum foil products and insulation systems).

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The Commission conducted a review of the rule under the Regulatory

Flexibility Act, 5 U.S.C. 601 et seq., in 1984. During the review, the

Commission solicited comments on whether the Rule had had a significant

economic impact (costs and benefits) on a substantial number of small

businesses, whether there was a continuing need for the Rule, and what

changes, if any, should be made to the Rule to minimize the economic

effect on small entities. 49 FR 22104 (1984). Based upon the comments

submitted, the Commission determined that it had no basis to conclude

that the R-value Rule had a significant economic impact upon a

substantial number of small entities. The Commission determined not to

amend the Rule following the Regulatory Flexibility Act review. 50 FR

13246, at 13247 (1985).

Since the Rule was promulgated, the Commission has brought 12

actions to enforce its provisions.\2\ The Commission also has granted

three partial or conditional exemptions relating to specific

provisions, issued one Advisory Opinion allowing use of an alternative

testing procedure, and adopted three non-substantive amendments (one

that allowed manufactures to add to their insulation fact sheets

specific information required by other government agencies; a second,

in response to an industry request, that adopted a revised settled

density test procedure for loose-fill cellulose insulation; and a third

that adopted revised versions of the ASTM R-value test procedures).

\2\The Commission has brought seven civil penalty actions

against manufacturers, one against a testing laboratory, and three

against retailers. It also has brought one consumer redress action

against a professional installer.

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III. Regulatory Review Program

The Commission has determined, as part of its oversight

responsibilities, to review all current Commission rules and guides

periodically. These reviews seek information about the costs and

benefits of the Commission's rules and guides and their regulatory and

economic impact. The information obtained will assist the Commission in

identifying rules and guides that warrant modification or recision.

At this time, therefore, the Commission solicits comments on, among

other things, the economic impact of and the continuing need for the R-

value Rule, possible conflict between the Rule and state, local or

other federal laws, and the effect on the Rule of any technological,

economic, or other industry changes. No Commission determination on the

need for or the substance of the Rule should be inferred from this

request for comments.

IV. Non-Substantive Amendment

The Commission has received a petition from Mr. Ronald S. Graves,

Research Staff Member, Materials Analysis Group, at Martin Marietta

Energy Systems, Inc. (``Petition'').\3\ The petition requests that the

Commission include an additional (fifth) ASTM R-value test procedure

(`` ASTM Standard Test Method for Steady-State Thermal Transmission

Properties by Means of the Thin-Heater Apparatus,'' ASTM C-1114-92), as

an approved test method for compliance with Section 460.5(a) of the R-

value Rule.\4\ The test method is under the jurisdiction of ASTM

Committee C-16 on Thermal Measurements (which is the Committee

responsible for the other R-value test procedures required by the R-

value Rule), and is the direct responsibility of Subcommittee C16.30 on

Thermal Measurements. Mr. Graves is the Chairman of the Thin Heater

Task Group within C16.30 that meets semiannually to maintain and keep

C-1114 current.

\3\Martin Marietta Energy Systems, Inc., operates Oak Ridge

National Laboratory (``ORNL'') as a contractor for the U.S.

Department of Energy.

\4\The Petition, plus attachments, have been placed on the

public record of the R-value Rule and can be inspected at the

Commission's Public Reference Room, room 130, Sixth and Pennsylvania

Ave., NW, Washington, DC.

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According to the Petition, tests conducted in 1983 and 1990 on two

standard reference materials (``SRMs'') obtained from the National

Institute of Standards and Technology show apparent thermal

conductivity values for the SRMs to be within the most probable

uncertainty of 1.2 percent between 25 deg.C (77 deg.F)

and 50 deg.C (132 deg.F). The Petition states that results with

single-sided heat flow up or down and double-sided heat flow agreed to

0.2 percent. It asserts that these test results at ORNL\5\

demonstrate that ASTM C-1114-92 is an appropriate test procedure for

obtaining accurate apparent thermal conductivity values on insulation

products.

\5\The testing apparatus used at ORNL is referred to as the

Unguarded Thin Heater Apparatus (``UTHA'').

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The accuracy of the ASTM C-1114-92 test procedure, therefore,

appears to rate favorably compared to the accuracy of the other ASTM R-

value test procedures the Commission has adopted under the R-value

Rule. Evidence in the original rulemaking proceeding demonstrated that,

if properly performed: (1) Measurements under C-177 could achieve

results within 2 percent of the specimen's actual thermal

value, and a precision of one percent or better is normally attained;

(2) measurements under C-518 should come within at least 5

percent of absolute accuracy, with a reproducibility rate of

2 percent; and (3) measurements under C-236 can measure

thermal resistance values within 2 percent of absolute

accuracy. See 44 FR 50218, at 50226 note 189.

Thus, the Commission is considering adopting a non-substantive

amendment to Sec. 460.5 of the Rule, 16 CFR 460.5(a), to include ASTM

C-1114-92 as an optional, but not required, test procedure for

determining the R-values of home insulation products. Because the

amendment would not impose any new obligations upon parties covered by

the Rule (but merely would recognize the use of an additional,

optional, R-value test procedure), and because the apparent accuracy of

the test procedure [[Page 17494]] compares favorably to the test

procedures already required by the Rule (so the amendment likely would

not lessen consumer protection),\6\ the proposed amendment appears to

be non-substantive under Section 18(d)(2)(B) of the FTC Act, 15 U.S.C.

57a(d)(2)(B). Because the amendment appears to be non-substantive, the

Commission believes that it does not need to solicit public comment or

follow the lengthy rulemaking proceedings that would be required for a

substantive amendment to the rule. On the other hand, because the

Commission is soliciting comments as part of its regulatory review of

the Rule, the Commission has determined in its discretion to solicit

comments on the proposed amendment.

\6\The test procedure already is recognized by the industry as

an accurate and appropriate test procedure, having been adopted as

an official ASTM procedure after going through ASTM's consensus

approval process.

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IV. Solicitation of Comments

A. Regulatory Review

As part of its on-going regulatory review program for all its rules

and guides, the Commission solicits public comments on the following

questions:

(1) Is there a continuing need for the R-value Rule?

(a) What benefits has the Rule provided to purchasers of the

products or services affected by the Rule?

(b) Has the Rule imposed costs on purchasers?

(2) What changes, if any, should be made to the Rule to increase the

benefits of the Rule to purchasers?

(a) How would these changes affect the costs the Rule imposes on

firms subject to its requirements?

(3) What significant burdens or costs, including costs of compliance,

has the Rule imposed on firms subject to its requirements?

(a) Has the Rule provided benefits to such firms?

(4) What changes, if any, should be made to the Rule to reduce the

burdens or costs imposed on firms subject to its requirements?

(a) How would these changes affect the benefits provided by the

Rule?

(5) Does the Rule overlap or conflict with other federal, state, or

local laws or regulations?

(6) Since the Rule was issued, what effects, if any, have changes in

relevant technology or economic conditions had on the Rule?

In addition to the questions raised above, the Commission solicits

comments on the following issues. First, should the Rule be revised to

require the use of different test procedures or specifications than

those currently specified for certain types of products? In addition to

specifying R-value test procedures, the Rule currently specifies

procedures that must be followed in preparing specimens of certain

types and forms of home insulation for testing under the R-value test

procedures.\7\ The Rule also contains specific requirements for

determining the R-values of reflective home insulation products (which

perform as thermal insulation only when installed as a system with one

or more air spaces).\8\ The Commission thus solicits comments

concerning whether the Rule should be amended to specify different or

additional test procedures or specifications for insulation products

specifically addressed in the Rule.

\7\For loose-fill cellulose insulation, the R-value tests must

be conducted on test specimens prepared at the product's long-term,

or settled, density, determined according to paragraph 8 of ASTM C-

739-88 (``Standard Specification for Cellulosic Fiber (Wood-Base)

Loose-Fill Thermal Insulation,'' approved Oct. 25, 1988, published

April 1989). For loose-fill mineral wool insulation, the R-value

tests must be conducted on test specimens that fully reflect the

effect of settling on the product's R-value. For polyurethane,

polyisocyanurate, and extruded polystyrene insulation, the R-value

tests must be conducted on test specimens that fully reflect the

effect of aging on the product's R-value, for example, specimens

aged according to the procedure in paragraph 4.6.4 of General

Services Administration (GSA) Specification HH-I-530A, or another

reliable procedure.

\8\For single sheet reflective foil home insulations, the Rule

allows manufacturers to determine R-value according to two options:

By conducting R-value tests according to ASTM C-236-87 or ASTM C-

976-82; or by measuring the emissivity (reflectivity) of the product

according to ASTM E-408 (or another test method that provides

comparable results), and then determining the R-value for the

measured emissivity level, and the air space and direction of heat

flow for the intended application, using the tables in the most

recent edition of the American Society of Heating, Refrigerating,

and Air-Conditioning Engineers' (ASHRAE) handbook (using the R-value

shown for 50 deg.F, with a temperature differential of 30 deg.F).

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Second, are the insulation products for which the Rule does not

sufficiently address product-specific issues relating to testing or

preparation of test specimens? As noted, in some instances the Rule

provides particular procedures to be followed in preparing specimens

for R-value testing where the Commission found there was post-

installation effects (e.g., settling of loose-fill insulation products,

aging of certain cellular plastics insulation products) that need to be

considered. During the period since the Commission promulgated the

Rule, additional home insulation products designed to slow down heat

flow have been developed and automatically have been covered by the

Rule. However, because these products did not exist when the Rule was

issued, the Rule currently contains no specific test specimen

preparation provisions for these new products. The Commission,

therefore, solicits comments on whether the Rule should be revised to

specify the manner in which specimens of new products should be

prepared for R-value testing to ensure that R-values and related

information are accurate and based on uniform standards.

B. Non-Substantive Amendment

The Commission solicits comments concerning the Petition and the

Commission's proposal to adopt a non-substantive amendment to the Rule

that would recognize ASTM C-1114-92 as an acceptable test method for

determining the R-value of home insulation products under Section 460.5

of the R-value Rule, 16 CFR 460.5. Interested parties are invited to

submit any data or other information relevant to whether the Commission

should adopt the proposed amendment.

List of Subjects in 16 CFR Part 460

Advertising, Incorporation by reference, Insulation, Labeling,

Trade practices.

Authority: 15 U.S.C. 41 et seq.

By the direction of the Commission.

Donald S. Clark,

Secretary.

[FR Doc. 95-8471 Filed 4-5-95; 8:45 am]

BILLING CODE 6750-01-M