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Federal Register / Vol. 86, No. 186 / Wednesday, September 29, 2021 / Proposed Rules
how the proposed efficiency levels based on EER and WER metrics align with the existing IMEF and IWF
metrics, DOE has defined each potential efficiency level according to both sets of efficiency metrics. See chapter 5 of the preliminary TSD for additional details on the proposed test procedure.

market and industry trends, and 6
technologies or design options that could improve the energy efficiency of the product.
See chapter 3 of the preliminary TSD
for further discussion of the market and technology assessment.

III. Summary of the Analyses Performed by DOE
For the products covered in this preliminary analysis, DOE conducted in-depth technical analyses in the following areas: 1 Engineering; 2
markups to determine product price; 3
energy and water use; 4 life-cycle cost LCC and payback period PBP;
and 5 national impacts. The preliminary TSD that presents the methodology and results of each of these analyses is available at www.regulations.gov/docket/EERE2017-BT-STD-0014.
DOE also conducted, and has included in the preliminary TSD, several other analyses that support the major analyses or are preliminary analyses that will be expanded if DOE
determines that a NOPR is warranted to propose amended energy conservation standards. These analyses include: 1
The market and technology assessment;
2 the screening analysis, which contributes to the engineering analysis;
and 3 the shipments analysis, which contributes to the LCC and PBP analysis and the national impact analysis NIA. In addition to these analyses, DOE has begun preliminary work on the manufacturer impact analysis and has identified the methods to be used for the consumer subgroup analysis, the emissions analysis, the employment impact analysis, the regulatory impact analysis, and the utility impact analysis.
DOE will expand on these analyses in the NOPR should one be issued.

DOE uses the following five screening criteria to determine which technology options are suitable for further consideration in an energy conservation standards rulemaking:
1 Technological feasibility.
Technologies that are not incorporated in commercial products or in working prototypes will not be considered further.
2 Practicability to manufacture, install, and service. If it is determined that mass production and reliable installation and servicing of a technology in commercial products could not be achieved on the scale necessary to serve the relevant market at the time of the projected compliance date of the standard, then that technology will not be considered further.
3 Impacts on product utility or product availability. If it is determined that a technology would have a significant adverse impact on the utility of the product for significant subgroups of consumers or would result in the unavailability of any covered product type with performance characteristics including reliability, features, sizes, capacities, and volumes that are substantially the same as products generally available in the United States at the time, it will not be considered further.
4 Adverse impacts on health or safety. If it is determined that a technology would have significant adverse impacts on health or safety, it will not be considered further.
5 Unique-pathway proprietary technologies. If a design option utilizes proprietary technology that represents a unique pathway to achieving a given efficiency level, that technology will not be considered further due to the potential for monopolistic concerns.
10 CFR part 430, subpart C, appendix A, sections 6c3 and 7b.
If DOE determines that a technology, or a combination of technologies, fails to meet one or more of the listed five criteria, it will be excluded from further consideration in the engineering analysis.
See chapter 4 of the preliminary TSD
for further discussion of the screening analysis.

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 general characteristics 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 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

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C. Engineering Analysis The purpose of the engineering analysis is to establish the relationship between the efficiency and cost of RCWs. There are two elements to consider in the engineering analysis; the selection of efficiency levels to analyze i.e., the efficiency analysis and the determination of product cost at each efficiency level i.e., the cost analysis. In determining the performance of higher-efficiency products, DOE considers technologies and design option combinations not eliminated by the screening analysis.
For each analyzed product class, DOE
estimates the manufacturer production cost MPC for the baseline as well as higher efficiency levels.
The output of the engineering analysis is a set of cost-efficiency curves that are used in downstream analyses i.e., the LCC and PBP analyses and the NIA.
As noted in section II.C of this document, the cost-efficiency curves are presented based on both sets of efficiency metrics: EER and WER
metrics as they would be determined using the proposed appendix J test procedure, and IMEF and IWF based on the existing appendix J2 test procedure, to facilitate comparison between both sets of metrics.
See chapter 5 of the preliminary TSD
for additional detail on the engineering analysis.
D. Markups Analysis The markups analysis develops appropriate markups e.g., manufacturer markups, retailer markups, distributor markups, contractor markups in the distribution chain and sales taxes to convert MPC estimates derived in the engineering analysis to consumer prices, which are then used in the LCC and PBP
analysis. At each step in the distribution channel, companies mark up the price of the product to cover business costs and profit margin.
DOE converts the MPC to the manufacturer selling price MSP by applying a manufacturer markup. The MSP is the price the manufacturer charges its first customer, when selling into the product distribution channels.
The manufacturer markup accounts for manufacturer non-production costs and profit margin. DOE developed the manufacturer markup by examining publicly available financial information for manufacturers of the covered product.
DOE further develops baseline and incremental markups for each actor in the distribution chain after the product leaves the manufacturer. Baseline markups are applied to the price of
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