Federal Register - December 29, 2021
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Source: Federal Register
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Federal Register / Vol. 86, No. 247 / Wednesday, December 29, 2021 / Rules and Regulations
khammond on DSKJM1Z7X2PROD with RULES
As indicated by several commenters, in certain instances, replacing a noncondensing appliance with a condensing one may involve complications, including the need for installation of new venting and renovation of existing living space.
However, these installation complications are separate and apart from any performance-related impacts of the unit once installed. When properly installed, a condensing furnace or water heater would be expected to provide the consumer with heated air or water indistinguishable from that supplied by a non-condensing appliance.
DOE finds strong statutory support for its changed position. EPCAs features provision makes no mention of cost as a relevant consideration. 42 U.S.C.
6295o4; 42 U.S.C.
6313a6BiiiIIaa As AGA et al.
noted, EPCA directs DOE to separately consider whether energy conservation standards would be economically justified. Therefore, DOE finds that the factors that gave rise to the January 2021
Final Interpretive Rule can be addressed through an evaluation of the factors for economic justification.
EPCA enumerates seven factors for economic justification that DOE must consider when evaluating whether to establish or amend energy conservation standards.14 42 U.S.C. 6295o23;
42 U.S.C. 6313a6AC; 42 U.S.C.
6316a Included among those factors is consideration of the savings in operating costs throughout the estimated average life of the covered product or covered equipment 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 14 Specifically, at 42 U.S.C. 6295o2Bi and with essentially the same language at 42 U.S.C.
6313a6Bii, EPCA provides: In determining whether a standard is economically justified, the Secretary shall, after receiving views and comments furnished with respect to the proposed standard, determine whether the benefits of the standard exceed its burdens by, to the greatest extent practicable, consideringI the economic impact of the standard on the manufacturers and on the consumers of the products subject to such standard;
II 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 products which are likely to result from the imposition of the standard; III
the total projected amount of energy, or as applicable, water, savings likely to result directly from the imposition of the standard; IV any lessening of the utility or the performance of the covered products likely to result from the imposition of the standard; V the impact of any lessening of competition, as determined in writing by the Attorney General, that is likely to result from the imposition of the standard; VI the need for national energy and water conservation; and VII
other factors the Secretary considers relevant.
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products which are likely to result from the imposition of the standard. 42
U.S.C. 6295o2biII; 42 U.S.C.
6313a6BiiII; 42 U.S.C. 6316a As part of evaluating this factor, DOE
conducts a LCC and PBP analysis. The LCC is the total consumer expense of an appliance or product over the life of that product, consisting of total installed cost plus operating costs. 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.
In this case, DOE originally considered the additional costs associated with installing condensing residential furnaces and condensing commercial water heaters in the rulemaking proceedings for those appliances whose proposals were withdrawn in conjunction with the January 2021 Final Interpretive Rule.
See 81 FR 65720, 6577665783 Sept.
23, 2016; 81 FR 34440, 3448434485
May 31, 2016 Additionally, in both the residential furnaces and commercial water heaters rulemaking proceedings, DOE conducted consumer subgroup analyses to understand the disparate impacts of the proposed standards on low-income households by analyzing the LCC impacts and PBP for those particular consumers from alternative standard levels. In these analyses, DOE
used different discount rates to reflect various income categories. See 81 FR
65720, 6579865799 Sept. 23, 2016; 81
FR 34440, 3449434495 May 31, 2016
DOE has concluded that these analyses are appropriate for analyzing the impacts of potential standards on consumers generally and low-income consumers in particular.
In proposing to return to its historical interpretation, DOE furthermore added that it tentatively concluded that it gave undue weight to the arguments presented by the Gas Industry Petitioners. 86 FR 48049, 4805448055
August 27, 2021. After reexamining the record, DOE preliminarily determined that the qualitative arguments made by the Gas Industry Petitioners were not accompanied by sufficient evidence to establish the existence or magnitude of the alleged problem, as would support the significant change from DOEs historical interpretation to the interpretation contained in the January 2021 Final Interpretive Rule. 86 FR 48049, 48055
August 27, 2021. To the extent that consumers would be faced with difficult installation situations, DOE tentatively concluded that consumers have other options for resolving such situations without the need for the Department to
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declare non-condensing technology and associated venting to be a performancerelated feature under EPCA. Id. In short, consumers facing difficult installation situations can either: 1 Utilize a technological solution to resolve their installation problem, or 2 switch to an appliance utilizing alternative technologies. Either approach would allow those consumers with potentially difficult installation situations to choose how best to avoid loss of usable space, extensive building modifications, or extreme installation costs identified in the January 2021 Final Interpretive Rule. Id. With regard to specific concerns of orphaned water heaters,15
DOE noted the development of potential technology solutions. Id. The Department stands by and reaffirms these conclusions in this Final Interpretive Rule. DOE has also concluded that installation professionals have the expertise to complete any necessary appliance replacements in a safe and effective fashion.
In response to these tentative findings in the August 2021 NOPIR, NEEA cited results from a study conducted by NEEA, Pacific Gas and Electric Company, National Grid, and Northeast Energy Efficiency Partnerships, which found that 5 percent or fewer of condensing gas appliance installations were challenging, and stated that, even in cases that present significant challenges, technical solutions were always possible. NEEA, No. 137 at p. 2
The commenter referenced technologies available on the market i.e., DuraVents FasNSeal 80/90 that it stated allow for the installation of a condensing appliance with existing venting systems and in situations with narrow lot lines, challenging clearances, or where side wall venting is not practical. Id. at p.
3 NEEA suggested that such solutions allow for condensing appliance venting without the need for additional building penetrations or the need to disturb finished internal spaces. Id. Similarly, the State Attorneys General stated that based on the rulemaking record, a variety of technological fixes are available to accommodate the replacement of non-condensing units and to increase compatibility with other non-condensing appliances. State Attorneys General, No. 136 at p. 3
15 The Gas Industry Petitioners raised specific concern with the potential of an orphaned water heater. An orphaned water heater refers to the situation in which a non-condensing furnace and non-condensing water heater share a common vent, but, upon replacement of the non-condensing furnace with a condensing furnace, they can no longer share that same venting due to differences in venting requirements.
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