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EERE 2014 BT STD 0005 12819 - Content

Uploaded by

victoria
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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TECHNICAL SUPPORT DOCUMENT:

ENERGY EFFICIENCY PROGRAM FOR


CONSUMER PRODUCTS AND COMMERCIAL
AND INDUSTRIAL EQUIPMENT:
CONSUMER CONVENTIONAL COOKING PRODUCTS

JANUARY 2024

U.S. Department of Energy


Assistant Secretary
Office of Energy Efficiency and Renewable Energy
Building Technologies Program
Appliances and Commercial Equipment Standards
Washington, DC 20585
This Document was prepared for the Department of Energy
by staff members of
Guidehouse Consulting, Inc.
and
Ernest Orlando Lawrence Berkeley National Laboratory
CHAPTER 1. INTRODUCTION

TABLE OF CONTENTS

1.1 PURPOSE OF THE DOCUMENT ................................................................................. 1-1


1.2 SUMMARY OF THE NATIONAL BENEFITS ............................................................. 1-1
1.3 STRUCTURE OF THE DOCUMENT ............................................................................ 1-6

LIST OF TABLES

Table 1.2.1 Summary of Monetized Benefits and Costs of Adopted Energy


Conservation Standards for Consumer Conventional Cooking Products ............ 1-3
Table 1.2.2 Annualized Benefits and Costs of Adopted Energy Conservation
Standards for Consumer Conventional Cooking Products .................................. 1-5

1-i
CHAPTER 1. INTRODUCTION

1.1 PURPOSE OF THE DOCUMENT

This technical support document (TSD) is a stand-alone report that provides the technical
analyses and results supporting the information presented by the U.S. Department of Energy
(DOE) in the direct final rule for consumer conventional cooking products.

1.2 SUMMARY OF THE NATIONAL BENEFITS

DOE’s analyses indicate that amended standards would save a significant amount of
energy. Relative to the case without new and amended standards, the lifetime energy savings
from consumer conventional cooking products purchased in the 30-year period that begins in the
assumed year of compliance with the adopted standards (2028–2057) amount to 0.22 quadrillion
Btu (quads).a This represents a savings of 2 percent relative to the energy use of these products in
the no-new-standards case.

The cumulative net present value (NPV) of total consumer costs and savings of the
adopted standards for consumer conventional cooking products ranges from $0.65 billion (at a 7-
percent discount rate) to $1.56 billion (at a 3-percent discount rate). This NPV expresses the
estimated total value of future operating-cost savings minus the estimated increased product and
installation costs for consumer conventional cooking products purchased in 2028–2057.

In addition, the adopted standards are projected to yield significant environmental


benefits. DOE estimates that the adopted standards would result in cumulative emission
reductions (over the same period as for energy savings) of 3.99 million metric tons (Mt)b of
carbon dioxide (CO2), 1.15 thousand tons of sulfur dioxide (SO2), 7.61 thousand tons of nitrogen
oxides (NOX), 34.70 thousand tons of methane (CH4), 0.04 thousand tons of nitrous oxide (N2O),
and 0.01 tons of mercury (Hg).c

DOE estimates climate benefits from a reduction in greenhouse gases (GHG) using four
different estimates of the social cost of CO2 (SC-CO2), the social cost of methane (SC-CH4), and
the social cost of nitrous oxide (SC-N2O). Together these represent the social cost of GHG (SC-
GHG). DOE used interim SC-GHG values developed by an Interagency Working Group on the

a
A quad is equal to 1015 British thermal units (Btu). 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.
b
A metric ton is equivalent to 1.1 short tons. Results for emissions other than CO 2 are presented in short tons.
c
DOE calculated emissions reductions relative to the no-new-standards case, which reflects key assumptions in the
Annual Energy Outlook 2023 (AEO2023) Reference case. AEO2023 reflects, to the extent possible, laws and
regulations adopted through mid-November 2022, including the Inflation Reduction Act.

1-1
Social Cost of Greenhouse Gases (IWG). d For presentational purposes, the climate benefits
associated with the average SC-GHG at a 3-percent discount rate are $0.22 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.)

DOE also estimates health benefits from SO2 and NOX emissions reductions.e DOE
estimates the present value of the health benefits would be $0.16 billion using a 7-percent
discount rate, and $0.42 billion using a 3-percent discount rate. DOE is currently only
monetizing PM2.5 and (for NOX) 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.

Table 1.2.1 summarizes the economic benefits and costs expected to result from the
adopted standards for consumer conventional cooking products. 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.

d
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, D.C.,
February 2021 www.whitehouse.gov/wp-
content/uploads/2021/02/TechnicalSupportDocument_SocialCostofCarbonMethaneNitrousOxide.pdf.
e
DOE estimated the monetized value of SO2 and NOX emissions reductions associated with site and electricity
savings using benefit per ton estimates from the scientific literature.

1-2
Table 1.2.1 Summary of Monetized Benefits and Costs of Adopted Energy Conservation
Standards for Consumer Conventional Cooking Products
Billion 2022$
3% Discount Rate
Consumer Operating Cost Savings 1.63
Climate Benefits* 0.22
Health Benefits** 0.42
Total Benefits† 2.27
Consumer Incremental Product
0.07
Costs‡
Net Monetized Benefits 2.20
Change in Producer Cash Flow
(0.14)
(INPV‡‡)
7% Discount Rate
Consumer Operating Cost Savings 0.69
Climate Benefits* (3% discount
0.22
rate)
Health Benefits** 0.16
Total Benefits† 1.07
Consumer Incremental Product
0.04
Costs‡
Net Monetized Benefits 1.03
Change in Producer Cash Flow
(0.14)
(INPV‡‡)
Note: This table presents the costs and benefits associated with consumer conventional cooking products shipped in 2028−2057.
These results include consumer, climate, and health benefits that accrue after 2058 from the products shipped in 2028−2057.
* Climate benefits are calculated using four different estimates of global 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; however, DOE emphasizes the
importance and value of considering the benefits calculated using all four sets of SC-GHG estimates. To monetize the benefits of
reducing GHG emissions this analysis uses the interim estimates presented in the Technical Support Document: Social Cost of
Carbon, Methane, and Nitrous Oxide Interim Estimates Under Executive Order 13990 published in February 2021 by the
Interagency Working Group on the Social Cost of Greenhouse Gases (IWG).
** Health benefits are calculated using benefit-per-ton values for NOX and SO2. DOE is currently only monetizing (for SO2 and
NOX) PM2.5 precursor health benefits and (for NOX) ozone precursor health benefits, but will continue to assess the ability to
monetize other effects such as health benefits from reductions in direct PM2.5 emissions.
† Total and net benefits include those consumer, climate, and health benefits that can be quantified and monetized. 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 DOE does not have a single central SC-GHG point estimate. DOE emphasizes the importance
and value of considering the benefits calculated using all four sets of SC-GHG estimates.
‡ Costs include incremental equipment costs as well as installation costs.
‡‡ Operating Cost Savings are calculated based on the life-cycle costs analysis and national impact analysis as discussed in detail
in chapter 8 of this TSD. DOE’s national impacts analysis includes all impacts (both costs and benefits) along the distribution
chain beginning with the increased costs to the manufacturer to manufacture the product and ending with the increase in price
experienced by the consumer. DOE also separately conducts a detailed analysis on the impacts on manufacturers (i.e.,
manufacturer impact analysis, or MIA). In the detailed MIA, DOE models manufacturers’ pricing decisions based on
assumptions regarding investments, conversion costs, cash flow, and margins. The MIA produces a range of impacts, which is
the rule’s expected impact on the INPV. The change in INPV is the present value of all changes in industry cash flow, including
changes in production costs, capital expenditures, and manufacturer profit margins. Change in INPV is calculated using the
industry weighted average cost of capital value of 9.1 percent that is estimated in the MIA (see chapter 12 of this TSD for a

1-3
complete description of the industry weighted average cost of capital). For consumer conventional cooking products, the change
in INPV ranges from -$144 million to -$143 million. DOE accounts for that range of likely impacts in analyzing whether a TSL
is economically justified. DOE is presenting the range of impacts to the INPV under two markup scenarios: the Preservation of
Gross Margin scenario, which is the manufacturer markup scenario used in the calculation of Consumer Operating Cost Savings
in this table, and the Preservation of Operating Profit scenario, where DOE assumed manufacturers would not be able to increase
per-unit operating profit in proportion to increases in manufacturer production costs. DOE includes the range of estimated change
in INPV in the above table, drawing on the MIA explained further in this chapter 12 of this TSD to provide additional context for
assessing the estimated impacts of this direct final rule to society, including potential changes in production and consumption,
which is consistent with Office of Management and Budget (OMB) Circular A-4 and Executive Order (E.O.) 12866. If DOE
were to include the INPV into the net benefit calculation for this direct final rule, the net benefits would be $2.06 billion at 3-
percent discount rate and would be $0.89 billion at 7-percent discount rate. Parentheses () indicate negative values.

The benefits and costs of the adopted 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 NOX and SO2 emission reductions, all
annualized.f

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
consumer conventional cooking products shipped in 2028–2057. The benefits associated with
reduced emissions achieved as a result of the adopted standards are also calculated based on the
lifetime of consumer conventional cooking products shipped in 2028–2057.

Estimates of annualized benefits and costs of the adopted standards are shown in Table
1.2.2. The results under the primary estimate are as follows.

Using a 7-percent discount rate for benefits and costs and health benefits from reduced
NOX and SO2 emissions, and the 3-percent discount rate case for climate benefits from reduced
GHG emissions, the estimated cost of the adopted standards is $3.9 million per year in increased
equipment costs, while the estimated annual benefits are $68.1 million per year in reduced
equipment operating costs, $12.4 million in climate benefits, and $16.1 million in health benefits.
In this case, the net benefit would amount to $92.6 million per year.

Using a 3-percent discount rate for all benefits and costs, the estimated cost of the
adopted standards is $4.0 million per year in increased equipment costs, while the estimated
annual benefits are $90.8 million per year in reduced operating costs, $12.4 million in climate
benefits, and $23.5 million in health benefits. In this case, the net benefit would amount to
$122.7 million per year.

f
To convert the time-series of costs and benefits into annualized values, DOE calculated a present value in 2024, 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 2024. 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.

1-4
Table 1.2.2 Annualized Benefits and Costs of Adopted Energy Conservation Standards for
Consumer Conventional Cooking Products
Million 2022$/year
Low-Net- High-Net-
Primary
Benefits Benefits
Estimate
Estimate Estimate
3% Discount Rate
Consumer Operating Cost Savings 90.8 84.0 95.6
Climate Benefits* 12.4 11.9 12.5
Health Benefits** 23.5 22.6 23.8
Total Benefits† 126.7 118.4 131.9
Consumer Incremental Product Costs‡ 4.0 4.1 3.8
Net Benefits 122.7 114.3 128.1
Change in Producer Cash Flow
(13.8) (13.8) (13.8)
(INPV‡‡)
7% Discount Rate
Consumer Operating Cost Savings 68.1 63.3 71.5
Climate Benefits* (3% discount rate) 12.4 11.9 12.5
Health Benefits** 16.1 15.5 16.3
Total Benefits† 96.6 90.7 100.3
Consumer Incremental Product Costs‡ 3.9 4.0 3.8
Net Benefits 92.6 86.7 96.5
Change in Producer Cash Flow
(13.8) (13.8) (13.8)
(INPV‡‡)
Note: This table presents the costs and benefits associated with consumer conventional cooking products shipped in 2028−2057.
These results include consumer, climate, and health benefits that accrue after 2057 from the products shipped in 2028−2057. The
Primary, Low Net Benefits, and High Net Benefits Estimates utilize projections of energy prices from the AEO2023 Reference
case, Low Economic Growth case, and High Economic Growth case, respectively. In addition, incremental equipment costs
reflect a medium decline rate in the Primary Estimate, a low decline rate in the Low Net Benefits Estimate, and a high decline
rate in the High Net Benefits Estimate. Note that the Benefits and Costs may not sum to the Net Benefits due to rounding.
* Climate benefits are calculated using four different estimates of the global SC- For presentational purposes of this table, the
climate benefits associated with the average SC-GHG at a 3-percent discount rate are shown, but 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
sets of SC-GHG estimates. To monetize the benefits of reducing GHG emissions, this analysis uses the interim estimates
presented in the Technical Support Document: Social Cost of Carbon, Methane, and Nitrous Oxide Interim Estimates Under
Executive Order 13990 published in February 2021 by the IWG.
** Health benefits are calculated using benefit-per-ton values for NOX and SO2. DOE is currently only monetizing (for SO2 and
NOX) PM2.5 precursor health benefits and (for NOX) ozone precursor health benefits, but will continue to assess the ability to
monetize other effects such as health benefits from reductions in direct PM2.5 emissions.
† Total benefits for both the 3-percent and 7-percent cases are presented using the average SC-GHG with 3-percent discount rate,
but DOE does not have a single central SC-GHG point estimate.
‡ Costs include incremental equipment costs as well as installation costs.
‡‡ Operating Cost Savings are calculated based on the life-cycle costs analysis and national impact analysis as discussed in detail
in chapter 8 of this TSD. DOE’s national impacts analysis includes all impacts (both costs and benefits) along the distribution
chain beginning with the increased costs to the manufacturer to manufacture the product and ending with the increase in price
experienced by the consumer. DOE also separately conducts a detailed analysis on the impacts on manufacturers (the MIA). In
the detailed MIA, DOE models manufacturers’ pricing decisions based on assumptions regarding investments, conversion costs,
cash flow, and margins. The MIA produces a range of impacts, which is the rule’s expected impact on the INPV. The change in
INPV is the present value of all changes in industry cash flow, including changes in production costs, capital expenditures, and
manufacturer profit margins. The annualized change in INPV is calculated using the industry weighted average cost of capital
value of 9.1 percent that is estimated in the MIA (see chapter 12 of this TSD for a complete description of the industry weighted
average cost of capital). For consumer conventional cooking products, the annualized change in INPV ranges from -$13.8 million

1-5
to -$13.7 million. DOE accounts for that range of likely impacts in analyzing whether a TSL is economically justified. DOE is
presenting the range of impacts to the INPV under two markup scenarios: the Preservation of Gross Margin scenario, which is the
manufacturer markup scenario used in the calculation of Consumer Operating Cost Savings in this table, and the Preservation of
Operating Profit scenario, where DOE assumed manufacturers would not be able to increase per-unit operating profit in
proportion to increases in manufacturer production costs. DOE includes the range of estimated annualized change in INPV in the
above table, drawing on the MIA explained further in chapter 12 of this TSD to provide additional context for assessing the
estimated impacts of this direct final rule to society, including potential changes in production and consumption, which is
consistent with OMB’s Circular A-4 and E.O. 12866. If DOE were to include the INPV into the annualized net benefit
calculation for this direct final rule, the annualized net benefits would be $108.9 million at 3-percent discount rate and would be
$78.8 million at 7-percent discount rate. Parentheses () indicate negative values.

1.3 STRUCTURE OF THE DOCUMENT

This TSD outlines the analytical approaches used in this rulemaking. The TSD consists of
the following chapters and appendices.

Chapter 1 Introduction: provides an overview of the appliance standards program


and how it applies to this rulemaking, and outlines the structure of the
document.

Chapter 2 Analytical Framework: describes the rulemaking process.

Chapter 3 Market and Technology Assessment: characterizes the market for the
considered products and the technologies available for increasing
product efficiency.

Chapter 4 Screening Analysis: identifies all the design options that improve
efficiency of the considered products, and determines which technology
options are viable for consideration in the engineering analysis.

Chapter 5 Engineering Analysis: discusses the methods used for developing the
relationship between increased manufacturer cost and increased
efficiency.

Chapter 6 Markups Analysis: discusses the methods used for establishing markups
for converting manufacturer prices to customer product costs.

Chapter 7 Energy Use Analysis: discusses the process used for generating energy
use estimates for the considered products as a function of standard
levels.

Chapter 8 Life-Cycle Cost and Payback Period Analysis: discusses the effects of
standards on individual customers and users of the products and
compares the LCC and PBP of products with and without higher
efficiency standards.

1-6
Chapter 9 Shipments Analysis: estimates shipments of the products over the 30-
year analysis period that is used in performing the national impact
analysis.

Chapter 10 National Impact Analysis: assesses the national energy savings, and the
national net present value of total consumer costs and savings, expected
to result from specific, potential energy conservation standards.

Chapter 11 Consumer Subgroup Analysis: describes the methods used for


estimating the impacts of potential standards on national energy
consumption and national economic benefit to consumers and presents
results of the analysis.

Chapter 12 Manufacturer Impact Analysis: discusses the effects of standards on the


finances and profitability of product manufacturers.

Chapter 13 Emissions Impact Analysis: discusses the effects of standards on


national emissions of sulfur dioxide, nitrogen oxides, and mercury—as
well as on carbon dioxide and other greenhouse gas emissions.

Chapter 14 Monetization of Emissions Reduction Benefits: describes the methods


used for estimating monetary benefits likely to result from reduced
emissions expected to result from new and amended standards.

Chapter 15 Utility Impact Analysis: discusses certain effects of the considered on


electric and gas utilities.

Chapter 16 Employment Impact Analysis: discusses the effects of standards on


national employment.

Chapter 17 Regulatory Impact Analysis: discusses the impact of non-regulatory


alternatives to efficiency standards.

Appendix 6A Detailed Data for Equipment Price Markups

Appendix 7A Cooking Products: Determination of Energy-Using Components

Appendix 8A User Instructions for Life-Cycle Cost and Payback Period Spreadsheet

Appendix 8B Uncertainty and Variability in LCC Analysis for Consumer


Conventional Cooking Products

Appendix 8C Lifetime Distributions

Appendix 8D Distributions Used for Residential Discount Rates

1-7
Appendix 8E Life-Cycle Cost and Payback Period Results for Alternative Scenarios

Appendix 9A Price Elasticity of Demand for Consumer Conventional Cooking


Products

Appendix 10A User Instructions for Shipments and National Impact Analysis
Spreadsheets

Appendix 10B Full-Fuel-Cycle Analysis

Appendix 10C National Impact Analysis Results for Alternative Scenarios

Appendix 12A Government Regulatory Impact Model Overview

Appendix 13A Emissions Analysis Methodology

Appendix 14A Social Cost of Greenhouse Gas Values, 2020-2070

Appendix 14B Benefit-Per-Ton Values for NOX and SO2 Emissions from Electricity
Generation

Appendix 15A Utility Impact Analysis Methodology

Appendix 17A Regulatory Impact Analysis: Supporting Materials

1-8
CHAPTER 2. ANALYTICAL FRAMEWORK

TABLE OF CONTENTS

2.1 INTRODUCTION ........................................................................................................... 2-1


2.2 MARKET AND TECHNOLOGY ASSESSMENT ........................................................ 2-4
2.2.1 Market Assessment .......................................................................................................... 2-4
2.2.2 Technology Assessment................................................................................................... 2-4
2.3 SCREENING ANALYSIS .............................................................................................. 2-4
2.4 ENGINEERING ANALYSIS .......................................................................................... 2-5
2.5 MARKUPS ANALYSIS ................................................................................................. 2-6
2.6 ENERGY USE ANALYSIS ............................................................................................ 2-6
2.7 LIFE-CYCLE COST AND PAYBACK PERIOD ANALSYIS ..................................... 2-7
2.8 SHIPMENTS ANALYSIS............................................................................................... 2-7
2.9 NATIONAL IMPACT ANALYSIS ................................................................................ 2-8
2.9.1 National Energy Savings.................................................................................................. 2-8
2.9.2 Net Present Value of Consumer Benefits ........................................................................ 2-9
2.10 CONSUMER SUBGROUP ANALYSIS ........................................................................ 2-9
2.11 MANUFACTURER IMPACT ANALYSIS.................................................................... 2-9
2.12 EMISSIONS IMPACT ANALYSIS.............................................................................. 2-10
2.13 MONETIZATION OF EMISSIONS REDUCTION BENEFITS ................................. 2-10
2.14 UTILITY IMPACT ANALYSIS ................................................................................... 2-11
2.15 EMPLOYMENT IMPACT ANALYSIS ....................................................................... 2-11
2.16 REGULATORY IMPACT ANALYSIS........................................................................ 2-12

LIST OF FIGURES

Figure 2.1.1 Flow Diagram of Analyses for the Rulemaking Process ..................................... 2-2

2-1
CHAPTER 2. ANALYTICAL FRAMEWORK

2.1 INTRODUCTION

Section 325(o)(2)(A) of the Energy Policy and Conservation Act, as amended (EPCA)a
(42 U.S.C. 6291 et seq.), requires the U.S. Department of Energy (DOE) to establish energy
conservation standards that achieve the maximum improvement in energy efficiency of
consumer products that is technologically feasible and economically justified. (42 U.S.C.
6295(o)(2)(A)) This chapter describes the general analytical framework that DOE uses in
evaluating and developing such standards, and in particular, energy conservation standards for
consumer conventional cooking products. The analytical framework is a description of the
methodology, the analytical tools, and the relationships among the various analyses that are part
of this rulemaking. The methodology that addresses the statutory requirement for economic
justification, for example, includes analyses of life-cycle cost; economic impact on
manufacturers and users; national benefits; effects, if any, on utility companies; and impacts
from any lessening in competition among manufacturers.

Figure 2.1.1 summarizes the analytical components of the standards-setting process that
may be conducted as part of an energy conservation standards rulemaking. The focus of this
figure is the center column, identified as “Analyses.” The column labeled “Key Inputs” lists the
types of data and information required for each analysis. Some key inputs come from public
databases; DOE collects other inputs from interested parties or other knowledgeable experts
within the field. The column labeled “Key Outputs” shows analytical results that feed directly
into the standards-setting process. The figure shows how the analyses fit into the rulemaking
process and how they relate to one another. Arrows connecting analyses show the types of
information that feed from one analysis to another.

a
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.

2-1
Figure 2.1.1 Flow Diagram of Analyses for the Rulemaking Process

The analyses performed for this direct final rule and reported in this technical support
document (TSD) are listed below.

• A market and technology assessment to characterize the relevant product markets and
existing technology options, including prototype designs.

2-2
• A screening analysis to review each technology option and determine if it is
technologically feasible; is practical to manufacture, install, and service; would adversely
affect product utility or product availability; would have adverse impacts on health and
safety; or would utilize proprietary technology that represents a unique pathway to
achieving a given efficiency level.
• An engineering analysis to develop cost-efficiency relationships that show the
manufacturer’s cost of achieving increased efficiency.
• A markups analysis to determine product price; markups throughout the distribution
channel relate the manufacturer selling price (MSP) to the retail price paid by to the
consumer.
• An energy use analysis to determine the annual energy use of the considered products in
a representative set of users.
• A life-cycle cost (LCC) and payback period (PBP) analysis to calculate the savings in
operating costs the consumer will realize throughout the life of the covered products
compared with any increase in the installed product cost likely to result directly from
imposition of a standard.
• A shipments analysis to forecast product shipments, which are then used to calculate the
national impacts of potential standards on energy consumption, net present value (NPV),
and future manufacturer cash flows.
• A national impact analysis (NIA) to assess the aggregate impacts, at the national level, of
potential energy conservation standards for the considered products, as measured by the
NPV of total consumer economic impacts and the national energy savings (NES).
• A consumer subgroup analysis to evaluate variations in customer characteristics that
might cause a standard to disproportionately affect particular customer subpopulations.
• A manufacturer impact analysis (MIA) to estimate the financial impact of standards on
manufacturers and to calculate impacts on costs, shipments, competition, direct
employment, and manufacturing capacity.
• An emissions impact analysis to assess the impacts of amended energy conservation
standards on the environment.
• An emissions monetization analysis to assess the benefits associated with emissions
reductions.
• A utility impact analysis to estimate the effects of potential standards on electric, gas, or
oil utilities.
• An employment impact analysis to assess the aggregate impacts on national employment.
• A regulatory impact analysis to examine major alternatives to amended energy
conservation standards that potentially could achieve substantially the same regulatory
goal at a lower cost.

2-3
2.2 MARKET AND TECHNOLOGY ASSESSMENT

The market and technology assessment characterizes the relevant product markets and
existing technology options, including prototype designs, for the considered products.

2.2.1 Market Assessment

When analyzing potential energy conservation standards, DOE initially develops


information that provides an overall picture of the market for the products analyzed, including
the nature of the products, the industry structure, and market characteristics for the products.
This activity consists of both quantitative and qualitative efforts based primarily on publicly
available information. The subjects addressed in the market assessment for consumer
conventional cooking products included manufacturers, trade associations, and the quantities and
types of products sold and offered for sale. DOE examined both large and small, foreign and
domestic manufacturers Finally, DOE reviewed other energy efficiency programs from utilities,
individual States, and other organizations.

The analysis developed as part of the market and technology assessment is described in
chapter 3 of this TSD.

2.2.2 Technology Assessment

DOE typically uses information relating to existing and past technology options and
working prototype designs as inputs to determine what technologies manufacturers may use to
attain higher performance levels. In consultation with interested parties, DOE develops a list of
technologies for consideration. Initially, these technologies encompass all those it believes are
technologically feasible. DOE developed its list of technologically feasible design options for
consumer conventional cooking products from trade publications and technical papers, and a
review of the previous rulemaking’s data. Because some options for improving product
efficiency are available in existing units, product literature and direct examination provided
additional information.

Chapter 3 of this TSD includes the detailed list of all technology options identified for
potential efficiency improvements in consumer conventional cooking products.

2.3 SCREENING ANALYSIS

The screening analysis examines various efficiency-improving technologies to determine


whether they: (1) are technologically feasible; (2) are practicable to manufacture, install, and
service; (3) have an adverse impact on product utility or availability; (4) have adverse impacts on
health and safety; or (5) would utilize proprietary technology that represents a unique-pathway to
achieving a given efficiency level. DOE reviewed each technology option identified in the
technology assessment against the screening criteria listed above. Those technologies that were
not screened out in the screening analysis were considered further in the engineering analysis.
Chapter 4 of this TSD contains details on the screening analysis for consumer conventional
cooking products.

2-4
2.4 ENGINEERING ANALYSIS

The purpose of the engineering analysis is to establish the relationship between the
efficiency and cost of a product. 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 product class, DOE estimates the baseline cost, as
well as the incremental cost for the product at efficiency levels above the baseline. 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).

The engineering analysis considered technologies not eliminated in the screening


analysis, designated as design options. DOE considered the analyzed design options in
developing the cost-efficiency curves.

DOE typically uses one of two approaches to develop energy efficiency levels for the
engineering analysis: (1) relying on observed efficiency levels in the market (i.e., the efficiency-
level approach), or (2) determining the incremental efficiency improvements associated with
incorporating specific design options to a baseline model (i.e., the design-option approach).
Using the efficiency-level approach, the efficiency levels established for the analysis are
determined based on the market distribution of existing products (in other words, based on the
range of efficiencies and efficiency level “clusters” that already exist on the market). Using the
design option approach, the efficiency levels established for the analysis are determined through
detailed engineering calculations and/or computer simulations of the efficiency improvements
from implementing specific design options. DOE may also rely on a combination of these two
approaches. For example, the efficiency-level approach (based on actual products on the market)
may be combined with the design option approach to interpolate to define “gap fill” levels (to
bridge large gaps between other identified efficiency levels) and/or to extrapolate to the max-
tech level, particularly in cases where the max-tech level exceeds the maximum efficiency level
currently available on the market.

For this direct final rule, DOE used a design-option approach, supplemented by testing.
The design-option approach is appropriate for consumer conventional cooking products, given
the lack of certification data to determine the market distribution of existing products and to
identify efficiency level “clusters” that already exist on the market.

The cost analysis portion of the engineering analysis is conducted using one or a
combination of cost approaches. The selection of the cost approach depends on a suite of factors,
including the availability and reliability of public information, characteristics of the regulated
product, the availability and timeliness of purchasing the product/equipment on the market. The
cost approaches are summarized as follows:
• Physical teardowns: Under this approach, DOE physically dismantles a commercially
available product, component-by-component, to develop a detailed bill of materials for
the product. The resulting bill of materials provides the basis for the manufacturer
production cost (MPC) estimates.

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• Catalog teardowns: In lieu of physically deconstructing a product, DOE identifies each
component using parts diagrams (available from manufacturer websites or appliance
repair websites, for example) to develop the bill of materials for the product, which once
again provides the basis for the MPC estimates.
• Price surveys: If neither a physical nor catalog teardown is feasible (e.g., for tightly
integrated products such as fluorescent lamps, which are infeasible to disassemble and for
which parts diagrams are unavailable) or would be cost-prohibitive and otherwise
impractical (e.g., for large commercial boilers), DOE conducts price surveys using
publicly available pricing data published on major online retailer websites and/or by
soliciting prices from distributors and other commercial channels.

For this direct final rule, DOE used the physical teardown approach supplemented by
catalog teardowns of printed circuit boards to develop the MPC data. In the MIA, DOE develops
manufacturer markups to convert the MPCs to MSPs. Chapter 5 of this TSD describes the
methodology and results of the analysis used to derive the cost-efficiency relationships.

2.5 MARKUPS ANALYSIS

DOE performed a markups analysis to convert the MSP estimated in the engineering
analysis to consumer prices, which then were used in the LCC and PBP and manufacturer impact
analyses. DOE calculated markups for baseline products (“baseline markups”) and for more
efficient products (“incremental markups”). The incremental markup relates the change in the
MSP of higher efficiency models (“the incremental cost increase”) to the change in the retailer or
distributor sales price.

To develop markups, DOE identified how the products are distributed from the
manufacturer to the consumer. After establishing appropriate distribution channels, DOE relied
on economic data from the U.S. Census Bureau and other sources to determine how prices are
marked up as the products pass from the manufacturer to the consumer. Chapter 6 of this TSD
provides details on DOE’s development of markups for consumer conventional cooking
products.

2.6 ENERGY USE ANALYSIS

DOE performed an energy use analysis to assess the energy savings potential from higher
efficiency levels, providing the basis for the energy savings values used in the LCC and
subsequent analyses. The goal of the energy use characterization is to generate a range of energy
use values that reflects actual product use in American homes. Chapter 7 of this TSD provides
more detail about DOE’s approach for characterizing energy use of consumer conventional
cooking tops and ovens.

DOE relied on the California Residential Appliance Saturation Study (CA RASS) and the
data from the Pecan Street Projectb to establish the annual energy consumption of cooking tops
and ovens. DOE determined a range of annual energy consumption of cooking products by
utilizing the frequency of product usage data provided for each household in the representative
b
Refer to chapter 7 of this TSD for details about the studies.

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sample of U.S. households based on the U.S. Energy Information Administration (EIA)
Residential Energy Consumption Survey (RECS) 2020. DOE utilized the range in frequency of
use to define the variability of the annual energy consumption.

2.7 LIFE-CYCLE COST AND PAYBACK PERIOD ANALSYIS

In determining whether an energy efficiency standard is economically justified, DOE


considers the economic impact of potential standards on consumers. The effect of new or
amended standards on individual consumers usually includes a reduction in operating cost and an
increase in purchase cost. DOE used the following two metrics to measure consumer impacts:
• LCC is the total consumer cost of an appliance or product, generally over the life
of the appliance or product. The LCC calculation includes total installed cost
(equipment manufacturer selling price, distribution chain markups, sales tax, and
installation costs), operating costs (energy, repair, and maintenance costs),
equipment lifetime, and discount rate. Future operating costs are discounted to the
time of purchase and summed over the lifetime of the appliance or product.
• PBP measures the amount of time it takes consumers to recover the assumed
higher purchase price of a more energy-efficient product through reduced
operating costs. Inputs to the payback period calculation include the installed cost
to the consumer and first-year operating costs.

DOE analyzed the net effect of potential amended consumer conventional cooking
product standards on consumers by determining the LCC and PBP using the engineering
performance data, the energy use data, and the markups. Inputs to the LCC calculation include
the installed cost to the consumer (purchase price plus installation cost), operating expenses
(energy expenses, repair costs, and maintenance costs), the lifetime of the product, and a
discount rate. Inputs to the PBP calculation include the installed cost to the consumer and first-
year operating costs.

DOE generated LCC and PBP results as probability distributions using a simulation
approach based on Monte Carlo analysis methods, in which certain key inputs to the analysis
consist of probability distributions rather than single-point values. Therefore, the outcomes of the
Monte Carlo analysis can also be expressed as probability distributions. As a result, the analysis
produces a range of LCC and PBP results which allows DOE to identify the fraction of
customers achieving LCC savings or incurring net cost at the considered efficiency levels.

Chapter 8 of this TSD describes the results from the LCC and PBP analyses.

2.8 SHIPMENTS ANALYSIS

DOE projected future shipments of consumer conventional cooking tops and ovens based
on an analysis of key market drivers. Projections of shipments are needed to calculate the
potential effects of standards on national energy use, NPV, and future manufacturer cash flows.
DOE generated shipments projections for each product class. The projections estimate the total
number of conventional cooking products shipped each year during the 30-year analysis period
starting in the first year of compliance. To create the projections, DOE combined current-year
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shipments with results of a shipments model that incorporates key market drivers for consumer
conventional cooking products. Chapter 9 of this TSD provides additional details on the
shipments analysis.

2.9 NATIONAL IMPACT ANALYSIS

The NIA assesses the NPV, to the nation, of total consumer LCC and NES. DOE
determined both the NPV and NES for the efficiency levels considered for the product classes
analyzed. To make the analysis more accessible and transparent to all interested parties, DOE
prepared a Microsoft Excel spreadsheet model to forecast NES and the national consumer
economic costs and savings resulting from potential amended standards. The spreadsheet model
uses as inputs typical values (as opposed to probability distributions). To assess the effect of
input uncertainty on NES and NPV results, DOE may conduct sensitivity analyses by running
scenarios on specific input variables. Chapter 10 of this TSD provides additional details
regarding the NIA.

Several of the inputs for determining NES and NPV depend on the forecast trends in
product energy efficiency. For the no-new-standards case, DOE uses the efficiency distributions
developed for the LCC analysis, and assumes some a static distribution over the forecast period.
In this analysis, DOE has used a roll-up scenario in developing its forecasts of efficiency trends
after potential standards take effect. Under a roll-up scenario, all products that perform at levels
below a prospective standard are moved, or rolled up, to the minimum performance level
allowed under the standard. Product efficiencies above the standard level under consideration
would remain the same as before the revised standard takes effect. Because DOE has no reason
to believe that implementation of standards would increase the demand for product that is more
efficient than the minimum required, it did not incorporate an efficiency trend in the standards-
case scenarios either.

2.9.1 National Energy Savings

The national energy savings analysis involves a comparison of national energy


consumption of the considered products between each potential trial standards case (TSL) and
the case with no new or amended energy conservation standards. DOE calculated the national
energy consumption by multiplying the number of units (stock) of each product (by vintage or
age) by the unit energy consumption (also by vintage). DOE calculated annual NES based on the
difference in national energy consumption for the no-new-standards case and for each higher
efficiency standard case. DOE estimated energy consumption and savings based on site energy
and converted the electricity consumption and savings to primary energy (i.e., the energy
consumed by power plants to generate site electricity) using annual conversion factors derived
from AEO2023. For natural gas, DOE assumed that site energy consumption is the same as
primary energy consumption.

Chapter 10 of this TSD presents the NES for the standards cases.

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2.9.2 Net Present Value of Consumer Benefits

The inputs for determining the NPV of the total costs and benefits experienced by
consumers are: (1) total annual installed cost, (2) total annual savings in operating costs, and (3)
a discount factor. DOE calculated the difference in total installed cost between the no-new-
standards case and a potential standards case. Because the more efficient equipment bought in a
standards case usually costs more than equipment bought in the no-new-standards case, cost
increases appear as negative values in the NPV.

DOE calculated net savings each year as the difference in total savings in operating costs
and total increases in installed costs between the no-new-standards case and each standards case.
DOE expressed savings in operating costs as decreases associated with the lower energy
consumption of equipment bought in the standards case compared to the no-new-standards case.
DOE calculated savings throughout the life of each equipment class, accounting for differences
in yearly energy rates. DOE calculated NPV as the difference between the present value of
operating cost savings and the present value of total installed costs. DOE used real discount rates
of 3 percent and 7 percent to discount future costs and savings to present values.

Chapter 10 of this TSD provides additional details regarding the NIA.

2.10 CONSUMER SUBGROUP ANALYSIS

The consumer subgroup analysis evaluates economic impacts on selected groups of


consumers who might be adversely affected by a change in the national energy conservation
standards for the considered products. DOE evaluates impacts on particular subgroups of
consumers primarily by analyzing the LCC impacts and PBP for those particular consumers
using the LCC spreadsheet model.

For this rulemaking, DOE analyzed as subgroups: (1) low-income households, and (2)
households solely occupied by senior citizens. Chapter 11 of this TSD describes the consumer
subgroup analysis.

2.11 MANUFACTURER IMPACT ANALYSIS

The MIA assesses the impacts of new and amended energy conservation standards on
manufacturers of consumer conventional cooking products. Potential impacts include financial
effects, both quantitative and qualitative, that might lead to changes in the manufacturing
practices for these products.

DOE conducts the MIA in three phases, and tailors the analytical framework based on
interested parties’ comments. In Phase I, DOE created a consumer conventional cooking product
manufacturing industry profile and analyzed publicly available financial information to derive
preliminary inputs for the Government Regulatory Impact Model (GRIM). In Phase II, DOE
prepared an industry cash flow model. In Phase III, industry and subgroup cash flow and
industry net present value were assessed through the use of the GRIM. Then, DOE assessed
impacts on competition, manufacturing capacity, employment, and cumulative regulatory
burden. DOE discusses its findings from the MIA in chapter 12 of this TSD.
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2.12 EMISSIONS IMPACT ANALYSIS
In the emissions analysis, DOE estimates the reduction in power sector combustion
emissions of carbon dioxide (CO2), nitrogen oxides (NOX), sulfur dioxide (SO2), mercury (Hg),
methane (CH4), and nitrous oxide (N2O) from potential energy conservation standards for the
considered products, as well as emissions at the building site. In addition, DOE estimates
emissions impacts in production activities (extracting, processing, and transporting fuels) that
provide the energy inputs to power plants and for site combustion. Together, these emissions
account for the full-fuel-cycle (FFC).

The emissions analysis consists of two components. The first component estimates the
effect of potential energy conservation standards on power sector and site (where applicable)
combustion emissions of CO2, NOX, SO2, and Hg. The second component estimates the impacts
of potential standards on emissions of two additional greenhouse gases, CH 4 and N2O, as well as
the reductions to emissions of other gases due to “upstream” activities in the fuel production
chain. These upstream activities comprise extraction, processing, and transporting fuels to the
site of combustion. The upstream emissions include emissions from fuel combustion during
extraction, processing, and transportation of fuel, and “fugitive” emissions (direct leakage to the
atmosphere) of CH 4 and CO2.The analysis of power sector emissions uses marginal emissions
factors that are derived from data in the most-recent AEO. The AEO incorporates the projected
impacts of existing air quality regulations on emissions. AEO generally represents current
legislation and environmental regulations, including recent government actions, for which
implementing regulations were available as of the time of its preparation.

The analysis of power sector emissions uses marginal emissions factors that are derived
from data in AEO. The AEO incorporates the projected impacts of existing air quality regulations
on emissions. AEO generally represents current legislation and environmental regulations,
including recent government actions, for which implementing regulations were available as of
the time of its preparation.

The methodology is described in more detail in chapter 13 of this TSD.

2.13 MONETIZATION OF EMISSIONS REDUCTION BENEFITS


As part of its assessment of energy conservation standards, DOE considered the
estimated monetary benefits likely to result from the reduced emissions of CO2, CH4, N2O, SO2,
and NOX that are expected to result from each of the potential standard levels considered in the
direct final rule.

DOE estimates the monetized benefits of the reductions in emissions of CO2, CH4, and
N2O by using a measure of the social cost (SC) of each pollutant (e.g., SC-CO2). These
estimates represent the monetary value of the net harm to society associated with a marginal
increase in emissions of these greenhouse gases (GHGs) in a given year, or the benefit of
avoiding that increase. DOE used SC-GHG values that were based on the interim values
presented in the Technical Support Document: Social Cost of Carbon, Methane, and Nitrous

2-10
Oxide Interim Estimates under Executive Order 13990, published in February 2021 by the
Interagency Working Group on the Social Cost of Greenhouse Gases (IWG).

To estimate the monetary value of reduced NOX and SO2 emissions from electricity
generation attributable to the standard levels it considers, DOE uses benefit-per-ton estimates
derived from analysis conducted by the EPA. For NOX and SO2 emissions from combustion at
the site of product use, DOE uses another set of benefit-per-ton estimates published by the EPA.

For more detail on the monetization of emissions analysis, see chapter 14 of this TSD.

2.14 UTILITY IMPACT ANALYSIS


The utility impact analysis estimates the changes in installed electrical capacity and
generation that would result for each TSL. For gas utilities, DOE also estimates the impacts on
deliveries of natural gas to consumers. The analysis is based on published output from the NEMS
associated with AEO2023. NEMS produces the AEO Reference case, as well as a number of side
cases that estimate the economy-wide impacts of changes to energy supply and demand. For the
current analysis, impacts are quantified by comparing the levels of electricity sector generation,
installed capacity, fuel consumption and emissions in the AEO2023 Reference case and various
side cases. The output of this analysis is a set of time-dependent coefficients that capture the
change in electricity generation, primary fuel consumption, installed capacity and power sector
emissions due to a unit reduction in demand for a given end use. These coefficients are
multiplied by the stream of electricity savings calculated in the NIA to provide estimates of
selected utility impacts of potential new or amended energy conservation standards. Details of
the methodology are provided in the appendices to chapters 13 and 15 of this TSD.

2.15 EMPLOYMENT IMPACT ANALYSIS


DOE considers employment impacts in the domestic economy as one factor in selecting a
standard. Employment impacts from new or amended energy conservation standards include
both direct and indirect impacts. Direct employment impacts are any changes in the number of
employees of manufacturers of the products subject to standards. The MIA addresses those
impacts. Indirect employment impacts are changes in national employment that occur due to the
shift in expenditures and capital investment caused by the purchase and operation of more-
efficient appliances. Indirect employment impacts from standards consist of the net jobs created
or eliminated in the national economy, other than in the manufacturing sector being regulated,
caused by (1) reduced spending by consumers on energy, (2) reduced spending on new energy
supply by the utility industry, (3) increased consumer spending on the products to which the new
standards apply and other goods and services, and (4) the effects of those three factors
throughout the economy.

DOE estimated indirect national employment impacts for the standard levels considered
in the direct final rule using an input/output model of the U.S. economy called Impact of Sector

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Energy Technologies version 4 (ImSET). c ImSET is a special-purpose version of the “U.S.
Benchmark National Input-Output” (I-O) model, which was designed to estimate the national
employment and income effects of energy-saving technologies. The ImSET software includes a
computer- based I-O model having structural coefficients that characterize economic flows
among 187 sectors most relevant to industrial, commercial, and residential building energy use.

Further detail is provided in chapter 16 of this TSD.

2.16 REGULATORY IMPACT ANALYSIS


As part of its regulatory impact analysis (RIA), DOE identified major alternatives to
standards that represent feasible policy options to reduce the energy consumption of
conventional cooking products DOE evaluated each alternative in terms of its ability to achieve
significant energy savings at a reasonable cost, and compared the effectiveness of each
alternative to the effectiveness of the adopted standard. DOE recognized that voluntary or other
non-regulatory efforts by manufacturers, utilities, and other interested parties can substantially
affect energy efficiency or reduce energy consumption. DOE based its assessment on the
recorded impacts of any such initiatives to date, but also considered information presented by
interested parties regarding the impacts current initiatives may have in the future. Further detail
on the analysis is provided in chapter 17 of this TSD.

c
Livingston, O. and et al. ImSET 4.0: Impact of Sector Energy Technologies Model Description and User’s Guide.
2015. Pacific Northwest National Laboratory.
https://www.pnnl.gov/main/publications/external/technical_reports/PNNL-24563.pdf.

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CHAPTER 3. MARKET AND TECHNOLOGY ASSESSMENT

TABLE OF CONTENTS

3.1 INTRODUCTION ........................................................................................................... 3-1


3.2 PRODUCT DEFINITIONS ............................................................................................. 3-1
3.3 PRODUCT CLASSES ..................................................................................................... 3-1
3.3.1Portable Indoor Conventional Cooking Tops .................................................................. 3-2
3.4 PRODUCT TEST PROCEDURES ................................................................................. 3-2
3.5 MANUFACTURER TRADE GROUPS ......................................................................... 3-3
3.5.1Association of Home Appliance Manufacturers .............................................................. 3-3
3.5.2Air-Conditioning, Heating, and Refrigeration Institute ................................................... 3-3
3.6 MANUFACTURER INFORMATION ........................................................................... 3-4
3.6.1Manufacturers and Market Shares ................................................................................... 3-4
3.6.2Mergers and Acquisitions ................................................................................................ 3-5
3.6.3Small Business Impacts ................................................................................................... 3-6
3.6.4Distribution Channels ...................................................................................................... 3-6
3.7 REGULATORY PROGRAMS ....................................................................................... 3-6
3.7.1Federal Energy Conservation Standards .......................................................................... 3-6
3.7.2Canadian Energy Conservation Standards ....................................................................... 3-6
3.7.3European Union Energy Conservation Standards............................................................ 3-7
3.8 OTHER PROGRAMS ................................................................................................... 3-10
3.8.1ENERGY STAR ............................................................................................................ 3-10
3.8.2Building Codes............................................................................................................... 3-11
3.9 HISTORICAL SHIPMENTS......................................................................................... 3-12
3.9.1New Home Starts ........................................................................................................... 3-12
3.9.2Unit Shipments and Value ............................................................................................. 3-13
3.9.3Imports and Exports ....................................................................................................... 3-14
3.10 MARKET SATURATION ............................................................................................ 3-16
3.11 EFFICIENCY DISTRIBUTION OF THE CURRENT MARKET ............................... 3-17
3.12 TECHNOLOGY ASSESSMENT .................................................................................. 3-19
3.12.1
Product Operations and Components............................................................................. 3-19
3.12.2
Technology Options ....................................................................................................... 3-22
3.12.2.1 Electric Open (Coil) Element Cooking Tops ............................................... 3-22
3.12.2.2 Electric Smooth Element Cooking Tops...................................................... 3-22
3.12.2.3 Gas Cooking Tops........................................................................................ 3-25
3.12.2.4 Electric and Gas Ovens ................................................................................ 3-28
REFERENCES .......................................................................................................................... 3-34

LIST OF TABLES

Table 3.3.1 Product Classes for Consumer Conventional Cooking Products ......................... 3-2
Table 3.6.1 Major and Other Consumer Conventional Cooking Product Manufacturers ...... 3-5

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Table 3.7.1 Canadian Energy Conservation Standards for Electric Cooking Products .......... 3-7
Table 3.7.2 European Union Energy Conservation Standards: Energy Efficiency
Performance Limits for Conventional Cooking Tops .......................................... 3-8
Table 3.8.1 ENERGY STAR Residential Electric Cooking Products Specification ............ 3-11
Table 3.9.1 New Privately Owned Single-Family and Multi-Family Housing Unit
Starts in the United States from 2005-2022 (Thousands) .................................. 3-12
Table 3.9.2 Industry Shipments of Conventional Cooking Products (Domestic and
Import in Thousands of Units),,,,,........................................................................ 3-13
Table 3.9.3 Household Cooking Appliance Manufacturing Statistics by Year .................... 3-14
Table 3.10.1 Percentage of U.S. Households with Conventional Cooking Products, , ........... 3-17
Table 3.12.1 Technology Options for Electric Smooth Element Cooking Tops .................... 3-22
Table 3.12.2 Technology Options for Gas Cooking Tops ...................................................... 3-25
Table 3.12.3 Technology Options for Electric and Gas Ovens .............................................. 3-28

LIST OF FIGURES

Figure 3.9.1 Annual Imports of Conventional Cooking Products .......................................... 3-15


Figure 3.9.2 Annual Exports of Gas Conventional Cooking Products .................................. 3-16
Figure 3.11.1 Electric Smooth Element Cooking Tops in the NRCan Database ..................... 3-18
Figure 3.11.2 Electric Ovens in the NRCan Database – Annual Energy Consumption
versus Cavity Volume ........................................................................................ 3-19

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CHAPTER 3. MARKET AND TECHNOLOGY ASSESSMENT

3.1 INTRODUCTION

This chapter provides a profile of the consumer conventional cooking product industry in
the United States. The U.S. Department of Energy (DOE) developed the market and technology
assessment presented in this chapter primarily from publicly available information. This
assessment is helpful in identifying the major manufacturers and their product characteristics,
which form the basis for the engineering and the life-cycle cost (LCC) analyses (chapters 5 and 8
of this technical support document (TSD)). Present and past industry structure and industry
financial information help DOE in the process of conducting the manufacturer impact analysis
(MIA) which can be found in chapter 12 of this TSD.

3.2 PRODUCT DEFINITIONS

DOE’s regulations define kitchen ranges and ovens, or “cooking products,” as consumer
products that are used as the major household cooking appliances. They are designed to cook or
heat different types of food by one or more of the following sources of heat: gas, electricity, or
microwave energy. Each product may consist of a horizontal cooking top containing one or more
surface units a and/or one or more heating compartments. (10 CFR 430.2) This direct final rule
covers consumer conventional cooking products, i.e., those consumer cooking products that meet
the definition of “conventional cooking top” and “conventional oven,” as codified at 10 CFR
430.2. Industrial cooking equipment and microwave ovens are not in the scope of this direct final
rule.

DOE considered whether portable products with a horizontal cooking top meet the
definition of a consumer conventional cooking product. DOE determined that portable
conventional cooking tops designed for indoor use meet the definition of “cooking product” in
10 CFR 430.2 and are a category of conventional cooking tops. Accordingly, in this direct final
rule, DOE is defining “portable indoor conventional cooking top” as a conventional cooking top
designed (1) for indoor use and (2) to be moved from place to place. On the other hand, DOE
does not consider barbecues and grills to be main sources of cooking within a household.
Therefore, DOE determines that barbecues and grills do not satisfy the definition of cooking
product and did not analyze them for this direct final rule.

3.3 PRODUCT CLASSES

On September 25, 2023, DOE received a joint statement of recommended standards


(“Joint Agreement”) for various home appliance products, including consumer conventional
cooking products, submitted jointly by groups representing manufacturers, energy and
environmental advocates, consumer groups, and a utility.b Among other recommendations, the
Joint Agreement specifies seven product classes for consumer conventional cooking products. In

a
The term surface unit refers to burners for gas cooking tops and electric resistance heating elements or inductive
heating elements for electric cooking tops. The term cooking zone is used in this TSD, consistent with the test
procedure language.
b
See section II.B.3 of the accompanying direct final rule.

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particular, the Joint Agreement recommends separate product classes for ranges—a type of
combined cooking product that combine a conventional cooking top and a conventional oven—
and standalone cooking tops for both electric smooth element cooking tops and gas cooking tops.
In this direct final rule, DOE is adopting the product classes from the Joint Agreement, with
updated nomenclature that clarifies that the “range” product classes refer to the cooking top
component of any combined cooking product, as listed in Table 3.3.1.

Table 3.3.1 Product Classes for Consumer Conventional Cooking Products


Joint Agreement Product Class Analyzed Product Class
Electric coil Electric open (coil) element cooking top
Electric smooth cooktop Electric smooth element standalone cooking top
Electric smooth element cooking top component of a
Electric smooth range
combined cooking product
Gas cooktop Gas standalone cooking top
Gas range Gas cooking top component of a combined cooking product
Electric ovens Electric oven
Gas ovens Gas oven

Because combined cooking products include a conventional cooking top and/or a


conventional oven, the conventional cooking top and conventional oven standards apply to the
individual components of the combined cooking product.

3.3.1 Portable Indoor Conventional Cooking Tops

In this direct final rule DOE has determined that portable indoor conventional cooking
tops are within the scope of this rulemaking. The Joint Agreement recommends excluding
portable cooking products from the conventional cooking top and conventional oven product
classes.

The Joint Agreement specifies that portable indoor conventional cooking tops are not
subject to the standards for conventional cooking tops adopted in this direct final rule. DOE
notes however, that gas portable indoor conventional cooking tops remain subject to the existing
prohibition on constant burning pilot lights.

3.4 PRODUCT TEST PROCEDURES

DOE’s test procedure for consumer cooking tops is codified at 10 CFR part 430, subpart
B, appendix I1 (“Appendix I1”). In Appendix I1, DOE generally adopted the current version of
the applicable industry standard, IEC 60350-2 (Edition 2.1 2021-05), “Household electric
cooking appliances–Part 2: Hobs – Methods for measuring performance” e (“IEC 60350-2”),
which provides a water-heating test method to measure the energy consumption of electric
cooking tops. Appendix I1 includes burden-reducing modifications to IEC 60350-2, further
clarifies certain provisions, and also extends these test methods to gas cooking tops by
correlating the burner input rate to specific test load diameters. The water-heating energy test for
electric and gas cooking tops is used to calculate the cooking top integrated annual energy

e
Hob is the British English term for cooking top.

3-2
consumption (IAEC). For further information on the Appendix I1 test procedure, see chapter 5 of
this TSD.

In the test procedure established in the test procedure final rule published on July 3, 2015
(“July 2015 TP Final Rule”), DOE incorporated methods for measuring conventional oven cavity
volume, clarified that the existing oven test block must be used to test all ovens regardless of
input rate, and included provisions for measuring the energy consumption and efficiency of
conventional ovens equipped with an oven separator. 80 FR 37954. Although this test procedure
was later repealed, as explained in chapter 5 of this TSD, DOE developed annual energy use
values for conventional ovens based on the version of the test procedure adopted in the July 2015
TP Final Rule.

3.5 MANUFACTURER TRADE GROUPS

To gain additional information regarding the consumer conventional cooking products


industry, DOE researched various associations available to manufacturers, suppliers, and users of
such equipment. DOE also used the member lists of these groups in the construction of an
exhaustive database containing domestic manufacturers.

DOE identified one trade group that supports the consumer conventional cooking product
industry, AHAM. DOE also identified one trade group that supports the suppliers of gas controls
and ignition systems used in most consumer gas cooking products, the Air-conditioning,
Heating, and Refrigeration Institute (AHRI).

3.5.1 Association of Home Appliance Manufacturers

AHAM, formed in 1967, has the stated aim of enhancing the value of the home appliance
industry through leadership, public education, and advocacy.f AHAM provides services to its
members including government relations; a certification program for room air cleaners; an active
communications program; and technical services and research. In addition, AHAM conducts
other market and consumer research studies and has published a Fact Book. AHAM also
develops and maintains technical standards for various appliances to provide uniform, repeatable
procedures for measuring specific product characteristics and performance features.

3.5.2 Air-Conditioning, Heating, and Refrigeration Institute

AHRI represents more than 300 heating, water heating, ventilation, air conditioning and
commercial refrigeration manufacturers within the global HVACR industry.g AHRI develops
and publishes technical standards, which use rating criteria and procedures for measuring and
certifying performance for residential and commercial air conditioning, heating, and refrigeration
equipment. Although manufacturers of conventional cooking products are not included in
AHRI’s membership, AHRI’s members do include the suppliers of gas controls and ignition
systems used in most residential and commercial gas-fired equipment sold in the United States,
including ignition systems used in gas ovens.

f
For more information visit www.aham.org.
g
For more information see: www.ahrinet.org/about-ahri.

3-3
3.6 MANUFACTURER INFORMATION

The following section details information regarding domestic manufacturers of


conventional cooking products, including estimated market shares (section 3.6.1), industry
mergers and acquisitions (section 3.6.2), potential small business impacts (section 3.6.3), and
product distribution channels (section 3.6.4).

3.6.1 Manufacturers and Market Shares

Manufacturers may offer multiple brand names. Some of the brand names come from
independent appliance manufacturers which have been acquired over time, and domestic
manufacturers may put their brand on a product manufactured overseas. Companies included in
this analysis may also be off-shore manufacturers that maintain a significant domestic presence
via a U.S. entity.

DOE estimates that there are approximately 35 manufacturers of consumer conventional


cooking products supplying the domestic market. Three major manufacturers, AB Electroluxh
(“Electrolux”); Haier Smart Home Co., Ltd.i (“Haier”); and Whirlpool Corporation
(“Whirlpool”), represent roughly 85 percent of the electric and gas cooking products market.

In addition to these three major manufacturers, manufacturers of consumer conventional


cooking products also include Bilancia Holdings SPA (“Bertazzoni”); Controladora Mabe, S.A.
de CV. (“Mabe”); Fagor Industrial S. Coop. (“Fagor”); Greenfield World Trade, Inc. (“Avanti”);
ILVE SPA (“ILVE”); Koc Holdings A.S. (“Arcelik”); LG Corp (“LG”); Meneghetti Groupe SA
(“Fulgor-Milano”); MGM SRL (“EuroChef Italia”); Midea Group Co., Ltd. (“Midea”); Miele &
Cie. KG (“Miele”); Robert Bosch Stiftung Gesellschaft mit beschrankter Haftung j (“Bosch”);
Samsung Electronics Co., Ltd.k (“Samsung”); SMEG SPA (“SMEG”); Sub-Zero, Inc. (“Wolf”);
Tecnosuperiore Beyaz Esya Anonim Sirketi (“Technogas”); and The Middleby Corporationl
(“Middleby”).

DOE also identified 15 small businesses, including Acme Kitchenettes Corp. (“Acme”);
American Range Corporation (“American Range”); Brown Stove Works, Inc. (“Brown Stove”);
Capital Cooking Equipment, Inc. (“Capital”); Cosmo Products, LLC (“Cosmo”); Felix Storch,
Inc. (“Summit”); Danby Product Limited (“Danby”); Duro Corporation (“NXR”); Hallman
Industries LLC (“Hallman”); Kenyon International, Inc. (“Kenyon”); Kucht LLC (“Kucht”);
Peerless-Premier Appliance Co. (“Peerless-Premier”); Prizer-Painter Stove Works, Inc
(“BlueStar”); Signature Kitchen Designs, Inc. (“Signature”); Thor Group (“Thor”). Table 3.6.1
lists these manufacturers.

h
Electrolux also owns Frigidaire.
i
Haier owns GE Appliances and Fisher & Paykel
j
Bosch also owns Thermador.
k
Samsung also owns Dacor.
l
The Middleby Corporation owns Evo, Imperial Range, and Viking.

3-4
Table 3.6.1 Major and Other Consumer Conventional Cooking Product Manufacturers
Major Manufacturers Other Manufacturers Small Manufacturers
Electrolux Arcelik Acme
Haier Avanti American Range
Whirlpool Bertazzoni BlueStar
Bosch Brown Stove
Eurochef Italia Capital
Fagor Cosmo
Fulgor-Milano Danby
ILVE Hallman
LG Kenyon
Mabe Kucht
Middleby NXR
Midea Peerless-Premier
Miele Signature
Samsung Summit
SMEG Thor
Technogas
Wolf

3.6.2 Mergers and Acquisitions

On November 5, 2012, Haier acquired a controlling interest in Fisher & Paykel, which
had previously acquired Dynamic Cooking Systems, Inc. in 2004. 1

On December 31, 2016 Viking Range announced it had been acquired by Middleby.2

On June 6, 2016, Haier confirmed its acquisition of GE’s appliance division from GE for
$5.6 billion. Haier stated that “[i]nvesting and growing in the U.S. is a key part of Haier’s
strategy, and the acquisition of GE Appliances will help us accelerate that expansion.” Haier
Group, Qingdao Haier’s parent company, claims to be the world’s leading home appliance
manufacturer, with global revenues exceeding $30 billion in 2015.3 GE Appliances retained its
headquarters in Louisville, Kentucky, and Haier has the rights to use the GE brand name until
2056.4

On January 2, 2019, Middleby announced the acquisition of EVO America, Inc. 5

On September, 2021, Middleby announced the acquisition of Imperial Commercial


Cooking Equipment.6

Due to mergers and acquisitions, the home appliance industry continues to consolidate.
While this phenomenon varies from product to product within the industry, the large market
shares of a few companies provide evidence in support of this characterization.

3-5
3.6.3 Small Business Impacts

DOE considers the possibility of small businesses being impacted by the promulgation of
energy conservation standards for consumer conventional cooking products. At this time, DOE is
aware of 15 small conventional cooking product manufacturers, defined by the Small Business
Association (SBA) as having 1,500 employees or fewer, who produce products that fall under
this rulemaking and who, therefore, would be impacted by energy conservation standards. These
small business manufacturers are listed in Table 3.6.1. DOE evaluated the potential impacts on
these small businesses as part of the MIA, which it conducted as a part of the rulemaking
analysis. For further information on the conventional cooking products small businesses, see
chapter 12 of this TSD.

3.6.4 Distribution Channels

Understanding the distribution channels of products covered by this rulemaking is an


important facet of the market assessment. DOE gathered information regarding the distribution
channels for consumer conventional cooking products from publicly available sources.

For consumer appliances, including cooking products, the majority of consumers


purchase their appliances directly from retailers. These retailers include: (1) home improvement,
appliance, and department stores; (2) Internet retailers; (3) membership warehouse clubs; and (4)
kitchen remodelers. The 2011 Top 100 Major Appliance Retailers Report states that home
improvement stores account for almost 40 percent of appliance sales.7

Home appliance retailers generally obtain products directly from manufacturers. The
AHAM Fact Book 2003 shows that over 93 percent of consumer appliances are distributed from
the manufacturer directly to a retailer. 8

3.7 REGULATORY PROGRAMS

The following section details current regulatory programs mandating energy conservation
standards for conventional cooking products. Section 3.7.1 discusses current U.S. Federal energy
conservation standards, section 3.7.2 reviews standards in Canada that may impact the
companies servicing the North American market, and section 3.7.3 reviews regulations in the
European Union.

3.7.1 Federal Energy Conservation Standards

The current Federal energy conservation standards for consumer conventional cooking
products require that all gas cooking tops and gas ovens (with or without an electrical supply
cord) manufactured on or after April 9, 2012, not to be equipped with constant burning pilots.

3.7.2 Canadian Energy Conservation Standards

Canada’s Energy Efficiency Regulations (“Canadian Regulations”) mandate minimum


energy conservation standards for certain conventional cooking products, including electric and

3-6
gas ranges, cooking tops, and ovens.m The current Canadian test method for household electric
ranges is, “Energy Consumption Test Methods for Household Electric Ranges,” originally
published in February 2003 (“CAN/CSA 358-03”). CAN/CSA 358-03 uses similar test
procedures for conventional cooking tops as the pre-2012 DOE test procedure in 10 CFR part
430, subpart B, appendix I that used an aluminum block test load. For conventional ovens,
CAN/CSA 358-03 uses similar testing methods as the DOE test procedure adopted in the July
2015 TP Final Rule, except that it does not include the active mode fan-only mode, standby
mode, and off mode testing provisions.

For gas cooking products, the Canadian Regulations require that gas cooking products,
including ranges, ovens, and cooking tops, with an electrical supply cord not be equipped with
constant burning pilots,n which is similar to the current U.S. standards except that the U.S.
requirement also applies to gas cooking products without an electrical supply cord. For electric
cooking products, the Canadian Regulations specify a maximum allowable energy consumption,
expressed in kilowatt-hours per year (kWh/year), as listed in Table 3.7.1.o

Table 3.7.1 Canadian Energy Conservation Standards for Electric Cooking Products
Maximum Allowable Energy
Cooking Product Classification
Consumption (kWh/year) *
Freestanding or built-in ranges with one or more surface
2.0V + 458
elements and one or more ovens
Built-in or wall-mounted ranges without surface elements
2.0V + 200
and with one or more ovens
Counter-mounted ranges without ovens and with one or
more surface elements on a conventional (i.e., not modular) 258
cooking top
* Where V = volume of oven in liters

3.7.3 European Union Energy Conservation Standards9

The European Union (EU) enacted the Commission Regulation (EC) No. 66/2014 of
January 14, 2014, implementing Directive 2009/125/EC of the European Parliament and of the
Council with regards to design requirements for conventional ovens and cooking tops.p EC No.
66/2014 was last amended as a consolidated version on January 9, 2017.q

The energy consumption of electric and gas ovens, including the oven component of
conventional ranges, is measured according to the European Committee for Electrotechnical

m
For more information, visit https://laws.justice.gc.ca/eng/regulations/SOR-2016-311/page-5.html#h-835647.
n
For more information, visit https://natural-resources.canada.ca/energy-efficiency/energy-efficiency-
regulations/guide-canadas-energy-efficiency-regulations/gas-ranges/6891.
o
For more information, visit https://natural-resources.canada.ca/energy-efficiency/energy-efficiency-
regulations/guide-canadas-energy-efficiency-regulations/electric-ranges/6937.
p
For more information, visit https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A32014R0066.
q
For more information, visit https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A02014R0066-
20170109.

3-7
Standardization (CENELEC)’s test procedure EN 60350-1:2016 “Household electric cooking
appliances – Part 1: Ranges, ovens, steam ovens and grills – Methods for measuring
performance” for electric ovens,r and EN 15181:2017 “Measuring method of the energy
consumption of gas fired ovens” for gas ovens.s Both test procedures measure the energy used
during one heating cycle which increases the temperature of a wet brick by 55 Kelvin. The
Energy Efficiency Index (EEI) is the ratio (multiplied by 100) of the energy consumption of a
specific oven to the standard energy consumption of an average 2012 oven with the same cavity
volume.t The EU regulations established three tiers of requirements with compliance dates in
2015, 2016, and 2019. As of February 3, 2019,u the maximum allowable EEI for a conventional
oven is 96. For multi-cavity conventional ovens, at least one cavity is required to have an EEI of
less than 96, and the other cavities are required to have an EEI of less than 121.

The energy consumption of conventional cooking tops is measured according to


CENELEC’s test procedure EN 60350-2:2013/A11:2014 “Household electric cooking appliances
- Part 2: Hobs - Methods for measuring performance” for electric cooking tops,v and EN 30-2-
1:2015 “Domestic cooking appliances burning gas – Part 2-1: Rational use of energy – General”
for gas cooking tops.w The test procedure for electric cooking tops is similar to Appendix I1,
with the energy use calculated differently. x The test procedure for gas cooking tops uses different
test vessels than Appendix I1, does not include a simmering period, and outputs theoretical
efficiency for each burner rather than the energy consumption of a water heating test. The EU
regulations established three tiers of requirements with compliance dates in 2015, 2016, and
2019. The maximum energy consumption for electric cooking tops, expressed in watt-hour (Wh)
per kilogram (kg) of water, and the minimum efficiency for gas cooking tops as of February 3,
2019, are indicated in Table 3.7.2.

Table 3.7.2 European Union Energy Conservation Standards: Energy Efficiency


Performance Limits for Conventional Cooking Tops
Maximum Allowable Average Hob Energy Consumption
195 Wh/kg of water
for Electric Cooking Tops
Minimum Allowable Average Hob Energy Efficiency for
55%
Gas Cooking Tops

r
Available at www.techstreet.com/standards/bs-en-60350-1-2016?product_id=1939439.
s
Available at www.techstreet.com/standards/bs-en-15181-2017-a1-2020?product_id=2185741.
t
The Standard Energy Consumption for an electric oven is 0.0042V + 0.55 kWh. The Standard Energy
Consumption for a gas oven is 0.044V + 3.53 MJ, or 0.0417V + 3.346 kBtu.
u
February 3, 2019, is 5 years after the entry into force of the directive which was February 3, 2014, 20 days after its
publication in the Official Journal of the European Union.
v
Available at www.techstreet.com/standards/bs-en-60350-2-2013-a11-2014?product_id=1916173.
w
Available at https://webstore.ansi.org/standards/din/dinen302015.
x
The reported energy use corresponds to the average energy use of each heating element, normalized by the weight
of the water load, but not normalized to correspond to a nominal final water temperature. The energy use is reported
on a per-cycle basis, and is not multiplied by a representative water load mass nor by a number of annual usage
cycles. Some other changes exist where Appendix I1 deviated from the industry test procedure incorporated by
reference such as test vessel selection and starting water temperature.

3-8
The International Energy Agency (IEA) has raised awareness of standby power through
publications, international conferences, and policy advice to governments. In 1999, the IEA
developed the “1-Watt Plan,” which proposed reducing standby power internationally in
electronic devices and which advocates that all countries harmonize energy policies and adopt
the same definition and test procedure. The IEA has advocated a 1-watt (W) requirement for all
consumer electrical products (unless specifically excluded) in standby mode. The IEA also stated
that International Electrotechnical Commission (IEC) Standard 62301 Household electrical
appliances – Measurement of standby power (“IEC 62301”) provides an internationally
sanctioned definition and test procedure for standby power, which is now widely specified and
used.y

The EU enacted the EC No. 1275/2008 of December 17, 2008, implementing design
requirements for standby and off mode power for electrical and electronic household and office
equipment, including conventional cooking products.z EC No. 1275/2008 was last amended as a
consolidated version on March 1, 2021.aa

The EU regulations established two tiers of requirements with compliance dates in 2009
and 2013. As of January 6, 2013,bb the regulations require:

(a) Power consumption in ‘off mode’:


Power consumption of equipment in any off-mode condition shall not exceed [0.50] W.

(b) Power consumption in ‘standby mode(s)’:


The power consumption of equipment in any condition providing only a reactivation
function, or providing only a reactivation function and a mere indication of enabled reactivation
function, shall not exceed [0.50] W.
The power consumption of equipment in any condition providing only information or
status display, or providing only a combination of reactivation function and information or status
display, shall not exceed [1.00] W.

(c) Availability of off mode and/or standby mode


Equipment shall, except where this is inappropriate for the intended use, provide off
mode and/or standby mode and/or another condition which does not exceed the applicable power
consumption requirements for off mode and/or standby mode when the equipment is connected
to the mains power source.

(d) Power management


When equipment is not providing the main function, or when other energy-using
product(s) are not dependent on its functions, equipment shall, unless inappropriate for the
intended use, offer a power management function, or a similar function, that switches equipment

y
For more information, visit www.iea.org/.
z
For more information, visit https://eur-lex.europa.eu/legal-content/EN/ALL/?uri=CELEX%3A32008R1275.
aa
For more information, visit https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A02008R1275-
20210301.
bb
January 6, 2013, is 4 years after the entry into force of the directive which was January 6, 2009, 20 days after its
publication in the Official Journal of the European Union.

3-9
after the shortest possible period of time appropriate for the intended use of the equipment,
automatically into:

• standby mode, or
• off mode, or
• another condition which does not exceed the applicable power consumption
requirements for off mode and/or standby mode when the equipment is connected to
the mains power source. The power management function shall be activated before
delivery.

This EU standard provides maximum power requirements for standby mode. The energy
conservation standard established in this direct final rule for conventional cooking tops specifies
maximum IAEC values. The IAEC value includes the energy consumption of the cooking top in
standby mode. Both the EU standard and the DOE test procedure require measurement using the
relevant sections of IEC 62301.

3.8 OTHER PROGRAMS

DOE reviewed other labeling programs promoting energy-efficient consumer appliances


(see section 3.8.1) and safety guidelines (see section 3.8.2) in the United States.

3.8.1 ENERGY STAR

ENERGY STAR®, a voluntary labeling program jointly administered by the U.S.


Environmental Protection Agency (EPA) and DOE, identifies energy efficient products through a
qualification process. cc To qualify, a product must exceed Federal minimum standards by a
specified amount, or if no Federal standard exists, exhibit specified energy-saving features. The
ENERGY STAR program works to recognize the top quartile of products on the market,
meaning that approximately 25 percent of the models on the market at the time the qualifying
criteria are specified meet or exceed the ENERGY STAR criteria. ENERGY STAR guidelines
have been established for numerous consumer products, including electric cooking tops.

The ENERGY STAR Emerging Technology Award (ETA) recognizes innovative


technologies that reduce energy use and lower greenhouse gas emissions. For the first time in
March 2021, ENERGY STAR published ENERGY STAR ETA criteria for residential induction
cooking tops.dd The ENERGY STAR ETA is awarded to conventional cooking tops available for
sale in the U.S. market in 2021–2022 that:

1. meet the DOE definition for a built-in, drop-in or freestanding cooking top and are
intended for residential use;
2. only include induction heating technology for all surface units on the cooking top; and
3. are tested according to the test procedure finalized in the December 2016 Final Rule
with an Integrated Annual Energy Consumption less than or equal to 125 kWh/year.

cc
For more information on the ENERGY STAR program, please visit www.energystar.gov.
dd
For more information on the ENERGY STAR Emerging Technology Award, please visit
www.energystar.gov/about/2021_residential_induction_cooking_tops.

3-10
ENERGY STAR additionally finalized version 1.0 of the Specification for residential
electric cooking products, which went into effect on September 25, 2023.ee The ENERGY STAR
criteria, expressed as the maximum allowable energy consumption in kWh/year, are shown in
Table 3.8.1.

Table 3.8.1 ENERGY STAR Residential Electric Cooking Products Specification


Energy Use Requirement for Standalone Conventional Electric Cooking Tops
IAEC ≤ 195 kWh/year
Energy Use Requirements for Combined Electric Cooking Products
IAEC ≤ 195 kWh/year
ETLP,O* ≤ 7 kWh/year
* ETLP,O is the annual combined low-power mode energy consumption of the conventional electric oven component
of a combined cooking product and is calculated in kWh/year as follows:
𝐸𝑇𝐿𝑃,𝑂 = [(𝑃𝐼𝐴 × 𝐹𝐼𝐴 ) + (𝑃𝑂𝑀 × 𝐹𝑂𝑀 )] × 𝐾 × 𝑆𝑇𝑂𝑇 × 𝐻𝑂
Where PIA, FIA, POM, FOM, K, STOT are as defined in Section 4.2.2 of Appendix I1.
Ho is equal to 40% for conventional electric ranges.

3.8.2 Building Codes

American National Standards Institute (ANSI) Z21.1 “Household Cooking Gas


Appliances” (“ANSI Z21.1”) is the industry safety standard for newly produced household
cooking gas appliances. ANSI Z21.1 includes specifications that cover construction
requirements, burner operating conditions, ignition systems, gas valve performance, regulator
performance, safety testing, wall temperature limits, flue gases, vent hoods, self-cleaning ovens,
and safety circuitry of gas cooking appliances. In addition to these, section 5.4 of ANSI Z21.1
specifies that an appliance shall not produce a concentration of carbon monoxide in excess of
800 parts per million (ppm) when the appliance is tested in a room having approximately a
normal oxygen supply.

ANSI Z21.1 is not a mandatory standard for conventional cooking product


manufacturers. However, because it is included in many local building and safety codes,ff the
provisions in ANSI Z21.1 are widely followed by conventional cooking product manufacturers.

ee
For more information on the ENERGY STAR Residential Electric Cooking Products Specification, please visit
https://www.energystar.gov/products/residential_electric_cooking_products_version_1.
ff
See, for example, the New York City Fuel Gas Code (“NYCFGC”) of the 2022 Construction Codes, Chapter 6,
Section 623.1 Cooking Appliances. This section requires that “[c]ooking appliances that are designed for permanent
installation, including ranges, ovens, stoves, broilers, grills, fryers, griddles, hot plates and barbecues, shall be tested
in accordance with ANSI Z21.1/CSA 6.5, ANSI Z21.58/CSA 1.6 or ANSI Z83.11/CSA 1.8 and shall be installed in
accordance with the manufacturer’s instructions.” For more information, see:
https://www1.nyc.gov/assets/buildings/apps/pdf_viewer/viewer.html?file=2022FGC_Chapter6_SpecAppliancesWB.
pdf&section=conscode_2022.

3-11
3.9 HISTORICAL SHIPMENTS

Awareness of annual product shipment trends is an important aspect of the market


assessment and in the development of the standards rulemaking. DOE reviewed data collected by
the U.S. Census Bureau and AHAM to evaluate consumer appliance product shipment trends and
the value of these shipments, which were used during the shipments analysis (see chapter 9 of
this TSD).

3.9.1 New Home Starts

Trends in new home starts may directly affect shipments of certain consumer appliances.
While there is certainly both a replacement and remodeling market for some appliances
including conventional cooking products, these products are also fixtures in virtually all new
homes.

Table 3.9.1 presents the number of new single-family and multi-family housing units
started in the United States from 2005–2022. Between 2005 and 2010, single-family home starts
decreased 73 percent, from over 1.7 million to 471,000 units annually. During the same time
period, multi-family unit starts decreased 67 percent, from 353,000 to 116,000 units annually.
While single-family unit starts have increased by 138 percent from 2010–2021, they still remain
below their pre-2005 levels, and have seen a new drop in 2022. Over the same time period,
multi-family unit starts have rebounded to above their pre-2005 levels to 547,000 annually.

Table 3.9.1 New Privately Owned Single-Family and Multi-Family Housing Unit Starts in
the United States from 2005-2022 (Thousands)10
Single- Multi-
Year
Family Family
2022 1005 547
2021 1127 474
2020 991 389
2019 888 402
2018 876 374
2017 849 354
2016 782 392
2015 715 397
2014 648 355
2013 618 307
2012 535 245
2011 431 178
2010 471 116
2009 445 109
2008 622 284
2007 1,046 309
2006 1,465 336
2005 1,716 353

3-12
3.9.2 Unit Shipments and Value

Shipments of conventional cooking products for 2006 through 2009 were obtained from
the July 2010 Appliance Market Research Report’s “U.S. Appliance Industry Statistical Review:
2000 to YTD 2010.” Data for 2010 was taken from the January 2011 Appliance Market Research
Report’s “U.S. Appliance Shipment Statistics Monthly: January 2011.” Shipments for 2011 to
2017 were obtained from Appliance Design’s “Major Appliance Shipments” found in the March
issue of each year. Table 3.9.2 presents the annual shipments of conventional cooking products
for the period from 2006 to 2017, the most recent year of data from these sources.

Table 3.9.2 Industry Shipments of Conventional Cooking Products (Domestic and Import
in Thousands of Units)11,12,13,14,15,16
Cooking Products
Electric Cooking Gas Cooking
Year Surface Surface
Electric Electric Gas Gas
Cooking Total Cooking Total
Ranges Ovens Ranges Ovens
Units Units
2017* 4,638 376 5,014 3,105 502 3,607
2016* 4,528 356 4,884 3,042 458 3,500
2015* 4,246 357 4,603 2,813 435 3,248
2014 4,078 718 335 5,131 2,628 30 403 3,061
2013 3,791 677 326 4,794 2,478 33 369 2,880
2012 3,439 589 304 4,332 2,275 31 304 2,610
2011 3,424 574 320 4,318 2,286 39 300 2,625
2010 3,509 604 335 4,448 2,432 44 314 2,790
2009 3,448 549 336 4,333 2,264 44 291 2,598
2008 3,973 700 433 5,106 2,408 47 387 2,843
2007 4,612 867 512 5,991 2,781 56 497 3,334
2006* 5,684 544 6,228 3,023 563 3,586
* Disaggregated shipments data for electric and gas ranges was unavailable for 2006 and 2015–2017.

Table 3.9.3 provides the value of shipments for the household cooking appliance industry
from 2002–2016 based upon data from the U.S. Census Bureau’s Annual Survey of
Manufactures (ASM).gg The ASM expresses all dollar values in nominal dollars; i.e., 2016 data
are expressed in 2016 dollars, and 2014 data are expressed in 2014 dollars. The value of
shipments decreased by nearly 19 percent between 2007 and 2008, but then increased to once
again reach pre-2008 levels in 2014–2016 (the most recent year the ASM provided this level of
disaggregation).

gg
Available online at https://www.census.gov/programs-surveys/asm/data.html.

3-13
Table 3.9.3 Household Cooking Appliance Manufacturing Statistics by Year17
Value of Shipments in
Year
Nominal Dollars ($1,000)
2016 4,864,516
2015 4,767,931
2014 5,160,766
2013 4,398,139
2012 4,359,383
2011 3,809,552
2010 3,740,373
2009 3,798,353
2008 3,884,230
2007 4,786,768
2006 4,864,268
2005 5,114,677
2004 4,798,227
2003 4,691,713
2002 4,327,308

There was an overall decrease in both shipment volume and values from 2006–2010,
followed by an overall increase in both from 2011–2017.

3.9.3 Imports and Exports

DOE obtained import and export data from the U.S. International Trade Commission’s
DataWeb database.18 Figure 3.9.1 shows the number of conventional cooking product imports
for the period 2005–2022. Imports of electric cooking stoves, ranges, and ovens have generally
decreased over this time period, from 4.1 million in 2005 to 3.0 million in 2022. Imports of non-
portable cooking appliances for gas and other fuels have generally increased over this time
period, especially from 2014 to 2021, where imports increased from 1.5 million units to 3.8
million units, exceeding imports of electric units for the first time in 2020. In 2022, imports of
gas units decreased to 3.0 million units.

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Figure 3.9.1 Annual Imports of Conventional Cooking Products19

Figure 3.9.2 shows the number of gas cooking product exports for the period 2005–
2022.hh The number of exports remained relatively constant for 2005–2013. From 2013 to 2022,
the number of exported units changed with more volatility, yielding an overall increase from 117
thousand to 233 thousand (peaking at 414 thousand in 2018).

hh
Figure 3.9.2 only includes the number of gas conventional cooking products exported because the U.S.
International Trade Commission’s DataWeb database did not have any data available for electric conventional
cooking product exports.

3-15
Figure 3.9.2 Annual Exports of Gas Conventional Cooking Products20

3.10 MARKET SATURATION

AHAM’s Fact Book 2005 and Appliance Magazine’s 2007–2010 U.S. Appliance
Industry: Market Share, Life Expectancy & Replacement Market, and Saturation Levels” and
2011–2014 U.S. Appliance Industry: Market Value, Life Expectancy & Replacement Picture
present the market saturation for conventional cooking products. The percentage of U.S.
households with electric ranges and/or cooking tops and gas ranges and/or cooking tops has
remained relatively steady since 2001. Table 3.10.1 presents the percentage of U.S. households
with each product for the period of 1999–2014, the most recent year of such data from these
sources.

3-16
Table 3.10.1 Percentage of U.S. Households with Conventional Cooking Products21, 22,23
Electric
Gas Ranges /
Year Ranges /
Cooking Tops
Cooking Tops
2014 61.0 39.0
2013 61.0 40.0
2008 61.0 40.0
2007 60.0 40.0
2006 60.0 39.0
2005 60.0 39.0
2004 61.0 39.0
2003 61.0 39.0
2002 62.0 38.0
2001 61.0 40.0
2000 60.0 10.0
1999 60.0 40.0

3.11 EFFICIENCY DISTRIBUTION OF THE CURRENT MARKET

In preparation for the screening and engineering analyses, DOE gathered data on the
energy efficiency of conventional cooking products currently available in the marketplace. While
this section is not intended to provide a complete characterization of the energy efficiency of all
appliances currently available and in use, it does provide an overview of the energy efficiency of
each product covered by this rulemaking.

Although not completely representative of the current U.S. cooking products market,
Natural Resources Canada (NRCan) publishes a database of electric cooking appliance
performance as measured by CAN/CSA 358-03.ii The NRCan database covers products available
in the Canadian market, which overlaps with the U.S. market. Data from the NRCan database are
presented as the distribution of listed models as a function of annual energy consumption.

Figure 3.11.1 displays the distribution of annual energy consumption of electric smooth
element cooking tops listed in the NRCan database. The NRCan database did not include any
electric open (coil) element cooking tops at the time of this analysis.

ii
See section 3.7.2 of this TSD.

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Figure 3.11.1 Electric Smooth Element Cooking Topsjj in the NRCan Database24

Because annual energy consumption is a function of cavity volume, DOE presented the
annual energy consumption of electric ovens listed in the NRCan database related to their cavity
volume in Figure 3.11.2.

jj
DOE has preliminarily determined that the highest-efficiency electric smooth element cooking top listed in the
NRCan database, is not available in the U.S. market.

3-18
Figure 3.11.2 Electric Ovens in the NRCan Database – Annual Energy Consumption
versus Cavity Volume25

3.12 TECHNOLOGY ASSESSMENT

This section provides a technology assessment for conventional cooking products.


Contained in this technology assessment are details about product characteristics and operation
(section 3.12.1) and an examination of possible technological improvements for each product
(section 3.12.2).

3.12.1 Product Operations and Components

In preparation for the screening and engineering analyses, DOE prepared a brief
description of the characteristics and operation of typical baseline products in each product class
covered by this rulemaking. These descriptions provide a basis for understanding the
technologies used to improve product efficiency.

Conventional cooking products are appliances that enable the homeowner to heat and
cook foods by means of transfer of input energy to the food load. Input energy may be
electricity, gas, or a combination of the two. Cooking tops consist of a horizontal surface
comprising one or more heating elements. A cooking vessel is placed on the top surface of the
cooking top over the element to facilitate heat transfer to the food load. In conventional ovens,
the cooking vessel is placed inside a cavity within which the energy transfer to the food load
takes place. Combined cooking products may incorporate both an oven(s) and a cooking top in a
single unit.

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An electric cooking top consists of a horizontal surface with one or more electrically
powered heating elements located either above or below the cooking top surface. When the
elements are located above the cooking top surface, the cooking vessel is placed directly on an
element to heat the vessel and contents through conductive heat transfer. The elements are
resistively heated by means of the current supplied to them. An open (coil) element cooking top
uses a spiral-wound sheathed heating element. Removable drip bowls beneath each element
serve as catch basins for spills.

Heating elements may also be located under a glass-ceramic cooking top surface. A
baseline smooth element cooking top uses solid disk elements to heat the glass-ceramic surface,
which provides heat to the cooking vessel through conductive heat transfer. Electronic control
systems are provided to energize the desired heating elements. These controls may incorporate
algorithms for modulation of the element according to cooking top and cooking process
parameters.

In a gas cooking top, pressurized natural gas or propane is supplied to each burner by
means of an orifice and venturi on the underside of the cooking top surface. A sheet metal box
encloses the array of burner supply lines as well as the controls for gas delivery and ignition, if
provided. Primary air drawn from within the enclosure mixes with the gas at the venturis and is
delivered to the ports typically arrayed radially on the burners above the cooking top surface.
Gas flow and thus burner turndown is controlled by individual (typically rotary) valves
connected to the burner supply lines. Upon ignition of the gas-air mixture, secondary air is
entrained near the burner ports to produce a substantially radial distribution of flames. For sealed
burners in which the cooking top surface interfaces directly with the base of each burner, all
secondary air is introduced above the cooking top surface. Open burners can derive some
secondary air from the box as well. Grates positioned above the burners allow a cooking vessel
to be placed at the proper spacing to ensure adequate secondary air for complete combustion,
minimization of carbon monoxide emissions, and adequate convective heat transfer for cooking
efficiency.

As discussed, gas cooking tops cannot have a constant burning pilot (10 CFR
430.32(j)(1)–(2)) and instead use some form of electrically powered ignition, typically an
intermittently activated spark igniter. An electronic control module may automatically energize
the spark electrode whenever flame extinction is detected; otherwise the spark igniter must be
manually reactivated by means of switches on the burner valve controls in the event of flame
loss. Controls for the burners typically consist of manual burner adjustment as dictated by the
rotary valve position. In order to achieve very low firing rates associated with such cooking
processes as simmering, melting chocolate, or heating delicate sauces, some conventional
cooking tops incorporate electronic controls that cycle burners on and off.

Electric ovens are appliances designed to bake, roast, or broil foods within an insulated
cavity. The major components of the oven include the cavity, the heat source, and a control
system. The heat source for the cooking process is typically provided by radiant elements. Bake
elements are located at the bottom of the cavity and may be either exposed or covered to provide
spill protection and improve cleanability. Broil elements are situated at the top of the cavity. If

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the oven incorporates a convection cooking mode, one or more fans are situated within the cavity
to provide a means for forced-air distribution.

The oven cavity is a formed sheet metal enclosure with provision for holding cooking
racks at varying positions. The interior surface of the cavity may be bare metal (stainless steel),
or it may have a porcelain coating for durability and cleanability. Additives in the porcelain
coating can provide catalytic conversion of food spilled on the surface under normal cooking
temperatures, thus enabling a continuous cleaning process. Alternatively, the oven may have
features that allow it to be operated under a special self-clean mode, which heats the cavity to
higher temperatures than those used for cooking. In the process, food spills are pyrolyzed,
leaving an ash residue that is easily wiped off when the cavity cools down.

Accessories such as lights and sensors for control of cooking processes are located within
the cavity, while an insulated glass window in the oven door allows observation of the cooking
processes without requiring the door to be opened (which would incur substantial heat loss). The
outside of the cavity is wrapped with insulation to minimize heat loss to ambient surroundings.
The space between the cavity and the outer sheet metal enclosure which is filled by the insulation
typically is made as small as practically possible in order to maximize the cavity volume. The
oven is also vented from the top of the cavity.

Like electric ovens, gas ovens are designed to bake, roast, or broil food, although the heat
source for the cooking process is the combustion of natural gas or propane. The cavity is similar
to those of electric ovens as well, in that the surface finishes may be bare or porcelainized, with
or without the catalytic properties. Accessories and insulation tend to be similar between gas and
electric ovens, although the demands for venting in gas ovens are higher than those for electric
ovens since due to the presence of combustion products.

Gas burners are situated at the bottom of the cavity for the bake function and the top for
broiling. They are typically shielded by baffles or covers to protect the burners from spills and to
help distribute heat evenly. Broil elements may also be of a radiant type in which the combustion
of the fuel-air mixture heats a perforated ceramic matrix or a metal mesh. As the ceramic or
metal heats, it emits infrared radiation that can produce heating and surface browning of the
cooking load.

As with gas cooking tops, gas ovens cannot have a constant burning pilot ignition system
(10 CFR 430.32(j)(1)–(2)). Ignition may be achieved through the use of a hot surface igniter or
an intermittently actuated spark igniter used to light the pilot when the oven controls are turned
on. With hot surface ignition, a ceramic heating element is placed in a location where the
incoming gas-air mixture will impinge on it. As the element is heated electrically, its resistance
goes down and current draw goes up. A bi-metallic gas valve in electrical series with the igniter
deforms as its corresponding current increases, allowing gas flow as long as the hot surface
igniter is energized by the burner controller. For spark ignition, the pilot serves to heat a
thermally actuated switch that keeps the main gas valve open.

Additional electrically powered components in gas ovens may include cavity lights,
electronic controls incorporating various types of displays, and cooking sensors.

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Combined cooking products combine a cooking product with other appliance
functionality. Typical combined cooking products include conventional ranges which are the
combination of a conventional cooking top and a conventional oven.

3.12.2 Technology Options

In order to gain a deeper understanding of the technological improvements used to


increase the efficiency of conventional cooking products, DOE identified several possible
technologies and examined the most common improvements used in today’s market.

DOE considered technologies identified in the following sources: (1) the 2009 Final Rule
Technical Support Document: Residential Dishwashers, Dehumidifiers, and Cooking Products
and Commercial Clothes Washers (“2009 TSD”) from the most recent energy conservation
standards rulemaking for conventional cooking products;kk (2) the 1996 Technical Support
Document for Residential Cooking Products (“1996 TSD”), which was released as part of the
previous standards rulemaking;ll (3) information provided by trade publications; and (4) design
data identified in manufacturer product offerings.

3.12.2.1 Electric Open (Coil) Element Cooking Tops

The Joint Agreement recommends establishing no standards for electric open (coil)
element cooking tops. For electric open (coil) element cooking tops, DOE did not identify any
technology options for improving efficiency. Therefore, and as discussed in the direct final rule,
DOE did not evaluate electric open (coil) element cooking tops as part of the efficiency analysis
in chapter 5 of this TSD.

3.12.2.2 Electric Smooth Element Cooking Tops

For electric smooth element cooking tops, DOE considered the technologies listed in
Table 3.12.1.

Table 3.12.1 Technology Options for Electric Smooth Element Cooking Tops
1. Halogen elements
2. Improved resistance heating elements
3. Induction elements
4. Low-standby-loss electronic controls
5. Reduced air gap

Halogen Elements

Halogen elements transfer energy to the cooking vessel by direct infrared radiation from
high-powered tungsten-halogen lamps. The halogen element lies underneath the same type of

kk
Available online at https://www.regulations.gov/document/EERE-2006-STD-0127-0097.
ll
Available online at https://www.regulations.gov/document/EERE-2006-STD-0070-0053.

3-22
glass-ceramic panel used in a baseline electric smooth element cooking top and consists of one
or more lamps installed horizontally within a corrosion-protected metal dish. The bottom of the
metal dish is insulated with microtherm insulation.

Radiant heating coils are commonly fitted around the halogen element to provide heat
around the element’s edge. This results in a highly responsive element that provides an even
temperature distribution. Halogen elements can be configured to operate across a wide range of
capacities. Parallel or series lamp arrangements can yield power outputs from 1200–2500 W.
Halogen lamp technology reported in the 1996 TSD consisted of a circular lamp that can provide
a more optimum temperature distribution than traditional straight lamps. This circular lamp has
the trademark name of Haloring.

The TSDs from previous rulemakings reported that with the continued development of
halogen elements, efficiencies had increased. The circular halogen-lamp elements that had
recently been developed at the time of the previous analysis could exceed the efficiency of solid
disk elements as measured according to the DOE test procedure at that time. Data provided for
the previous rulemakings by a cooking top manufacturer were used to establish the efficiency
gain of a circular halogen lamp element over that of a solid disk element. An efficiency increase
of approximately 1.5 percent was measured. It is important to reiterate that this efficiency
increase was only for the circular halogen lamp element. Other halogen lamp elements might not
yield the same efficiency increase. The same cooking top manufacturer mentioned above also
provided efficiency data based on boiling water tests. These tests indicated that circular halogen
lamp elements can yield even higher efficiency increases over that of solid disk elements.
European manufacturers had also conducted boiling water tests indicating that halogen lamp
elements (the configuration of halogen lamp tested was not specified) are more efficient than
solid disk elements.26

DOE is not aware of any conventional cooking tops currently on the market using
halogen technologies.

Improved Resistance Heating Elements

Resistance heating elements consist of heated coils housed beneath a ceramic-glass


cooking top surface. The heated coils radiate heat through the cooking top surface to heat the
bottom of the cookware. Through its testing of electric smooth element cooking tops, DOE has
identified increased efficiency associated with improved resistance heating elements that are
designed to more effectively radiate heat from the housed coil to the cookware bottom.

Induction Elements

Induction elements use a solid-state power supply to convert 60 hertz alternating line
current into a high-frequency (approximately 25 kilohertz) alternating current. This high-
frequency current is supplied to an inductor. The inductor is a flat spiral winding located just
underneath the same type of glass-ceramic panel used in a baseline electric smooth element
cooking top. The high-frequency current, which is supplied to the inductor, causes it to generate
a magnetic field which passes through the glass-ceramic panel unaffected and produces eddy
currents in the bottom of the cooking vessel. The vessel must be made of ferromagnetic material,

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and the eddy currents that are generated within it cause it to heat up. Thus, the vessel essentially
becomes the heating element.

A sensor is placed between the inductor and the glass-ceramic panel, providing a
continuous temperature measurement of the vessel bottom. Sensors also enable the inductor to
only heat objects of at least 4 inches in diameter. This prevents any small metal objects, such as
forks or spoons, from accidentally being heated. In addition, since the glass-ceramic panel is
unaffected by the magnetic field, it remains relatively cool, reducing the potential for accidental
burns.

The primary advantages of induction elements are their fast response and control of the
heat source, their ease of cleaning, and their ability to heat vessels that are not flat. Because these
features have usually been associated with gas burners, induction elements are being marketed in
competition to them. DOE’s testing, discussed in detail in chapter 5 of this TSD, showed that
induction heating resulted in up to a 14 percent relative decrease in active mode energy use
compared to electric smooth element cooking tops with electric resistance heating elements.

Low-standby-loss Electronic Controls

Electronic controls may consume power even when the electric cooking top is not
performing its intended function. Depending on the implementation of the controller, standby
power is required to enable the electronic controls to detect user input without the user first
having to turn on a mechanical power switch or to enable displays, illuminate switches, etc.
Reducing the standby power consumption of electronic controls would reduce the IAEC of the
electric cooking top but would not impact the energy consumption of the electric cooking top
during active mode operation.

A potential area for standby power improvements is the power supplies on the control
board. Baseline efficiency cooking tops use less efficient power supply designs, such as
conventional linear power supplies. A linear power supply typically produces unregulated as
well as regulated power. The main characteristic of an unregulated power supply is that its output
may contain significant voltage ripple and that the output voltage will usually vary with the
current drawn. The voltages produced by regulated power supplies are typically more stable;
exhibiting less ripple than the output from an unregulated power supply and maintaining a
relatively constant voltage within the specified current limits of the device(s) regulating the
power. The unregulated portion of a linear power supply typically consists of a transformer that
steps alternating current (AC) line voltage down, a voltage rectifier circuit for AC to direct
current (DC) conversion, and a capacitor to produce unregulated, direct current output. However,
there are many means of producing and implementing an unregulated power supply such as a
transformerless capacitive and/or resistive rectification circuits.

Within a linear power supply, the unregulated output serves as an input into a single or
multiple voltage-regulating devices. Such regulating devices include Zener diodes, linear voltage
regulators, or similar components which produce a lower-potential, regulated power output from
a higher-potential direct current input. This approach results in a rugged power supply which is
reliable, but typically has an efficiency of about 40 percent.

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Switch-mode power supplies (SMPSs) switch the current at high frequencies, adjusting
the proportion of on time during each switching cycle to maintain the regulated output voltage
proportional to a fixed voltage reference. SMPSs offer the highest conversion efficiencies (up to
75 percent in designs for appliance applications with power supply sizes similar to those of
conventional cooking products mm) and the lowest no-load standby losses (0.2 W or less), though
at higher part count and greater complexity. SMPSs’ greater complexity may also result in lower
overall reliability and take greater care to implement. For example, among other issues, a SMPS
can be prone to causing electromagnetic interference.

Manufacturers could also meet very low (i.e., less than 1 W) standby power levels
according to the definition of “standby mode” in the DOE test procedure by incorporating an
automatic function that turns off most power-consuming components once a period of inactivity
has elapsed. Such a low-consumption state could be user-selectable on demand. DOE noted that
at least one product in its test sample already incorporates such a design to achieve very low
standby power levels (around 0.25 W). The automatic power-down module would feature a
SMPS and a microprocessor that can respond to a simple capacitive-touch or switch signal to
power up and enable product operation via a triac.

Reduced Air Gap

Typical radiant element cooking tops have an air gap between the heating element and
the ceramic-glass cooking top surface. Energy is expended to heat the air between the heating
element and the glass, with that heated air providing minimal to the cooking vessel. One
approach for increasing the efficiency of a radiant element is to reduce the air gap, to reduce the
amount of wasted heat.

3.12.2.3 Gas Cooking Tops

For gas cooking tops, DOE considered the technologies listed in Table 3.12.2.

Table 3.12.2 Technology Options for Gas Cooking Tops


1. Catalytic burners
2. Optimized burner and grate design
3. Radiant gas burners
4. Reduced excess air at burner
5. Reflective surfaces

Catalytic Burners

Catalytic burners consist of a porous ceramic or refractory material such as glass or


ceramic wool, impregnated with a catalyst. The gas-air mixture or gas alone is fed to the catalytic
matrix, whereupon additional ambient air diffuses into it. The catalyst, typically palladium or
platinum, lowers the activation energy required for combustion such that the gas-air mixture

mm
Information on design and efficiencies of switch mode power supplies is available from Power Integrations:
www.power.com/applications/ac-dc-conversion/appliances.

3-25
subsequently oxidizes at temperatures below those normally required for combustion. This
produces a uniform, low-intensity infrared radiation with no visible flame. The burners include
an electric heating element to preheat the catalyst prior to initiating operation. Catalytic burners
in consumer appliances have been investigated primarily as a means of reducing nitrogen oxides
(NOX) emissions, since NOX formation is highly temperature dependent. Several organizations
have investigated catalytic burners that could be applied to consumer conventional cooking tops.
Precision Combustion, Inc. is developing several small-scale low-NOX catalytic burners that are
suitable for consumer conventional cooking tops.27 Hybrid catalytic burners have been shown to
improve cooking efficiency by 3 to 9 percent, in laboratory conditions. 28

Optimized Burner and Grate Design

As discussed in chapter 5 of this TSD, DOE testing revealed that gas cooking top
efficiency was correlated to burner design (e.g., grate weight, flame angle, distance from burner
ports to the cooking surface). For example, heavier grates result in more input energy being
absorbed by the grate instead of the pan. Because designs of burner system components are
interdependent and must also consider combustion efficiency to maintain approved levels of
carbon monoxide emissions,nn DOE considered optimized gas cooking top burner designs for
increasing efficiency only as consistent with products available on the market, which meet the
relevant safety and emissions standards.

DOE’s analysis for the 2009 standards rulemaking considered sealed burner as a design
option for improving efficiency. As discussed in chapter 5 of this TSD, DOE testing reviewed
that neither sealed or open burners clearly performed better or worse than the other. Therefore,
DOE did not consider sealed burners as a design option or part of the optimized burner and grate
design option for gas cooking tops for this direct final rule.

Radiant Gas Burners

Radiant gas burners transfer heat through infrared radiation from the burner surface. The
burner consists of a porous matrix through which a premixed gas-air mixture is fed. Upon
ignition, the flames sit on the surface of the matrix, heating the surface and causing it to emit
radiation at infrared wavelengths. The burner is located under a glass-ceramic cooking top
surface.

One form of radiant gas burners is termed the powered Infrared Jet-Impingement (IR-Jet)
burner. In an IR-Jet gas burner, both radiant and convective energy are transmitted to the
cooking vessel. A forced-draft combustion fan is used to deliver the fully premixed gas-air
mixture to the cooking top burners. At each burner, combustion occurs at the surface of a
perforated ceramic tile. As the tile heats, it emits radiant energy, principally in the far infrared
regime. Combustion products are jetted through perforations in the glass-ceramic cooking top,
delivering convective energy to the cooking vessel as well.

nn
The 800-ppm limit specified in ANSI Z21.1 is the most commonly referenced carbon monoxide limit. See section
3.8.2 of this TSD.

3-26
As reported in the 2009 TSD, the Gas Research Institute (GRI, now known as the Gas
Technology Institute) sponsored the development of the IR-Jet gas burner. With GRI’s
sponsorship, the American Gas Association Laboratories (AGAL) worked with a range
manufacturer to produce a working IR-Jet burner. However, the IR-Jet burner is not currently
being marketed. Data collected from a boiling water test indicated that the AGAL-developed IR-
Jet radiant burner is more efficient than a comparable conventional open burner. The boiling
water test indicated a 16-percent increase in efficiency.

Another type of radiant gas burner uses a silicon carbide-fiber burner which emits
radiation in the near-infrared spectrum. A prototype developed jointly by Tokyo Gas and Rinnai
Corporation used such material in a glass-ceramic cooking top that did not incorporate jet
impingement. Instead, combustion products were vented from underneath a solid, non-perforated
cooking top. Such a radiant burner relied entirely on radiant heat transfer and conduction from
the glass-ceramic after it heated up. In tests conducted according to the Japanese Industrial
Standard (JIS) S 2103:1996, Gas burning cooking appliances for domestic use, which is a water
heating procedure, the efficiency was reported as 43.5 percent compared with an estimated 30
percent for traditional gas burners.29

Reduced Excess Air at Burner

The excess-air ratio is defined as the amount of air used in the combustion process of the
gas burner divided by the amount of air necessary for stoichiometric combustion. Excess air is
provided to ensure high-quality flame characteristics and to create a safety margin to ensure
complete combustion is reached under all conditions. Reducing the excess-air ratio at the burner
through redesign and shrouding can improve its efficiency. This information was provided by the
1980 engineering analysis performed by DOE30 in support of developing energy efficiency
standards for a variety of consumer products, including conventional cooking tops and
conventional ovens. This document did not specify how the burner should be redesigned and
shrouded.

Reflective Surfaces

Reflective surfaces for gas cooking tops use highly polished or chromed drip pans
underneath the burner. By reflecting some of the radiant heat of the burner back up to the
cooking vessel, the efficiency of the burner is increased. The consumer must maintain the
reflective finish by cleaning the drip pans regularly.

Efficiency gains resulting from using reflective pans are extremely small because gas
flames and burners have minimal infrared emissions. The primary mechanism for heat transfer to
the cooking vessel is convection. The efficiency increase was obtained from using
manufacturers’ data provided by AHAM and reported in the 1996 TSD. The data indicate that an
efficiency increase of only 0.1 percent is realized due to the incorporation of reflective surfaces.
As reported in the 1996 TSD, manufacturers stated that any increase in efficiency due to a
reflective surface could easily be negated if the consumer fails to regularly clean the surface or
uses an abrasive pad to clean the surface.

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3.12.2.4 Electric and Gas Ovens

For gas and electric ovens, DOE considered the technologies listed in Table 3.12.3.

Table 3.12.3 Technology Options for Electric and Gas Ovens


1. Bi-radiant oven (electric ovens only)
2. Convection mode capability*
3. Halogen lamp oven (electric ovens only)
4. Improved and added insulation (standard ovens only)
5. Improved door seals
6. Low-standby-loss electronic controls
7. No oven-door window
8. Optimized burner and cavity design (gas ovens only)
9. Oven separator (electric ovens only)
10. Reduced vent rate (electric standard ovens only)
11. Reflective surfaces
* This technology option was previously referred to as “forced convection” in this rulemaking. In this direct final rule, DOE is
updating the name of this technology option, as discussed in the direct final rule.

Bi-radiant Oven (Electric Ovens Only)

A bi-radiant electric oven system was developed by Purdue University for Oak Ridge
National Laboratory in the late 1970s.31 The objective of the project was to develop an electric
oven that offered significant energy savings without compromising food quality. The bi-radiant
oven has three important features which provide improved performance: (1) the cavity walls are
highly reflective rather than absorptive, thereby allowing these surfaces to operate at cooler
temperatures; (2) the heating elements, similar in construction to those in typical consumer
conventional ovens but operating at much lower temperatures, provide a prescribed, balanced
radiant flux to the top and bottom surfaces of the food product; and (3) the baking and roasting
utensils have a highly absorptive finish.

The bi-radiant oven was tested under a variety of cooking conditions (including the DOE
test procedure at that time) and also modeled (using computer thermal analysis programs) to
determine its performance. It demonstrated a greater than 50-percent increase in efficiency over
that of a typical conventional oven. In addition, the separate upper and lower heating elements
required by the oven provided more flexibility in baking and roasting.

As noted in the 2009 TSD, several important practical concerns have to be addressed by
manufacturers in order to realize the demonstrated energy savings: (1) the oven lining material
must be durable enough to maintain the low-emissivity (less than 0.1) cavity surface; (2)
microprocessor controls must be used; and (3) as mentioned earlier, the baking and roasting
utensils must have a highly absorptive exterior. However, given the assumption that all of these
criteria are met, the previous rulemakings analyses assumed a 50-percent efficiency increase.

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Convection Mode Capability

An additional cooking feature on many electric ovens and certain gas ovens is convection
mode, in which hot air within the cavity is circulated by means of one or more fans to speed the
cooking process, promote surface crisping, and increase cooking uniformity. Supplemental
heating of this recirculated air may be accomplished by means of a radiant heating element
located near the fan. The use of convection mode can reduce fuel consumption by cooking food
more quickly, at lower temperatures, and in larger quantities than a natural convection oven of
the same size and rating. The fan is placed within the rear cabinet wall and a protective screen is
placed around it. The screen prevents any items being placed in the oven from “knocking” into
the fan and causing damage. The screen may also assist in distributing the heated air evenly
throughout the cavity. Cooking times can be reduced by using convection mode.32 As a result,
convection mode capability is widely used in electric ovens.

Additionally, conventional ovens can use convection heating elements in addition to


resistance and other types of elements to speed up the cooking process. By using different
cooking elements where they are most effective, such combination ovens can reduce the time
and energy consumption required to cook food.

In the previous rulemaking, DOE used estimates from manufacturers, researchers,


published reports,33, 34 and interested parties 35 to determine a relative cooking efficiency increase
due to the use of convection mode of 23 percent for gas self-clean ovens, 4.8 percent for gas
standard ovens, and 2.4 percent for both standard and self-clean electric ovens. Additionally,
DOE estimated that an increase in electrical energy consumption of approximately 15 Wh would
result from operation of the convection fan motor.

As described further in chapter 5 of this TSD, DOE performed testing on conventional


ovens in support of this rulemaking to determine the improvement in cooking efficiency
associated with convection mode capability. Included in the DOE test sample were four gas
ovens and two electric ovens equipped with convection mode capability. DOE compared the
measured energy consumption of each oven in bake mode to the average energy consumption of
bake mode and convection mode (including energy consumption due to the fan motor) as
specified in the test procedure finalized in the July 2015 TP Final Rule. The relative decrease in
active mode energy consumption resulting from the use of convection mode capability in
conventional ovens ranged from 4 to 7 percent depending on the product class.

Halogen Lamp Oven (Electric Ovens Only)

Halogen elements, similar to those used in electric cooking tops, can also be used in
electric ovens. Far less common than radiant elements, halogen elements are used to promote
faster cooking. This oven type was first introduced in Europe, but according to U.S.
manufacturers, its acceptance has been slow in the United States. Manufacturers stated in
previous rulemakings that the cooking performance of the halogen lamp oven is relatively poor
compared to that of a typical conventional oven, though it might be advantageous for certain
broiling applications.

3-29
Alternatively, a conventional oven can use halogen elements in addition to resistance
and/or convection elements to speed up the cooking process. By using different cooking
elements when they are most effective, combination ovens can reduce the time and energy
consumption required to cook food. However, no data were found or submitted to demonstrate
how efficiently halogen elements alone perform relative to typical conventional ovens.

Improved and Added Insulation (Standard Ovens Only)

The efficiency of an oven can be increased by either improving the insulation or adding
more insulation to the cabinet walls and oven door. Most standard models have 2 inches of low-
density (around 1.09 pounds (lb)/cubic feet (ft3)) fiberglass insulation in the cabinet walls and
door, while most self-clean ovens use 2 inches of high-density (around 1.90 lb/ft3) insulation.
Insulation is added primarily to pass Underwriters Laboratories (UL) surface temperature tests,
which explains why self-clean ovens—which require high temperatures for pyrolysis—tend to
have a more effective insulation package.

Since the earlier DOE test procedure for conventional ovens did not require maintaining
heat in the oven over an extended period of time, manufacturers stated in previous rulemakings
that increasing the thickness or density of the oven’s insulation would demonstrate no energy
savings. But data provided by several sources indicate that small energy savings can be realized
under the conditions of the DOE test procedure adopted in the July 2015 TP Final Rule.

The following sources were used in the 1996 TSD to establish the efficiency increase
from using a denser insulation (1.09 to 1.90 lb/ft3): (1) manufacturers’ data provided by AHAM;
(2) the costing analysis of design options for consumer appliances prepared by ADM Associates
for LBNL;36 (3) the energy efficient electrical product knowledge base prepared by ORTECH
International for the Canadian Electrical Association;37 and (4) the 1980 DOE engineering
analysis for consumer appliances.38 Averaging the data from these sources results in an
efficiency increase of 4.9 percent for standard gas ovens and 5.2 percent for standard electric
ovens.

As noted in the 2009 TSD, two sources of data were available which showed an increase
in efficiency due to adding more insulation (2 to 4 inches): (1) manufacturers’ data provided by
AHAM for the 1996 TSD and (2) the 1980 DOE engineering analysis for consumer appliances.39
Averaging these data points results in an efficiency increase of approximately 1.4 percentage
points. However, GRI reported no change in energy consumption by adding insulation. 40

Improved Door Seals

Door seals for standard ovens generally consist of a strip of silicone rubber, while self-
clean ovens usually incorporate fiberglass seals. These seals are attached to the oven front frame
and act as a seal for the door, which serves to reduce the loss of hot oven air through the door.
Because some venting is required for proper cooking performance, a complete seal on the oven is
undesirable. But the oven door seals can be improved further without sealing the oven
completely.

3-30
As noted in the 2009 TSD, data from the energy efficient electrical product knowledge
base prepared by ORTECH International for the Canadian Electrical Association 41 were used to
estimate the efficiency increase from improving the door seals. The data indicated that an
approximately 7-percent increase in efficiency was possible for standard electric ovens and both
standard and self-clean gas ovens. However, more recent data by GRI 42 show efficiency
increases much less than the 7-percent value previously reported. The GRI report also pointed
out the need for sufficient air flow though the oven cavity for proper heating and moisture
conditions while cooking.

Low-standby-loss Electronic Controls

Electronic controls may consume power even when the conventional oven is not
performing its intended function. Depending on the implementation of the controller, standby
power is required to enable the electronic controls to detect user input without the user first
having to turn on a mechanical power switch or to enable displays, illuminate switches, etc.
Reducing the standby power consumption of electronic controls would reduce the integrated
annual energy consumption of the conventional oven but would not impact the energy
consumption of the conventional oven during active mode operation.

A potential area for standby power improvements is the power supplies on the control
board. As described for conventional cooking tops, baseline efficiency conventional ovens
incorporate linear power supplies with efficiencies of about 40 percent. SMPS designs are also
available for conventional ovens offering conversion efficiencies of up to 75 percent and the
lowest no-load standby losses. Based on DOE’s reverse engineering analyses, discussed in detail
in chapter 5 of this TSD, DOE observed that more than 90 percent of the conventional ovens on
the U.S. market incorporated SMPSs.

No Oven-door Window

Most conventional ovens come equipped with windows in the door. Using the window,
the contents of the oven can be viewed without opening the oven door. But oven-door windows
allow more energy to be lost through the door and, thus, reduce the efficiency of the oven. It
could be argued, however, that having no window in the door necessitates frequent door
openings to check the contents of the oven. The lost energy caused by these door openings could
offset any energy savings that would result from eliminating the door window.

Optimized Burner and Cavity Design (Gas Ovens Only)

DOE testing and reverse engineering analyses revealed that gas oven cooking efficiency
was correlated to burner and cavity design. Specifically, DOE’s testing indicated that reducing
the thermal mass of the oven cavity can increase cooking efficiency. Energy is absorbed by the
oven components as the oven warms to its operating temperature. By reducing the amount of
material used in constructing the oven, the amount of energy that is absorbed is reduced and
hence the efficiency increases. One method of achieving this thermal mass reduction is to reduce
the gauge of sheet metal used in constructing the oven. Because oven cavity and burner design
are interdependent, DOE is considering optimized burner and cavity design as a technology
option for increasing efficiency for gas ovens only as consistent with products available on the

3-31
market rather than considering the reduced thermal mass technology option included in the
previous rulemaking.

Oven Separator (Electric Ovens Only)

For loads that do not require the entire oven volume, an oven separator can be used to
reduce the cavity volume that is used for cooking. With less oven volume to heat, the energy
used to cook an item would be reduced. The oven separator considered here is the type that can
be easily and quickly installed by the user. The side walls of the oven cavity would be fitted with
“slots” that guide and hold the separator into position, and a switch to indicate when the
separator has been installed. The oven would also require at least two separate heating elements
to heat the two cavities. Different pairs of “slots” could be spaced throughout the oven cavity so
that the user could select different positions to place the separator.

Based on DOE’s review of products available on the market, DOE noted that at least one
manufacturer offers an electric oven that incorporates an oven separator. Based on DOE’s testing
of this unit, DOE observed a 19 percent relative increase in cooking efficiency associated with an
oven separator in a standard electric oven. Oven separators are not used in gas ovens because
they would interfere with the combustion air flow and venting requirements for the separate gas
burners on the top and bottom of the oven cavity.

Reduced Vent Rate (Electric Standard Ovens Only)

Oven vents function primarily to remove the moisture present during the baking process.
Self-clean ovens have reduced vent diameters to limit the air flow in accordance with
combustion safety regulations during the high-temperature cleaning cycle. For safety reasons for
the combustion process, the vent rate found in self-clean ovens cannot be reduced any further.
But the vent rate of standard ovens can be reduced to the vent rate of self-clean ovens. This can
be accomplished by either reducing the vent-tube size or adding a baffle. A reduction in vent rate
causes a corresponding increase in efficiency.

As noted in the 2009 TSD, manufacturers stated as part of the previous rulemakings that
reduced vent rates should only be considered for standard electric ovens. Manufacturers asserted
that vent sizes are unique to the design of the oven. The vent size is critical in maintaining the
oven’s proper cooking and safety performance. According to the manufacturers, mandating a
specific vent rate would require most oven models to be redesigned in order to maintain their
proper performance.

Reflective Surfaces

Oven efficiency can be improved by incorporating reflective surfaces onto the walls of
the oven cavity. Reflective surfaces improve the oven’s performance by reflecting and retaining
infrared radiation within the oven cavity, thus increasing the percentage of heat available to be
transferred to the food load.

GRI performed tests on this technology option which resulted in a decrease in energy
efficiency.43 The reflective surface interfered with the convective currents and the thermostat,

3-32
thus fooling the thermostat into cycling. GRI reported that increased reflectance from the
chrome-plated inner surface of the oven caused repeated thermostat cycling that “might have
contributed to the higher energy consumption,” which resulted in a 12.6-percent decrease in
energy efficiency. ADL also commented that the reflected radiation is different from the normal
radiation emitted by the oven cavities currently in use.44

Based on these studies, it is uncertain whether, or how much, energy savings are
realizable with this technology option. A smarter controller for the oven seems to be a reasonable
fix for the thermostat cycling problem. However, there is a general lack of sophistication in the
technology to maintain clean, reflective surfaces over the lifetime of the product. Manufacturers
stated in the previous rulemaking that reflective surfaces degrade throughout the life of the oven,
particularly for self-clean ovens.

3-33
REFERENCES

1. Haier. 2021. “Haier History.” About Haier. Available online at


www.haier.com/global/about-haier/history/.

2. Viking Range. 2016. Viking Range Corporation Acquired by Middleby Corporation.


Available online at www.vikingrange.com/consumer/product/about-viking/viking-
news/viking-range-corporation-acquired-by-middleby-corporation.

3. GE Appliances. 2016. “Qingdao Haier Acquires GE Appliances.” GE Appliances Press


Release, June 6, 2016. Available online at
http://pressroom.geappliances.com/news/qingdao-haier-acquires-ge-appliances (Accessed
August 28, 2023).

4. Courier Journal, June 6, 2016 “GE Appliances Sold to Haier.” Available online at
www.courier-journal.com/story/news/local/2016/06/06/haier-execs-lville-ge-appliance-
park-sale/85459922/ (Accessed August 28, 2023).

5. Middleby. 2019. “Middleby Acquires EVO America.” Available online at


www.middleby.com/newsroom/middleby-acquires-evo-america/.

6. Middleby. 2021. “Middleby Acquires Imperial Commercial Cooking Equipment.”


Available online at www.middleby.com/newsroom/middleby-acquires-imperial-
commercial-cooking-equipment/.

7. Association of Home Appliance Manufacturers (AHAM) Fact Book 2005.

8. AHAM Fact Book 2003.

9. European Commission. Ecodesign and energy labelling – Domestic ovens, hobs and
range hods. Available online at https://single-market-economy.ec.europa.eu/single-
market/european-standards/harmonised-standards/ecodesign-and-energy-labelling-
domestic-ovens-hobs-and-range-hoods_en (Accessed October 25, 2023).

10. U.S. Census Bureau. “New Residential Construction.” Available online at


www.census.gov/construction/nrc/historical_data/index.html (Accessed August 23,
2023).

11. “U.S. Appliance Industry Statistical Review: 2000 to YTD 2010”. Appliance Magazine
Market Research Report, July 2010.

12. “U.S. Appliance Shipment Statistics Monthly: January 2011”. Appliance Magazine
Market Research Report, January 2011.

3-34
13. “Major Appliance Shipments”. Appliance Design, March 2013, pp. 7.

14. “Major Appliance Shipments”. Appliance Design, March 2014, pp. 5.

15. “Major Appliance Shipments”. Appliance Design, March 2017, pp. 5.

16. “Major Appliance Shipments”. Appliance Design, March 2018, pp. 5.

17. U.S. Census Bureau. Annual Survey of Manufacturers: Data: Value of Product
Shipments. Available online at www.census.gov/programs-surveys/asm.html (Accessed
October 17, 2023).

18. U.S. International Trade Commission, “USITC Interactive Tariff and Trade DataWeb.”
Available online at https://dataweb.usitc.gov/ (Accessed August 28, 2023).

19. Ibid.

20. Ibid.

21. AHAM Fact Book 2005.

22. “2007-2010 U.S. Appliance Industry: Market Share, Life Expectancy & Replacement
Market, and Saturation Levels.” Appliance Magazine Market Research Report, January
2010.

23. “2011-2014 U.S. Appliance Industry: Market Value, Life Expectancy & Replacement
Picture.” Appliance Magazine Market Research Report, October 2014.

24. Natural Resources Canada Database of Major Appliances. Available online at


http://oee.nrcan.gc.ca/pml-lmp/index.cfm?action=app.welcome-bienvenue (Accessed
August 23, 2023.)

25. Ibid.

26. M. Shepard, A.B. Lovins, J. Neymark, D.J. Houghton, and H.R. Heede. “The State of the
Art: Appliances.” Rocky Mountain Institute, Competitek, August 1990 Edition.

27. Precision Combustion, Inc. website. “Catalytic Burners.” Available online at


www.precision-combustion.com/products/burners-oxidizers/catalytic-burner (Accessed
August 28, 2023).

28. S. Cimino and G. Russo. 2010. “Radiant Catalytic Cooktop Burner.” Processes and
Technologies for a Sustainable Energy.

3-35
29. Y. Yamada, T. Sobue, M. Oyaizu, 2003. “Glass-Ceramic Top Plate Gas Cooking Hob
with High Efficiency.” Proceedings of the 22nd World Gas Conference, Tokyo, Japan,
June 2003.

30. U.S. DOE. 1980. Engineering Analysis. Washington, DC, DOE/CS-0166, June 1980, pp.
D7-1 to D7-28.

31. D. DeWitt and M. Peart. 1982. Bi-Radiant Oven: A Low-Energy Oven System. Purdue
University, West Lafayette, IN. Prepared for Oak Ridge National Laboratory, Oak Ridge,
TN, ORNL/Sub-80/0082/1, ORNL/Sub-80/0082/2, ORNL/Sub-80/0082/3, March 1982.

32. Whirlpool Corporation Product Literature. Available online at


www.whirlpool.com/blog/kitchen/convection-vs-regular-oven.html (Accessed August 28,
2023).

33. ORTECH. 1989. Op. cit.

34. Gas Research Institute (GRI). 1994. Topical Report: Technical Input to NAECA
Rulemaking for Gas-Fired Ranges. Prepared by Battelle, Columbus, OH, American Gas
Association Laboratories, Cleveland, OH, and ADL, Cambridge, MA for Gas Appliance
Technology Center, Chicago, IL. Comment No. 001 to the NOPR, GRI-94/0195, July
1994.

35. ADL. 1994. Op. cit.

36. ADM. 1987. Op. cit.

37. ORTECH. 1989. Op. cit.

38. U.S. DOE. 1980. Op. cit.

39. Ibid.

40. GRI. 1994. Op. cit.

41. ORTECH. 1989. Op. cit.

42. GRI. 1994. Op. cit.

43. Ibid.

44. ADL. 1994. Op. cit.

3-36
CHAPTER 4. SCREENING ANALYSIS

TABLE OF CONTENTS

4.1 INTRODUCTION ........................................................................................................... 4-1


4.2 DISCUSSION OF TECHNOLOGY OPTIONS .............................................................. 4-2
4.2.1 Screened-Out Technology Options .................................................................................. 4-2
4.2.1.1 Electric Cooking Tops ................................................................................... 4-2
4.2.1.2 Gas Cooking Tops.......................................................................................... 4-3
4.2.1.3 Electric and Gas Ovens .................................................................................. 4-5
4.2.2 Remaining Design Options .............................................................................................. 4-7
4.2.2.1 Conventional Cooking Tops .......................................................................... 4-7
4.2.2.2 Conventional Ovens ....................................................................................... 4-7
REFERENCES ............................................................................................................................ 4-9

LIST OF TABLES

Table 4.2.1 Retained Design Options for Electric and Gas Cooking Tops ............................ 4-7
Table 4.2.2 Retained Design Options for Electric and Gas Ovens ......................................... 4-8

4-i
CHAPTER 4. SCREENING ANALYSIS

4.1 INTRODUCTION

This chapter discusses the screening analysis conducted by the U.S. Department of
Energy (DOE) of the technology options identified in the market and technology assessment for
consumer conventional cooking tops and ovensa (see chapter 3 of this technical support
document (TSD)). In the market and technology assessment, DOE presented an initial list of
technology options that can be used to reduce energy consumption of the products covered in
this rulemaking. The goal of the screening analysis is to identify any technologies that will be
eliminated from further consideration in the rulemaking analyses.

DOE must follow specific statutory criteria for prescribing new or amended standards for
covered products. The Energy Policy and Conservation Act (EPCA) requires that any new or
amended energy conservation standard prescribed by the Secretary of Energy (“Secretary”) be
designed to achieve the maximum improvement in energy or water efficiency that is
technologically feasible and economically justified. (42 U.S.C. 6295(o)(2)(A)) The Secretary
may not prescribe an amended or new standard that will not result in significant conservation of
energy, or is not technologically feasible or economically justified. (42 U.S.C. 6295(o)(3)) As
stated, DOE determines whether to eliminate certain technology options from further
consideration based on the following criteria:

(1) Technological feasibility. If it is determined that a technology has not been


incorporated in commercial products or in working prototypes, then that technology will not be
considered further.

(2) Practicability to manufacture, install, and service. If it is determined that mass


production of a technology in commercial products and reliable installation and servicing of the
technology could not be achieved on the scale necessary to serve the relevant market at the time
of the effective date of the standard, then that technology will not be considered further.

(3) Impacts on product utility or product availability. If a technology is determined to


have significant adverse impact on the utility of the product to significant subgroups of
consumers, or results in the unavailability of any covered product type with performance
characteristics (including reliability), features, size, 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 will have
significant adverse impacts on health or safety, it will not be considered further.

(5) Unique-Pathway Proprietary Technologies. If a technology option uses proprietary


technology that represents a unique pathway to achieving a given efficiency level, that
technology will not be considered further.

a
The term “conventional ovens” refers to residential electric and gas ovens or the oven component of a combined
cooking product, but not microwave ovens.

4-1
10 CFR part 430, subpart C, appendix A, 6(b)(3) and 7(b).

The candidate technology options are assessed based on DOE analysis as well as inputs
from interested parties, including manufacturers, trade organizations, and energy efficiency
advocates. Technology options that are judged to be viable approaches for improving energy
efficiency are retained as inputs to the subsequent engineering analysis, and are designated as
“design options.”

4.2 DISCUSSION OF TECHNOLOGY OPTIONS

For consumer conventional cooking products, the screening criteria specified in section
4.1 of this TSD were applied to the technology options to either retain or eliminate each
technology from the engineering analysis. The rationale for screening out each technology option
is detailed in the following sections for each product class.

4.2.1 Screened-Out Technology Options

4.2.1.1 Electric Cooking Tops

As discussed in chapter 3 of this TSD, DOE did not identify any technology options for
improving efficiency of electric open (coil) element cooking tops for this direct final rule.

For electric smooth element cooking tops, DOE screened out halogen elements,
automatic power-down, and reduced air gap for the reasons that follow.

Halogen Elements

DOE is not aware of any commercialized halogen heating elements for electric smooth
element cooking tops, so DOE believes that it would not be practicable to manufacture, install,
and service this technology on the scale necessary to serve the relevant market at the time of the
effective date of an amended standard.

Low-standby-loss Electronic Controls: Automatic Power-down

DOE is aware that the use of automatic power-down low-standby-loss electronic controls
may negatively impact product utility. In particular, the use of automatic power-down low-
standby-loss electric controls may result in a loss in the utility of the continuous clock display for
combined cooking products, such as conventional ranges.

However, it should be noted that other low-standby-loss electronic controls, such as


switch-mode power supplies, were still analyzed in this direct final rule.

Reduced Air Gap

DOE is aware that the air gaps in commercialized radiant heating elements are currently
as small as is practicable to manufacture on the scale necessary to serve the cooking products

4-2
market. Furthermore, DOE is not aware of the magnitude of potential energy savings from this
technology. Therefore, DOE screened out this technology from further analysis.

4.2.1.2 Gas Cooking Tops

For gas cooking tops, DOE screened out catalytic burners, radiant gas burners, reduced
excess air at burner, and reflective surfaces for the reasons that follow.

Catalytic Burners

DOE is not aware of any commercialized catalytic burners for gas cooking tops, so DOE
believes that it would not be practicable to manufacture, install, and service this technology on
the scale necessary to serve the relevant market at the time of the effective date of an amended
standard. Also, because this technology is in the research stage, it is not possible to assess
whether it will have any adverse impacts on utility to consumers or product availability, or any
adverse impacts on consumers’ health or safety.

Optimized Burner and Grate Design

As discussed in chapter 5 of this TSD, DOE testing revealed that gas cooking top
efficiency was correlated to burner design (e.g., grate weight, flame angle, distance from burner
ports to the cooking surface). Because designs of burner system components are interdependent
and must also consider combustion efficiency to maintain approved levels of carbon monoxide
emissions, DOE considered optimized gas cooking top burner designs for increasing efficiency
only as consistent with products available on the market, which meet the relevant safety and
emissions standards.

Based on market surveys and manufacturer interviews, DOE has determined that some
level of optimization of the burner and grate design can affect product utility and may have
adverse safety impacts. In particular, the use of wire tines as opposed to continuous cast-iron
grates could lead to safety issues related to tipping hazard when placing a small pot on the
cooking top if the pot is not fully centered on the wire tines or when moving a large, heavy pot
off a burner. Additionally, market research has shown that consumers expect the utility of
multiple high input rate burners (“HIR burners”).b In this direct final rule, DOE is screening out
any optimized burner and grate design that would result in the lack of multiple HIR burners or
continuous cast-iron grates.

Radiant Gas Burners

In the previous rulemaking, manufacturers asserted that the operating characteristics of an


infrared (IR)-jet radiant burner are such that it is difficult to maintain a low burner input rate for
many cooking top functions. They stated that field testing for residential ranges was discontinued
because test users were unable to turn down the burner satisfactorily. 1 Without an adequate “turn
down” capability, the burner would not be able to be tested to the DOE test procedure at 10 CFR

b
DOE defines a cooking top HIR burner as a burner with an input rate greater than or equal to 14,000 British
thermal units per hour (Btu/h).

4-3
430, subpart B, appendix I1 or to pass the American National Standards Institute (ANSI)
Standard Z21.1-2016, Household Cooking Gas Appliances.

Although a silicon carbide radiant burner has been tested to the Japanese Industrial
Standard (JIS) S 2103:1996, Gas burning cooking appliances for domestic use, it is also not
known how either type of radiant burner would perform under DOE test conditions. Since DOE
lacks relevant test data to evaluate potential impacts on consumers’ health and safety, this
technology option was not analyzed for this direct final rule.

Reduced Excess Air at Burner

For the 1996 Technical Support Document for Residential Cooking Products that DOE
published in support of the September 8, 1998 final rule (“1996 TSD” c), the Gas Research
Institute (GRI, now known as the Gas Technology Institute) submitted a report that analyzed this
technology option and was submitted as a comment in the previous rulemaking.2 GRI concluded
that the efficiency increase of this technology option was not measurable at that time. They
pointed out that the burner described by DOE did not exist on the market and thus there were no
designs that could be evaluated. DOE is unaware of any changes to that situation. GRI also noted
that use of this technology option may cause a safety issue due to the possibility of increased
carbon monoxide production.

Reduced excess air at the burner has not been commercialized, and DOE believes that it
would not be practicable to manufacture, install, and service this technology on the scale
necessary to serve the relevant market at the time of the effective date of an amended standard.
Also, because this technology is undeveloped, it is not possible to assess whether it will have any
adverse impacts on utility to consumers or product availability, or any adverse impacts on
consumers’ health or safety.

Reflective Surfaces

Reflective surfaces for gas cooking tops use highly polished or chromed drip pans
underneath the burner. The primary mechanism for heat transfer to the cooking vessel for gas
cooking tops is convection. As a result, the efficiency gains resulting from using reflective pans
are extremely small because gas flames and burners have minimal infrared emissions. Based on
data provided by manufacturers through the Association of Home Appliance Manufacturers
(AHAM), DOE estimated in the 2009 Final Rule Technical Support Document: Residential
Dishwashers, Dehumidifiers, and Cooking Products and Commercial Clothes Washers (“2009
TSD”)d that an efficiency increase of only 0.1 percent was possible. As reported in the 1996
TSD, manufacturers stated that any increase in efficiency due to a reflective surface could easily
be negated if the consumer fails to regularly clean the surface or uses an abrasive pad to clean the
surface. DOE is not aware of any data on prototypes or commercialized designs that have shown
a measurable increase in efficiency due to reflective surfaces for gas cooking tops. As a result,
DOE screened out this technology option from further analysis.

c
Available online at www.regulations.gov/document/EERE-2006-STD-0070-0053.
d
Available online at www.regulations.gov/document/EERE-2006-STD-0127-0097.

4-4
4.2.1.3 Electric and Gas Ovens

For electric and gas ovens, DOE screened out bi-radiant oven, halogen lamp oven,
improved and added insulation, improved door seals, low-standby-loss electronic controls
resulting in automatic power-down, no oven-door window, optimized burner and cavity design,
reduced vent rate, and reflective surfaces, for the reasons that follow.

Bi-radiant Oven (Electric Ovens Only)

The 1996 TSD assumed that three major conditions would have to be met in order to
consider the bi-radiant oven as a viable technology option. These included the use of (1) low-
emissivity cavity lining materials; (2) electronic controls; and (3) highly-absorptive baking and
roasting utensils. While electronic controls are currently in widespread use in electric ovens, the
cavity maintenance issues and the requirement for specialized cookware negatively impact
consumer utility. In addition, there is currently no such product on the market and the last
working prototype known to DOE was tested in the 1970s.

Halogen Lamp Oven (Electric Ovens Only)

DOE is not aware of any ovens that use halogen lamps alone as the heating element, and
no data were found or submitted to demonstrate how efficiently halogen elements alone perform
relative to conventional ovens. DOE believes that it would not be practicable to manufacture,
install, and service halogen lamps for use in consumer conventional ovens on the scale necessary
to serve the relevant market at the time of the standard’s effective date.

Improved and Added Insulation (Standard Ovens Only)

Although some analyses indicated energy consumption could be reduced by increasing


the thickness of the insulation in the cabinet walls and doors from 2 inches to 4 inches, consumer
utility would be negatively impacted, since the oven cavity volume would have to be reduced to
maintain standardized exterior dimensions. The reduced oven cavity volume would limit the size
of large items that could be cooked in the oven.

DOE recognizes that the performance associated with improved insulation may vary
depending on the test procedure. Without a DOE test procedure to determine such performance,
DOE believes it would not be practicable to manufacture, install, and service this technology on
the scale necessary to serve the market at the time of the effective date of an amended standard.
Furthermore, the absence of a DOE test procedure to determine performance produces
uncertainty as to whether this technology option would impact product utility or product
availability. For these reasons, this technology option was screened out from further analysis.

Improved Door Seals

DOE recognizes that the performance associated with improved door seals may vary
depending on the test procedure. Without a DOE test procedure to determine such performance,
DOE believes it would not be practicable to manufacture, install, and service this technology on
the scale necessary to serve the market at the time of the effective date of an amended standard.
Furthermore, the absence of a DOE test procedure to determine performance produces
4-5
uncertainty as to whether this technology option would impact product utility or product
availability. For these reasons, this technology option was screened out from further analysis.

Low-standby-loss Electronic Controls: Automatic Power-down

DOE is aware that the use of automatic power-down low-standby-loss electronic controls
may negatively impact product utility. In particular, the use of automatic power-down low-
standby-loss electric controls may result in a loss in the utility of the continuous clock display for
ovens and ranges.

However, it should be noted that the other low-standby-loss electronic controls such as
switch-mode power supplies were still analyzed.

No Oven-door Window

GRI issued a topical report3 that discussed this technology option in the previous
rulemaking. GRI’s experimental tests showed a small savings in annual energy usage (increase in
efficiency) for both the standard and self-clean ovens by eliminating the door window. However,
GRI reported there could actually be a net energy loss due to consumer practices, which would
be a function of the number of times a consumer would open the door to inspect the food while
cooking. With four door openings per test, a standard oven would realize a net energy savings of
34 thousand British thermal units per year (kBtu/yr). For a self-clean oven there is a net energy
loss of 3 kBtu/yr. The report also stated there would be reduced consumer utility and the
possibility of failure of delicate food items (e.g., soufflés), as well as decreased safety without
the window due to increased risk of burns from additional door openings while the oven is in
use.

Optimized Burner and Cavity Design (Gas Ovens Only)

DOE recognizes that the performance associated with optimized burner and cavity design
in gas ovens may vary depending on the test procedure. Without a DOE test procedure to
determine such performance, DOE believes it would not be practicable to manufacture, install,
and service this technology on the scale necessary to serve the market at the time of the effective
date of an amended standard. Furthermore, the absence of a DOE test procedure to determine
performance produces uncertainty as to whether this technology option would impact product
utility or product availability, in particular the availability of commercial-style ovens. For these
reasons, this technology option was screened out from further analysis.

Reduced Vent Rate (Electric Standard Ovens Only)

DOE recognizes that the performance associated with reduced vent rate may vary
depending on the test procedure. Without a DOE test procedure to determine such performance,
DOE believes it would not be practicable to manufacture, install, and service this technology on
the scale necessary to serve the market at the time of the effective date of an amended standard.
Furthermore, the absence of a DOE test procedure to determine performance produces
uncertainty as to whether this technology option would impact product utility or product
availability. For these reasons, this technology option was screened out from further analysis.

4-6
Reflective Surfaces

As noted in the 1996 TSD, manufacturers stated that it has been very difficult to obtain
satisfactory cooking performance with reflective surfaces. The reflective materials degrade after
the first baking function and continue to degrade through the life of the product. This is
especially true of self-clean ovens, as the self-clean process damages the reflective walls and
negates any possible energy savings. 4

GRI5 performed tests on this technology option that measured a decrease in energy
efficiency. The reflective surface interfered with the convective currents and the thermostat, thus
fooling the thermostat into cycling. GRI reported that increased reflectance from the chrome-
plated inner surface of the oven caused repeated thermostat cycling that “might have contributed
to the higher energy consumption” which resulted in a 12.6 percent decrease in energy
efficiency. Arthur D. Little Inc. (ADL)6 also commented that the reflected radiation was different
from the normal radiation emitted by the oven cavities in use at the time.

Based on these studies, it is uncertain whether, or how much, energy savings is realizable
with this technology option. A smarter controller for the oven could potentially compensate for
the thermostat problems. However, there is a general lack of sophistication in the technology in
terms of maintaining clean, reflective surfaces over the lifetime of the product. For these reasons,
this technology option was not analyzed.

4.2.2 Remaining Design Options

The following sections list the technology options for consumer conventional cooking
tops and ovens that were retained by DOE and subsequently designated as design options. Each
of these technologies were evaluated further in the subsequent engineering analysis.

4.2.2.1 Conventional Cooking Tops

For conventional cooking tops, DOE retained the technologies listed in Table 4.2.1 for
further analysis.

Table 4.2.1 Retained Design Options for Electric and Gas Cooking Tops
Electric Smooth Element Cooking Tops
1. Induction elements
2. Improved resistance elements
3. Switch-mode power supply
Gas Cooking Tops
1. Optimized burner and grate design*
* As can be achieved by units with multiple HIR burners and continuous cast-iron grates.

4.2.2.2 Conventional Ovens

For conventional ovens, DOE retained the technologies listed in Table 4.2.2 for further
analysis.

4-7
Table 4.2.2 Retained Design Options for Electric and Gas Ovens
1. Convection mode capability
2. Oven separator (electric ovens only)
3. Switch-mode power supply

4-8
REFERENCES

1. Department of Energy. 1998. Technical Support Document: Energy Conservation


Standards for Consumer Products: Cooking Products, Washington, DC, September,
1998.

2. Gas Research Institute. 1994. Topical Report: Technical Input to NAECA Rulemaking for
Gas-Fired Ranges. Prepared by Battelle, Columbus, OH, American Gas Association
Laboratories, Cleveland, OH, and Arthur D. Little, Cambridge, MA for Gas Appliance
Technology Center, Chicago, IL, submitted as comment No. 001 to the NOPR, GRI-
94/0195, July 1994.

3. Ibid.

4. Ibid.

5. Ibid.

6. Arthur D. Little. 1994. Electric Oven and Cooktop Data Analysis. Prepared by ADL,
Cambridge, MA, for Association of Home Appliance Manufacturers, Reference 47066,
submitted as comment No. 001 to the NOPR, July 15, 1994.

4-9
ENGINEERING ANALYSIS

TABLE OF CONTENTS

5.1 INTRODUCTION ........................................................................................................... 5-1


5.2 PRODUCT CLASSES ANALYZED .............................................................................. 5-3
5.3 EFFICIENCY LEVELS................................................................................................... 5-4
5.3.1 Conventional Cooking Tops ............................................................................................ 5-4
5.3.1.1 Electric Cooking Tops ................................................................................... 5-4
5.3.1.2 Gas Cooking Tops.......................................................................................... 5-6
5.3.2 Conventional Ovens ......................................................................................................... 5-8
5.3.2.1 Analyzed Product Types ................................................................................ 5-8
5.3.2.2 Potential Prescriptive Standards .................................................................... 5-8
5.3.2.3 Energy Consumption of Baseline Efficiency Level....................................... 5-9
5.3.2.4 Energy Consumption of Incremental Efficiency Levels .............................. 5-11
5.4 METHODOLOGY OVERVIEW .................................................................................. 5-13
5.4.1 Review of Previous Technical Support Documents and Models................................... 5-13
5.4.2 Manufacturer Interviews ................................................................................................ 5-13
5.4.3 Selection of Units ........................................................................................................... 5-14
5.4.4 Product Testing .............................................................................................................. 5-14
5.4.4.1 Conventional Cooking Tops ........................................................................ 5-14
5.4.4.2 Conventional Ovens ..................................................................................... 5-15
5.4.5 Product Teardowns ........................................................................................................ 5-18
5.4.5.1 Generation of Bill of Materials .................................................................... 5-19
5.4.5.2 Cost Structure of the Spreadsheet Models ................................................... 5-20
5.4.5.3 Cost Model and Definitions ......................................................................... 5-21
5.4.5.4 Cost Model Assumptions ............................................................................. 5-22
5.5 ANALYSIS AND RESULTS ........................................................................................ 5-22
5.5.1 Manufacturer Interviews ................................................................................................ 5-22
5.5.1.1 Design Features of Current Baseline Products ............................................ 5-23
5.5.1.2 Oven Energy Consumption as a Function of Cavity Volume...................... 5-23
5.5.1.3 Power Supplies............................................................................................. 5-23
5.5.1.4 Carbon Monoxide Emission Limits ............................................................. 5-23
5.5.2 Product Selection ........................................................................................................... 5-23
5.5.2.1 Conventional Cooking Tops ........................................................................ 5-23
5.5.2.2 Conventional Ovens ..................................................................................... 5-30
5.5.3 Product Testing .............................................................................................................. 5-32
5.5.3.1 Conventional Cooking Tops ........................................................................ 5-32
5.5.3.2 Conventional Ovens ..................................................................................... 5-40
5.5.4 Conventional Oven Energy Use versus Cavity Volume ................................................ 5-44
5.5.5 Product Teardowns ........................................................................................................ 5-47
5.5.5.1 Baseline Construction .................................................................................. 5-48
5.5.5.2 Cost Estimates .............................................................................................. 5-50

5-i
LIST OF TABLES

Table 5.2.1 Product Classes for Consumer Conventional Cooking Products ......................... 5-3
Table 5.3.1 Electric Smooth Element Cooking Top Efficiency Levels .................................. 5-6
Table 5.3.2 Gas Cooking Top Efficiency Levels .................................................................... 5-8
Table 5.3.3 Electric Oven Efficiency Levels .......................................................................... 5-9
Table 5.3.4 Gas Oven Efficiency Levels ................................................................................ 5-9
Table 5.3.5 Estimated Energy Consumption of Baseline Conventional Ovens.................... 5-11
Table 5.3.6 Estimated Energy Consumption of Electric Oven Efficiency Levels ................ 5-13
Table 5.3.7 Estimated Energy Consumption of Gas Oven Efficiency Levels ...................... 5-13
Table 5.4.1 Major Manufacturing Processes ........................................................................ 5-21
Table 5.5.1 Electric Smooth Element Cooking Tops in the Expanded Test Sample ............ 5-24
Table 5.5.2 Gas Cooking Tops in the Expanded Test Sample (Non-Entry-Level*) ............ 5-27
Table 5.5.3 Gas Cooking Tops in the Expanded Test Sample (Non-Entry-Level*) –
Burner Characterization ..................................................................................... 5-28
Table 5.5.4 Gas Cooking Tops in the Expanded Test Sample (Entry-Level*) ..................... 5-30
Table 5.5.5 Electric Ovens in the DOE Test Sample ............................................................ 5-31
Table 5.5.6 Gas Ovens in the DOE Test Sample .................................................................. 5-31
Table 5.5.7 Test Results for Electric Smooth Element Cooking Tops in the DOE Test
Sample................................................................................................................ 5-32
Table 5.5.8 Test Results for Electric Smooth Element Cooking Tops in the Expanded
Test Sample ........................................................................................................ 5-33
Table 5.5.9 Test Results for Gas Cooking Tops in the Expanded Test Sample (Non-
Entry-Level*) ..................................................................................................... 5-35
Table 5.5.10 Test Results for Gas Cooking Tops in the Expanded Test Sample (Entry-
Level*) ............................................................................................................... 5-37
Table 5.5.11 Combined Low-Power Mode Annual Energy of Standalone Ovens in the
DOE Test Sample .............................................................................................. 5-41
Table 5.5.12 Combined Low-Power Mode Annual Energy of Combined Cooking
Products in the DOE Test Sample ..................................................................... 5-41
Table 5.5.13 Fan-only Mode Energy of Conventional Ovens in the DOE Test Sample ........ 5-42
Table 5.5.14 Annual Energy Consumption of Electric Ovens in the DOE Test Sample........ 5-43
Table 5.5.15 Annual Energy Consumption of Gas Ovens in the DOE Test Sample .............. 5-44
Table 5.5.16 Slopes and Intercepts of Electric Oven IEAO versus Cavity Volume
Relationship ....................................................................................................... 5-47
Table 5.5.17 Slopes and Intercepts of Gas Oven IEAO versus Cavity Volume
Relationship ....................................................................................................... 5-47
Table 5.5.18 Baseline Manufacturer Production Costs for all Conventional Cooking
Top Product Classes ........................................................................................... 5-50
Table 5.5.19 Baseline Manufacturer Production Costs for all Conventional Oven
Product Types .................................................................................................... 5-51
Table 5.5.20 Electric Smooth Element Cooking Top Incremental Manufacturer
Production Costs ................................................................................................ 5-51
Table 5.5.21 Gas Cooking Top Incremental Manufacturer Production Costs ........................ 5-51
Table 5.5.22 Electric Oven Incremental Manufacturer Production Costs .............................. 5-51
Table 5.5.23 Gas Oven Incremental Manufacturer Production Costs .................................... 5-52

5-ii
LIST OF FIGURES

Figure 5.3.1 Annual Active Mode Energy Consumption Distribution of Electric


Smooth Element Cooking Tops in DOE’s Test Sample ...................................... 5-5
Figure 5.3.2 Augmented Electric Standard Oven Data from the DOE Test Sample ............. 5-10
Figure 5.4.1 Manufacturing Cost Assessment Stages ............................................................ 5-20
Figure 5.5.1 Normalized Per-Burner Gas Energy Consumption versus Burner Input
Rate .................................................................................................................... 5-39
Figure 5.5.2 Normalized Per-Burner Gas Energy Consumption versus Input Rate by
Burner Type ....................................................................................................... 5-40
Figure 5.5.3 Electric Standard Oven IEAO vs. Cavity Volume Slope .................................... 5-45
Figure 5.5.4 Electric Self-Clean Oven IEAO vs. Cavity Volume Slope.................................. 5-45
Figure 5.5.5 Gas Standard Oven IEAO vs. Cavity Volume Slope ........................................... 5-46
Figure 5.5.6 Gas Self-Clean Oven IEAO vs. Cavity Volume Slope ........................................ 5-46

5-iii
CHAPTER 5. ENGINEERING ANALYSIS

This chapter provides an overview of the engineering analysis (section 5.1), discusses
product classes (section 5.2), establishes baseline and incremental efficiency levels (section 5.3),
explains the methodology used during data gathering (section 5.4) and discusses the analysis and
results (section 5.5).

5.1 INTRODUCTION

After conducting the screening analysis, the U.S. Department of Energy (DOE)
performed an engineering analysis. The purpose of the engineering analysis is to determine the
incremental manufacturing cost associated with producing products at higher efficiency levels.
The primary considerations in the engineering analysis are 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”).

DOE conducts the efficiency analysis using either an efficiency-level approach, a design-
option approach, or a combination of both. Under the efficiency-level approach, the efficiency
levels to be considered in the analysis are determined based on the market distribution of existing
products (in other words, observing the range of efficiency and efficiency level “clusters” that
already exist on the market). This approach typically starts with compiling a comprehensive list
of products available on the market, such as from DOE’s product certification database. Next,
the list of models is ranked by efficiency level from lowest to highest, and DOE typically creates
a scatter plot to visualize the distribution of efficiency levels. From these rankings and visual
plots, efficiency levels can be identified by examining clusters of models around common
efficiency levels. The maximum efficiency level currently available on the market can also be
identified.

Under the design option approach, the efficiency levels to be considered in the analysis
are determined through detailed engineering calculations and/or computer simulations of the
efficiency improvements from implementing specific design options that have been identified in
the technology assessment. In an iterative fashion, design options can also be identified during
product teardowns, described below. The design option approach is typically used when a
comprehensive database of certified models is unavailable (for example, if a product is not yet
regulated) and therefore the efficiency-level approach cannot be used.

In certain rulemakings, the efficiency-level approach (based on actual products on the


market) will be extended using the design option approach to interpolate to define “gap fill”
levels (to bridge large gaps between other identified efficiency levels) and/or to extrapolate to the
“max tech” level (the level that DOE determines is the maximum achievable efficiency level),
particularly in cases where the “max tech” level exceeds the maximum efficiency level currently
available on the market.

In this direct final rule, DOE used a design-option approach, supplemented by testing, for
the efficiency analysis. The design-option approach is appropriate for consumer conventional

5-1
cooking products, given the lack of certification data to determine the market distribution of
existing products and to identify efficiency level “clusters” that already exist on the market.

The cost analysis portion of the engineering analysis is conducted using one or a
combination of cost approaches. The selection of the cost approach depends on a variety of
factors such as the availability and reliability of public information on product features and
pricing, the physical characteristics of the regulated product, and the practicability of purchasing
the product on the market. DOE generally uses the following cost approaches:

• Physical teardown: Under this approach, DOE physically dismantles a commercially


available product, component-by-component, to develop a detailed bill of materials
(BOM) for the product.

• Catalog teardown: In lieu of physically deconstructing a product, DOE identifies each


component using parts diagrams (available from manufacturer websites or appliance
repair websites, for example) to develop the BOM for the product.

• Price surveys: If neither a physical nor catalog teardown is feasible (for example, for
tightly integrated products that are infeasible to disassemble and for which parts diagrams
are unavailable), DOE conducts retail price surveys by scanning retailer websites and
other marketing materials. This approach must be coupled with assumptions regarding
distributor markups and retailer markups in order to estimate the actual manufacturing
cost of the product.

The primary inputs to the engineering analysis are baseline information from the market
and technology assessment (chapter 3 of this technical support document (TSD)) and design
options from the screening analysis (chapter 4). Additional inputs were determined through
teardown analysis and manufacturer interviews.

In this direct final rule, DOE used the physical teardown approach, supplemented by
catalog teardowns specifically for printed circuit boards (PCBs), to develop the cost-efficiency
data. In addition, DOE considered cost-efficiency data from the 2009 Final Rule Technical
Support Document: Residential Dishwashers, Dehumidifiers, and Cooking Products and
Commercial Clothes Washers (“2009 TSD”), which was released as part of the previous final
rule establishing energy conservation standards for residential dishwashers, dehumidifiers,
consumer conventional cooking products, and commercial clothes washers published in 2009. 74
FR 16040 (April 8, 2009).a

The primary output of the engineering analysis is a set of tables identifying the
incremental manufacturing cost, in relation to the manufacturing cost of the minimum-efficiency
baseline product, required to produce products at each of the higher efficiency levels considered
in the analysis (visualized as “cost-efficiency curves”). In the subsequent markups analysis
(chapter 6 of this TSD), DOE determined customer (i.e., product purchaser) prices by applying
manufacturer markups (determined in the manufacturer impact analysis (chapter 12 of this

a
Available online at www.regulations.gov/document/EERE-2006-STD-0127-0097.

5-2
TSD)), distribution markups, and sales tax. After applying these markups, the cost-efficiency
curves serve as the input to the building energy-use and end-use load characterization (chapter 7
of this TSD), and the life-cycle cost and payback period analyses (chapter 8 of this TSD).

5.2 PRODUCT CLASSES ANALYZED

On September 25, 2023, DOE received a joint statement of recommended standards


(“Joint Agreement”) for various home appliance products, including consumer conventional
cooking products, submitted jointly by groups representing manufacturers, energy and
environmental advocates, consumer groups, and a utility.b Among other recommendations, the
Joint Agreement specifies seven product classes for consumer conventional cooking products. In
particular, the Joint Agreement recommends separate product classes for ranges—a type of
combined cooking product that combine a conventional cooking top and a conventional oven—
and standalone cooking tops for both electric smooth element cooking tops and gas cooking tops,
and also recommends that DOE exclude portable cooking products.

As discussed in chapter 3 of this TSD, in this direct final rule, DOE is adopting the
product classes from the Joint Agreement, with updated nomenclature that clarifies that the
“range” product classes refer to the cooking top component of any combined cooking product.
Furthermore, as discussed in chapter 3 of this TSD, DOE did not include electric open (coil)
element cooking tops as part of the efficiency analysis for this direct final rule. Therefore, DOE’s
analysis was conducted on the remaining six product classes listed in Table 5.2.1.

Table 5.2.1 Product Classes for Consumer Conventional Cooking Products


Electric smooth element standalone cooking top
Electric smooth element cooking top component of a combined cooking product
Gas standalone cooking top
Gas cooking top component of a combined cooking product
Electric oven
Gas oven

Because combined cooking products include a conventional cooking top and/or a


conventional oven, the conventional cooking top and conventional oven standards apply to the
individual components of the combined cooking product.

DOE’s test procedure for conventional cooking tops is established at title 10 of the Code
of Federal Regulations (CFR) part 430, subpart B, appendix I1 (“Appendix I1”). DOE conducted
the analysis for electric and gas cooking top standards for this direct final rule using the test
procedure at Appendix I1.

DOE conducted the analysis for electric and gas oven standards for this direct final rule
using the test procedure finalized in a test procedure final rule published July 2, 2015 (“July
2015 TP Final Rule”).c 80 FR 37954.

b
See section II.B.3 of the accompanying direct final rule.
c
DOE subsequently withdrew the conventional oven testing provisions in the final rule published on December 16,
2016. 81 FR 91418.

5-3
5.3 EFFICIENCY LEVELS

For each product class, DOE selects a baseline model as a reference point for that class.
To determine energy savings and changes in cost that would result from a potential new or
amended energy conservation standard, DOE compares energy use and price of more energy-
efficient units to the energy consumption and cost of the baseline unit. Generally, a baseline
model is one that exactly meets current Federal energy conservation standards; or, if no
standards are in place, the baseline is typically the most common or least efficient unit on the
market.

As part of its analysis, DOE establishes incremental efficiency levels (ELs) to evaluate
the range of efficiencies available on the market. DOE must also determine the maximum
improvement in energy efficiency that is technologically feasible (“max-tech”) for each product
class. (42 U.S.C. 6295(p)(1)) DOE typically determines max-tech levels based on technologies
that are either commercially available or have been demonstrated as working prototypes. DOE
also considers consumer utility and availability of features, which may be met by a niche
product. If the max-tech design meets DOE’s screening criteria, DOE considers the design in
further analysis. For this direct final rule analysis, DOE identified design options and determined
corresponding incremental efficiency levels during the testing and reverse engineering performed
in support of this rulemaking.

5.3.1 Conventional Cooking Tops

5.3.1.1 Electric Cooking Tops

There are no current Federal energy conservation standards for electric cooking tops.
Therefore, for this direct final rule, DOE developed performance-based baseline efficiency levels
for electric cooking tops using the measured cooking top integrated annual energy consumption
(IAEC) of units in its test sample, measured according to Appendix I1 (see section 5.5.3.1 of this
TSD). Specifically, DOE set the baseline IAEC equal to the sum of the maximum cooking top
annual active mode energy consumption (AEC) observed in the DOE test sample and the
maximum annual combined low-power mode energy consumption (ETLP) observed in the DOE
test sample.

To develop incremental efficiency levels, DOE analyzed the distribution of AEC values
among the cooking tops in its test sample. Figure 5.3.1 shows the measured AEC of all electric
smooth element cooking tops in DOE’s test sample.

5-4
Figure 5.3.1 Annual Active Mode Energy Consumption Distribution of Electric Smooth
Element Cooking Tops in DOE’s Test Sample

DOE also measured the ETLP of the electric smooth element cooking tops in its test
sample and evaluated the efficiency levels associated with standby power improvements based
on product testing. The results of this testing for both AEC and ETLP are presented in section
5.5.3.1 of this TSD.

DOE reviewed the AEC and ETLP values for the electric smooth element cooking tops in
its test sample and identified three higher efficiency levels as discussed further in the following
paragraphs.

DOE defined EL 1 for electric smooth element cooking tops based on the low-standby-
loss electronic controls design option. As discussed, DOE defined the baseline efficiency
assuming the highest AEC would be paired with the highest ETLP observed in its test sample.
DOE is aware of many methods employed by manufacturers to achieve lower ETLP, including by
changing from a linear power supply to a switch-mode power supply (SMPS), by dimming the
control screen’s default brightness, by allowing the clock functionality to turn off after a period
of inactivity, and by removing the clock from the cooking top altogether. DOE defined EL 1
using the lowest measured ETLP among the units in its test sample with clock functionality,
paired with the baseline AEC. The Joint Agreement recommends a standard level for both
electric smooth element cooking top product classes of 207 kWh/year that is equivalent to the
IAEC at EL 1.

DOE defined EL 2 for electric smooth element cooking tops using the lowest measured
AEC (highest efficiency) among radiant cooking tops in its sample and the same ETLP as EL 1.
As shown in Figure 5.3.1, this AEC value can also be reached by units using induction
technology.

5-5
To determine the highest measured efficiency for electric smooth element cooking tops
(EL 3), DOE calculated the sum of the lowest measured AEC in its test sample of electric
smooth element cooking tops, which represented induction technology, and the same ETLP as
EL 1.

After evaluating these electric smooth element cooking top efficiency levels, DOE
received additional stakeholder test data for electric and gas cooking tops (see section 5.5.2.1 of
this TSD) that supplemented DOE’s test sample (i.e., in aggregate comprising the “expanded test
sample”). DOE determined that the additional electric smooth element cooking top test data are
consistent with the efficiency levels evaluated on the basis of the DOE test sample.

DOE found no difference in the performance of standalone cooking tops and the cooking
top component of combined cooking products associated with installation configuration and is
therefore analyzing the same efficiency levels for both installation configurations.

For this direct final rule the efficiency levels for both electric smooth element cooking
top product classes, expressed in kilowatt-hours (kWh) per year (kWh/year), are presented in
Table 5.3.1.

Table 5.3.1 Electric Smooth Element Cooking Top Efficiency Levels


IAEC
Level
(kWh/year)
Baseline 250
1 207
2 189
3 179

5.3.1.2 Gas Cooking Tops

For gas cooking tops, the current Federal energy conservation standards are prescriptive
standards that require gas cooking tops not to be equipped with constant burning pilots. For this
direct final rule, DOE developed performance-based baseline efficiency levels for gas cooking
tops using the measured IAEC of units in the expanded test sample, measured according to
Appendix I1. Specifically, DOE set the baseline IAEC equal to the sum of the least efficient
AEC value in the expanded test sample and the average of the non-zero ETLP values measured in
the expanded test sample.

DOE is aware that some methods used by gas cooking top manufacturers to achieve
lower AEC can result in a smaller number of high input rate burners (HIR burners). d HIR burners
provide unique consumer utility and allow consumers to perform high heat cooking activities
such as searing and stir-frying. DOE is also aware that some consumers derive utility from
continuous cast-iron grates, such as the ability to use heavy pans, or to shift cookware between

d
DOE defines a cooking top HIR burner as a burner with an input rate greater than or equal to 14,000 British
thermal units per hour (Btu/h).

5-6
burners without needing to lift them. As discussed in chapter 4 of this TSD, in this direct final
rule, DOE is not considering any efficiency levels that would result in the lack of multiple HIR
burners or continuous cast-iron grates and has defined the efficiency levels for gas cooking tops
such that all efficiency levels are achievable with multiple HIR burners and continuous cast-iron
grates.

Furthermore, in this direct final rule analysis, DOE defines an “entry-level” gas cooking
top as one that does not have at least one HIR burner and continuous cast-iron grates (i.e.,
featuring steel grates, non-continuous grates, and/or the lack of HIR burners). By contrast, DOE
defines a “non-entry-level” gas cooking top as one that has at least one HIR burner and
continuous cast-iron grates.

To develop incremental efficiency levels, DOE analyzed the distribution of AEC values
among the cooking tops in the expanded test sample that have multiple HIR burners and
continuous cast-iron grates, consistent with the screening analysis developed in chapter 4 of this
TSD.

The Joint Agreement recommends a standard level for both gas cooking top product
classes of 1,770 kBtu/year. To define EL 1, DOE analyzed the efficiency level recommended in
the Joint Agreement. DOE determined that the recommended efficiency level can be achieved by
a gas cooking top with multiple HIR burners, continuous cast-iron grates, and does not preclude
any other combination of consumer-desired features (e.g., different nominal unit widths, sealed
burners, at least one low input rate burner (LIR burner),e multiple dual-stacked and/or multi-ring
HIR burners, and at least one extra-high input rate burner). DOE determined that manufacturers
could improve a baseline gas cooking top to meet EL 1 by implementing optimized turndown
capability in one burner that does not have optimized turndown capability out of five burners on
the cooking top.

DOE defined EL 2 for gas cooking tops using the same ETLP as used for the baseline
efficiency level. DOE defined EL 2 for gas cooking tops based on the lowest, i.e., most efficient,
AEC value in the expanded test sample, achievable with multiple HIR burners and continuous
cast-iron grates. DOE determined that manufacturers would be required to fully redesign a gas
cooking top to meet EL 2.

DOE found no difference in the performance of standalone cooking tops and the cooking
top component of combined cooking products associated with installation configuration and is
therefore analyzing the same efficiency levels for both installation configurations.

For this direct final rule, the efficiency levels for both gas cooking top product classes,
expressed in thousand British thermal units (kBtu) per year (kBtu/year), are presented in Table
5.3.2.

e
DOE defines a cooking top LIR burner as a burner with an input rate less than 6,500 Btu/h.

5-7
Table 5.3.2 Gas Cooking Top Efficiency Levels
IAEC
Level
(kBtu/year)
Baseline 1,900
1 1,770
2 1,343

The Joint Agreement specifies a performance standard for gas cooking tops that replaces
the existing design requirement prohibiting the use of a constant burning pilot light on gas
cooking tops with or without an electric supply cord. DOE notes that a constant burning pilot
light consumes approximately 2,000 kBtu/year. Therefore, a gas cooking top with a constant
burning pilot light cannot meet the maximum IAEC established as the baseline efficiency level in
this direct final rule of 1,900 kBtu/year, or the adopted standard level of 1,770 kBtu/year.

5.3.2 Conventional Ovens

5.3.2.1 Analyzed Product Types

As discussed, the Joint Agreement defines two product classes for conventional ovens:
electric ovens and gas ovens. For this direct final rule, DOE analyzed four product types per
conventional oven product class, representing different energy use profiles and baseline cost, as
follows:

• Freestanding standard oven with or without a catalytic line;f


• Built-in/slide-in standard oven with or without a catalytic line;
• Freestanding self-clean oven; and
• Built-in/slide-in self-clean oven.

However, efficiency levels and incremental costs were analyzed at the product class
level.

5.3.2.2 Potential Prescriptive Standards

There are currently no Federal energy conservation standards for electric ovens. For gas
ovens, the current Federal energy conservation standards are prescriptive standards that require
gas ovens not to be equipped with constant burning pilots. For this direct final rule, DOE
considered only efficiency levels corresponding to prescriptive design requirements as defined
by the design options developed as part of the screening analysis (see chapter 4 of this TSD):
convection mode capability,g the use of an SMPS, and an oven separator (for electric ovens
only).

f
In this TSD, DOE refers to a standard oven with or without a catalytic line as a “standard oven,” for simplicity.
g
In this direct final rule, DOE renamed the design option from “forced convection” to “convection mode
capability,” for clarity.

5-8
DOE ordered the design options by ease of implementation. In this direct final rule, DOE
analyzed, consistent with the recommendations in the Joint Agreement, the efficiency levels for
the electric and gas oven product classes defined in Table 5.3.3 and Table 5.3.4, respectively.

Table 5.3.3 Electric Oven Efficiency Levels


Level Design Option
Baseline Baseline
1 Baseline + SMPS
2 1 + Convection mode capability
3 2 + Oven separator

Table 5.3.4 Gas Oven Efficiency Levels


Level Design Option
Baseline Baseline
1 Baseline + SMPS
2 1 + Convection mode capability
Note: All efficiency levels for gas ovens include the current prescriptive requirement prohibiting the use of a
constant burning pilot light.

5.3.2.3 Energy Consumption of Baseline Efficiency Level

For this direct final rule, DOE compared the minimum cooking efficiency of
conventional ovens measured in its test sample to the baseline cooking efficiency levels
presented in the 2009 standards rulemaking analysis for conventional cooking products. DOE
also conducted testing for conventional ovens according to the version of the test procedure
adopted in the July 2015 TP Final Rule. 80 FR 33030, 33048–33049. Although DOE repealed
the conventional oven test procedure in Appendix I as part of the December 2016 TP Final Rule,
DOE based its analyses for this direct final rule on the data measured using the previous version
of the test procedure. For each conventional oven in its test sample, DOE calculated the oven
annual active cooking mode energy consumption (EAO)h and the oven integrated annual energy
consumption (IEAO)i using the test procedure finalized in the July 2015 TP Final Rule. The IEAO
metric combines the energy use of active cooking mode (including any self-cleaning operation),
any fan-only mode, and combined low-power mode (including standby mode and off mode).
DOE set the baseline IEAO for conventional ovens equal to the sum of:

h
The test procedure finalized in the July 2015 TP Final Rule referred to the annual active cooking mode energy
consumption of an electric oven using the abbreviation EAO. However, this test procedure did not provide a single
abbreviation for the annual active cooking mode energy consumption of a gas oven: the primary (gas) energy was
designated as EAOG and the secondary (electric) energy was designated as EAOE. This direct final rule analysis
defines EAO for gas ovens as the sum of EAOG and EAOE, which is comparable to EAO for electric ovens.
i
Similar to above, the test procedure finalized in the July 2015 TP Final Rule referred to the integrated annual
energy consumption of an electric oven using the abbreviation IEAO. However, this test procedure did not provide a
single abbreviation for the integrated annual energy consumption of a gas oven: the primary (gas) energy was
designated as EAOG (there is no difference between the primary active cooking mode energy consumption and
primary integrated energy consumption of a gas cooking top because fan-only mode and combined-low-power mode
do not consume any gas) and the secondary (electric) energy was designated as IEAOE. This direct final rule analysis
defines IEAO for gas ovens as the sum of EAOG and IEAOE, which is comparable to the value IEAO for electric ovens.

5-9
• the maximum EAO measured in the test sample for each conventional oven
product type,
• the maximum ETLP measured in the entire test sample among combined cooking
products equipped with baseline (linear) power supplies, and,
• for the built-in/slide-in product types, the maximum fan-only mode annual
energy consumption measured in the entire test sample.

DOE notes that the energy consumption of a conventional oven depends on the oven
cavity volume (see section 5.5.1.2 and section 5.5.4 of this TSD). In its 2009 rulemaking
analysis, DOE determined that there was a linear relationship between energy factor (EF) and
cavity volume. To correlate IEAO, which combines active mode and combined low-power mode
energy consumption, with cavity volume, DOE translated EF to IEAO using the slopes from the
2009 rulemaking and the baseline ETLP in DOE’s current test sample.

To expand the number of electric standard oven data points in its analysis of baseline
efficiency levels, DOE “augmented” its test sample by subtracting the self-cleaning energy
consumption from these electric self-clean ovens’ IEAO.

Figure 5.3.2 Augmented Electric Standard Oven Data from the DOE Test Sample

Augmenting the electric standard oven dataset with self-clean models in the DOE test
sample allowed DOE to include a wider range of cavity volumes in its baseline efficiency
analysis, as shown in Figure 5.3.2.

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For each analyzed product type, DOE compared its augmented test sample baseline to the
baseline values from the 2009 TSD. For multiple product types, the lowest measured
conventional oven efficiency in DOE’s test sample was lower (less efficient) than the values for
the previous rulemaking. In those cases, DOE selected y-intercepts for the baseline efficiency
levels corresponding to the conventional ovens in the current test sample with the highest
measured IEAO, so that no conventional ovens in the test sample were cut off by the baseline
curve. For self-clean gas ovens, DOE selected the y-intercept of the best fit line corresponding to
the baseline evaluated in the 2009 TSD.

The estimated energy use of the baseline efficiency levels for each analyzed product type
of conventional oven are presented in Table 5.3.5. After receiving manufacturer feedback and
reviewing products currently on the market, DOE determined the energy consumption of the
baseline efficiency levels based on a conventional oven with a cavity volume of 4.3 cubic feet
(ft3) to represent the market-average cavity volume.

Table 5.3.5 Estimated Energy Consumption of Baseline Conventional Ovens


Product Class Analyzed Product Type IEAO*
Standard – Freestanding 314.7 kWh/year
Standard – Built-in/Slide-in 321.2 kWh/year
Electric Ovens
Self-Clean – Freestanding 354.4 kWh/year
Self-Clean – Built-in/Slide-in 360.5 kWh/year
Standard – Freestanding 2,085 kBtu/year
Standard – Built-in/Slide-in 2,104 kBtu/year
Gas Ovens
Self-Clean – Freestanding 1,958 kBtu/year
Self-Clean – Built-in/Slide-in 1,979 kBtu/year
* IEAO values are normalized based on a 4.3 ft3 cavity volume.

5.3.2.4 Energy Consumption of Incremental Efficiency Levels

DOE developed incremental efficiency levels for each analyzed product type of
conventional oven based on test data collected according to the earlier version of the
conventional oven test procedure established in the July 2015 TP Final Rule. DOE developed the
incremental efficiency levels in cases where DOE identified design options during testing and
reverse engineering performed in support of this analysis.

Specifically, DOE evaluated EL 1, the efficiency level associated with combined low-
power mode power improvements for conventional ovens, consistent with the recommendation
in the Joint Agreement, based on product testing and reverse engineering. To determine standby
mode and off mode power levels, DOE measured the standby mode and off mode power
consumption of the standalone ovens and combined cooking products in its test sample. The
results are presented in section 5.5.3 of this TSD. As discussed in section 5.3.2.3 of this TSD,
DOE selected the baseline ETLP for conventional ovens based on the highest measured combined
low-power mode power consumption in DOE’s test sample among combined cooking products
equipped with a linear power supply. DOE determined the reduction in combined low-power
mode power associated with changing from a linear power supply to an SMPS using the lowest

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measured combined low-power mode power consumption among combined cooking products, to
maintain the full functionality of controls.

DOE included in its analysis EL 2, an efficiency level for both electric and gas ovens
based on test data from units in the test sample equipped with convection mode capability. For
each conventional oven equipped with convection mode capability, DOE averaged the energy
consumption both with and without the convection mode enabled as required by the test
procedure finalized in the July 2015 TP Final Rule. In this TSD, DOE’s analysis is based on the
fact that the use of convection mode capability would impact only active cooking mode energy,
excluding self-clean mode. The resulting relative decrease in EAO was 4.4% for electric standard
ovens and 6.6% for gas standard ovens at the representative cavity volume of 4.3 ft3. These
percentages of EAO at that representative volume correspond to incremental EAO values of 13.0
kWh/year for electric standard ovens and 133 kBtu/year for gas standard ovens. In this TSD,
DOE used these values to calculate the energy savings of the convection mode capability design
option at the IEAO level for each analyzed product type of conventional oven , assuming the same
incremental EAO between EL 1 and EL 2 for the standard and self-clean product types.

Using a similar analysis, DOE developed an efficiency level, EL 3, for electric ovens
based on test data for a unit in its test sample equipped with an oven separator. The oven
separator allows the user to reduce the cavity volume that is used for cooking so that the
individual cavities are more appropriately sized to the load and so that different temperature
settings can be used simultaneously. DOE first determined the energy consumption of the
conventional oven when measured without the separator and then measured with the separator
according to the earlier version of the conventional oven test procedure established in the July
2015 TP Final Rule. Noting that the existence of an oven separator would affect only the EAO of
a standard oven, DOE calculated the percent decrease in EAO as a result of using the oven
separator. DOE calculated the efficiency level for an oven separator in electric standard ovens by
first applying this percent decrease to the EAO of EL 2, and then adding the ETLP to determine the
IEAO of a freestanding oven. To develop the energy savings estimates for the self-clean product
type, DOE assumed the same incremental EAO energy use between EL 2 and EL 3 for the
standard and self-clean product types at 4.3 ft3.

DOE’s testing of freestanding, built-in, and slide-in installation configurations for gas
and electric ovens revealed that built-in and slide-in ovens have a fan that consumes energy in
fan-only mode, whereas freestanding ovens do not have such a fan. The energy consumption in
fan-only mode for built-in and slide-in ovens ranges from 1 watt-hour (Wh) to 32 Wh per fan-
only cycle, which can extend from 4.5 to 69 minutes after the cooking cycle ends. For this direct
final rule, DOE estimated the maximum fan-only mode energy using 32 Wh and 69 minutes. As
discussed in section 5.3.2.3 of this TSD, DOE developed separate baseline IEAO values for each
installation configuration. DOE estimated the relative decrease in IEAO for each incremental
efficiency level to be constant across installation configuration since fan-only mode energy
consumption is independent of the design options retained for this analysis.

Table 5.3.6 and Table 5.3.7 show the efficiency levels for each product type of
conventional oven analyzed in this direct final rule. The IEAO values for each efficiency level are
normalized based on an oven cavity volume of 4.3 ft3.

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Table 5.3.6 Estimated Energy Consumption of Electric Oven Efficiency Levels
IEAO (kWh/year)
Standard Self-Clean
Level Design Option Standard Self-Clean
Built-in / Built-in /
Freestanding Freestanding
Slide-in Slide-in
Baseline Baseline 314.7 321.2 354.4 360.5
1 Baseline + SMPS 302.0 308.9 341.7 348.1
1 + Convection
2 289.0 295.9 328.7 335.1
Mode Capability
2 + Oven
3 235.3 242.1 275.0 281.4
Separator

Table 5.3.7 Estimated Energy Consumption of Gas Oven Efficiency Levels


IEAO (kBtu/year)
Standard Self-Clean
Level Design Option Standard Self-Clean
Built-in / Built-in /
Freestanding Freestanding
Slide-in Slide-in
Baseline Baseline 2,085 2,104 1,958 1,979
1 Baseline + SMPS 2,041 2,062 1,915 1,937
1 + Convection Mode
2 1,908 1,929 1,781 1,804
Capability

5.4 METHODOLOGY OVERVIEW

DOE relied on multiple sources of information for this engineering analysis, including a
review of TSDs from previous rulemakings, manufacturer interviews, internal product testing,
and product teardowns.

5.4.1 Review of Previous Technical Support Documents and Models

DOE typically reviews previous rulemaking TSDs to assess their applicability to the
current standard setting process. These previous rulemaking TSDs serve as a source for design
options and energy consumption analysis, in addition to other sources. For consumer
conventional cooking products, DOE reviewed the 2009 TSD.

5.4.2 Manufacturer Interviews

DOE understands that there is variability among manufacturers in baseline units, design
strategies, and cost structures. To better understand and explain these variances, DOE conducted
manufacturer interviews. These confidential interviews provided a deeper understanding of the
various combinations of technologies used to increase consumer conventional cooking product
efficiency, and their associated manufacturing costs. DOE conducted interviews throughout this
rulemaking, most recently after the publication of the notice of proposed determination published
on December 14, 2020 (“December 2020 NOPD”) and the test procedure final rule published on
August 22, 2022 (“August 2022 TP Final Rule”). 85 FR 80982, 87 FR 51492.

5-13
During the interviews, DOE also gathered information about the capital expenditures
required to implement different design options at different efficiency levels. The interviews
provided information about the size and the nature of the capital investments. DOE also
requested information about the depreciation method used to expense the conversion capital. The
manufacturer impact analysis in chapter 12 of this TSD includes a discussion of this information
obtained during manufacturer interviews.

5.4.3 Selection of Units

DOE generally adopts the following criteria for selecting units for testing and teardown
analysis:
• The selected products should span the full range of efficiency levels for each
product class or product type under consideration;
• Within each product class or product type, the selected products should, if
possible, come from the same manufacturer and belong to the same product
platform;
• The selected products should, if possible, come from manufacturers with large
market shares in that product class or product type, although the highest
efficiency products are chosen irrespective of manufacturer; and
• The selected products should have non-efficiency-related features that are the
same as, or similar to, features of other products in the same class or type and at
the same efficiency level.

Because manufacturers are not currently required to report product efficiency or energy
use, DOE selected test units based on a review of design options listed in product literature.

5.4.4 Product Testing

5.4.4.1 Conventional Cooking Tops

DOE conducted testing using the current conventional cooking top test procedure at
Appendix I1 to develop a better understanding of the design options and product features
currently available on the market. The testing also allowed DOE to characterize the distribution
of product energy consumption in the marketplace.

In Appendix I1, DOE generally adopted the current version of the applicable industry
standard, IEC 60350-2 (Edition 2.1 2021-05), “Household electric cooking appliances–Part 2:
Hobs – Methods for measuring performance” j (“IEC 60350-2”), which provides a water-heating
test method to measure the energy consumption of electric cooking tops. Appendix I1 includes
burden-reducing modifications to IEC 60350-2, further clarifies certain provisions, and also
extends these test methods to gas cooking tops by correlating the burner input rate to specific test
load diameters.

j
Hob is the British English term for cooking top.

5-14
The water-heating energy test for both electric and gas cooking tops requires heating a
test load to a calculated “turndown temperature” k at the maximum energy input setting. When
the water temperature reaches the turndown temperature, the energy input rate is reduced to a
lower energy input setting, and the test is run for a 20-minute “simmering period” after the
smoothenedl water temperature reaches 90 degrees Celsius (°C) (194 degrees Fahrenheit (°F)),
without additional adjustment of the energy input setting. The test load is made up of a quantity
of water which is heated in a standardized, stainless-steel test vessel and covered with a vented
aluminum lid. There are eight standardized cooking vessel sizes, ranging from 120 to 300
millimeters (4.7 to 13 inches) in diameter, one of which is selected to test each cooking zone
based on the electric heating element dimension or the gas burner input rate. The amount of
water varies with test vessel diameter. The full energy test is run for two consecutive energy
input settings where the higher setting is one that can maintain the smoothened water
temperature above 90 °C for the entire 20-minute simmering period and the lower setting cannot.

The per-cycle energy use for each cooking zone is then interpolated between the two
energy tests, to represent the energy use of a test run with a final water temperature of 90 °C. The
total conventional cooking top energy consumption is determined as the average of the energy
consumed during each independent test divided by the mass of the water load used for that test.
This average energy consumption is then normalized to a standard water load size (2,853 grams
(g)) to determine the average per-cycle energy consumption of the conventional cooking top. To
determine the AEC, the average per-cycle cooking top energy consumption is multiplied by the
number of cooking cycles per year, 418.

The ETLP is calculated by multiplying the average of the standby-mode power and the off-
mode power by the number of annual low-power mode hours. The number of annual low-power
hours is 8,544 for a standalone cooking top and 8,392 for a conventional range. The annual low-
power mode energy consumption of a conventional range is apportioned between the cooking
top component and the oven component such that 60% of the energy is included in the cooking
top IAEC. In Appendix I1, the IAEC is calculated by adding the AEC and the ETLP.

5.4.4.2 Conventional Ovens

Because there is currently no test procedure in place for conventional ovens, most
manufacturers of conventional ovens do not have energy consumption data to share with DOE.
Therefore, DOE conducted its own investigative testing using the conventional oven test
procedure adopted in the July 2015 TP Final Rule to develop a better understanding of the
impact of the design options available on the market. DOE specifically used this data to help
determine whether certain design changes resulted in reduced product energy consumption.

k
The turndown temperature is determined during a preliminary test (the “overshoot test”) performed for each
cooking zone to account for the continued temperature rise of the water (due to residual heat on the cooking top
surface and in the test vessel) that occurs after the cooking top control is adjusted. The turndown temperature is
calculated so that after the cooking top control is turned down from the maximum power setting to a low-power
setting, the steady-state temperature of the water reaches a temperature slightly above 90 °C.
l
The smoothened water temperature is the 40-second moving average temperature, used to reduce the impact of
measurement noise of the water temperature on the final result.

5-15
The conventional oven test procedure adopted in the July 2015 TP Final Rule required
setting the oven controls to achieve an average internal cavity temperature 325° ± 5 °F higher
than the room ambient air temperature and measuring the amount of energy required to raise the
temperature of an aluminum block test load at room temperature by 234 °F above its initial
temperature. The measured energy consumption included the energy input during the time the
load was being heated plus the energy consumed during fan-only mode.

The annual primary energy consumption for cooking, ECO, in kWh/year for electric
ovens and in kBtu/year for gas ovens, was defined as:
𝐸𝑂 ×𝐾𝑒 ×𝑂𝑂
𝐸𝐶𝑂 = for electric ovens, where,
𝑊1 ×𝐶𝑝 ×𝑇𝑆

EO = the test energy consumption, in Wh;


Ke = 3.412 Btu/Wh, the conversion factor of Wh to Btu;
OO = 29.3 kWh/year, the annual useful cooking energy output of a electric oven;
W1 = the measured weight of test block, in pounds (lb);
Cp = 0.23 Btu/lb⋅°F, the specific heat of test block; and
TS = 234 °F, the temperature rise of test block.

𝑂𝐸 ×𝑂𝑂
𝐸𝐶𝑂 = 𝑊 ×𝐶 for gas ovens, where,
1 𝑝 ×𝑇𝑆

EO = the test energy consumption, in Btu;


OO = 88.8 kBtu/year, the annual useful cooking energy output of a gas oven;
and W1, Cp and TS are the same as defined above.

In the test procedure adopted in the July 2015 TP Final Rule, the annual secondary
energy consumption for gas ovens (i.e., the electrical energy consumption due to the ignition
system and the display) was incorrectly calculated using the annual useful cooking energy output
intended for electric ovens, 29.3 kWh/year, instead of the constant specified for gas ovens, 26.0
kWh/year (88.8 kBtu/year). Because the purpose of the constant was to represent the typical field
usage of the conventional oven during the cooking cycle, the factor used to calculate the annual
secondary energy consumption should have corresponded to the same usage factor used to
calculate the annual primary energy consumption for gas ovens. Thus, for all gas oven energy
consumption values presented in this analysis, DOE included the secondary annual energy
consumption of gas ovens, ESO, in kWh/year, calculated using the following equation:
𝐸𝐼𝑂 ×𝐾𝑒 ×𝑂𝑂
𝐸𝑆𝑂 = for gas ovens, where,
𝑊1 ×𝐶𝑝 ×𝑇𝑆

EIO = the electrical test energy consumption, as measured, in Wh;


OO = 26.0 kWh/year (88.8 kBtu/year), the annual useful cooking energy output of a gas oven;
and Ke, W1, Cp and TS are the same as defined above.

5-16
The test procedure adopted in the July 2015 TP Final Rule also included a method for
measuring the annual primary and secondary energy consumption for conventional oven self-
cleaning operations, ESC and ESS, respectively.

The annual active cooking mode energy consumption, EAO, in kWh/year for electric
ovens and in kBtu/year for gas ovens, was defined as:

𝐸𝐴𝑂 = 𝐸𝐶𝑂 + 𝐸𝑆𝐶 for electric ovens, where,

ECO = the annual primary (electrical) cooking energy consumption for the electric oven, in
kWh/year; and
ESC = the annual self-cleaning energy consumption, in kWh/year.

𝐸𝐴𝑂 = 𝐸𝐶𝑂 + 𝐸𝑆𝐶 + [(𝐸𝑆𝑂 + 𝐸𝑆𝑆 ) × 𝐾𝑒 ] for gas ovens, where,

ECO = the annual primary (gas) cooking energy consumption for the gas oven, in kBtu/year;
ESO = the annual secondary (electrical) cooking energy consumption for gas ovens only, in
kWh/year;
ESC = the annual primary (gas) self-cleaning energy consumption, in kBtu/year;
ESS = the annual secondary (electrical) self-cleaning energy consumption, in kWh/year;
and Ke is the same as defined above.

In the test procedure adopted in the July 2015 TP Final Rule, the number of combined
low-power mode hours for built-in/slide-in ovens was incorrectly calculated using the annual
number of non-active hours (8540.1 and 8329.2, for conventional ovens and conventional ranges
respectively) minus the duration in hours of the fan-only mode portion of the cooking cycle,
instead of subtracting the number of annual hours spent in fan-only mode. Because the purpose
of the subtraction was to represent the annual hours not spent in combined low-power mode, the
subtraction should have corresponded to the annual hours spent in fan-only mode. Thus, for all
oven energy consumption values presented in this analysis, DOE defined the number of
combined low-power mode hours, STOT, in hours, calculated using the following equation:
𝑡𝑂𝐹×𝑁𝑂
𝑆𝑇𝑂𝑇 = 𝑆 − , where,
60

S = the annual number of non-active hours, 8540.1 for conventional ovens, and 8329.2 for
conventional ranges;
tOF = the fan-only mode duration in minutes;
NO = the representative number of annual conventional oven cooking cycles per year;m and
60 = the conversion factor for minutes to hours.

The test procedure finalized in the July 2015 TP Final Rule further specified that the
number of combined low-power mode hours for freestanding conventional ovens and

m
NO is equal to 219 for electric standard ovens, 204 for electric self-clean ovens, 183 for gas standard ovens, and
197 for gas self-clean ovens.

5-17
conventional ranges are equal to these same values (8540.1 and 8329.2, respectively) because
freestanding ovens do not typically have a fan-only mode.

DOE measured standby-mode and off-mode power for the standalone ovens and for the
oven components of combined cooking products, ETLP, in kWh/year, was defined as:

𝐸𝑇𝐿𝑃 = [(𝑃𝐼𝐴 × 𝑆𝐼𝐴 ) + (𝑃𝑂𝑀 × 𝑆𝑂𝑀 )] × 𝐾 where,

PIA = the inactive mode power, in W;


POM = the off mode power, in W;
SIA = the annual hours in inactive mode;
SOM = the annual hours in off mode;
If the oven has both standby-mode and off-mode, SIA = SOM = STOT/2. If the oven has a standby
mode but no off mode, SIA = STOT and SOM = 0. If the oven has an off mode but no standby
mode, SIA = 0 and SOM = STOT;
STOT is the number of combined low-power mode hours, as defined above; and
K = 0.001 kWh/Wh, the conversion factor for Wh to kWh.

The total integrated annual energy consumption, IEAO, in kWh/year for electric ovens
and in kBtu/year for gas ovens, was defined as:

𝐼𝐸𝐴𝑂 = 𝐸𝐶𝑂 + 𝐸𝑆𝐶 + 𝐸𝑇𝐿𝑃 + (𝐸𝑂𝐹 × 𝑁𝑂𝐸 ) for electric ovens, where,

ECO = the annual primary (electrical) cooking energy consumption for the electric oven, in
kWh/year;
ESC = the annual self-cleaning energy consumption, in kWh/year;
ETLP = the annual combined low-power mode energy consumption, in kWh/year;
EOF = the fan-only mode energy consumption, in kWh/cycle; and
NOE = the representative number of annual electric oven cooking cycles per year.

𝐼𝐸𝐴𝑂 = 𝐸𝐶𝑂 + 𝐸𝑆𝐶 + {[𝐸𝑆𝑂 + 𝐸𝑆𝑆 + 𝐸𝑇𝐿𝑃 + (𝐸𝑂𝐹 × 𝑁𝑂𝐺 )] × 𝐾𝑒 } for gas ovens, where,

ECO = the annual primary (gas) cooking energy consumption for the gas oven, in kBtu/year;
ESO = the annual secondary (electrical) cooking energy consumption for gas ovens only, in
kWh/year;
ESC = the annual primary (gas) self-cleaning energy consumption, in kBtu/year;
ESS = the annual secondary (electrical) self-cleaning energy consumption, in kWh/year;
NOG = the representative number of annual gas oven cooking cycles per year;
and ETLP, EOF, and Ke are the same as defined above.

5.4.5 Product Teardowns

As noted, DOE used the physical teardown approach, supplemented by catalog teardown
of PCBs for this direct final rule.

5-18
The teardown method provides key information that is difficult to obtain from the other
cost analysis approaches and that can be critical to the quality of the engineering analysis. In
conducting a teardown, DOE physically disassembles a commercially available product,
component-by-component, to develop a structured BOM that estimates the costs of raw
materials, machining processes, purchased parts, capital depreciation, and factory overhead costs
at an assumed production volume. The teardown approach allows for the unbundling of non-
efficiency related features that are often bundled with higher efficiency technologies and
subsequently contribute to the higher retail price of higher-efficiency models. The teardown
approach also reveals different design paths used by different manufacturers, and enables DOE
to estimate manufacturer investments required to achieve each higher efficiency level. The
teardown approach is time-intensive, and unit selection is critical to ensure an industry-
representative cost curve. Periodically, DOE invites manufacturers to review the results in detail
and verifies the manufacturing parameters/processes via site visits to production facilities.

A supplementary method to a physical teardown, called a catalog teardown or virtual


teardown, uses published manufacturer catalogs and supplementary component data to estimate
the major physical differences between a product that has been physically disassembled and
another similar product. In a catalog teardown, DOE references public information to estimate
manufacturing costs. Usually, these estimates leverage prior product teardowns, allowing the
analysis to capture a broader range of capacities and other features within a product family.
Using product teardown data as a foundation, DOE can model the costs associated with higher-
efficiency models through parametric scaling, part substitutions, etc., to capture relevant product
parameters. In some instances, the incremental cost of well-defined equipment may also be
characterized with a catalog teardown alone. This method is best suited for product categories
where features are well-documented, with “mature” or commoditized designs, and where
efficiency-related design are physically scalable. This approach allows a wide variety of
capacities and features to be covered.

The teardown methodology is further explained in the following sections.

5.4.5.1 Generation of Bill of Materials

The end result of each teardown is a structured BOM, which describes each product part
and its relationship to the other parts, in the estimated order of assembly. The BOMs describe
each fabrication and assembly operation in detail, including the type of value-added equipment
needed (e.g., stamping presses, injection molding machines, spot-welders, etc.) and the estimated
cycle times associated with each conversion step. The result is a thorough and explicit model of
the production process.

Materials in the BOM are divided between raw materials—which require conversion
steps to be made ready for assembly—and purchased parts, which are typically delivered ready
for installation. The classification into raw materials or purchased parts is based on DOE’s
previous industry experience, recent information in trade publications, and past discussions with
original equipment manufacturers (OEMs). For purchased parts, the purchase price is based on
volume-variable price quotations and detailed discussions with suppliers.

5-19
For parts fabricated in-house, the prices of the underlying “raw” metals (e.g., sheet metal)
are estimated on the basis of 5-year averages to smooth out spikes in demand. Other “raw”
materials such as plastic resins, insulation materials, etc. are estimated on a current-market basis.
The costs of raw materials are based on past discussions with manufacturers, quotes from
suppliers, and secondary research. DOE regularly updates historical data to present-day prices
using indices from resources such as MEPS Intl.,n PolymerUpdate,o the U.S. geologic survey
(USGS),p and the Bureau of Labor Statistics (BLS).q

5.4.5.2 Cost Structure of the Spreadsheet Models

The manufacturing cost assessment methodology is based on a detailed, component-


focused technique for rigorously calculating the manufacturing cost of a product, including
materials, labor and overhead costs. Figure 5.4.1 shows the three major steps in generating the
manufacturing cost.

Figure 5.4.1 Manufacturing Cost Assessment Stages

The first step in the manufacturing cost assessment was the creation of a complete and
structured BOM from the disassembly of the units selected for teardown. The units are
dismantled, and each part is characterized according to weight, manufacturing processes used,
dimensions, material, and quantity. The BOM incorporates all materials, components, and
fasteners, with estimates of raw material costs and purchased part costs. Assumptions on the
sourcing of parts and in-house fabrication are based on industry experience and past discussions
with manufacturers.

Following the development of a detailed BOM, the major manufacturing processes are
identified and developed for the spreadsheet model. Some of these processes are listed in
Table 5.4.1.

n
For more information on MEPS Intl, please visit: www.meps.co.uk/.
o
For more information on PolymerUpdate, please visit: www.polymerupdate.com.
p
For more information on the USGS metal price statistics, please visit: www.usgs.gov/centers/nmic/commodity-
statistics-and-information.
q
For more information on the BLS producer price indices, please visit: www.bls.gov/ppi/.

5-20
Table 5.4.1 Major Manufacturing Processes
Quality
Fabrication Finishing Assembly/Joining
Control
Fixturing
Stamping/Pressing Washing
Adhesive Bonding
Brake Forming Powder Coating
Spot Welding Inspecting &
Cutting and Enameling
Seam Welding Testing
Shearing De-burring
Packaging
Turret Punch Polishing
Tube Forming

Fabrication process cycle times for each part made in-house are estimated and entered
into the BOM. Based on estimated assembly and fabrication time requirements, the labor content
of each teardown unit is estimated based on typical annual wages and benefits of industry
employees.

Cycle requirements for fabrication steps are similarly aggregated by fabrication machine
type while accounting for dedicated versus non-dedicated machinery and/or change-over times
(e.g., die swaps in a press). Once the cost estimate for each teardown unit is finalized, a detailed
summary is prepared for relevant components, subassemblies, and processes. The BOM thus
details all aspects of unit costs: material, labor, and overhead.

Design options used in units subject to teardown are noted in the summary sheet of each
cost model and are cost-estimated individually. Thus, various implementations of design options
can be accommodated, ranging from assemblies that are entirely purchased to units that are made
entirely from raw materials. Hybrid assemblies, consisting of purchased parts and parts made on
site are thus also accommodated.

5.4.5.3 Cost Model and Definitions

The cost model is based on production activities and divides factory costs into the
following categories:

• Materials: Purchased parts (i.e., motors, valves, etc.), raw materials, (i.e., cold-rolled
steel, copper tube, etc.), and indirect materials that are used for processing and
fabrication.
• Labor: Fabrication, assembly, supervisor, and indirect labor. Fabrication and assembly
labor cost are burdened with benefits and supervisory costs.
• Overhead: Equipment, tooling, and building depreciation, as well as utilities, equipment
and tooling maintenance, insurance, and property taxes. The equipment, tooling, and
building depreciation costs are modeled as a “green-field” site; i.e., a new manufacturing
plant with all new equipment.

DOE defines the above terms as follows:

5-21
• Direct material: Purchased parts (outsourced) plus manufactured parts (made in-house
from raw materials).
• Indirect material: Material used during manufacturing (e.g., welding rods, adhesives).
• Fabrication labor: Labor associated with in-house piece manufacturing.
• Assembly labor: Labor associated with final assembly.
• Supervisory labor: Labor associated with fabrication and assembly basis. Assigned on a
span basis (× number of employees per supervisor) that depends on the industry.
• Indirect labor: Labor costs that scale with fabrication and assembly labor. These included
the cost of technicians, manufacturing engineering support, stocking, etc. that are
proportional to all other labor.
• Equipment depreciation: Money allocated to pay for initial equipment installation and
replacement as the production equipment is amortized. All depreciation is assigned in a
linear fashion and affected equipment life depends on the type of equipment.
• Tooling depreciation: Cost for initial tooling (including non-recurring engineering and
debugging of the tools) and tooling replacement as it wears out or is rendered obsolete.
• Building depreciation: Money allocated to pay for the building space and the conveyors
that feed and/or make up the assembly line.
• Utilities: Electricity, gas, telephones, etc.
• Maintenance: Annual money spent on maintaining tooling and equipment.
• Insurance: Appropriated as a function of unit cost.
• Property Tax: Appropriated as a function of unit cost.

5.4.5.4 Cost Model Assumptions

As discussed in the previous section, assumptions about manufacturer practices and cost
structure played an important role in estimating the final product cost. In converting physical
information about the product into cost information, DOE reconstructs manufacturing processes
for each component using internal expertise and knowledge of the methods used by the industry.
DOE regularly confirms its cost model assumptions through various sources such as
manufacturer interviews and reviews of current BLS data.

5.5 ANALYSIS AND RESULTS

5.5.1 Manufacturer Interviews

As discussed, DOE conducted interviews with consumer conventional cooking product


manufacturers to develop a better understanding of current product features and the technologies
used to improve energy efficiency. The interviewed manufacturers represent a wide range of
U.S. market share and included both domestic and international companies that sell consumer
conventional cooking products in the United States.

The discussions below represent a consolidation of the manufacturer responses that were
relevant to the engineering analysis in this direct final rule.

5-22
5.5.1.1 Design Features of Current Baseline Products

DOE discussed the features of baseline products identified during the previous energy
conservation standards rulemaking and during the previous stages of the current rulemaking with
manufacturers. Manufacturers generally stated that the baseline identified in the previous
rulemaking may not be representative of products currently being sold on the market. Most
manufacturers indicated that they did not test their consumer conventional cooking products
according to a DOE test procedure and thus had limited or no data to help support a baseline
energy consumption estimate.

5.5.1.2 Oven Energy Consumption as a Function of Cavity Volume

DOE asked manufacturers how conventional oven energy consumption may scale with
cavity volume. Manufacturers stated that conventional ovens with smaller cavities are generally
more efficient but did not supply data to support this statement.

5.5.1.3 Power Supplies

DOE asked manufacturers about the market uptake of SMPSs in conventional ovens, and
any impact that a requirement to use an SMPS could have on manufacturer production costs
(MPCs), consumer utility, or conversion costs. Multiple manufacturers commented that they
already use SMPSs in all their conventional ovens that use line power. Manufacturers noted the
increased engineering complexity of a control system with an SMPS as compared to a linear
power supply.

5.5.1.4 Carbon Monoxide Emission Limits

DOE is aware that for gas cooking tops, some of the strategies that yield higher efficiency
(e.g., reduced space between the burner and the grate) also tend to increase emissions of carbon
monoxide. As discussed in chapter 3 of this TSD, Section 5.4 of American National Standards
Institute (ANSI) Z21.1 “Household Cooking Gas Appliances” (“ANSI Z21.1”), requires that gas
appliances not produce a concentration of carbon monoxide exceeding 800 parts per million. For
this direct final rule, DOE only considered standards corresponding to the efficiency of consumer
conventional cooking products available on the market. DOE notes that ANSI Z21.1 is required
by many building codes in the United States.

5.5.2 Product Selection

5.5.2.1 Conventional Cooking Tops

DOE conducted a market survey of conventional cooking top models and their associated
features to identify the primary differentiators among commercially available units. Because
there are no performance-based energy conservation standards or energy reporting requirements
for conventional cooking tops, DOE selected test units based on performance-related features
and technologies advertised in product literature.

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For electric cooking tops, DOE selected units considering the following features: 1)
product configuration (i.e., whether the cooking top is standalone or is a component of a
conventional ranger); 2) unit width; 3) heating element technology (i.e., electric resistance versus
induction); and 4) total number of cooking zones.s DOE’s electric cooking top test sample for
this direct final rule includes 13 electric smooth element standalone cooking tops and the electric
smooth element cooking top portion of 7 conventional ranges for a total of 20 electric smooth
element cooking tops. As discussed, DOE received additional cooking top test data, which DOE
included in the “expanded test sample.” The expanded test sample for this direct final rule
includes an additional 26 electric smooth element standalone cooking tops and the electric
smooth element cooking top portion of 24 conventional ranges for an overall total of 70 electric
smooth element cooking tops covering both of the product classes for electric cooking tops
considered in this analysis. The key parameters for each of the electric cooking top test units in
the expanded test sample are presented in Table 5.5.1.

Table 5.5.1 Electric Smooth Element Cooking Tops in the Expanded Test Sample
Total
Test Unit Unit Width
Configuration Technology Number of
ID (inches)
Elements
DOE-3 Standalone cooking top 30 Electric resistance 4
DOE-4 Standalone cooking top 30 Electric resistance 5
DOE-5 Standalone cooking top 36 Electric resistance 5
DOE-6 Standalone cooking top 36 Electric resistance 5
DOE-7 Standalone cooking top 36 Electric resistance 5
DOE-8 Standalone cooking top 30 Electric resistance 4
DOE-9 Standalone cooking top 24 Electric resistance 4
DOE-10 Conventional range 30 Electric resistance 4
DOE-11 Conventional range 30 Electric resistance 4
DOE-12 Conventional range 36 Electric resistance 4
DOE-13 Conventional range 30 Electric resistance 4
DOE-14 Standalone cooking top 30 Induction 4
DOE-15 Standalone cooking top 30 Induction 4
DOE-16 Standalone cooking top 30 Induction 6
DOE-17 Standalone cooking top 30 Induction 5
DOE-18 Standalone cooking top 30 Induction 4
DOE-19 Standalone cooking top 30 Induction 4
DOE-20 Conventional range 30 Induction 4
DOE-21 Conventional range 30 Induction 4
DOE-22 Conventional range 30 Induction 4
AHAM-1 Standalone cooking top unknown Electric resistance unknown

r
A conventional range is a combined cooking product with a conventional cooking top component and a
conventional oven component.
s
The term cooking zone refers to burners for gas cooking tops and electric resistance heating elements or inductive
heating elements for electric cooking tops.

5-24
Total
Test Unit Unit Width
Configuration Technology Number of
ID (inches)
Elements
AHAM-2 Standalone cooking top unknown Electric resistance unknown
AHAM-3 Standalone cooking top unknown Electric resistance unknown
AHAM-4 Standalone cooking top unknown Electric resistance unknown
AHAM-5 Standalone cooking top unknown Electric resistance unknown
AHAM-6 Standalone cooking top unknown Electric resistance unknown
AHAM-7 Standalone cooking top unknown Electric resistance unknown
AHAM-8 Standalone cooking top unknown Electric resistance unknown
AHAM-9 Standalone cooking top unknown Electric resistance unknown
AHAM-10 Standalone cooking top unknown Electric resistance unknown
AHAM-11 Standalone cooking top unknown Induction unknown
AHAM-12 Standalone cooking top unknown Induction unknown
AHAM-13 Standalone cooking top unknown Induction unknown
AHAM-14 Standalone cooking top unknown Induction unknown
AHAM-15 Standalone cooking top unknown Induction unknown
AHAM-16 Standalone cooking top unknown Induction unknown
AHAM-17 Standalone cooking top unknown Induction unknown
AHAM-18 Standalone cooking top unknown Induction unknown
AHAM-19 Standalone cooking top unknown Induction unknown
AHAM-20 Standalone cooking top unknown Electric resistance unknown
AHAM-21 Standalone cooking top unknown Electric resistance unknown
AHAM-22 Standalone cooking top unknown Electric resistance unknown
AHAM-23 Standalone cooking top unknown Electric resistance unknown
AHAM-24 Standalone cooking top unknown Electric resistance unknown
AHAM-25 Standalone cooking top unknown Induction unknown
AHAM-26 Conventional range unknown Electric resistance unknown
AHAM-27 Conventional range unknown Electric resistance unknown
AHAM-28 Conventional range unknown Electric resistance unknown
AHAM-29 Conventional range unknown Electric resistance unknown
AHAM-30 Conventional range unknown Electric resistance unknown
AHAM-31 Conventional range unknown Electric resistance unknown
AHAM-32 Conventional range unknown Electric resistance unknown
AHAM-33 Conventional range unknown Electric resistance unknown
AHAM-34 Conventional range unknown Electric resistance unknown
AHAM-35 Conventional range unknown Electric resistance unknown
AHAM-36 Conventional range unknown Electric resistance unknown
AHAM-37 Conventional range unknown Electric resistance unknown
AHAM-38 Conventional range unknown Electric resistance unknown

5-25
Total
Test Unit Unit Width
Configuration Technology Number of
ID (inches)
Elements
AHAM-39 Conventional range unknown Electric resistance unknown
AHAM-40 Conventional range unknown Electric resistance unknown
AHAM-41 Conventional range unknown Electric resistance unknown
AHAM-42 Conventional range unknown Electric resistance unknown
AHAM-43 Conventional range unknown Electric resistance unknown
AHAM-44 Conventional range unknown Electric resistance unknown
AHAM-45 Conventional range unknown Electric resistance unknown
AHAM-46 Conventional range unknown Induction unknown
AHAM-47 Conventional range unknown Induction unknown
AHAM-48 Conventional range unknown Induction unknown
PG&E-1 Conventional range 30 Electric resistance 5
PG&E-2 Standalone cooking top 36 Induction 5

For gas cooking tops, DOE selected units considering the following features: 1) product
configuration (i.e., whether the cooking top is standalone or is a component of a conventional
range); 2) unit width; 3) burner type (i.e., sealed versus open); 4) total number of burners; and 5)
distribution of burner input rates. DOE’s gas cooking top test sample for this direct final rule
includes 16 gas standalone cooking tops and the gas cooking top portion of 8 conventional
ranges for a total of 24 gas cooking tops tested by DOE. As discussed, DOE received additional
cooking top test data, which DOE included in the “expanded test sample.” The expanded test
sample for this direct final rule includes an additional 19 gas standalone cooking tops and the gas
cooking top portion of 20 conventional ranges for an overall total of 63 gas cooking tops. The
key parameters for each of the gas cooking top test units in the expanded test sample are
presented in Table 5.5.2 through Table 5.5.3. In these tables, gas burners with input rates under
6,500 Btu/h are labeled LIR burners; burners with input rates over 14,000 Btu/h are labeled HIR
burners; and HIR burners with input rates over 18,000 Btu/h are labeled extra-high input rate
(XHIR) burners. Throughout this direct final rule, DOE defines an “entry-level” gas cooking top
as one that does not have at least one HIR burner and continuous cast-iron grates. By contrast,
DOE defines a “non-entry-level” gas cooking top as one that has at least one HIR burner and
continuous cast-iron grates. In this TSD, DOE is presenting the results for all tested gas cooking
tops, which are also used to develop the market share distributions (see chapter 8 of this TSD).
However, as discussed, to develop incremental efficiency levels, DOE analyzed the distribution
of AEC values among only the cooking tops in the expanded test sample that have multiple HIR
burners and continuous cast-iron grates, consistent with the screening analysis developed in
chapter 4 of this TSD. DOE did not consider any efficiency levels that would result in the lack of
multiple HIR burners or continuous cast-iron grates.

5-26
Table 5.5.2 Gas Cooking Tops in the Expanded Test Sample (Non-Entry-Level*)
Total
Test Unit Unit Width Burner
Configuration Number of
ID (inches) Type
Burners
DOE-1 Standalone cooking top 36 Sealed 5
DOE-2 Standalone cooking top 36 Sealed 5
DOE-3 Standalone cooking top 30 Sealed 4
DOE-4 Standalone cooking top 36 Sealed 5
DOE-5 Standalone cooking top 36 Sealed 6
DOE-6 Standalone cooking top 36 Sealed 5
DOE-7 Conventional range 30 Sealed 4
DOE-8 Conventional range 30 Sealed 4
DOE-9 Conventional range 30 Sealed 4
DOE-10 Conventional range 30 Sealed 5
DOE-11 Standalone cooking top 30 Sealed 4
DOE-12 Standalone cooking top 36 Sealed 4
DOE-13 Standalone cooking top 36 Sealed 6
DOE-14 Standalone cooking top 36 Sealed 6
DOE-15 Standalone cooking top 36 Sealed 6
DOE-16 Standalone cooking top 36 Open 6
DOE-17 Standalone cooking top 36 Sealed 6
DOE-18 Conventional range 30 Sealed 4
DOE-19 Conventional range 30 Open 4
DOE-20 Conventional range 36 Sealed 6
DOE-21 Conventional range 30 Sealed 6
AHAM-1 Standalone cooking top unknown unknown 5
AHAM-2 Standalone cooking top unknown unknown 6
AHAM-3 Standalone cooking top unknown unknown 4
AHAM-4 Standalone cooking top unknown unknown 6
AHAM-5 Standalone cooking top unknown unknown 6
AHAM-6 Standalone cooking top unknown unknown 4
AHAM-7 Standalone cooking top unknown unknown 5
AHAM-8 Standalone cooking top unknown unknown 5
AHAM-9 Standalone cooking top unknown unknown 5
AHAM-10 Standalone cooking top unknown unknown 5
AHAM-11 Standalone cooking top unknown unknown 5
AHAM-12 Standalone cooking top unknown unknown 5
AHAM-13 Standalone cooking top unknown unknown 5
AHAM-14 Standalone cooking top unknown unknown 5
AHAM-15 Conventional range unknown unknown 5

5-27
Total
Test Unit Unit Width Burner
Configuration Number of
ID (inches) Type
Burners
AHAM-16 Conventional range unknown unknown 4
AHAM-17 Conventional range unknown unknown 4
AHAM-18 Conventional range unknown unknown 4
AHAM-19 Conventional range unknown unknown 4
AHAM-21 Conventional range unknown unknown 4
AHAM-22 Conventional range unknown unknown 5
AHAM-23 Conventional range unknown unknown 5
AHAM-25 Conventional range unknown unknown 4
AHAM-26 Conventional range unknown unknown 4
AHAM-27 Conventional range unknown unknown 5
AHAM-28 Conventional range unknown unknown 4
AHAM-29 Conventional range unknown unknown 4
AHAM-30 Conventional range unknown unknown 6
PG&E-1 Standalone cooking top 30 Sealed 4
PG&E-2 Conventional range 30 Sealed 4
PG&E-3 Standalone cooking top 30 Open 4
PG&E-4 Conventional range 30 Sealed 4
PG&E-5 Conventional range 30 Sealed 5
PG&E-6 Standalone cooking top 36 Sealed 5
* A non-entry-level gas cooking top is one that has at least one HIR burner and continuous cast-iron grates.

Table 5.5.3 Gas Cooking Tops in the Expanded Test Sample (Non-Entry-Level*) – Burner
Characterization
Total
Number Number of HIR Burners
Test Unit Number
Configuration of LIR
ID of All XHIR Multi-Ring
Burners
Burners Types Burners Burners
DOE-1 Standalone cooking top 5 1 1 1 0
DOE-2 Standalone cooking top 5 0 1 1 1
DOE-3 Standalone cooking top 4 1 1 0 0
DOE-4 Standalone cooking top 5 1 1 1 1
DOE-5 Standalone cooking top 6 1 4 1 0
DOE-6 Standalone cooking top 5 0 1 1 1
DOE-7 Conventional range 4 1 2 0 0
DOE-8 Conventional range 4 1 1 0 0
DOE-9 Conventional range 4 1 2 1 1
DOE-10 Conventional range 5 1 2 0 0
DOE-11 Standalone cooking top 4 0 4 4 0

5-28
Total
Number Number of HIR Burners
Test Unit Number
Configuration of LIR
ID of All XHIR Multi-Ring
Burners
Burners Types Burners Burners
DOE-12 Standalone cooking top 4 0 4 4 0
DOE-13 Standalone cooking top 6 0 5 0 5
DOE-14 Standalone cooking top 6 0 6 1 6
DOE-15 Standalone cooking top 6 0 6 2 0
DOE-16 Standalone cooking top 6 0 5 4 0
DOE-17 Standalone cooking top 6 1 5 2 0
DOE-18 Conventional range 4 1 3 2 2
DOE-19 Conventional range 4 0 3 3 0
DOE-20 Conventional range 6 0 3 0 0
DOE-21 Conventional range 6 1 2 1 1
AHAM-1 Standalone cooking top 5 0 1 1 unknown
AHAM-2 Standalone cooking top 6 0 5 0 unknown
AHAM-3 Standalone cooking top 4 0 4 2 unknown
AHAM-4 Standalone cooking top 6 0 3 3 unknown
AHAM-5 Standalone cooking top 6 1 4 1 unknown
AHAM-6 Standalone cooking top 4 0 2 2 unknown
AHAM-7 Standalone cooking top 5 1 1 1 unknown
AHAM-8 Standalone cooking top 5 2 1 1 unknown
AHAM-9 Standalone cooking top 5 0 1 1 unknown
AHAM-10 Standalone cooking top 5 0 1 1 unknown
AHAM-11 Standalone cooking top 5 2 1 1 unknown
AHAM-12 Standalone cooking top 5 3 1 0 unknown
AHAM-13 Standalone cooking top 5 0 1 0 unknown
AHAM-14 Standalone cooking top 5 0 1 1 unknown
AHAM-15 Conventional range 5 0 5 2 unknown
AHAM-16 Conventional range 4 0 4 2 unknown
AHAM-17 Conventional range 4 1 2 0 unknown
AHAM-18 Conventional range 4 1 2 0 unknown
AHAM-19 Conventional range 4 1 2 1 unknown
AHAM-21 Conventional range 4 1 2 0 unknown
AHAM-22 Conventional range 5 1 2 1 unknown
AHAM-23 Conventional range 5 2 1 0 unknown
AHAM-25 Conventional range 4 1 2 2 unknown
AHAM-26 Conventional range 4 1 2 0 unknown
AHAM-27 Conventional range 5 1 2 1 unknown
AHAM-28 Conventional range 4 1 2 1 unknown

5-29
Total
Number Number of HIR Burners
Test Unit Number
Configuration of LIR
ID of All XHIR Multi-Ring
Burners
Burners Types Burners Burners
AHAM-29 Conventional range 4 1 2 1 unknown
AHAM-30 Conventional range 6 1 2 2 unknown
PG&E-1 Standalone cooking top 4 1 2 0 0
PG&E-2 Conventional range 4 1 2 1 1
PG&E-3 Standalone cooking top 4 0 2 2 0
PG&E-4 Conventional range 4 1 1 1 0
PG&E-5 Conventional range 5 2 2 1 0
PG&E-6 Standalone cooking top 5 0 1 0 0
* A non-entry-level gas cooking top is one that has at least one HIR burner and continuous cast-iron grates.

Table 5.5.4 Gas Cooking Tops in the Expanded Test Sample (Entry-Level*)
Total
Unit
Test Unit Burner Grate Grate Number
Configuration Width
ID Type Material Type of
(inches)
Burners
Standalone cooking Enameled
DOE-A 30 Open Discrete 4
top Steel
Standalone cooking
DOE-B 36 Sealed Cast Iron Continuous 5
top
Standalone cooking Enameled
DOE-C 30 Sealed Discrete 4
top Steel
AHAM-20 Conventional range unknown unknown Cast Iron Continuous 4
AHAM-24 Conventional range unknown unknown Cast Iron Continuous 4
Standalone cooking
PG&E-7 30 Sealed Steel Discrete 4
top
Standalone cooking
PG&E-8 36 Sealed Cast Iron Continuous 5
top
PG&E-9 Conventional range 30 Sealed Steel Discrete 4
* An entry-level gas cooking top is one that does not have at least one HIR burner and continuous cast-iron grates.
Entry-level gas cooking tops were not considered for defining efficiency levels.

5.5.2.2 Conventional Ovens

DOE also conducted a market survey of conventional oven models and their associated
features to identify the primary differentiators among commercially available units. DOE
selected test units based on performance-related features and technologies advertised in product
literature. These features included, among other things: 1) oven fuel type; 2) product
configuration (i.e., whether the oven is standalone or is a component of a conventional range); 3)
whether the oven offers a self-clean cycle; 4) installation configuration (i.e., built-in/slide-in
versus freestanding); 5) heating element rating in W or burner rating in Btu/h; 6) oven cavity
volume in ft3; and 7) the presence of convection mode capability. DOE’s test sample included 5

5-30
standalone electric ovens, the electric oven component of 2 conventional ranges, 1 standalone
gas oven, and the gas oven component of 7 conventional ranges, for a total of 15 conventional
ovens covering all of the conventional oven product types considered in this direct final rule. The
key parameters for each of the test units in DOE’s test sample are presented in Table 5.5.5 and
Table 5.5.6.

Table 5.5.5 Electric Ovens in the DOE Test Sample


Heating Convection
Test Cavity
Product Installation Element Mode
Unit Type Volume
Configuration Configuration Wattage Capability
# (ft3)
(W) (Y/N)
Conventional
1 Self-Clean Freestanding 3,000 5.9* Y
range
Conventional
2 Standard Freestanding 2,000 2.4 N
range
3 Standalone oven Self-Clean Built-in 3,400 2.7 N
4 Standalone oven Standard Built-in 2,600 4.3 N
5 Standalone oven Self-Clean Built-in 2,600 4.3 N
6 Standalone oven Self-Clean Built-in 2,600 4.3 Y
7 Standalone oven Self-Clean Built-in 2,800 4.3** N
* Test Unit 1 was equipped with an oven separator that allowed for splitting the single cavity into two separate
smaller cavities with volumes of 2.7 ft3 and 3.0 ft3. In accordance with the test procedure adopted in the July 2015
TP Final Rule, the measured energy consumption for each of the three oven cavity configurations (full cavity
without the separator, top cavity with the separator, and bottom cavity with the separator) were averaged together to
determine the energy consumption for the unit.
** Test Unit 7 was a double oven having two separate cavities with equal volumes of 4.3 ft 3. In accordance with the
test procedure adopted in the July 2015 TP Final Rule, the measured energy consumption for these two cavities were
averaged together to determine the energy consumption for the unit.

Table 5.5.6 Gas Ovens in the DOE Test Sample


Convection
Test Burner Cavity
Product Installation Mode
Unit Type Input Rate Volume
Configuration Configuration Capability
# (Btu/h) (ft3)
(Y/N)
1 Conventional range Standard Freestanding 18,000 4.8 N
2 Conventional range Standard Freestanding 18,000 4.8 N
3 Conventional range Self-Clean Freestanding 18,000 5.0 Y
4 Conventional range Standard Freestanding 16,500 4.4 N
5 Standalone oven Self-Clean Built-in 13,000 2.8 N
6 Conventional range Standard Freestanding 28,000 5.3 Y
7 Conventional range Standard Slide-in 27,000 4.4 Y
8 Conventional range Standard Freestanding 30,000 5.4 Y

The range of input rates and cavity volumes were determined on the basis of
manufacturer specifications. Several units were selected from a single manufacturer that
appeared to have similar construction, rated power, and volume, but differed in ancillary features

5-31
such as whether the product was equipped with self-clean and whether the product offered
convection mode capability.

5.5.3 Product Testing

5.5.3.1 Conventional Cooking Tops

Electric Cooking Tops

Table 5.5.7 lists the test results for each electric smooth element cooking top in the DOE
test sample.

Table 5.5.7 Test Results for Electric Smooth Element Cooking Tops in the DOE Test
Sample
Does
Cooking AEC ETLP* IAEC**
Test Unit
Configuration Technology Top Display
ID
Include a (kWh/year) (kWh/year) (kWh/year)
Clock (Y/N)
DOE-3 Cooktop Electric resistance N 186 0 186
DOE-4 Cooktop Electric resistance N 189 7 196
DOE-5 Cooktop Electric resistance N 193 1 193
DOE-6 Cooktop Electric resistance N 193 8 200
DOE-7 Cooktop Electric resistance N 188 9 197
DOE-8 Cooktop Electric resistance N 190 0 190
DOE-9 Cooktop Electric resistance N 186 4 190
DOE-10 Range Electric resistance Y 189 10 200
DOE-11 Range Electric resistance Y 191 3 195
DOE-12 Range Electric resistance Y 199 25 224
DOE-13 Range Electric resistance Y 204 14 218
DOE-14 Cooktop Induction N 176 25 201
DOE-15 Cooktop Induction N 179 5 184
DOE-16 Cooktop Induction N 177 6 183
DOE-17 Cooktop Induction N 191 22 213
DOE-18 Cooktop Induction N 186 4 189
DOE-19 Cooktop Induction N 176 2 177
DOE-20 Range Induction Y 183 6 189
DOE-21 Range Induction Y 180 10 191
DOE-22 Range Induction Y 180 47 226
* For conventional ranges, the ETLP presented here represents the portion of the combined low-power mode energy
apportioned to the cooking top component of the combined cooking product, according to Appendix I1.
** IAEC may not equal the sum of AEC and ETLP presented in this table due to rounding.

5-32
The AEC for electric smooth element cooking tops in the DOE test sample varied from
176 to 204 kWh/year. The ETLP for electric smooth element cooking tops in the DOE test sample
varied from 0 to 47 kWh/year. The IAEC for electric smooth element cooking tops in the DOE
test sample varied from 177 to 226 kWh/year.

As discussed, DOE set the baseline efficiency level based on the cooking top in the DOE
test sample with the highest AEC (DOE Test Unit #13) and the cooking top with the highest
combined low-power mode energy consumption (DOE Test Unit #22).

Table 5.5.8 lists the test results provided to DOE for each additional electric smooth
element cooking top in the expanded test sample.

Table 5.5.8 Test Results for Electric Smooth Element Cooking Tops in the Expanded Test
Sample
Test Unit AEC ETLP* IAEC**
Configuration Technology
ID (kWh/year) (kWh/year) (kWh/year)
AHAM-1 Cooktop Electric resistance 189 7 196
AHAM-2 Cooktop Electric resistance 189 0 189
AHAM-3 Cooktop Electric resistance 194 4 198
AHAM-4 Cooktop Electric resistance 185 4 189
AHAM-5 Cooktop Electric resistance unknown unknown 190
AHAM-6 Cooktop Electric resistance 184 4 188
AHAM-7 Cooktop Electric resistance 182 4 186
AHAM-8 Cooktop Electric resistance 176 4 180
AHAM-9 Cooktop Electric resistance 168 17 185
AHAM-10 Cooktop Electric resistance 181 4 185
AHAM-11 Cooktop Induction 201 4 205
AHAM-12 Cooktop Induction 188 17 205
AHAM-13 Cooktop Induction 168 17 185
AHAM-14 Cooktop Induction 198 0 198
AHAM-15 Cooktop Induction 197 1 198
AHAM-16 Cooktop Induction 181 17 198
AHAM-17 Cooktop Induction unknown unknown 181
AHAM-18 Cooktop Induction unknown unknown 202
AHAM-19 Cooktop Induction unknown unknown 202
AHAM-20 Cooktop Electric resistance unknown unknown 193
AHAM-21 Cooktop Electric resistance unknown unknown 196
AHAM-22 Cooktop Electric resistance unknown unknown 189
AHAM-23 Cooktop Electric resistance unknown unknown 198
AHAM-24 Cooktop Electric resistance unknown unknown 193
AHAM-25 Cooktop Induction unknown unknown 181
AHAM-26 Range Electric resistance 185 17 202

5-33
Test Unit AEC ETLP* IAEC**
Configuration Technology
ID (kWh/year) (kWh/year) (kWh/year)
AHAM-27 Range Electric resistance 185 17 202
AHAM-28 Range Electric resistance 187 13 200
AHAM-29 Range Electric resistance 183 6 189
AHAM-30 Range Electric resistance 181 10 191
AHAM-31 Range Electric resistance 192 3 195
AHAM-32 Range Electric resistance 192 26 218
AHAM-33 Range Electric resistance unknown unknown 203
AHAM-34 Range Electric resistance 206 0 206
AHAM-35 Range Electric resistance 200 17 217
AHAM-36 Range Electric resistance 219 4 223
AHAM-37 Range Electric resistance unknown unknown 208
AHAM-38 Range Electric resistance unknown unknown 192
AHAM-39 Range Electric resistance unknown unknown 181
AHAM-40 Range Electric resistance unknown unknown 193
AHAM-41 Range Electric resistance unknown unknown 198
AHAM-42 Range Electric resistance unknown unknown 197
AHAM-43 Range Electric resistance unknown unknown 182
AHAM-44 Range Electric resistance unknown unknown 193
AHAM-45 Range Electric resistance unknown unknown 192
AHAM-46 Range Induction unknown unknown 182
AHAM-47 Range Induction unknown unknown 236
AHAM-48 Range Induction unknown unknown 205
PG&E-1 Range Electric resistance 191 0 191
PG&E-2 Cooktop Induction 189 15 204
* For conventional ranges, the ETLP presented here represents the portion of the combined low-power mode energy
apportioned to the cooking top component of the combined cooking product, according to Appendix I1.
** IAEC may not equal the sum of AEC and ETLP presented in this table due to rounding.

Gas Cooking Tops

Table 5.5.9 and Table 5.5.10 present the test results for each gas cooking top unit in the
expanded test sample for non-entry-level and entry-level gas cooking tops, respectively.

5-34
Table 5.5.9 Test Results for Gas Cooking Tops in the Expanded Test Sample (Non-Entry-
Level*)
Test Unit AEC ETLP* IAEC**
Configuration
ID (kBtu/year) (kBtu/year) (kBtu/year)
DOE-1 Cooktop 1501 10 1511
DOE-2 Cooktop 1175 12 1187
DOE-3 Cooktop 1267 0 1267
DOE-4 Cooktop 1509 9 1517
DOE-5 Cooktop 1437 0 1437
DOE-6 Cooktop 1328 0 1328
DOE-7 Range 1321 35 1356
DOE-8 Range 1506 12 1518
DOE-9 Range 1423 36 1459
DOE-10 Range 1316 23 1339
DOE-11 Cooktop 1436 101 1537
DOE-12 Cooktop 1487 57 1543
DOE-13 Cooktop 1607 0 1607
DOE-14 Cooktop 1454 0 1454
DOE-15 Cooktop 1410 12 1422
DOE-16 Cooktop 1552 0 1552
DOE-17 Cooktop 1415 16 1430
DOE-18 Range 1572 34 1606
DOE-19 Range 1398 0 1398
DOE-20 Range 1387 6 1393
DOE-21 Range 1380 20 1400
AHAM-1 Cooktop 1320 10 1330
AHAM-2 Cooktop 1595 12 1607
AHAM-3 Cooktop 1420 10 1430
AHAM-4 Cooktop 1405 0 1405
AHAM-5 Cooktop 1437 0 1437
AHAM-6 Cooktop 1600 4 1604
AHAM-7 Cooktop 1669 25 1694
AHAM-8 Cooktop 1387 0 1387
AHAM-9 Cooktop 1322 6 1328
AHAM-10 Cooktop 1577 0 1577
AHAM-11 Cooktop 1408 0 1408
AHAM-12 Cooktop 1220 0 1220
AHAM-13 Cooktop 1223 0 1223
AHAM-14 Cooktop 1345 0 1345

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Test Unit AEC ETLP* IAEC**
Configuration
ID (kBtu/year) (kBtu/year) (kBtu/year)

AHAM-15 Range 1745 17 1762


AHAM-16 Range 1409 0 1409
AHAM-17 Range 1356 0 1356
AHAM-18 Range 1471 0 1471
AHAM-19 Range 1440 34 1474
AHAM-21 Range 1503 19 1522
AHAM-22 Range 1683 0 1683
AHAM-23 Range 1703 3 1706
AHAM-25 Range 1482 0 1482
AHAM-26 Range 1415 56 1471
AHAM-27 Range 1417 0 1417
AHAM-28 Range 1495 28 1523
AHAM-29 Range 1507 29 1536
AHAM-30 Range 1703 0 1703
PG&E-1 Cooktop 1874 † 17 1891
PG&E-2 Range 1507 23 1530
PG&E-3 Cooktop 1504 0 1504
PG&E-4 Range 1658 36 1694
PG&E-5 Range 1774 118 1892
PG&E-6 Cooktop 1283 12 1295
* A non-entry-level gas cooking top is one that has at least one HIR burner and continuous cast-iron grates.
** For conventional ranges, the ETLP presented here represents the portion of the combined low-power mode energy
apportioned to the cooking top component of the combined cooking product, according to Appendix I1.
*** IAEC may not equal the sum of AEC and ETLP presented in this table due to rounding.
† For unit PG&E-1, the AEC value reported by PG&E includes the energy of a downdraft fan that could not be
powered off during testing. DOE evaluated the test data and determined to the best of its ability the fan energy use
during the test and has subtracted that fan energy use from this table, consistent with the finalized approach in this
direct final rule for cooking tops with downdraft fans that cannot be powered off.

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Table 5.5.10 Test Results for Gas Cooking Tops in the Expanded Test Sample (Entry-
Level*)
Test Unit AEC ETLP* IAEC**
Configuration
ID (kBtu/year) (kBtu/year) (kBtu/year)
DOE-A Cooktop 983 0 983
DOE-B Cooktop 951 0 951
DOE-C Cooktop 1041 0 1041
AHAM- Range
1221 31 1252
20
AHAM- Range
1374 0 1374
24
PG&E-7 Cooktop 1156 0 1156
PG&E-8 Cooktop 1324 0 1324
PG&E-9 Range 1225 0 1225
* An entry-level gas cooking top is one that does not have at least one HIR burner and continuous cast-iron grates.
Entry-level gas cooking tops were not considered for defining efficiency levels.
** For conventional ranges, the ETLP presented here represents the portion of the combined low-power mode energy
apportioned to the cooking top component of the combined cooking product, according to Appendix I1.
*** IAEC may not equal the sum of AEC and ETLP presented in this table due to rounding.

The AEC for gas cooking tops in the expanded test sample varied from 1,175 to 1,874
kBtu/year for non-entry-level gas cooking tops and 951 to 1,374 kBtu/year for entry-level gas
cooking tops. The ETLP for gas cooking tops in the expanded test sample varied from 0 to 118
kBtu/year. The IAEC for gas cooking tops in the expanded test sample varied from 1,187 to
1,892 kBtu/year for non-entry-level gas cooking tops and 951 to 1,374 kBtu/year for entry-level
gas cooking tops.

As discussed, DOE set the baseline efficiency level equal to the sum of the least efficient
AEC value in the expanded test sample for units that have multiple HIR burners and continuous
cast-iron grates, consistent with the screening analysis developed in chapter 4 of this TSD
(PG&E Test Unit #1) and the average of the non-zero ETLP values measured in the expanded test
sample.

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Although these efficiency levels are expressed in terms of IAEC, it is useful to examine
how these identified levels relate to performance at a per-burner level to help illustrate the wide
range of burner styles that can be implemented in cooking tops that achieve each analyzed
efficiency level. By “backing out” from each IAEC value the number of annual cooking cycles
and representative water load mass as defined in Appendix I1, each IAEC value can be
associated with a corresponding average normalized gas energy consumption representative of
the Energy Test Cycle across all of the burners (i.e., a corresponding “average per-burner
efficiency” that represents the average of the energy used per g of water tested among all of the
burners on the cooking top). For each IAEC value analyzed, the average per-burner efficiency,
Eper-burner, in Btu/g is calculated as:
𝐸
𝐶𝐺𝐺
𝐸𝑝𝑒𝑟−𝑏𝑢𝑟𝑛𝑒𝑟 = 𝑟𝑒𝑓𝑒𝑟𝑒𝑛𝑐𝑒 , where
𝑙𝑜𝑎𝑑

𝐸𝐴𝐺𝑇
𝐸𝐶𝐺𝐺 = ;
𝐾 × 𝑁𝑐
reference load = 2,853 g; and

𝐸𝐴𝐺𝑇 = 𝐼𝐴𝐸𝐶 − 𝐸𝑇𝐿𝑃 ;


ETLP = 26 kBtu/year, the assumed ETLP for each gas cooking top efficiency level, equal to the
average of the non-zero ETLP values measured in the expanded test sample;
K = 0.001 kBtu/Btu, the conversion factor for Btu to kBtu; and
Nc = 418 cooking cycles per year.

Figure 5.5.1 presents individual per-burner normalized test energy consumption, as a


function of input rate for all gas burners in the expanded test sample, as compared with the
average per-burner efficiencies required for each efficiency level analyzed in this direct final
rule.

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Figure 5.5.1 Normalized Per-Burner Gas Energy Consumption versus Burner Input Rate

For both IEAC and the corresponding average per-burner efficiency, lower values are
indicative of higher-efficiency performance. As shown in Figure 5.5.1, a wide range of burner
styles can be implemented in gas cooking tops that achieve each analyzed efficiency level.
Specifically, gas burners meeting EL 1 span the whole range of tested burner input rates (3,900–
25,000 Btu/h). In other words, on a per-burner basis, EL 1 performance can be achieved using
any combination of low input, medium input, or high input rate burners. Burners meeting EL 2
span a wide (but slightly smaller) range of tested burner input rates (3,900–20,000 Btu/h).

In previous rulemakings, DOE considered sealed gas burners as a design option, but the
test data in Table 5.5.9 and Table 5.5.10 indicate that neither sealed burners nor open burners are
inherently more efficient than the other. The range of measured energy consumption for both
burner types in the expanded test sample overlap as shown in Figure 5.5.2.

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Figure 5.5.2 Normalized Per-Burner Gas Energy Consumption versus Input Rate by
Burner Type

5.5.3.2 Conventional Ovens

Each conventional oven in DOE’s test sample was evaluated according to the version of
the test procedure adopted in the July 2015 TP Final Rule. The IEAO for conventional ovens
included the energy of active cooking mode, EAO (including any self-cleaning operation); fan-
only mode, for built-in/slide-in ovens as applicable; and combined low-power mode, ETLP
(including standby mode and off mode).

Combined Low-Power Mode

Table 5.5.11 and Table 5.5.12 list the measured and apportioned ETLP consumption and
the power supply type for the conventional ovens in DOE’s test sample for which DOE was able
to ascertain the power supply type. DOE used the test procedure adopted in the December 2016
TP Final Rule to apportion 51% of the combined low-power mode energy of a conventional
range to the conventional oven component in this direct final rule. t

t
The percentage allocation to the conventional oven component of a conventional range is calculated as 219.9 ÷
(219.9+213.1) = 51%.

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Table 5.5.11 Combined Low-Power Mode Annual Energy of Standalone Ovens in the
DOE Test Sample
Combined Low-
Test Low-Power
Power Mode Power Supply
Unit Product Type Mode Power
Annual Energy Type
#* (W)
(kWh/year)
E3 Electric Self-Clean – Built-in/Slide-in 1.72 14.7 Linear
E4 Electric Standard – Built-in/Slide-in 0.53 4.5 SMPS
E5 Electric Self-Clean – Built-in/Slide-in 0.66 5.6 SMPS
E6 Electric Self-Clean – Built-in/Slide-in 0.84 7.2 SMPS
E7 Electric Self-Clean – Built-in/Slide-in** 1.61 13.7 SMPS
G5 Gas Self-Clean – Built-in/Slide-in 1.67 14.3 Linear
* Test unit numbers can be read as the first letter of the energy source of the oven, E for electric or G for gas
followed by the unit number as listed in Table 5.5.5 or Table 5.5.6, as applicable.
** This unit was a double oven having two separate cavities with equal volumes. The measured low-power mode
energy consumption for this product was apportioned equally between these two cavities for comparison to single
ovens.

Table 5.5.12 Combined Low-Power Mode Annual Energy of Combined Cooking Products
in the DOE Test Sample
Combined Low-Power
Low-Power Mode Energy
Test Power
Oven Product Type Mode Power Apportioned to Oven
Unit #* Supply Type
(W) Component
(kwh/year)
Ov-E1 Electric Self-Clean –
1.2 5.0 SMPS
Freestanding
Ov-E2 Electric Standard – Freestanding 1.2 5.2 Linear
Ckt-E2 Electric Standard – Freestanding 0.6 2.5 SMPS
Ckt-E10 Electric Self-Clean –
2.0 8.6 SMPS
Freestanding
Ckt-E11 Electric Self-Clean –
0.7 2.8 SMPS
Freestanding
Ckt-E12 Electric Self-Clean – Built-
5.0 21.4 SMPS
in/Slide-in
Ckt-E13 Electric Self-Clean – Built-
2.7 11.6 SMPS
in/Slide-in
Ckt-E20 Electric Self-Clean – Built-
1.2 5.2 SMPS
in/Slide-in
Ckt-E21 Electric Self-Clean –
2.1 8.7 SMPS
Freestanding
Ckt-E22 Electric Self-Clean – Built-
9.3 39.1 SMPS
in/Slide-in
Ov-G3 Gas Self-Clean – Freestanding 1.6 6.8 Linear
Ov-G4 Gas Standard – Freestanding 2.1 9.1 Linear
Ov-G8 Gas Standard – Freestanding 0.8 3.3 Linear
Ckt-G11 Gas Self-Clean – Freestanding 0.7 2.9 SMPS

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Combined Low-Power
Low-Power Mode Energy
Test Power
Oven Product Type Mode Power Apportioned to Oven
Unit #* Supply Type
(W) Component
(kwh/year)
Ckt-G12 Gas Self-Clean – Freestanding 2.1 8.8 SMPS
Ckt-G13 Gas Self-Clean – Built-in/Slide-
1.4 5.7 SMPS
in
Ckt-G21 Gas Self-Clean – Built-in/Slide-
2.0 8.5 Linear
in
Ckt-G24 Gas Self-Clean – Built-in/Slide-
1.2 4.9 SMPS
in
* Test unit numbers starting with “Ov” were tested as part of the oven test sample and can be read as the first letter
of the energy source of the oven, E for electric or G for gas followed by the unit number as listed in Table 5.5.5 or
Table 5.5.6, as applicable. Test unit numbers starting with “Ckt” were tested as part of the DOE cooking top test
sample and can be read as the first letter of the energy source of the oven, E for electric or G for gas followed by the
unit number as listed in Table 5.5.1 or Table 5.5.2, as applicable.

For conventional ovens, as noted in section 5.3.2.3 of this TSD, DOE set baseline ETLP
consumption for conventional ovens equal to that of the range equipped with a linear power
supply with the highest ETLP consumption in the test sample in order to maintain the full
functionality of controls for consumer utility.

Fan-only Mode

Table 5.5.13 presents the fan-only mode testing results for built-in/slide-in ovens in
DOE’s test sample. DOE separated freestanding ovens and built-in/slide-in ovens into different
product types, as noted in section 5.3.2.1 of this TSD, because built-in/slide-in ovens consume
energy during fan-only mode to exhaust air from the oven cavity to meet safety-related
temperature requirements, since the oven is enclosed in cabinetry.

Table 5.5.13 Fan-only Mode Energy of Conventional Ovens in the DOE Test Sample
Test Fan-Only Mode Fan-Only Mode
Unit Oven Product Type Energy Use Duration
#* (Wh/cycle) (minutes)
E3 Electric Self-Clean – Built-in/Slide-in 2 6.7
E4 Electric Standard – Built-in/Slide-in 32 69
E5 Electric Self-Clean – Built-in/Slide-in 32 69
E6 Electric Self-Clean – Built-in/Slide-in 31 67
E7 Electric Self-Clean – Built-in/Slide-in 30 41
G5 Gas Self-Clean – Built-in/Slide-in 1 4.5
G7 Gas Standard – Built-in/Slide-in 16 31
* Test unit numbers can be read as the first letter of the energy source of the oven, E for electric or G for gas
followed by the unit number as listed in Table 5.5.5 or Table 5.5.6, as applicable.

The fan-only mode energy ranged from 1 to 32 Wh/cycle and the fan was on for a
duration between 4.5 and 69 minutes.

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For conventional ovens, as noted in section 5.3.2.3 of this TSD, DOE set fan-only mode
energy consumption for conventional slide-in/built-in ovens equal to the maximum fan energy
per cycle measured in DOE’s test sample. For the purposes of calculating annual combined low-
power mode hours, DOE set fan-only mode duration for conventional slide-in/built-in ovens
equal to the maximum duration measured in DOE’s test sample.

Active Cooking Mode

Table 5.5.14 presents the active cooking mode testing results for electric ovens in DOE’s
test sample. Because conventional oven cooking efficiency and energy consumption depend on
cavity volume, DOE also normalized IEAO using the relationship between energy consumption
and cavity volume discussed in section 5.5.4 of this TSD to allow for more direct comparison
between units in the test sample.

Table 5.5.14 Annual Energy Consumption of Electric Ovens in the DOE Test Sample
Test Cavity Measured Normalized
EAO
Unit Oven Product Type Volume IEAO† IEAO††
(kWh/year)
# (ft3) (kWh/year) (kWh/year)
1 Electric Self-Clean – Freestanding 5.9* 256.3 266.2 200.7
2 Electric Standard – Freestanding 2.4 203.4 213.6 309.6
3 Electric Self-Clean – Built-in/Slide-in 2.7 143.7 158.7 241.6
4 Electric Standard – Built-in/Slide-in 4.3 276.2 287.7 300.5
5 Electric Self-Clean – Built-in/Slide-in 4.3 296.7 308.8 320.5
6 Electric Self-Clean – Built-in/Slide-in 4.3 328.3 341.8 352.1
7 Electric Self-Clean – Built-in/Slide-in 4.3** 336.6 370.0 360.5
* Test Unit 1 was equipped with an oven separator that allowed for splitting the single cavity into two separate
smaller cavities with volumes of 2.7 ft3 and 3.0 ft3. In accordance with the test procedure adopted in the July 2015
TP Final Rule, the measured energy consumption for each of the three oven cavity configurations (full cavity
without the separator, top cavity with the separator, and bottom cavity with the separator) were averaged together to
determine the energy consumption for the unit.
** Test Unit 7 was a double oven having two separate cavities with equal volumes of 4.3 ft 3. In accordance with the
test procedure adopted in the July 2015 TP Final Rule, the measured energy consumption for these two cavities were
averaged together to determine the energy consumption for the unit.
† Measured IEAO includes measured EAO plus measured ETLP plus any measured fan-only mode energy.
†† Measured IEAO includes measured EAO plus baseline ETLP plus, for built-in/slide-in ovens the maximum fan-only
mode energy from the test sample. This sum is then normalized to a fixed cavity volume of 4.3 ft3.

The normalized IEAO for electric ovens ranged from 301 to 310 kWh/year for standard
ovens and 201 to 361 kWh/year for self-clean ovens.

Table 5.5.15 presents the testing results for gas ovens in DOE’s test sample. As with
electric ovens, DOE normalized IEAO using the energy consumption versus cavity volume
relationship discussed in section 5.5.4 of this TSD for comparison between units of differing
cavity volumes.

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Table 5.5.15 Annual Energy Consumption of Gas Ovens in the DOE Test Sample
Test Cavity Measured Normalized
EAO
Unit Oven Product Type Volume IEAO* IEAO**
(kBtu/year)
# (ft3) (kBtu/year) (kBtu/year)
1 Gas Standard – Freestanding 4.8 1,341 1,341 1,289
2 Gas Standard – Freestanding 4.8 1,489 1,489 1,437
3 Gas Self-Clean - Freestanding 5.0 1,358 1,403 1,260
4 Gas Standard – Freestanding 4.4 1,440 1,501 1,480
5 Gas Self-Clean – Built-in/Slide-in 2.8 1,110 1,160 1,536
6 Gas Standard – Freestanding 5.3 2,050 2,061 1,883
7 Gas Standard – Built-in/Slide-in 4.4 1,720 1,923 1,778
8 Gas Standard – Freestanding 5.4 2,274 2,297 2,085
* Measured IEAO includes measured EAO plus measured ETLP plus any measured fan-only mode energy.
** Measured IEAO includes measured EAO plus baseline ETLP plus, for built-in/slide-in ovens the maximum fan-only
mode energy from the test sample. This sum is then normalized to a fixed cavity volume of 4.3 ft 3.

The normalized IEAO for gas ovens ranged from 1,260 to 2,085 kBtu/year.

5.5.4 Conventional Oven Energy Use versus Cavity Volume

The conventional oven efficiency levels detailed in the previous sections are predicated
upon ovens with a cavity volume of 4.3 ft3. Based on DOE’s testing of gas and electric ovens and
discussions with manufacturers, IEAO scales with oven cavity volume due to the fact that larger
ovens have higher thermal masses and larger volumes of air (including larger vent rates) than
smaller ovens. Because the test procedure adopted in the July 2015 TP Final Rule used a fixed
test load size to measure IEAO, larger ovens with higher thermal mass will have a higher
measured IEAO. As a result, DOE characterized the relationship between IEAO and oven cavity
volume for each product type, using available data.

DOE determined the slope of the baseline curves by first reviewing data from the
previous rulemaking analysis as presented in the 2009 TSD, which presented a relationship
between measured EF and cavity volume for each product type. These relationships continue to
be relevant based on DOE’s testing described in the previous sections. Because DOE is using
IEAO to determine the estimated energy use of incremental efficiency levels in this direct final
rule, DOE translated the baseline EF determined using the 2009 TSD relationship to baseline
IEAO by assuming a baseline ETLP. DOE plotted baseline IEAO versus cavity volume for each
analyzed product type and compared it to the measured test data discussed in section 5.5.3.2 of
this TSD, as shown in Figure 5.5.3 through Figure 5.5.6.

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Figure 5.5.3 Electric Standard Oven IEAO vs. Cavity Volume Slope

Figure 5.5.4 Electric Self-Clean Oven IEAO vs. Cavity Volume Slope

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Figure 5.5.5 Gas Standard Oven IEAO vs. Cavity Volume Slope

Figure 5.5.6 Gas Self-Clean Oven IEAO vs. Cavity Volume Slope

Although the relationship between IEAO and cavity volume derived using the 2009 slope
was not linear, DOE notes that the Canadian and European Union energy conservation standards
(as discussed in section 3.7 of this TSD) use a linear relationship between energy consumption
and cavity volume, indicating that a linear fit is appropriate. DOE performed a linear curve fit on

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the IEAO data evaluated for discrete cavity volumes that were considered to represent the range of
cavity volumes available on the market. The resulting IEAO versus cavity volume equations were
used to establish the baseline slope for each analyzed product type. DOE notes that for the
electric oven product class, the conversion to IEAO initially resulted in different slopes for the
standard and self-clean product types. After expanding the dataset used to establish baseline
energy consumption for electric standard ovens, as described in section 5.3.2.3 of this TSD, to
include a wider range of cavity volumes, DOE modified the slope for electric standard ovens so
that it was representative of the augmented dataset and was consistent with the slope used for
electric self-clean ovens. If necessary, the baseline intercepts were adjusted so that none of the
conventional ovens in the DOE test sample were cut off by the baseline curve, as discussed in
section 5.3.2.3 of this TSD.

As noted above, baseline built-in/slide-in conventional ovens consume more energy than
freestanding ovens. DOE offset the baseline intercepts for each built-in oven product type by
adding the maximum fan-only mode energy consumption measured in the test sample to the
baseline intercept for the corresponding freestanding oven product type. DOE then shifted the
intercept for the built-in product type so that none of the resulting data were cut off by the built-
in curve.

Table 5.5.16 and Table 5.5.17 present the slopes and intercepts of the IEAO versus cavity
volume relationship for each analyzed product type of electric and gas oven respectively, at each
efficiency level.

Table 5.5.16 Slopes and Intercepts of Electric Oven IEAO versus Cavity Volume
Relationship
Standard Electric Ovens Self-Clean Electric Ovens
Slope = 46.3 Slope = 46.3
Level
Freestanding Built-in / Slide-in Freestanding Built-in / Slide-in
Intercepts Intercepts Intercepts Intercepts
Baseline 115.8 122.3 155.5 161.5
1 103.1 109.9 142.8 149.2
2 90.1 97.0 129.8 136.2
3 36.3 43.2 76.1 82.5

Table 5.5.17 Slopes and Intercepts of Gas Oven IEAO versus Cavity Volume Relationship
Standard Gas Ovens Self-Clean Gas Ovens
Slope = 229.5 Slope = 229.5
Level
Freestanding Built-in / Slide-in Freestanding Built-in / Slide-in
Intercepts Intercepts Intercepts Intercepts
Baseline 1,098 1,117 971 993
1 1,054 1,075 928 950
2 921 942 795 817

5.5.5 Product Teardowns

In addition to conducting the investigative testing described in the previous section, DOE
conducted teardowns on a subset of its test units. The test units spanned the range of product

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efficiencies and features available on the market from multiple manufacturers. DOE relied on the
teardowns to supplement the information gained through manufacturer interviews and to
investigate performance observed during testing. Specifically, the teardowns allowed DOE to
identify design features for improving efficiency and to develop corresponding manufacturing
costs for products at different efficiency levels.

DOE also conducted catalog teardowns of PCBs to determine the controls design
approaches (specifically the types of power supplies) used by the products in its test sample.

5.5.5.1 Baseline Construction

Baseline Electric Cooking Tops – Smooth Elements

Baseline electric smooth element cooking tops had a glass ceramic cooking top surface
that shields the heating elements. Baseline electric smooth element cooking tops were also
equipped with electronic controls and used a layer of insulation in the cooking top enclosure to
help protect against overheating. Each electric resistance heating element consisted of a metallic
ribbon encased in a dense insulation material located flush against the glass ceramic surface. The
heating elements in DOE’s sample had a variety of diameters. A temperature sensor was also
located in the center of each heating element to protect from overheating and to provide
temperature feedback to the controls. The cooking zone would cycle on and off based on the
desired temperature and input power of the heating element. The heating element assemblies
were determined to be a purchased component.

Baseline Gas Cooking Tops

Baseline gas cooking tops in the DOE teardown sample had continuous cast-iron grates.
Each baseline gas cooking top was enclosed on the bottom and sides by a single sheet metal box.
The top of the cooking top enclosure was a separate stamped piece of sheet metal with cutouts
for each burner.

Baseline gas cooking tops typically include four to six burners, which may be of either
open or sealed type for a given cooking top. Open burner assemblies consisted of a steel cylinder
with openings arranged for adequate gas flow and combustion. Aluminum tubes extended from
each burner and connected to the main gas tube to deliver gas to the burners. For every pair of
open burners on the cooking top, a single electronic spark electrode was used to ignite gas
flowing to each burner.

Sealed burner assemblies had removable ceramic burner caps to protect against spills,
and a main burner body consisting of one or two cast aluminum pieces. The burner body was
fixed mechanically to the top of the cooking top enclosure. A brass orifice fitted in the center of
the burner body connected to an aluminum tube leading to the main gas tube. Gas cooking tops
with sealed burners had one electronic spark electrode mounted on the body of each burner.

The electronic spark electrodes for both burner types were controlled by a spark module
that connected to the mechanically controlled rotary spark switches and gas valves attached to
the main gas tube. The main gas tube extended outside of the cooking top enclosure and was

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fitted with a gas pressure regulator which could be connected to a natural gas or propane hookup.
As with electric cooking tops, DOE observed that many of the key components in each gas
cooking top, including the burner assemblies, were purchased parts.

Baseline Electric Ovens

The interior surface of the oven cavity for the electric ovens in DOE’s teardown sample
had a porcelain enamel coating for durability and cleanability. Accessories such as a light to
illuminate the food load without having to open the oven door and a temperature sensor for
control of cooking processes were also located within the cavity. The metal pieces making up the
cavity walls were formed by stamping and had grooves to support oven racks. The back of the
cavity was typically its own metal piece mechanically sealed to the top, bottom, and sides, which
were composed of a single wrapped piece of sheet metal. Cavity construction did vary slightly by
manufacturer. Baseline electric ovens were typically equipped with two to three oven racks made
of enamel-coated steel rods.

The outside of the oven cavity was wrapped with insulation, and DOE observed that the
space between the cavity and the outer sheet metal enclosure was made as small as practically
possible in order to maximize the cavity volume. As discussed in previous sections, built-
in/slide-in ovens had an added fan, motor, and vent assembly to provide cooling.

The radiant heating elements performing the bake function were situated at the bottom of
the oven cavity and were made up of a composite metal rod.

All of the baseline electric ovens examined had a door attached by two hinges at the
bottom of the oven cavity opening. The oven door had an interior enamel-coated panel, a dual-
pane glass window surrounded by insulation, and an exterior panel typically consisting of
ceramic glass or sheet metal. For standard electric ovens, baseline products had a silicone rubber
gasket lining the perimeter of the cavity opening, but for self-clean electric ovens, even baseline
products had a fiberglass door seal lined with a metallic mesh.

DOE observed that baseline electric ovens featured electronic controls in which the user
interface and clock display comprised a push-button control panel with a liquid crystal display
(LCD) or light-emitting diode (LED) display.

Baseline Gas Ovens

The baseline gas oven cavities examined by DOE were similar in construction to those
for baseline electric ovens. Accessories, insulation, and door seals were also made of the same
materials. The primary difference in construction between baseline electric and gas ovens
observed by DOE was that the bake and broil heating components were gas burners. The bake
burner was shielded by a baffle to help distribute heat evenly but was also shielded by the cavity
base, which partially concealed the burner to prevent damage from food spills. Broil burners
were sometimes located at the top of the oven cavity, but for many baseline gas ovens, a drawer
was added below the main cavity so that the same bake burner could be employed for broiling. In
baseline gas ovens, DOE observed that the bake burner was ignited with a glo-bar, or hot-surface
igniter. A bi-metallic gas valve in electrical series with the igniter deformed as current in the

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circuit increased, allowing gas to flow as long as the hot surface igniter was energized by the
burner controller.

DOE observed that some gas ovens in its test sample incorporated additional air channels
between the exterior oven shell and the layer of insulation around the interior cavity to provide
an added layer of insulation, keeping the outer sheet metal enclosure within a safe temperature
range.

DOE also noted that combustion products from the burner and gases released in the
interior cavity during the cooking process were vented from the top of the cavity through a sheet
metal air channel using natural convection.

DOE observed that baseline gas ovens had either electromechanical controls or electronic
controls, although the self-cleaning function required electronic controls and a door locking
mechanism.

5.5.5.2 Cost Estimates

DOE developed manufacturer cost estimates based on the method outlined in section
5.4.5 of this TSD for the models considered in this teardown sample.

Baseline Cost Estimates

DOE developed baseline MPCs for each conventional cooking product class and for each
analyzed product type of conventional oven that are outlined in Table 5.5.18 and Table 5.5.19.
All costs presented are in 2022 dollars. DOE notes that the estimated baseline MPCs are
equivalent for standalone cooking tops and the corresponding cooking top component of
combined cooking products because none of the considered design options would be
implemented differently as a function of installation configuration.

Table 5.5.18 Baseline Manufacturer Production Costs for all Conventional Cooking Top
Product Classes
Baseline MPC
Product Class
(2022$)
Electric Smooth Element Standalone Cooking Top $232.32
Electric Smooth Element Cooking Top Component of a Combined Cooking
$232.32
Product
Gas Standalone Cooking Top $137.58
Gas Cooking Top Component of a Combined Cooking Product $137.58

5-50
Table 5.5.19 Baseline Manufacturer Production Costs for all Conventional Oven Product
Types
Baseline MPC
Product Class Analyzed Product Type
(2022$)
Standard – Freestanding $305.89
Standard – Built-in/Slide-in $323.27
Electric Ovens
Self-Clean – Freestanding $335.39
Self-Clean – Built-in/Slide-in $352.77
Standard – Freestanding $326.47
Standard – Built-in/Slide-in $343.85
Gas Ovens
Self-Clean – Freestanding $417.88
Self-Clean – Built-in/Slide-in $435.26

Incremental Cost Estimates

Based on the analyses discussed above, DOE developed the cost-efficiency results for
each product class shown in Table 5.5.20 through Table 5.5.23. Where available, DOE
developed incremental MPCs based on manufacturing cost modeling of units in its sample
featuring the design options. DOE notes that the estimated incremental MPCs are equivalent for
standalone cooking tops and the corresponding cooking top component of combined cooking
products because none of the considered design options would be implemented differently as a
function of installation configuration. DOE further notes that the estimated incremental MPCs
are equivalent for all analyzed product types within each conventional oven product class
because none of the considered design options would be implemented differently as a function of
installation configuration or self-clean functionality.

Table 5.5.20 Electric Smooth Element Cooking Top Incremental Manufacturer


Production Costs
Incremental
IAEC
Level MPC
(kWh/year)
(2022$)
1 207 $1.99
2 189 $15.82
3 179 $251.34

Table 5.5.21 Gas Cooking Top Incremental Manufacturer Production Costs


IAEC Incremental MPC
Level
(kBtu/year) (2022$)
1 1,770 $2.67
2 1,343 $18.72

Table 5.5.22 Electric Oven Incremental Manufacturer Production Costs


Incremental MPC
Level Design Option
(2022$)
1 Baseline + SMPS $1.99
2 1 + Convection mode capability $36.70
3 2 + Oven separator $71.89

5-51
Table 5.5.23 Gas Oven Incremental Manufacturer Production Costs
Incremental MPC
Level Design Option
(2022$)
1 Baseline + SMPS $1.99
2 1 + Convection mode capability $26.23

5-52
CHAPTER 6. MARKUPS ANALYSIS

TABLE OF CONTENTS

6.1 INTRODUCTION ........................................................................................................... 6-1


6.1.1 Distribution Channels ...................................................................................................... 6-1
6.2 MANUFACTURER MARKUP ...................................................................................... 6-2
6.3 RETAILER MARKUPS .................................................................................................. 6-2
6.3.1 Approach for Retailer Markups ....................................................................................... 6-3
6.3.2 Derivation of Retailer Markups ....................................................................................... 6-5
6.4 SALES TAXES ............................................................................................................... 6-7
6.5 SUMMARY OF MARKUPS .......................................................................................... 6-7
REFERENCES ............................................................................................................................ 6-9

LIST OF TABLES

Table 6.3.1 Competitive Environment of Appliance Retailers ............................................... 6-3


Table 6.3.2 Data for Baseline Markup Calculation: Electronics and Appliance Stores ......... 6-5
Table 6.3.3 Data for Incremental Markup Calculation: Electronics and Appliance
Stores.................................................................................................................... 6-6
Table 6.4.1 Average Sales Tax Rates by RECS Region ......................................................... 6-7
Table 6.5.1 Summary of Markups .......................................................................................... 6-8

LIST OF FIGURES

Figure 6.1.1 Distribution Channel for Consumer Conventional Cooking Products ................ 6-2

6-i
CHAPTER 6. MARKUPS ANALYSIS

6.1 INTRODUCTION
To carry out its analyses, the U.S. Department of Energy (DOE) needed to determine the
cost to the consumer of both baseline products (i.e., products not subject to newly amended
energy conservation standards) and more efficient products. DOE calculated such costs based on
engineering estimates of manufacturing production costs, a manufacturer markup to calculate the
manufacturer sales price (i.e., the price to the manufacturer’s first customer), and appropriate
additional markups for the various distribution channels to move the product to consumers.

The total markups applied to all product classes differ by their corresponding distribution
channel, as discussed below. DOE adopts a total firm approach to markups, consistent with
economic theory, rather than a product level cost accounting approach. In the economics based
approach, the firm is assumed to produce a single product, so marginal costs include total costs
for the firm rather than cost of goods inventoried and produced. The markup in this treatment
depends on marginal cost, not average cost as is the case in cost accounting. These distinctions
should be kept in mind when considering the results presented. At each point in a distribution
channel, companies mark up the price of a product to cover costs. In financial statements, gross
margin in dollar value (GM) is the difference between the company revenue and the company
cost of sales, or CGS. The GM takes account of the expenses of companies, including various
operating costs; research and development (R&D); interest expenses; depreciation; and taxes—
and company profits. To cover costs and to contribute positively to company cash flow, the price
of products must include a markup. Products command lower or higher markups depending on
company expenses associated with the product and the degree of market competition.

DOE estimates a baseline markup and an incremental markup for each market participant
besides manufacturers. DOE defines a baseline markup as a multiplier that converts the
manufacturer selling price (MSP) of equipment with baseline efficiency to the consumer
purchase price. An incremental markup is defined as the multiplier to convert the incremental
increase in manufacturer selling price of higher efficiency equipment to the consumer purchase
price. Because companies mark up the price at each point in the distribution channel, both
overall baseline and incremental markups are dependent on the distribution channel, as described
in section 6.1.1.

6.1.1 Distribution Channels


The appropriate markups for determining consumer product prices depend on the type of
distribution channels through which products move from manufacturers to consumers. At each
point in the distribution channel, companies mark up the price of the product to cover costs.

DOE based the distribution channel on data from the Association of Home Appliance
Manufacturers (AHAM).1 AHAM estimates that 93 percent of consumer conventional cooking
products are sold to retail outlets by manufacturers, and then purchased by consumers from retail
outlets, as shown in Figure 6.1.1 .

6-1
Manufacturer Retailer Consumer

Figure 6.1.1 Distribution Channel for Consumer Conventional Cooking Products

6.2 MANUFACTURER MARKUP


DOE uses the manufacturer markups to convert manufacturer production costs to
manufacturer selling prices. The manufacturer markup covers all manufacturer non-production
costs (e.g., SG&A, R&D, and interest) and profit.

DOE relied on publicly available financial data to estimate an industry-average


manufacturer markup. See chapter 12 for more information on the manufacturer markup.

6.3 RETAILER MARKUPS


A change in energy efficiency standards usually increases the manufacturer selling price
that retailers pay. In the past, DOE used the same markups as for baseline products to estimate
the product price of more efficient products. Applying a fixed markup on higher manufacturer
selling price would imply an increase in the dollar margin earned by retailers, and an increase in
per-unit profit.
Based on microeconomic theory, the degree to which firms can pass along a cost increase
depends on the level of market competition, as well as the market structure on both the supply
and demand sides (e.g., supply and demand elasticity). DOE examined industry data from
IBISWorld and the results suggest that the industry groups involved in appliance retail exhibit a
fair degree of competition (see Table 6.3.1).2 In addition, consumer demand for household
appliances is relatively inelastic (i.e., demand is not expected to decrease substantially with an
increase in the price of product). Under relatively competitive markets, it may be tenable for
retailers to maintain a fixed markup for a short period of time after an input price increase, but
the market competition should eventually force them to readjust their markups to reach a
medium-term equilibrium in which per-unit profit is relatively unchanged before and after
standards are implemented.

6-2
Table 6.3.1 Competitive Environment of Appliance Retailers
Industry
Sector Competition Barriers to Entry
Concentration
High and
Consumer electronics stores Low Moderate and steady
increasing
High and
Department stores High Moderate and steady
increasing
Moderate and
Home improvement stores High Moderate and steady
steady
* Note that there is competition between the three types of appliance retailers listed in this table, as well as within
each individual retailing type.

Thus, DOE concluded that applying fixed markups for both baseline products and higher-
priced products meeting a standard is not viable in the medium to long term considering the
competitive nature of the appliance retail industry. DOE developed the incremental markup
approach based on the widely accepted economic view that firms are not able to sustain a
persistently higher dollar margin in a competitive market in the medium term. If the price of the
product increases under standards, the only way to maintain the same dollar margin as before is
for the markup (and percent gross margin) to decline.
To estimate the markup under standards, DOE derived an incremental markup that is
applied to the incremental product costs of higher efficiency products. The overall markup on the
products meeting standards is an average of the markup on the component of the cost that is
equal to the baseline product and the markup on the incremental cost, weighted by the share of
each in the total cost of the standards-compliant product.
DOE’s incremental markup approach allows the part of the cost that is thought to be
affected by the standard to scale with the change in manufacturer price. The income statements
DOE used to develop retailer markups itemize firm costs into a number of expense categories,
including direct costs to purchase or install the product, labor and occupancy costs, and other
operating costs and profit. Although retailers tend to handle multiple commodity lines, DOE
contends that these aggregated data provide the most accurate available indication of the cost
structure of distribution channel participants.
DOE uses these income statements to divide firm costs between those that are not likely
to scale with the manufacturer price of product (labor and occupancy expenses, or “invariant”
costs) and those that are (operating expenses and profit, or “variant” costs). For example, when
the manufacturer selling price of product increases, only a fraction of a wholesaler’s expenses
increase (operating expenses and profit), while the remainder can be expected to stay relatively
constant (labor and occupancy expenses). If the unit price of a cooking product increases by 20
percent under standards, it is unlikely that the cost of secretarial support in an administrative
office or office rental expenses will increase proportionally.

6.3.1 Approach for Retailer Markups


DOE based the retailer markups for consumer conventional cooking products on financial
data for electronics and appliance stores from the 2017 U.S. Census Annual Retail Trade Survey

6-3
(ARTS)3, which is the most recent survey that includes industry-wide detailed operating
expenses for that economic sector. DOE organized the financial data into statements that break
down cost components incurred by firms in the sector. DOE assumes that the income statements
faithfully represent the various average costs incurred by firms selling home appliances.
Although electronics and appliance stores handle multiple commodity lines, the data provide the
best available indication of expenses incurred during the sale of consumer conventional cooking
products.

The baseline markup transforms the manufacturer sales price of baseline products to the
retailer sales price. DOE considers baseline models to be products sold under current market
conditions (i.e., without new energy conservation standards). DOE used the following equation
to calculate an average baseline markup (MUBASE) for retailers.

𝐶𝐺𝑆𝑅𝑇𝐿 + 𝐺𝑀𝑅𝑇𝐿
𝑀𝑈𝐵𝐴𝑆𝐸 =
𝐶𝐺𝑆𝑅𝑇𝐿
Eq. 6.1

Where:

MUBASE = retailer’s baseline markup,


CGSRTL = retailer’s cost of goods sold (CGS), and
GMRTL = retailer’s gross margin (GM).

To estimate incremental retailer markups, DOE divides retailers’ operating expenses into
two categories: (1) those that do not change when CGS increases due to amended efficiency
standards (“fixed”), and (2) those that increase proportionately with CGS (“variable”). DOE
defines labor and occupancy expenses as fixed costs, because these costs are not likely to
increase as a result of a rise in CGS due to amended efficiency standards. All other expenses, as
well as the net profit, are assumed to vary in proportion to CGS. Although it is possible that
some of the other expenses may not scale with CGS, DOE is inclined to take a more conservative
position and include these as variable costs. (Note: Under DOE’s approach, a high fixed cost
component yields a low incremental markup.)

DOE calculated the incremental markup (MUINCR) for retailers using the following
equation:

𝐶𝐺𝑆𝑅𝑇𝐿 + 𝑉𝐶𝑅𝑇𝐿
𝑀𝑈𝐼𝑁𝐶𝑅 =
𝐶𝐺𝑆𝑅𝑇𝐿
Eq. 6.2
where:

MUINCR = incremental retailer markup,


CGSRTL = retailer’s cost of goods sold, and
VCRTL = retailer’s variable costs.

6-4
6.3.2 Derivation of Retailer Markups
The 2017 ARTS data for electronics and appliance stores provide total sales data and
detailed operating expenses that are most relevant to consumer conventional cooking product
retailers. To construct a complete data set for estimating markups, DOE needed to estimate CGS
and GM. The most recent 2017 ARTS publishes a separate document containing historical sales
and gross margin for household appliance stores. DOE took the GM as a percent of sales
reported for 2017 and combined that percent with detailed operating expenses data from 2017
ARTS to construct a complete income statement for electronics and appliance stores to estimate
both baseline and incremental markups. Table 6.3.2 shows the calculation of the baseline retailer
markup.

Table 6.3.2 Data for Baseline Markup Calculation: Electronics and Appliance Stores
Kind of Business Item Amount ($1,000,000)
Sales 99,401
Cost of Goods Sold (CGS) 66,897
Gross Margin (GM) 32,504
Baseline Markup = (CGS+GM)/CGS 1.49
Source: U.S. Census, 2017 Annual Retail Trade Survey

Table 6.3.3 shows the breakdown of operating expenses using the 2017 ARTS data. The
incremental markup is calculated as 1.24.

6-5
Table 6.3.3 Data for Incremental Markup Calculation: Electronics and Appliance Stores
Amount
($1,000,000)
Sales 99,401
Cost of Goods Sold (CGS) 66,897
Gross Margin (GM) 32,504
Labor & Occupancy Expenses (“Fixed”)
Annual payroll 10,226
employer costs for fringe benefit 1,574
Contract labor costs including temporary help 157
Purchased utilities, total 459
Purchased Repairs and Maintenance to Buildings, Structures, and Offices 266
Cost of purchased professional and technical services 743
Purchased communication services 290
Lease and Rental Payments for Land, Buildings, Structures, Store Space, and Offices 2,686
Subtotal: 16,401
Other Operating Expenses & Profit (“Variable”)
Expensed equipment 87
Cost of purchased packaging and containers 51
Other materials and supplies not for resale 387
Cost of purchased transportation, shipping and warehousing services 471
Cost of purchased advertising and promotional services 1,392
Cost of purchased software 93
Purchased Repairs and Maintenance to Machinery and Equipment 118
Lease and Rental Payments for Machinery, Equipment, and Other Tangible Items 89
Cost of data processing and other purchased computer services 66
Commission expenses 235
Depreciation and amortization charges 1,019
Taxes and license fees (mostly income taxes) 382
Other operating expenses 2,312
Net profit before tax (Operating profit) 9,401
Subtotal: 16,103
Incremental Markup = (CGS+Total Other Operating Expenses and Profit)/CGS 1.24
Source: U.S. Census, 2017 Annual Retail Trade Survey

6-6
6.4 SALES TAXES
The sales tax represents state and local sales taxes that are applied to the consumer
product price. The sales tax is a multiplicative factor that increases the consumer product price.
DOE used state and local tax data provided by the Sales Tax Clearinghouse.4 DOE then derived
population-weighted average tax values for each RECS region, as shown in Table 6.4.1. Detailed
state-level sales taxes can be found in Appendix 6A.

Table 6.4.1 Average Sales Tax Rates by RECS Region


RECS State(s) Tax Rate (%)
Region
1 New England 5.60
2 Middle Atlantic 7.38
3 East North Central 7.09
4 West North Central 7.23
5 South Atlantic 6.64
6 East South Central 8.13
7 West South Central 8.29
8 Mountain North 5.98
9 Mountain South 7.49
10 Pacific 7.99
Population-weighted average 7.31

6.5 SUMMARY OF MARKUPS


The overall markup is the product of the manufacturer and retailer markups, as well as
sales taxes. DOE used the overall baseline markup to estimate the consumer product price of
baseline models, given the manufacturer cost of the baseline models. As stated above, DOE
considers baseline models to be product sold under existing market conditions (i.e., without new
energy efficiency standards). The following equation shows how DOE applied the overall
baseline markup to determine the product price for baseline models.

EQPBASE = COSTMFG  (MU MFG  MU BASE  TaxSALES ) = COSTMFG  MU OVERALL_ BASE

where:

EQPBASE = Consumer product price for baseline models,


COSTMFG = Manufacturer cost for baseline models,
MUMFG = Manufacturer markup,
MUBASE = Baseline retailer markup,
TaxSALES = Sales tax, and
MUOVERALL_BASE = Baseline overall markup (product of manufacturer markup, baseline
retailer markup, and sales tax).

6-7
Similarly, DOE used the overall incremental markup to estimate changes in the consumer
product price, given changes in the manufacturer cost above the baseline model cost resulting
from a standard to raise product efficiency. The total consumer product price for higher-
efficiency models is composed of two components: the consumer product price of the baseline
model and the change in consumer product price associated with the increase in manufacturer
cost to meet the new efficiency standard. The following equation shows how DOE used the
overall incremental markup to determine the consumer product price for higher-efficiency
models (i.e., models meeting new efficiency standards).

EQPSTD = COSTMFG  MU OVERALL_ BASE + COSTMFG  (MU MFG  MU INCR  TaxSALES )


= EQPBASE + COSTMFG  MU OVERALL_ INCR

where:

EQPSTD = Consumer product price for models meeting new efficiency standards,
EQPBASE = Consumer product price for baseline models,
COSTMFG = Manufacturer cost for baseline models,
ΔCOSTMFG = Change in manufacturer cost for higher-efficiency models,
MUMFG = Manufacturer markup,
MUINCR = Incremental retailer markup,
TaxSALES = Sales tax,
MUOVERALL_BASE = Baseline overall markup (product of manufacturer markup, baseline
retailer markup, and sales tax), and
MUOVERALL_INCR = Incremental overall markup (product of manufacturer markup,
incremental retailer markup, and sales tax).

Table 6.5.1 summarizes the markups at each stage in the distribution channel and the
overall baseline and incremental markups, including sales taxes.

Table 6.5.1 Summary of Markups


Markup Baseline Incremental
Manufacturer 1.20
Retailer 1.49 1.24
Sales Tax 1.073
Overall 1.92 1.60

6-8
REFERENCES

1. Association of Home Appliance Manufacturers. Fact Book 2009. 2009. AHAM:


Washington, D.C.

2. IBISWorld. US Industry Reports (NAICS): 45211 - Department Stores; 44311 -


Consumer Electronics Stores; 44411 - Home Improvement Stores in the US. 2023.
IBISWorld. (Last accessed August 1, 2023.) https://www.ibisworld.com.

3. U.S. Census Bureau. 2017 Annual Retail Trade Survey, Electronics and Appliance Stores
(NAICS 443). 2017. Washington, D.C. (Last accessed February 16, 2023.)
https://www.census.gov/programs-surveys/arts.html.

4. Sales Tax Clearinghouse Inc. State Sales Tax Rates Along with Combined Average City
and County Rates. June 14, 2023. (Last accessed August 1, 2023.)
http://thestc.com/STrates.stm.

6-9
CHAPTER 7. ENERGY USE ANALYSIS

TABLE OF CONTENTS

7.1 INTRODUCTION ........................................................................................................... 7-1


7.2 AVERAGE ANNUAL ENERGY CONSUMPTION ..................................................... 7-1
7.2.1 Annual Energy Consumption of Energy-Using Components .......................................... 7-3
7.2.2 Annual Energy Consumption by Efficiency Level .......................................................... 7-5
7.2.2.1 Cooking Tops ................................................................................................. 7-5
7.2.2.2 Electric Ovens ................................................................................................ 7-7
7.2.2.3 Gas Ovens ...................................................................................................... 7-9
7.2.3 Variability of Annual Energy Consumption .................................................................. 7-12
REFERENCES .......................................................................................................................... 7-18

LIST OF TABLES

Table 7.2.1 Component Annual Energy Use of Baseline Cooking Tops ............................... 7-3
Table 7.2.2 Component Annual Energy Use of Baseline Ovens ............................................ 7-4
Table 7.2.3 Baseline Annual Energy Consumption Based on DOE Test Procedure
Energy Use Calculation and Energy Use Analysis .............................................. 7-5
Table 7.2.4 Electric Smooth Element Standalone Cooking Tops: Annual Energy
Consumption by Efficiency Level ....................................................................... 7-6
Table 7.2.5 Electric Smooth Element Cooking Top Component of a Combined
Cooking Product: Annual Energy Consumption by Efficiency Level................. 7-6
Table 7.2.6 Gas Standalone Cooking Tops: Annual Energy Consumption by
Efficiency Level ................................................................................................... 7-7
Table 7.2.7 Gas Cooking Top Component of a Combined Cooking Product: Annual
Energy Consumption by Efficiency Level ........................................................... 7-7
Table 7.2.8 Electric Standard Ovens - Freestanding: Annual Energy Consumption by
Efficiency Level ................................................................................................... 7-8
Table 7.2.9 Electric Standard Ovens – Built-in/Slide-in: Annual Energy Consumption
by Efficiency Level .............................................................................................. 7-8
Table 7.2.10 Electric Self-Clean Ovens - Freestanding: Annual Energy Consumption by
Efficiency Level ................................................................................................... 7-9
Table 7.2.11 Electric Self-Clean Ovens – Built-in/Slide-in: Annual Energy
Consumption by Efficiency Level ....................................................................... 7-9
Table 7.2.12 Gas Standard Ovens - Freestanding: Annual Energy Consumption by
Efficiency Level ................................................................................................. 7-10
Table 7.2.13 Gas Standard Ovens – Built-in/Slide-in: Annual Energy Consumption by
Efficiency Level ................................................................................................. 7-10
Table 7.2.14 Gas Self-Clean Ovens - Freestanding: Annual Energy Consumption by
Efficiency Level ................................................................................................. 7-12
Table 7.2.15 Gas Self-Clean Ovens – Built-in/Slide-in: Annual Energy Consumption by
Efficiency Level ................................................................................................. 7-12

7-i
Table 7.2.16 Annual Energy Use of Baseline Cooking Tops and Ovens with
Corresponding RECS Cooking Frequency ........................................................ 7-13

LIST OF FIGURES

Figure 7.2.1 Historical Estimates of Annual Electric Range Energy Use ................................ 7-2
Figure 7.2.2 Historical Estimates of Annual Gas Range Energy Use ...................................... 7-2
Figure 7.2.3 Range of Annual Energy Consumption for Electric Smooth Element
Cooking Top Product Classes Based on 2020 RECS Cooking Frequency ....... 7-14
Figure 7.2.4 Range of Annual Energy Use for Gas Cooking Top Product Classes Based
on 2020 RECS Cooking Frequency ................................................................... 7-15
Figure 7.2.5 Range of Electric Standard Oven Annual Energy Use Based on 2020
RECS Cooking Frequency ................................................................................. 7-15
Figure 7.2.6 Range of Electric Self-clean Oven Annual Energy Use Based on 2020
RECS Cooking Frequency ................................................................................. 7-16
Figure 7.2.7 Range of Gas Standard Oven Annual Energy Use Based on 2020 RECS
Cooking Frequency ............................................................................................ 7-16
Figure 7.2.8 Range of Gas Self-Clean Oven Annual Energy Use Based on 2020 RECS
Cooking Frequency ............................................................................................ 7-17

7-ii
CHAPTER 7. ENERGY USE ANALYSIS

7.1 INTRODUCTION
The purpose of the energy use analysis is to determine the annual energy consumption of
consumer conventional electric and gas cooking products in representative U.S. homes and to
assess the potential savings in energy use and costs that consumers would experience from more-
efficient products. The U.S. Department of Energy (DOE) uses annual energy use, along with
energy prices, to establish energy costs at various energy efficiency levels and to carry out the
life-cycle cost (LCC) and payback period (PBP) analysis described in chapter 8. This chapter
describes how DOE determined the annual energy use of consumer conventional cooking
products at various efficiency levels for each product class considered in this direct final rule.

The engineering analysis, described in chapter 5 of this technical support document


(TSD), reports energy use based on the DOE test procedure, which uses typical operating
conditions in a laboratory setting. This test serves as the basis for comparing the performance of
appliances under uniform conditions. Actual energy usage in the field varies depending on the
conditions under which an appliance is operated. The energy use analysis seeks to estimate the
range of energy consumption of the products in the field across diverse climate types and
household characteristics.

7.2 AVERAGE ANNUAL ENERGY CONSUMPTION


DOE’s 2009 final rule TSD identified several studies that estimated the annual energy
consumption of electric and gas ranges.1 The studies that covered the time period of 1977–2004
showed a steady decline in the annual energy consumption. More recent studies from the 2010
California Residential Appliance Saturation Study (CA RASS)2, Florida Solar Energy Center
(FSEC)3, the 2019 California Residential Appliance Saturation Study (CA RASS 2019), and
2021 field metered data from the Pecan Street Project4 on electric ranges show that the decline
has levelled off in the annual energy consumption. Figure 7.2.1 and Figure 7.2.2 show how the
annual energy consumption of electric ranges and gas ranges, respectively, have varied over
time. Red squares indicate energy consumption values estimated using a conditional demand
analysis (CDA) and blue diamonds indicated field metered values.

7-1
2200
Annual Electric Cooking Use (kWh/yr)
Metered
2000
CDA
1800
1600
1400
1200
1000
800
600
400
200
0
1973 1983 1993 2003 2013 2023
Year

Figure 7.2.1 Historical Estimates of Annual Electric Range Energy Use

140
Annual Gas Cooking Energy (therms/yr)

CDA
120 Metered

100

80

60

40

20

0
1973 1983 1993 2003 2013 2023
Year

Figure 7.2.2 Historical Estimates of Annual Gas Range Energy Use

For this direct final rule analysis, DOE bases its estimates for cooking product energy use
analysis on the two most recent datasets available: CA RASS 2019 and field-metered data from
the Pecan Street Project covering 2021-2022.5 Both data-sets provide estimates for the annual
electricity usage of electric ranges. Pecan Street measures circuit-level electricity use at 1-minute

7-2
resolution from volunteer households across multiple states. From the Pecan Street data, DOE
performed an analysis of 45 households in Texas and 35 households in New York to derive
develop average annual energy consumption values for each State. The CA RASS 2019 reported
an average electric range annual energy consumption of 352 kWh per year while the Pecan Street
data reported an average electric range annual energy consumption of 141 kWh and 347 kWh per
year for Texas and New York, respectively. DOE then calculated a household-weighted National
value of 282 kWh using the average values from Texas, New York, and California (from CA
RASS 2019) and estimates for the number of households in each State from the U.S. Census.
DOE assumed that 282 kWh represents the average energy consumption of electric ranges.

7.2.1 Annual Energy Consumption of Energy-Using Components


The CA RASS 2019 and Pecan Street annual energy consumption values represent the
consumption of electric and gas ranges which combine a cooking top and an oven into a single
unit. DOE performed several calculation steps to disaggregate the representative average annual
energy consumption value for an electric range, 282 kWh per year, into appropriate energy use
values for the various energy-using components of electric and gas cooking products. The
detailed calculations are presented in Appendix 7A. Table 7.2.1 and
Table 7.2.2 show the results of these calculations for cooking tops and ovens, respectively. In the
tables, DOE presents the energy use values for electric and gas cooking tops, standard ovens, and
self-clean ovens with their disaggregated energy use components (i.e., cooking, self-clean, and
standby energy) that correspond to the baseline efficiency levels. For comparison, Table 7.2.1
includes the integrated annual energy consumption (IAEC) as measured by the DOE cooking top
test procedure and
Table 7.2.2 shows the integrated annual oven energy consumption (IEAO) as measured using data
gathered in the engineering analysis (see chapter 5 for details) for the baseline efficiency level.
For cooking tops of a given fuel type (e.g., electric or gas), DOE assumed the same energy use
for the baseline level for standalone cooking tops and component of a combined cooking product
classes.

Table 7.2.1 Component Annual Energy Use of Baseline Cooking Tops


Cooking Tops
Energy Use Components Electric Smooth
Gas
Element
Cooking
Electric (kWh/yr) 99
Gas (kBtu/yr) 925
Standby (kWh/yr)
Electric (kWh/yr) 47
Gas (kBtu/yr) 26*
146 951*
Total
kWh kBtu/yr
250 1,900
IAEC
kWh kBtu/yr
** Including electrical energy consumption converted from kWh to kBtu

7-3
Table 7.2.2 Component Annual Energy Use of Baseline Ovens
Electric Standard Electric Self-Clean Gas Self-Clean
Gas Standard Oven
Oven Oven Oven
Energy Use
Built-
Components* Free- Free- Built-In/ Free- Built-In/ Free- Built-In/
In/
standing standing Slide-In standing Slide-In standing Slide-In
Slide-In
Cooking
Electric
146 146 149 149
(kWh/yr)
Gas (kBtu/yr) 977 977 792 792
Self-clean
Electric
34 34 6 6
(kWh/yr)
Gas (kBtu/yr) 234 234
Fan
Electric
7 7 6 6
(kWh/yr)
Gas (kBtu/yr)
Combined
Low Power
Mode 18 18 18 18 18 18 18 18
Energy(kWh/
yr)
164 171 202 208 1,039 1,058 1,108 1,130
Total
kWh kWh kWh kWh kBtu** kBtu** kBtu** kBtu**
Test
Procedure 315 321 354 361 2,085 2,104 1,958 1,979
IEAO kWh kWh kWh kWh kBtu kBtu kBtu kBtu
*The ratio of component energy consumption to overall annual energy consumption used to disaggregate the
baseline energy consumption for conventional ovens was based on the product testing and analysis described in
chapter 5 of this TSD.
** Including electrical energy consumption converted from kWh to kBtu

Table 7.2.3 summarizes the estimated average baseline energy consumption for each
cooking top product class and the four types of electric and gas ovens analyzed in this direct final
rule, based on the energy component analysis applied to the average range energy consumption
estimated from CA RASS 2019 and Pecan Street data. Table 7.2.3 also shows the IAEC for
cooking tops and IEAO for ovens. While similar in magnitude, DOE considers the annual energy
consumption values from CA RASS 2019 and Pecan Street to be representative of electric and
gas cooking energy usage in the field.

7-4
Table 7.2.3 Baseline Annual Energy Consumption Based on DOE Test Procedure
Energy Use Calculation and Energy Use Analysis
Baseline Efficiency Level Annual Energy
(IAEC/IEAO)* Consumption

Electric Smooth Element Standalone


250 kWh 146 kWh
Cooking Top
Electric Smooth Element Cooking Top
Component of a Combined Cooking 250 kWh 146 kWh
Product
Gas Standalone Cooking Tops 1,900 kBtu 954 kBtu**
Gas Cooking Top Component of a
1,900 kBtu 954 kBtu**
Combined Cooking Product
Electric Standard Ovens, Free-
315 kWh 164 kWh
Standing
Electric Standard Ovens, Built-
321 kWh 171 kWh
In/Slide-In
Electric Self-Clean Ovens, Free-
354 kWh 202 kWh
Standing
Electric Self-Clean Ovens, Built-
361 kWh 208 kWh
In/Slide-In
Gas Standard Ovens, Free-Standing 2,085 kBtu 1,039 kBtu**
Gas Standard Ovens, Built-In/Slide-In 2,041 kBtu 1,058 kBtu**
Gas Self-Clean Ovens, Free-Standing 1,958 kBtu 1,109 kBtu**
Gas Self-Clean Ovens, Built-In/Slide-
1,979 kBtu 1,130 kBtu**
In
* IEAO baseline efficiency levels are normalized based on a 4.3 ft3 volume for oven
** Including electrical energy consumption converted from kWh to kBtu

7.2.2 Annual Energy Consumption by Efficiency Level

7.2.2.1 Cooking Tops

In addition to the baseline level, DOE considered three efficiency levels for electric
smooth element cooking top product classes. For electric smooth element cooking top product
classes, DOE determined the annual cooking energy consumption for a more efficient level by
taking the ratio of the cooking energy component of the IAEC of the more efficient and baseline
levels and multiplying it by the baseline annual energy consumption estimated in Table 7.2.3.
DOE assumed that the non-cooking energy component of the IAEC would reflect the non-
cooking energy consumption in the energy use analysis. Table 7.2.4 and Table 7.2.5 show the
cooking top IAEC as measured by the DOE test procedure, estimated annual cooking energy
consumption based on field metering data, annual non-cooking energy consumption, and total
annual energy consumption product classes at each efficiency level considered for electric
smooth element cooking top product classes in this direct final rule.

7-5
Table 7.2.4 Electric Smooth Element Standalone Cooking Tops: Annual Energy
Consumption by Efficiency Level

IAEC Cooking Energy Non-Cooking Energy* Annual Energy Consumption


Level
kWh/year
Baseline 250 99 47 146
1 207 99 3 102
2 189 90 3 93
3 179 85 3 88
*Includes standby energy consumption

Table 7.2.5 Electric Smooth Element Cooking Top Component of a Combined Cooking
Product: Annual Energy Consumption by Efficiency Level

IAEC Cooking Energy Non-Cooking Energy* Annual Energy Consumption


Level
kWh/year
Baseline 250 99 47 146
1 207 99 3 102
2 189 90 3 93
3 179 85 3 88
*Includes standby energy consumption

In addition to the baseline level, DOE considered two additional efficiency levels for gas
cooking top product classes. DOE determined the annual cooking energy consumption for a
more efficient level by taking the ratio of the cooking energy component of the IAEC of the
more efficient and baseline levels and multiplying it by the baseline annual energy consumption
estimated in Table 7.2.3. DOE assumed that the non-cooking energy component of the IAEC
would reflect the non-cooking energy consumption in the energy use analysis. Table 7.2.6 and
Table 7.2.7 show the gas cooking top IAEC as measured by the DOE test procedure, annual gas
consumption, and annual electricity consumption for each efficiency level considered in this
direct final rule for gas cooking top product classes.

7-6
Table 7.2.6 Gas Standalone Cooking Tops: Annual Energy Consumption by Efficiency
Level
Gas Electricity
IAEC Annual Gas Non-Cooking
Level
Consumption Energy*
kBtu/year kBtu/year kWh/year
Baseline 1,900 925 8
1 1,770 861 8
2 1,343 650 8
*Includes standby energy consumption

Table 7.2.7 Gas Cooking Top Component of a Combined Cooking Product: Annual
Energy Consumption by Efficiency Level
Gas Electricity
IAEC Annual Gas Non-Cooking
Level
Consumption Energy*
kBtu/year kBtu/year kWh/year
Baseline 1,900 925 8
1 1,770 861 8
2 1,343 650 8
*Includes standby energy consumption

7.2.2.2 Electric Ovens

DOE analyzed four types of ovens for the conventional electric oven product class as
described in chapter 5 of this direct final rule TSD. DOE considered three efficiency levels in
addition to the baseline for each electric oven type. Table 7.2.8 and Table 7.2.9 show the electric
standard oven IEAO as measured in the engineering analysis, the average annual cooking energy
consumption, non-cooking energy consumption, and total annual energy consumption. For
electric ovens without self-cleaning mode, non-cooking energy is attributed to energy consumed
in standby mode. The annual cooking energy consumption for efficiency levels above the
baseline are estimated by taking the ratio of the cooking energy component of IEAO of the more
efficient and baseline levels and multiplying it by the baseline annual cooking energy
consumption.

7-7
Table 7.2.8 Electric Standard Ovens - Freestanding: Annual Energy Consumption by
Efficiency Level

IEAO Cooking Energy Non-Cooking Energy* Annual Energy Consumption


Level
kWh/year
Baseline 315 146 18 164
1 302 146 6 152
2 289 140 6 145
3 235 113 6 119
*Includes standby energy consumption

Table 7.2.9 Electric Standard Ovens – Built-in/Slide-in: Annual Energy Consumption by


Efficiency Level

IEAO Cooking Energy Non-Cooking Energy* Annual Energy Consumption


Level
kWh/year
Baseline 321 146 25 171
1 309 146 13 159
2 296 140 13 152
3 242 113 13 126
*Includes standby and fan-only energy consumption

Table 7.2.10 and Table 7.2.11 show the electric self-clean oven IEAO as measured in the
engineering analysis, cooking energy consumption, non-cooking energy consumption, and total
annual energy consumption. For electric ovens with self-cleaning mode, non-cooking energy
consumption includes the electricity consumption associated with self-cleaning and standby
modes. Built-in electric ovens also include fan-only mode in estimates for non-cooking energy
consumption. The annual cooking energy consumption for efficiency levels above the baseline
are estimated by taking the ratio of the cooking energy component of IEAO of the more efficient
and baseline levels and multiplying it by the baseline annual cooking energy consumption. DOE
assumed that self-clean remains constant with increased efficiency.

7-8
Table 7.2.10 Electric Self-Clean Ovens - Freestanding: Annual Energy Consumption by
Efficiency Level

IEAO Cooking Energy Non-Cooking Energy* Annual Energy Consumption


Level
kWh/year
Baseline 354 149 53 202
1 342 149 40 189
2 329 142 40 182
3 275 116 40 156
*Includes standby and self-cleaning mode energy consumption

Table 7.2.11 Electric Self-Clean Ovens – Built-in/Slide-in: Annual Energy Consumption


by Efficiency Level

IEAO Cooking Energy Non-Cooking Energy* Annual Energy Consumption


Level
kWh/year
Baseline 361 149 59 208
1 348 149 47 195
2 335 142 47 189
3 281 116 47 162
*Includes standby, fan-only and self-clean energy consumption

7.2.2.3 Gas Ovens

DOE analyzed four types of ovens for the conventional gas oven product class. DOE
considered two efficiency levels in addition to the baseline for each gas oven type. Table 7.2.12
and Table 7.2.13 show the gas standard oven IEAO, gas cooking energy consumption, and non-
cooking electricity consumption. For gas ovens without self-cleaning mode, non-cooking energy
is attributed to energy consumed in standby mode. Built-in gas ovens also include standby and
fan-only modes in estimates for non-cooking electricity consumption. The annual cooking
energy consumption for efficiency levels above the baseline are estimated by taking the ratio of
the cooking energy component of IEAO of the more efficient and baseline levels and multiplying
it by the baseline annual cooking energy consumption.

7-9
Table 7.2.12 Gas Standard Ovens - Freestanding: Annual Energy Consumption by
Efficiency Level
Gas Electricity
IEAO Cooking Energy Non-Cooking
Level
Consumption Energy*
kBtu/year kWh/year
Baseline 2,085 977 18
1 2,041 976 6
2 1,908 912 6
*Includes standby and fan-only energy consumption

Table 7.2.13 Gas Standard Ovens – Built-in/Slide-in: Annual Energy Consumption by


Efficiency Level
Gas Electricity
IEAO Cooking Energy Non-Cooking
Level
Consumption Energy*
kBtu/year kWh/year
Baseline 2,104 977 24
1 2,062 977 11
2 1,929 913 11
*Includes standby and fan-only mode energy consumption

7-10
Table 7.2.14 and Table 7.2.15 show the gas self-clean oven IEAO, gas cooking energy
consumption, gas non-cooking energy consumption, total annual gas consumption, and
electricity non-cooking energy consumption. The annual cooking energy consumption for
efficiency levels above the baseline are estimated by taking the ratio of the cooking energy
component of IEAO of the more efficient and baseline levels and multiplying it by the baseline
annual cooking energy consumption. For self-cleaning gas ovens, non-cooking energy
consumption includes the gas and electricity consumption associated with self-cleaning mode
and the electricity consumption associated with standby mode. Built-in gas ovens also include
fan-only mode in estimates for non-cooking electricity consumption. DOE assumed that the self-
clean energy remains constant with increased efficiency.

7-11
Table 7.2.14 Gas Self-Clean Ovens - Freestanding: Annual Energy Consumption by
Efficiency Level
Gas Electricity

IAEO Cooking Non-Cooking Annual Gas Non-Cooking


Level
Energy Energy* Consumption Energy**

kBtu/year kWh/year
Baseline 1,958 792 234 1,026 24
1 1,915 792 234 1,026 12
2 1,781 728 234 962 12
*Includes self-cleaning mode energy consumption
**Includes standby and self-cleaning mode energy consumption.

Table 7.2.15 Gas Self-Clean Ovens – Built-in/Slide-in: Annual Energy Consumption by


Efficiency Level
Gas Electricity
IAEO Cooking Non-Cooking Annual Gas Non-Cooking
Level
Energy Energy* Consumption Energy**
kBtu/year kWh/year
Baseline 1,979 792 234 1,026 30
1 1,937 792 234 1,026 18
2 1,804 728 234 962 18
*Includes self-cleaning energy consumption
**Includes standby, self-cleaning, and fan-only mode energy consumption

7.2.3 Variability of Annual Energy Consumption


DOE’s Energy Information Administration (EIA) conducts a Residential Energy
Consumption Survey (RECS) that collects energy-related data for occupied primary housing
units in the U.S. The 2020 RECS collected data from 18,496 housing units representing almost
123.5 million households.6 The RECS indicates which households in the survey use electric and
gas cooking products. With regard to cooking tops, 11,122 household records have electric
cooking tops and 8,640 household records have gas cooking tops. The above totals represent
cooking tops in households as either a standalone unit or as part of a combined cooking product.
DOE used the entire sample of electric cooking top consumers to represent the population of
cooking top users for both electric smooth element cooking top product classes. Similarly, DOE
used the entire sample of gas cooking top consumers to represent the population of gas cooking
top users for both gas cooking top product classes. Note that the sum of electric and gas cooking
tops exceeds the number of 2020 RECS because some households reporting having multiple
cooking products.

7-12
For each household using a conventional cooking product, RECS provides data on the
frequency of use per week for cooktops and ovens. DOE utilizes the frequency of use to define
the variability of the annual energy consumption. Conducting the analysis in this manner
captures the observed variability in annual energy consumption while maintaining the average
annual energy consumption shown in Table 7.2.3. To determine the variability of cooking top
energy consumption, DOE first equated the weighted-average cooking frequency from RECS
with the average energy use values reported in Table 7.2.3. Table 7.2.16 presents the weighted-
average cooking frequency values along with the corresponding annual energy use values from
Table 7.2.3. For the purposes of the energy-use analysis, DOE excludes households that own a
cooking product, but indicate that they never cook hot meals at home in the calculation of
average cooking frequency.

Table 7.2.16 Annual Energy Use of Baseline Cooking Tops and Ovens with
Corresponding RECS Cooking Frequency
Ovens
Cooking Tops
Electric Gas
Electric Standard Self-Clean Standard Self-Clean
Smooth Gas Freestanding Freestandin Freestanding Freestanding
Element /Built-In g/Built-In /Built-In /Built-In
Baseline Total
164/171 202/208 1,039/1,058** 1,108/1,130**
Annual Energy 146 kWh 951 kBtu**
kWh kWh kBtu kBtu
Consumption
Baseline Annual
Cooking Energy 99 kWh 925 kBtu 146 kWh 149 kWh 977 kBtu 792 kBtu
Consumption
RECS 2020 average
cooking frequency 1.218 1.343 0.729 0.729 0.617 0.617
(usage per day)
** Including electrical energy consumption converted from kWh to kBtu.

DOE then varied the annual energy consumption for each RECS household based on its
reported cooking frequency. DOE determined the annual cooking energy consumption for each
RECS household with a cooking top based on the following equation:

E CA _ AVG
E CA _ HH = FreqC _ HH ×
FreqC _ AVG
where:

ECA_HH = Cooking top annual energy consumption for specific RECS household,
FreqC_HH = Cooking top frequency for specific RECS household,
ECA_AVG = Average cooking top annual energy consumption (from Table 7.2.4, Table 7.2.5, Table
7.2.6, or Table 7.2.7), and
FreqC_AVG = Average cooking top usage frequency (from Table 7.2.16).

DOE determined the annual cooking energy consumption for each RECS household with
an oven based on the following equation:

7-13
E AO _ AVG
E AO _ HH = FreqO _ HH ×
FreqO _ AVG

where:

EAO_HH = Oven annual energy consumption for specific RECS household,


FreqO_HH = Oven frequency for specific RECS household,
EAO_AVG = Average oven annual energy consumption (from Table 7.2.8 through Table 7.2.15),
and
FreqO_AVG = Average oven frequency (from Table 7.2.16).

For all RECS households, cooking frequency varies between zero to four meals per day.
Figure 7.2.3 and Figure 7.2.4 show the range of annual cooking energy consumption at each
efficiency level based on correlating the average cooking energy use to the cooking frequency
data from RECS for electric and gas cooking top product classes, respectively. The bar at the
middle of the box indicates the median: 50 percent of households have annual energy use in
excess of that value. The “whiskers” at the bottom and the top of the box indicate the 5th and
95th percentiles. The small box shows the average annual energy use for each standard level.

median
Elec Smooth Cooking Tops average
300
Annual Elec Use (kWh)

250

200

150

100

50

0
Level 0 Level 1 Level 2 Level 3
Efficiency Level

Figure 7.2.3 Range of Annual Energy Consumption for Electric Smooth Element Cooking
Top Product Classes Based on 2020 RECS Cooking Frequency

7-14
median
Gas Cooking Tops average
2.5
Annual Gas Use (MMBtu)

2.0

1.5

1.0

0.5

0.0
Level 0 Level 1 Level 2
Efficiency Level

Figure 7.2.4 Range of Annual Energy Use for Gas Cooking Top Product Classes Based on
2020 RECS Cooking Frequency

Figure 7.2.5 and Figure 7.2.6 show the range of annual energy use at each considered
efficiency level for electric standard and self-clean ovens, respectively.

median
Elec Standard Oven - Free-Standing average
500
450
Annual Elec Use (kWh)

400
350
300
250
200
150
100
50
0
Level 0 Level 1 Level 2 Level 3
Efficiency Level

Figure 7.2.5 Range of Electric Standard Oven Annual Energy Use Based on 2020 RECS
Cooking Frequency

7-15
median
Elec Self-Cleaning Oven - Free-Standing average
600
Annual Elec Use (kWh)

500

400

300

200

100

0
Level 0 Level 1 Level 2 Level 3
Efficiency Level

Figure 7.2.6 Range of Electric Self-clean Oven Annual Energy Use Based on 2020 RECS
Cooking Frequency

Figure 7.2.7 and Figure 7.2.8 show the range of annual energy use at each efficiency
level for gas standard and self-clean ovens, respectively.

median
Gas Standard Oven - Free-Standing average
3.5
Annual Gas Use (MMBtu)

3.0

2.5

2.0

1.5

1.0

0.5

0.0
Level 0 Level 1 Level 2
Efficiency Level

Figure 7.2.7 Range of Gas Standard Oven Annual Energy Use Based on 2020 RECS
Cooking Frequency

7-16
median
Gas Self-Cleaning Oven - Free-Standing average
3.0
Annual Gas Use (MMBtu)

2.5

2.0

1.5

1.0

0.5

0.0
Level 0 Level 1 Level 2
Efficiency Level

Figure 7.2.8 Range of Gas Self-Clean Oven Annual Energy Use Based on 2020 RECS
Cooking Frequency

DOE used the RECS household samples with their associated baseline annual cooking
energy consumption to conduct the LCC and PBP analysis as described in chapter 8 of this direct
final rule TSD.

7-17
REFERENCES
1. U.S. Department of Energy–Office of Energy Efficiency and Renewable Energy.
Technical Support Document: Energy Efficiency Program for Consumer Products and
Commercial and Industrial Equipment, Residential Dishwashers, Dehumidifiers, and
Cooking Products, and Commercial Clothes Washers. 2009. Washington, D.C. (Last
accessed July 8, 2022.) https://www.regulations.gov/document/EERE-2006-STD-0127-
0097.

2. Palmgren, C., N. Stevens, M. Goldberg, R. Barnes, and K. Rothkin. 2009 California


Residential Appliance Saturation Study: Executive Summary. 2010. California Energy
Commission. Report No. CEC‐ 200‐ 2010‐004‐ES.
https://www.energy.ca.gov/2010publications/CEC-200-2010-004/CEC-200-2010-004-
ES.PDF.

3. Parker, D. and P. Fairey. Updated Miscellaneous Electricity Loads and Appliance Energy
Usage Profiles for Use in Home Energy Ratings, the Building America Benchmark
Procedures and Related Calculations. 2010. Florida Solar Energy Center. Report No.
FSEC-CR-1837-10. http://www.fsec.ucf.edu/en/publications/pdf/FSEC-CR-1837-10-
R01.pdf.

4. Palmgren, C., M. Goldberg, B. Ramirez, and C. Williamson. 2019 California Residential


Appliance Saturation Study: Executive Summary. 2021. California Energy Commission.
Report No. CEC-200-2021-005. https://www.energy.ca.gov/publications/2021/2019-
california-residential-appliance-saturation-study-rass.

5. Pecan Street. Pecan Street Dataset. www.pecanstreet.org/category/dataport.

6. U.S. Department of Energy–Energy Information Administration. 2020 Residential


Energy Consumption Survey (RECS). 2020. (Last accessed August 1, 2023.)
https://www.eia.gov/consumption/residential/data/2020/.

7-18
CHAPTER 8. LIFE-CYCLE COST AND PAYBACK PERIOD ANALYSIS

TABLE OF CONTENTS

8.1 INTRODUCTION ........................................................................................................... 8-1


8.1.1 General Approach to Analysis ......................................................................................... 8-1
8.1.2 Overview of Inputs to Analysis ....................................................................................... 8-3
8.2 INPUTS TO LIFE-CYCLE COST AND PAYBACK PERIOD ANALYSIS ................ 8-5
8.2.1 Inputs to Total Installed Cost ........................................................................................... 8-5
8.2.1.1 Forecasting Future Product Prices .................................................................. 8-6
8.2.1.2 Baseline Manufacturer Costs ........................................................................ 8-11
8.2.1.3 Incremental Manufacturer Cost by Efficiency Level .................................... 8-13
8.2.1.4 Overall Markup ............................................................................................. 8-16
8.2.1.5 Installation Cost ............................................................................................ 8-16
8.2.2 Inputs to Operating Cost ................................................................................................ 8-19
8.2.2.1 Annual Energy Consumption ........................................................................ 8-21
8.2.2.2 Energy Prices ................................................................................................ 8-21
8.2.2.3 Energy Price Trends ...................................................................................... 8-24
8.2.2.4 Repair and Maintenance Costs ...................................................................... 8-27
8.2.2.5 Product Lifetime ........................................................................................... 8-27
8.2.3 Discount Rate ................................................................................................................. 8-29
8.2.3.1 Shares of Debt and Asset Classes ................................................................. 8-31
8.2.3.2 Rates for Types of Debt ................................................................................ 8-32
8.2.3.3 Rates for Types of Assets .............................................................................. 8-34
8.2.3.4 Discount Rate Calculation and Summary ..................................................... 8-36
8.2.4 Compliance Date of Standard ........................................................................................ 8-37
8.2.5 Product Energy Efficiency in the No-New-Standards Case .......................................... 8-37
8.3 RESULTS OF LIFE-CYCLE COST AND PAYBACK PERIOD ANALYSES .......... 8-38
8.3.1 Summary of Results ....................................................................................................... 8-39
8.3.2 Distribution of Impacts .................................................................................................. 8-52
8.3.2.1 No-New-Standards Case LCC Distributions ................................................ 8-52
8.3.2.2 Standard-Level Distributions of LCC Impacts ............................................. 8-58
8.3.2.3 Range of Impacts .......................................................................................... 8-59
8.4 REBUTTABLE PAYBACK PERIOD .......................................................................... 8-66
8.4.1 Inputs to the Rebuttable Payback Period Analysis ........................................................ 8-66
8.4.2 Results of Rebuttable Payback Period Analysis ............................................................ 8-66
REFERENCES .......................................................................................................................... 8-68

8-i
LIST OF TABLES

Table 8.2.1 Inputs to Total Installed Cost ............................................................................... 8-5


Table 8.2.2 Baseline Manufacturer Costs for Cooktops ....................................................... 8-12
Table 8.2.3 Baseline Manufacturer Costs for Ovens ............................................................ 8-12
Table 8.2.4 Electric Smooth Element Cooking Top Product Classes: Incremental
Manufacturer Production Cost by Efficiency Level .......................................... 8-13
Table 8.2.5 Gas Cooking Top Product Classes: Incremental Manufacturer Production
Cost by Efficiency Level ................................................................................... 8-14
Table 8.2.6 Electric Standard Ovens, Freestanding: Incremental Manufacturer
Production Cost by Efficiency Level ................................................................. 8-14
Table 8.2.7 Electric Standard Ovens, Built-In/Slide-In: Incremental Manufacturer
Production Cost by Efficiency Level ................................................................. 8-14
Table 8.2.8 Electric Self-Clean Ovens, Freestanding: Incremental Manufacturer
Production Cost by Efficiency Level ................................................................. 8-14
Table 8.2.9 Electric Self-Clean Ovens, Built-In/Slide-In: Incremental Manufacturer
Production Cost by Efficiency Level ................................................................. 8-15
Table 8.2.10 Gas Standard Ovens, Freestanding: Incremental Manufacturer Production
Cost by Efficiency Level ................................................................................... 8-15
Table 8.2.11 Gas Standard Oven, Built-In/Slide-In: Incremental Manufacturer
Production Cost by Efficiency Level ................................................................. 8-15
Table 8.2.12 Gas Self-Clean Ovens, Freestanding: Incremental Manufacturer
Production Cost by Efficiency Level ................................................................. 8-15
Table 8.2.13 Gas Self-Clean Ovens, Built-In/Slide-In: Incremental Manufacturer
Production Cost Increases by Efficiency Level ................................................. 8-16
Table 8.2.14 Cooking Products: Overall Markup ................................................................... 8-16
Table 8.2.15 Baseline Installation Cost for Electric Smooth Element Cooking Tops ............ 8-17
Table 8.2.16 Baseline Installation Cost for Gas Cooking Tops .............................................. 8-17
Table 8.2.17 Baseline Installation Cost for Electric Ovens .................................................... 8-17
Table 8.2.18 Baseline Installation Cost for Gas Ovens .......................................................... 8-18
Table 8.2.19 Induction Cooking Tops (Range outlet, 50 amp-240 volt receptacle):
Incremental Installation Costs............................................................................ 8-19
Table 8.2.20 Labor Cost Factors by Census Division............................................................. 8-19
Table 8.2.21 Inputs for Operating Cost................................................................................... 8-20
Table 8.2.22 Average Residential Electricity Prices in 2022 ................................................. 8-22
Table 8.2.23 Marginal Residential Electricity Prices in 2022 ................................................ 8-22
Table 8.2.24 Average Residential Natural Gas Prices in 2022 ............................................... 8-23
Table 8.2.25 Residential Marginal Natural Gas Price in 2022 ............................................... 8-24
Table 8.2.26 Residential Average LPG Price in 2022 ............................................................ 8-24
Table 8.2.27 Lifetime Parameters ........................................................................................... 8-29
Table 8.2.28 Definitions of Income Groups ........................................................................... 8-31
Table 8.2.29 Average Shares of Household Debt and Asset Types by Income Group
(%)...................................................................................................................... 8-32
Table 8.2.30 Data Used to Calculate Real Effective Household Debt Rates.......................... 8-33
Table 8.2.31 Average Real Effective Interest Rates for Household Debt (%) ....................... 8-34
Table 8.2.32 Average Capital Gains Marginal Tax Rate by Income Group (%) .................... 8-35
8-ii
Table 8.2.33 Average Real Interest Rates for Household Assets (%) .................................... 8-36
Table 8.2.34 Average Real Effective Discount Rates ............................................................. 8-37
Table 8.2.35 No-New-Standards Case Market Share for Cooking Tops by Efficiency
Level in Compliance Year ................................................................................. 8-38
Table 8.2.36 No-New-Standards Case Market Share for Electric Ovens by Efficiency
Level in Compliance Year ................................................................................. 8-38
Table 8.2.37 No-New-Standards Case Market Share for Gas Ovens by Efficiency Level
in Compliance Year ........................................................................................... 8-38
Table 8.3.1 Average LCC and PBP Results by Efficiency Level for Electric Smooth
Element Standalone Cooking Tops .................................................................... 8-40
Table 8.3.2 Average LCC Savings Relative to the No-New-Standards Case Efficiency
Distribution for Electric Smooth Element Standalone Cooking Tops ............... 8-40
Table 8.3.3 Average LCC and PBP Results by Efficiency Level for Electric Smooth
Element Cooking Top Component of a Combined Cooking Product ............... 8-41
Table 8.3.4 Average LCC Savings Relative to the No-New-Standards Case Efficiency
Distribution for Electric Smooth Element Cooking Top Component of a
Combined Cooking Product ............................................................................... 8-41
Table 8.3.5 Average LCC and PBP Results by Efficiency Level for Gas Standalone
Cooking Tops ..................................................................................................... 8-42
Table 8.3.6 Average LCC Savings Relative to the No-New-Standards Case Efficiency
Distribution for Gas Standalone Cooking Tops ................................................. 8-42
Table 8.3.7 Average LCC and PBP Results by Efficiency Level for Gas Cooking Top
Component of a Combined Cooking Product .................................................... 8-42
Table 8.3.8 Average LCC Savings Relative to the No-New-Standards Case Efficiency
Distribution for Gas Cooking Top Component of a Combined Cooking
Product ............................................................................................................... 8-43
Table 8.3.9 Average LCC and PBP Results by Efficiency Level for Electric Standard
Ovens, Free-Standing ......................................................................................... 8-43
Table 8.3.10 Average LCC Savings Relative to the No-New-Standards Case Efficiency
Distribution for Electric Standard Ovens, Free-Standing .................................. 8-44
Table 8.3.11 Average LCC and PBP Results by Efficiency Level for Electric Standard
Ovens, Built-In/Slide-In ..................................................................................... 8-44
Table 8.3.12 Average LCC Savings Relative to the No-New-Standards Case Efficiency
Distribution for Electric Standard Ovens, Built-In/Slide-In .............................. 8-45
Table 8.3.13 Average LCC and PBP Results by Efficiency Level for Electric Self-Clean
Ovens, Free-Standing ......................................................................................... 8-45
Table 8.3.14 Average LCC Savings Relative to the No-New-Standards Case Efficiency
Distribution for Electric Self-Clean Ovens, Free-Standing ............................... 8-46
Table 8.3.15 Average LCC and PBP Results by Efficiency Level for Electric Self-Clean
Ovens, Built-In/Slide-In ..................................................................................... 8-46
Table 8.3.16 Average LCC Savings Relative to the No-New-Standards Case Efficiency
Distribution for Electric Self-Clean Ovens, Built-In/Slide-In ........................... 8-47
Table 8.3.17 Average LCC and PBP Results by Efficiency Level for All Electric Ovens .... 8-47
Table 8.3.18 Average LCC Savings Relative to the No-New-Standards Case Efficiency
Distribution for All Electric Ovens .................................................................... 8-48

8-iii
Table 8.3.19 Average LCC and PBP Results by Efficiency Level for Gas Standard
Ovens, Free-Standing ......................................................................................... 8-48
Table 8.3.20 Average LCC Savings Relative to the No-New-Standards Case Efficiency
Distribution for Gas Standard Ovens, Free-Standing ........................................ 8-49
Table 8.3.21 Average LCC and PBP Results by Efficiency Level for Gas Standard
Ovens, Built-In/Slide-In ..................................................................................... 8-49
Table 8.3.22 Average LCC Savings Relative to the No-New-Standards Case Efficiency
Distribution for Gas Standard Ovens, Built-In/Slide-In .................................... 8-50
Table 8.3.23 Average LCC and PBP Results by Efficiency Level for Gas Self-Clean
Ovens, Free-Standing ......................................................................................... 8-50
Table 8.3.24 Average LCC Savings Relative to the No-New-Standards Case Efficiency
Distribution for Gas Self-Clean Ovens, Free-Standing ..................................... 8-50
Table 8.3.25 Average LCC and PBP Results by Efficiency Level for Gas Self-Clean
Ovens, Built-In/Slide-In ..................................................................................... 8-51
Table 8.3.26 Average LCC Savings Relative to the No-New-Standards Case Efficiency
Distribution for Gas Self-Clean Ovens, Built-In/Slide-In ................................. 8-51
Table 8.3.27 Average LCC and PBP Results by Efficiency Level for All Gas Ovens........... 8-51
Table 8.3.28 Average LCC Savings Relative to the No-New-Standards Case Efficiency
Distribution for All Gas Ovens .......................................................................... 8-52
Table 8.4.1 Rebuttable Payback Periods for Electric Smooth Element Cooking Top
Product Classes .................................................................................................. 8-67
Table 8.4.2 Rebuttable Payback Periods for Gas Cooking Top Product Classes ................. 8-67
Table 8.4.3 Rebuttable Payback Periods for Conventional Electric Ovens .......................... 8-67
Table 8.4.4 Rebuttable Payback Periods for Conventional Gas Ovens ................................ 8-67

LIST OF FIGURES

Figure 8.1.1 Flow Diagram of Inputs for the Determination of LCC and PBP .................... 8-4
Figure 8.2.1 Nominal and Deflated Conventional Gas Cooking Products PPI from
1981 to 2022 ..................................................................................................... 8-8
Figure 8.2.2 Nominal and Deflated Conventional Electric Cooking Products PPI from
1967 to 2022 ..................................................................................................... 8-8
Figure 8.2.3 Relative Price versus Cumulative Shipments of Consumer Conventional
Gas Cooking Products from 1981 to 2022, with Power Law Fit ...................... 8-9
Figure 8.2.4 Relative Price versus Cumulative Shipments of Consumer Conventional
Electric Cooking Products from 1967 to 2022, with Power Law Fit.............. 8-10
Figure 8.2.5 Price Forecast Indices for Conventional Gas and Electric Cooking
Products........................................................................................................... 8-11
Figure 8.2.6 AEO 2023 Residential Electricity Price Trends ............................................. 8-25
Figure 8.2.7 AEO 2023 Residential Natural Gas Price Trends ........................................... 8-26
Figure 8.2.8 AEO 2023 Residential LPG Price Trends ...................................................... 8-26
Figure 8.2.9 Weibull Function for Lifetime of Electric Cooking Products ........................ 8-28
Figure 8.2.10 Weibull Function for Lifetime of Gas Cooking Products ............................... 8-29

8-iv
Figure 8.3.1 Electric Smooth Element Standalone Cooking Tops: No-New-Standards
Case LCC Distribution .................................................................................... 8-53
Figure 8.3.2 Electric Smooth Element Cooking Top Component of a Combined
Cooking Product: No-New-Standards Case LCC Distribution ...................... 8-53
Figure 8.3.3 Gas Standalone Cooking Tops: No-New-Standards Case LCC
Distribution ..................................................................................................... 8-54
Figure 8.3.4 Gas Cooking Top Component of a Combined Cooking Product: No-
New-Standards Case LCC Distribution .......................................................... 8-54
Figure 8.3.5 Electric Standard Ovens, Freestanding: No-New-Standards Case LCC
Distribution ..................................................................................................... 8-55
Figure 8.3.6 Electric Standard Ovens, Built-in/Slide-in: No-New-Standards Case
LCC Distribution ............................................................................................ 8-55
Figure 8.3.7 Electric Self-Clean Ovens, Freestanding: No-New-Standards Case LCC
Distribution ..................................................................................................... 8-56
Figure 8.3.8 Electric Self-Clean Ovens, Built-in/Slide-in: No-New-Standards Case
LCC Distribution ............................................................................................ 8-56
Figure 8.3.9 Gas Standard Ovens, Freestanding: No-New-Standards Case LCC
Distribution ..................................................................................................... 8-57
Figure 8.3.10 Gas Standard Ovens, Built-in/Slide-in: No-New-Standards Case LCC
Distribution ..................................................................................................... 8-57
Figure 8.3.11 Gas Self-Clean Ovens, Freestanding: No-New-Standards Case LCC
Distribution ..................................................................................................... 8-58
Figure 8.3.12 Gas Self-Clean Ovens, Built-in/Slide-in: No-New-Standards Case LCC
Distribution ..................................................................................................... 8-58
Figure 8.3.13 Electric Smooth Element Cooking Tops: Distribution of LCC Impacts
for TSL 1 ......................................................................................................... 8-59
Figure 8.3.14 Electric Smooth Element Standalone Cooking Tops: Range of LCC
Savings ............................................................................................................ 8-60
Figure 8.3.15 Electric Smooth Element Cooking Top Component of a Combined
Cooking Product: Range of LCC Savings ...................................................... 8-60
Figure 8.3.16 Gas Standalone Cooking Tops: Range of LCC Savings ................................. 8-61
Figure 8.3.17 Gas Cooking Top Component of a Combined Cooking Product: Range
of LCC Savings ............................................................................................... 8-61
Figure 8.3.18 Electric Standard Ovens, Freestanding: Range of LCC Savings .................... 8-62
Figure 8.3.19 Electric Standard Ovens, Built-In/Slide-In: Range of LCC Savings .............. 8-62
Figure 8.3.20 Electric Self-Clean Ovens, Freestanding: Range of LCC Savings ................. 8-63
Figure 8.3.21 Electric Self-Clean Ovens, Built-In/Slide-In: Range of LCC Savings ........... 8-63
Figure 8.3.22 Gas Standard Ovens, Freestanding: Range of LCC Savings .......................... 8-64
Figure 8.3.23 Gas Standard Ovens, Built-In/Slide-In: Range of LCC Savings .................... 8-64
Figure 8.3.24 Gas Self-Clean Ovens, Freestanding: Range of LCC Savings ....................... 8-65
Figure 8.3.25 Gas Self-Clean Ovens, Built-In/Slide-In: Range of LCC Savings ................. 8-65

8-v
CHAPTER 8. LIFE-CYCLE COST AND PAYBACK PERIOD ANALYSIS

8.1 INTRODUCTION
This chapter of the direct final rule technical support document (TSD) describes the
Department of Energy (DOE)’s method for analyzing the economic impacts of new energy
conservation standards on individual consumers. The effects of standards on individual
consumers include a change in operating expense (usually decreased) and a change in purchase
price (usually increased). This chapter describes three metrics DOE used in the consumer
analysis to determine the effect of standards on individual consumers of consumer conventional
cooking products:

• Life-cycle cost (LCC) is the total consumer expense over the life of an appliance,
including purchase price and operating costs (including energy expenditures). DOE
discounts future operating costs to the time of purchase, and sums them over the lifetime
of the product.
• Payback period (PBP) measures the amount of time it takes a consumer to recover the
assumed higher purchase price of more energy-efficient equipment through lower
operating costs.
• Rebuttable payback period is a special case of the PBP. Whereas LCC and PBP are
estimated over a range of inputs that reflect field conditions, rebuttable payback period is
based on laboratory conditions, specifically inputs to DOE’s test procedure.

Inputs to the LCC and PBP are discussed in section 8.2 of this chapter. Results for the
LCC and PBP are presented in section 8.3. The rebuttable PBP is discussed in section 8.4. Key
variables and calculations are presented for each metric. DOE performed the calculations
discussed herein using a series of Microsoft Excel® spreadsheets which are accessible on the
Internet (http://www.eere.energy.gov/buildings/appliance_standards/). Details and instructions
for using the spreadsheets are discussed in appendix 8A.

8.1.1 General Approach to Analysis


DOE uses the following equation to calculate life-cycle cost (LCC), the total consumer
expense throughout the life of an appliance.

N
OC t
LCC = IC + 
t =1 (1 + r )t
Eq. 8.1
Where:

LCC = life-cycle cost in dollars,


IC = total installed cost in dollars,
∑ = sum over the appliance lifetime, from year 1 to year N,
N = lifetime of the appliance in years,

8-1
OC = operating cost in dollars,
r = discount rate, and
t = for which operating cost is being determined.

Numerically, the PBP, defined above, is the ratio of the increase in purchase cost (i.e.,
from a less energy efficient design to a more efficient design) to the decrease in the first-year
operating expenditures. This type of calculation results in what is termed a simple payback
period, because it does not take into account changes in operating expenses over time or the time
value of money. The equation for PBP is:

IC
PBP =
OC
Eq. 8.2
Where:

ΔIC = difference in weighted-average total installed cost between the more energy efficient
design and the baseline design for the entire sample, and
ΔOC = difference in weighted-average first-year operating costs for the entire sample.

Payback periods are expressed in years. Payback periods greater than the life of the
product indicate that the increased total installed cost is not recovered through reduced operating
costs.

Recognizing that several inputs to the determination of consumer LCC and PBP are
either variable or uncertain, DOE conducted the LCC and PBP analysis by modeling both the
uncertainty and variability of the inputs using Monte Carlo simulation and probability
distributions. Appendix 8B provides a detailed explanation of Monte Carlo simulation and the
use of probability distributions. DOE used Microsoft Excel spreadsheets combined with Crystal
Ball (a commercially available add-in program) to develop LCC and PBP spreadsheet models
that incorporate both Monte Carlo simulation and probability distributions.

In addition to using probability distributions to characterize several of the inputs to the


analysis, DOE developed a sample of individual households that use conventional electric and
gas cooking products. By developing household samples, DOE was able to calculate the LCC
and PBP for each household to account for the variability in energy consumption and/or energy
price associated with a range of households.

As described in chapter 7 (section 7.2.3) of this TSD, DOE used the Energy Information
Administration’s (EIA’s) 2020 Residential Energy Consumption Survey (RECS 2020) to
develop household samples for electric and gas cooking tops and ovens 1. The EIA designed
RECS 2020, which consists of 18,496 housing units, to be a national representation of 123.5
million households in the United States. DOE used RECS to establish the variability of annual
cooking energy use and of energy prices based on household location. DOE assigned unique
number of meals cooked to each household in the sample based on household responses to the
typical cooking frequency. The variability among households in annual cooking tops and ovens

8-2
use and energy pricing contributes to the range of LCCs calculated for the baseline efficiency
level and each increased efficiency level.

DOE displays the LCC results as distributions of impacts compared to baseline


conditions. Results, which are presented in section 8.3, are based on 10,000 sampled households
per Monte Carlo simulation run. To illustrate the implications of the analysis, DOE generated
visualizations that depicts the variation in LCC for each efficiency level being considered.

8.1.2 Overview of Inputs to Analysis


DOE categorizes inputs to the LCC and PBP analysis as (1) inputs for establishing the
purchase expense, otherwise known as the total installed cost, and (2) inputs for calculating
operating costs. The primary inputs for establishing the total installed cost are listed below.

• Baseline manufacturer cost: The costs incurred by the manufacturer to produce


products that meet current minimum efficiency standards.
• Standard-level manufacturer cost increases: The change in manufacturer costs
associated with producing products that meet a given standard level.
• Markups and sales tax: The increases associated with converting the manufacturer
cost to a consumer product cost.
• Installation cost: The cost to the consumer of installing the product. The installation
cost represents all costs required to install the product other than the marked-up
consumer product cost. The installation cost includes labor, overhead, and any
miscellaneous materials and parts. Thus, the total installed cost equals the consumer
product cost plus the installation cost.

The primary inputs for calculating operating costs are listed below.

• Product energy consumption: The on-site energy use associated with operating a
product.
• Product efficiency: The product energy consumption associated with standard-level
products (i.e., products having efficiencies greater than those of baseline products).
• Energy prices: The prices consumers pay for energy (e.g., electricity or natural gas).
• Energy price trends: DOE used the EIA’s Annual Energy Outlook 2023 (AEO 2023)
to project energy prices 2.
• Repair and maintenance costs: Repair costs are associated with repairing or replacing
components that have failed. Maintenance costs are associated with maintaining the
operation of the product.
• Lifetime: The age at which the product is retired from service.
• Discount rate: The rate at which DOE discounts future expenditures to establish their
present value.

The data inputs for calculating the PBP for each trial standard level (TSL) are the total
installed cost of the product to the consumer for each energy efficiency level and the annual
(first-year) operating expenditures. The inputs to total installed cost are the product cost plus the

8-3
installation cost. The inputs to operating costs are the first-year energy cost, the annual repair
cost, and the annual maintenance cost. The PBP uses the same inputs as the LCC analysis, except
the PBP does not require energy price trends or discount rates. Because the PBP is what is
termed a simple payback, the required energy price is only for the year in which a new energy
efficiency standard takes effect. The energy price DOE uses in the PBP calculation is the price
projected for that year. Discount rates are also not required for calculating the simple PBP.

Figure 8.1.1 depicts the relationships among inputs to the calculation of the LCC and
PBP. In the figure, the yellow boxes indicate inputs, the green boxes indicate intermediate
outputs, and the blue boxes indicate final outputs (the LCC and PBP).

Figure 8.1.1 Flow Diagram of Inputs for the Determination of LCC and PBP

8-4
8.2 INPUTS TO LIFE-CYCLE COST AND PAYBACK PERIOD ANALYSIS
DOE gathered most of the data for performing the LCC and PBP analysis in 2022 and
2023. DOE expresses dollar values in 2022$.

8.2.1 Inputs to Total Installed Cost

DOE uses the following equation to define the total installed cost.

IC = CPC + INST
Eq. 8.3
Where:

IC = total installed cost,


CPC = consumer product cost (i.e., consumer cost for the product only), and
INST = consumer cost to install the product.

The product cost depends on how the consumer purchases the product. As discussed in
chapter 6 of this TSD, DOE defined markups and sales taxes for converting manufacturing costs
into consumer product costs. Table 8.2.1 summarizes the inputs for determining total installed
cost.

Table 8.2.1 Inputs to Total Installed Cost


Baseline manufacturer cost
Standard-level manufacturer Cost
Markups throughout distribution chain
Sales tax (replacement applications)
Installation cost

The baseline manufacturer cost is the cost incurred by the manufacturer to produce
products that meet current minimum efficiency standards. Standard-level manufacturer cost
increases are the change in manufacturer cost associated with producing products that meet a
new standard level. Markups and sales tax convert the manufacturer cost to a consumer product
cost. The installation cost represents all costs required for the consumer to install the product,
other than the marked-up consumer product cost. The installation cost includes labor, overhead,
and any miscellaneous materials and parts.

DOE calculated the total installed cost for baseline products based on the following
equation.

IC BASE = CPCBASE + INSTBASE


= COSTMFG  MU OVERALL_ BASE + INSTBASE
Eq. 8.4

8-5
Where:

ICBASE = total installed cost for baseline model,


CPCBASE = consumer product cost for baseline model,
INSTBASE = installation cost for baseline model,
COSTMFG = manufacturer cost for baseline model, and
MUOVERALL_BASE = overall baseline markup (product of manufacturer markup, baseline
retailer or distributor markup, and sales tax).

DOE used the following equation to calculate the total installed cost for standard-level
products.

IC STD = CPCSTD + INSTSTD


= (CPCBASE + CPCSTD ) + (INSTBASE + INSTSTD )
= (CPCBASE + INSTBASE ) + (CPCSTD + INSTSTD )
= IC BASE + (COSTMFG  MU OVERALL_ INCR + INSTSTD )
Eq. 8.5
Where:

ICSTD = total installed cost for standard-level model,


CPCSTD = consumer product cost for standard-level model,
INSTSTD = installation cost for standard-level model,
CPCBASE = consumer product cost for baseline model,
ΔCPCSTD = change in product cost for standard-level model,
INSTBASE = baseline installation cost,
ΔINSTSTD = change in installation cost for standard-level model,
ICBASE = baseline total installed cost,
ΔCOSTMFG = change in manufacturer cost for standard-level model, and
MUOVERALL_INCR = overall incremental markup (product of manufacturer markup,
incremental retailer or distributor markup, and sales tax).

The rest of this section provides information about each of the above input variables,
which DOE used to calculate the total installed cost for consumer conventional cooking
products.

8.2.1.1 Forecasting Future Product Prices


Examination of historical price data for certain appliances and equipment that have been
subject to energy conservation standards indicates that the assumption of constant real prices and
costs may, in many cases, overestimate long-term trends in appliance and equipment prices.
Economic literature and historical data suggest that the real costs of these products may in fact
trend downward over time according to “learning” or “experience” curves. Desroches et al.
(2013) summarizes the data and literature currently available that is relevant to price projections
for selected appliances and equipment3. The extensive literature on the “learning” or

8-6
“experience” curve phenomenon is typically based on observations in the manufacturing sector a.
In the experience curve method, the real cost of production is related to the cumulative
production or “experience” with a manufactured product. This experience is usually measured in
terms of cumulative production. A common functional relationship used to model the evolution
of production costs in this case is:

Y = a X -b
Eq. 8.6
Where:

a = an initial price (or cost),


b = a positive constant known as the learning rate parameter,
X = cumulative production, and
Y = the price as a function of cumulative production.

Thus, as experience (production) accumulates, the cost of producing the next unit
decreases. The percentage reduction in cost that occurs with each doubling of cumulative
production is known as the learning rate (LR), given by:

LR = 1 – 2-b
Eq. 8.7

In typical learning curve formulations, the learning rate parameter is derived using two
historical data series: cumulative production and price (or cost).

To derive the learning rate parameter for conventional gas and electric cooking products,
DOE obtained historical Producer Price Index (PPI) data for “gas household ranges, ovens
surface cooking units, and equipment” and “electric household ranges, ovens surface cooking
units, and equipment” from the Bureau of Labor Statistics’ (BLS) spanning the time period
1981-2022 and 1967-2022, respectivelyb. These are the most representative price indices for
these two product categories. Inflation-adjusted price indices were calculated by dividing the PPI
series by the implicit price deflator for Gross Domestic Product for the same years. These
inflation-adjusted price indices (shown in Figure 8.2.1 and Figure 8.2.2) ware used in subsequent
analysis steps.

a
In addition to Desroches (2013), see Weiss, M., Junginger, H.M., Patel, M.K., Blok, K., (2010a). A Review of
Experience Curve Analyses for Energy Demand Technologies. Technological Forecasting & Social Change. 77:411-
428.
b
Product series ID: PCU33522013 for gas household ranges, ovens, surface cooking units and equipment and
PCU33522011 for electric household ranges, ovens, surface cooking units and equipment. Available at:
http://www.bls.gov/ppi/.

8-7
180.0 2.0

160.0 1.8

140.0 1.6
Nominal PPI (1981=100)

Deflated PPI (2022=1)


1.4
120.0
1.2
100.0
1.0
80.0
0.8
60.0
0.6
40.0 0.4
20.0 0.2

0.0 0.0

2007

2013

2019
1981
1983
1985
1987
1989
1991
1993
1995
1997
1999
2001
2003
2005

2009
2011

2015
2017

2021
Nominal Gas Cooktop and Oven PPI Deflated Gas Cooktop and Oven PPI

Figure 8.2.1 Nominal and Deflated Conventional Gas Cooking Products PPI from 1981 to
2022

160.0 3.0

140.0
2.5
Nominal PPI (1981=100)

120.0 Deflated PPI (2022=1)


2.0
100.0

80.0 1.5

60.0
1.0
40.0
0.5
20.0

0.0 0.0
2015
1967
1970
1973
1976
1979
1982
1985
1988
1991
1994
1997
2000
2003
2006
2009
2012

2018
2021

Nominatal Electric Cooktop and Oven PPI


Deflated Electric Cooktop and Oven PPI

Figure 8.2.2 Nominal and Deflated Conventional Electric Cooking Products PPI from
1967 to 2022

DOE assembled a time-series of annual shipments for both consumer conventional


electric and gas cooking products from Association of Household Appliance Manufacturers
(AHAM) and Market Research Magazine.4 The annual shipments data were used to estimate

8-8
cumulative shipments (production). Projected shipments after 2022 were obtained from the no-
new-standards case projections made for the NIA (see chapter 9 of this TSD).

To estimate learning rate parameter, a least-squares power-law fit was performed on the
deflated price index versus cumulative shipments. See Figure 8.2.3 and Figure 8.2.4.

2.0
Price Index (2022=1)

1.5

1.0

0.5

0.0
0.0 20.0 40.0 60.0 80.0 100.0 120.0 140.0 160.0
Cumulative Shipments (million)

Gas Cooktop and Oven (1981-2022) Power (Gas Cooktop and Oven (1981-2022))

Figure 8.2.3 Relative Price versus Cumulative Shipments of Consumer Conventional Gas
Cooking Products from 1981 to 2022, with Power Law Fit

8-9
4.5

4.0

3.5
Price Index (2022=1)

3.0

2.5

2.0

1.5

1.0

0.5

0.0
0.0 50.0 100.0 150.0 200.0 250.0
Cumulative Shipments (million)

Electric Cooktop and Oven (1967-2022) Power (Electric Cooktop and Oven (1967-2022))

Figure 8.2.4 Relative Price versus Cumulative Shipments of Consumer Conventional


Electric Cooking Products from 1967 to 2022, with Power Law Fit

The form of the fitting equation is:

Pt = Po Xt (-b),
Eq. 8.8

where, the two parameters, b (the learning rate parameter) and Po (the price or cost of the first
unit of production), are obtained by fitting the model to the data. The variable Xt, is the
cumulative shipments from period zero to period t and Pt is the average deflated price of
shipments in period t. DOE notes that the cumulative shipments on the right hand side of the
equation can have a dependence on price, so there is an issue with simultaneity where the
independent variable Xt is not truly independent. DOE’s use of a simple least squares fit is
equivalent to an assumption of no significant effect of the price elasticity of supply.

For consumer conventional gas cooking products, the parameter values obtained are:

Po = 7.357+1.091
−0.950 (95% confidence), and
b = -0.420±0.032 (95% confidence).

The estimated learning rate (defined as the fractional reduction in price expected from
each doubling of cumulative production) is 25.2+1.6
−1.7 % (95% confidence).

8-10
For consumer conventional electric cooking products, the parameter values obtained are:

Po = 5.252+0.961
−0.812 (95% confidence), and
b = -0.316±0.038 (95% confidence).

The estimated learning rate (defined as the fractional reduction in price expected from
each doubling of cumulative production) is 19.7+2.1
−2.2 (95% confidence).

Since the production costs estimated in the engineering analysis represent the cost data in
2022, DOE derived two price factor indices, with 2022 equal to 1, to project prices for
conventional gas and electric cooking products in each future year in the analysis period. The
index value in a given year is a function of the LR and the cumulative production forecast
through that year. DOE applied the same value to project prices for each considered efficiency
level. The estimated price forecast index is shown in Figure 8.2.5.

1.2

1.0
Price Index Factor (2022=1)

0.8

0.6
Gas Cooktop and Oven

0.4 Electric Cooktop and Oven

0.2

0.0
2024

2034

2050
2022

2026
2028
2030
2032

2036
2038
2040
2042
2044
2046
2048

2052
2054
2056

Year

Figure 8.2.5 Price Forecast Indices for Conventional Gas and Electric Cooking Products

8.2.1.2 Baseline Manufacturer Costs


DOE developed the baseline manufacturer costs for consumer conventional cooking
products shown in Table 8.2.2 and Table 8.2.3, respectively. For this direct final rule, DOE
analyzed four oven types per conventional oven product class, representing different energy use
profiles and baseline cost (see chapter 5 for details). The tables below also include the integrated
annual energy consumption (IAEC) for cooking tops and integrated annual oven energy
consumption (IEAO) for ovens.

8-11
Table 8.2.2 Baseline Manufacturer Costs for Cooktops
IAEC Baseline Manufacturer
Cost
Gas Electricity
(2022$)
(kBtu/year) (kWh/year)

Electric Smooth Element


-- 250 232.32
Standalone Cooking Tops

Electric Smooth Element


Cooking Top Component
-- 250 232.32
of a Combined Cooking
Product
Gas Standalone Cooking
1,900 -- 137.58
Top
Gas Cooking Top
Component of a
1,900 -- 137.58
Combined Cooking
Product

Table 8.2.3 Baseline Manufacturer Costs for Ovens


IEAO Baseline
Manufacturer
Gas Electricity Costs
(kBtu/year) (kWh/year) (2022$)
Electric Standard
Ovens, -- 314.7 305.89
Freestanding
Electric Standard
Ovens, Built- -- 321.2 323.27
In/Slide-In
Electric Self-
Clean Ovens, -- 354.4 335.39
Freestanding
Electric Self-
Clean Ovens, -- 360.5 352.77
Built-In/Slide-in
Gas Standard
Ovens, 2,085 -- 326.47
Freestanding

8-12
IEAO Baseline
Manufacturer
Gas Electricity Costs
(kBtu/year) (kWh/year) (2022$)
Gas Standard
Ovens, Built- 2,104 -- 343.85
In/Slide-In
Gas Self-Clean
Ovens, 1,958 -- 417.88
Freestanding
Gas Self-Clean
Ovens, Built- 1,979 -- 435.26
In/Slide-In

8.2.1.3 Incremental Manufacturer Cost by Efficiency Level


DOE used a design-option approach supported by testing and supplemented by reverse
engineering (i.e., physical teardowns and testing of existing products in the market) to identify
the incremental cost and efficiency improvement associated with each design option or design-
option combination (see chapter 5 of this TSD for details). Table 8.2.4 and Table 8.2.5 present
the incremental manufacturer production costs (MPCs) at each efficiency level relative to the
baseline level for electric and gas cooking top product classes, respectively. Table 8.2.6 through
Table 8.2.9 present the incremental MPCs at each efficiency level for the four types of electric
ovens analyzed in this direct final rule. Table 8.2.10 through Table 8.2.13 present the
incremental MPCs at each efficiency level for the four types of gas ovens analyzed in this direct
final rule. Also included in each of the tables are the associated efficiency metric, IAEC for
conventional cooking tops and IEAO for conventional ovens.

Table 8.2.4 Electric Smooth Element Cooking Top Product Classes: Incremental
Manufacturer Production Cost by Efficiency Level
IAEC Manufacturer Cost
EL
kWh/year Increase (2022$)
Baseline 250 --
1 207 $1.99
2 189 $15.82
3 179 $251.34

8-13
Table 8.2.5 Gas Cooking Top Product Classes: Incremental Manufacturer Production
Cost by Efficiency Level
IAEC Manufacturer Cost
EL
kBtu/year Increase (2022$)
Baseline 1,900 -
1 1,770 $2.67
2 1,343 $18.72

Table 8.2.6 Electric Standard Ovens, Freestanding: Incremental Manufacturer


Production Cost by Efficiency Level
IEAO Manufacturer Cost
EL
kWh/year Increase (2022$)
Baseline 314.7 --
1 302.0 $1.99
2 289.0 $36.70
3 235.3 $71.89

Table 8.2.7 Electric Standard Ovens, Built-In/Slide-In: Incremental Manufacturer


Production Cost by Efficiency Level
IEAO Manufacturer Cost
EL
kWh/year Increase (2022$)
Baseline 321.2 --
1 308.9 $1.99
2 295.9 $36.70
3 242.1 $71.89

Table 8.2.8 Electric Self-Clean Ovens, Freestanding: Incremental Manufacturer


Production Cost by Efficiency Level
IEAO Manufacturer Cost
EL
kWh/year Increase (2022$)
Baseline 354.4 --
1 341.7 $1.99
2 328.7 $36.70
3 275.0 $71.89

8-14
Table 8.2.9 Electric Self-Clean Ovens, Built-In/Slide-In: Incremental Manufacturer
Production Cost by Efficiency Level
IEAO Manufacturer Cost
EL
kWh/year Increase (2022$)
Baseline 360.5 --
1 348.1 $1.99
2 335.1 $36.70
3 281.4 $71.89

Table 8.2.10 Gas Standard Ovens, Freestanding: Incremental Manufacturer Production


Cost by Efficiency Level
IEAO Manufacturer Cost
EL
kBtu/year Increase (2022$)
Baseline 2,085 --
1 2,041 $1.99
2 1,908 $26.23

Table 8.2.11 Gas Standard Oven, Built-In/Slide-In: Incremental Manufacturer


Production Cost by Efficiency Level
IEAO Manufacturer Cost
EL
kBtu/year Increase (2022$)
Baseline 2,104 --
1 2,062 $1.99
2 1,929 $26.23

Table 8.2.12 Gas Self-Clean Ovens, Freestanding: Incremental Manufacturer Production


Cost by Efficiency Level
IEAO Manufacturer Cost
EL
kBtu/year Increase (2022$)
Baseline 1,958 --
1 1,915 $1.99
2 1,781 $26.23

8-15
Table 8.2.13 Gas Self-Clean Ovens, Built-In/Slide-In: Incremental Manufacturer
Production Cost Increases by Efficiency Level
IEAO Manufacturer Cost
EL
kBtu/year Increase (2022$)
Baseline 1,979 --
1 1,937 $1.99
2 1,804 $26.23

8.2.1.4 Overall Markup


For a given distribution channel, the overall markup is the value determined by
multiplying all the associated markups and the applicable sales tax together to arrive at a single
overall distribution chain markup value. Because there are baseline and incremental markups
associated with the various market participants, the overall markup is also divided into a baseline
markup (i.e., a markup used to convert the baseline manufacturer price into a consumer price)
and an incremental markup (i.e., a markup used to convert a standard-compliant manufacturer
cost increase due to an efficiency increase into an incremental consumer price). Refer to chapter
6 of this TSD for details.

Table 8.2.14 shows the overall baseline, incremental markups, and the national
population-weighted sales tax for consumer conventional cooking products. Note that although
DOE presents a national sales tax value in Table 8.2.14, in the LCC analysis, DOE uses sales tax
values that vary by Census Division for households in the consumer sample.

Table 8.2.14 Cooking Products: Overall Markup


Markup Baseline Incremental
Manufacturer 1.20
Retailer 1.49 1.24
National Sales
1.073
Tax
Overall 1.92 1.60

8.2.1.5 Installation Cost


DOE derived baseline installation costs for cooking tops and ovens based on data in the
RSMeans Residential Cost Data, 2022.5 RSMeans 2022 provides minimum and maximum
estimates for the labor time costs required to install consumer cooking equipment. DOE assumed
that installation costs for a 4-burner countertop cooktop best represents the cost to install cooking
top product classes and the cost to install a 30-inch free-standing cooking range best represents
the cost to install oven product classes. Based on feedback from stakeholders to the February
2023 Supplemental Notice of Proposed Rulemaking (SNOPR), DOE included an additional labor
cost for a gas plumber to perform any additional set-up specific to gas appliances. DOE used the
average of the minimum and maximum labor costs as its estimate of installation costs for

8-16
baseline cooking tops and ovens. Table 8.2.15 through Table 8.2.18 provide the installation costs
used for each product category.

Table 8.2.15 Baseline Installation Cost for Electric Smooth Element Cooking Tops
Labor Costs Including
Installation Labor Bare Labor Overhead and
Crew Type Overhead & Profit
Type Hours Costs (2022$) Profit (%)
(2022$)
Minimum 1 Electrician 1.3 $59 62.9% $95
Maximum 1 Electrician 2.7 $115 62.9% $190
Average (2022$) $143

Table 8.2.16 Baseline Installation Cost for Gas Cooking Tops


Labor Costs Including
Installation Labor Bare Labor Overhead and
Crew Type Overhead & Profit
Type Hours Costs (2022$) Profit (%)
(2022$)
1 Electrician 1.3 $59 62.9%
Minimum $163
1 Plumber 1.0 $42 63.1%
1 Electrician 2.7 $117 62.9%
Maximum $258
1 Plumber 1.0 $42 63.1%
Average (2022$) $211

Table 8.2.17 Baseline Installation Cost for Electric Ovens


Labor Costs Including
Installation Labor Bare Labor Overhead and
Crew Type Overhead & Profit
Type Hours Costs (2022$) Profit (%)
(2022$)
Minimum 2 Building
Common 1.4 $46 62.9% $75
Labors
Maximum 2 Building
Common 4.0 $115 62.9% $187
Labors
Average (2022$) $131

8-17
Table 8.2.18 Baseline Installation Cost for Gas Ovens
Labor Costs Including
Installation Labor Bare Labor Overhead and
Crew Type Overhead & Profit
Type Hours Costs (2022$) Profit (%)
(2022$)
2 Building
Common 1.4 $46 62.9%
Minimum Labors $143
1 Plumber 1.0 $42 63.1%
2 Building
Common 4.0 $115 62.9%
Maximum Labors $256
1 Plumber 1.0 $42 63.1%
Average (2022$) $199

For all product classes other than electric smooth element cooking top product classes,
DOE assumed that installation costs for a given product class would not vary by efficiency and
assigned the baseline installation cost to all efficiency levels.

In the case of electric smooth element cooking top product classes, the induction heating
design option requires a change of utensils to those that are ferromagnetic to operate the cooking
tops. DOE treated this as additional installation cost for this particular design option. DOE
utilized a study by Willem et al.6 to determine the average number of pots and pans to be
replaced. DOE used average number of pots and pans utilized by a representative household and
average retail price of induction compatible cooking utensils to estimate this portion of the
installation cost. After adjusting costs to 2022$, DOE estimated $117 as the cost due to the
change of pots and pans. With regard to those consumers who may need to upgrade the electrical
wiring to accommodate for a higher amperage, DOE did not have information about the existing
amperage of the electrical circuit of the consumer population. In order to be representative of the
consumer population in this direct final rule, DOE estimated an average additional cost based on
the assumption that 50% of the user population may need upgrades and 50% may not, using the
wiring cost contained in RS Means 2022 Residential Cost Data. Table 8.2.19 provides the
material and labor costs due to the upgrade of the electrical wiring based on the 2022 RS Means
Residential Cost Data.

8-18
Table 8.2.19 Induction Cooking Tops (Range outlet, 50 amp-240 volt receptacle):
Incremental Installation Costs
Bare Bare Bare Total Incl
Residential Wiring
Material Labor Total O&P
Type NM cable $93.50 $83.00 $176.50 $238.00
Type MC cable $112.00 $87.50 $119.50 $265.00
EMT & Wire $128.00 $118.00 $246.00 $333.00
Average (2022$) $278.67

In this direct final rule, DOE derived geographic-dependent labor factors to account for
the variability in installation costs in its LCC analysis. RSMeans 2022 Residential Cost Data
provides labor cost factors for 295 cities and towns in the United States. To derive average labor
cost values by State, DOE weighted the cost factors by city or town population size using 2022
census population data. The population weighted state labor costs factors then aggregated into
the appropriate nine census divisions. Table 8.2.20 shows the final regional labor cost factors
used in this direct final rule analysis.

Table 8.2.20 Labor Cost Factors by Census Division


Census Division Census Division Name Labor Cost Factor
1 New England 1.15
2 Middle Atlantic 1.59
3 East North Central 1.13
4 West North Central 0.90
5 South Atlantic 0.72
6 East South Central 0.73
7 West South Central 0.65
8 Mountain 0.76
9 Pacific 1.28

8.2.2 Inputs to Operating Cost


DOE defines operating cost (OC) by the following equation:

OC = EC + RC + MC
Eq. 8.9
where:

EC = Energy expenditure associated with operating the equipment,


RC = Repair cost associated with component failure, and
MC = Service cost for maintaining equipment operation.

Table 8.2.21 shows the inputs for determining annual operating costs and their discounted
values throughout the product lifetime.
8-19
Table 8.2.21 Inputs for Operating Cost
Annual energy consumption
Energy prices and price trends
Repair and maintenance Costs
Energy Price Trends
Product Lifetime
Discount Rate
Effective Date of Standard

The annual energy consumption is the site energy use associated with operating the
product. Annual energy consumption varies with product efficiency. Energy prices are the prices
paid by consumers for energy (e.g., electricity or natural gas). Multiplying the annual energy
consumption by the energy price yields the annual energy cost. Repair costs are associated with
repairing or replacing components that have failed. Maintenance costs are associated with
maintaining the operation of the product. DOE used energy price trends to forecast energy prices
into the future and, along with the product lifetime and discount rate, to establish the present
value of lifetime energy costs.

DOE used the following equation to calculate the annual operating cost for baseline
products.

OC BASE = EC BASE + RC BASE + MC BASE = AEC BASE  PRICE ENERGY + RC BASE + MC BASE
Eq. 8.10
where:

OCBASE = Baseline operating cost,


ECBASE = Energy expenditure associated with operating the baseline equipment,
RCBASE = Repair cost associated with component failure for the baseline equipment,
MCBASE = Service cost for maintaining baseline equipment operation,
AECBASE = Annual energy consumption for baseline equipment, and
PRICEENERGY = Energy price.

DOE calculated the operating cost for standard-level products based on the following
equation:

OC STD = EC STD + RC STD + MC STD = AEC STD  PRICE ENERGY + RC STD + MC STD
(
= AEC BASE __
)
AEC STD  PRICE ENERGY + (RC BASE + RC STD ) + (MC BASE + MC STD )
Eq. 8.11
where:

OCSTD = Standard-level operating cost,


8-20
ECSTD = Energy expenditure associated with operating standard-level equipment,
RCSTD = Repair cost associated with component failure for standard-level equipment,
MCSTD = Service cost for maintaining standard-level equipment operation,
AECSTD = Annual energy consumption for standard-level equipment,
PRICEENERGY = Energy price,
ΔAECSTD = Change in annual energy consumption caused by standard-level equipment,
ΔRCSTD = Change in repair cost caused by standard-level equipment, and
ΔMCSTD = Change in maintenance cost caused by standard-level equipment.

The remainder of this section provides information about each of the above input
variables that DOE used to calculate the operating costs for all product classes for consumer
conventional cooking products.

8.2.2.1 Annual Energy Consumption


As described in section 7.2.3 of chapter 7 of this TSD, DOE developed a sample of
individual households that use one of the product classes of consumer conventional cooking
products. By developing household samples, DOE was able to perform the LCC and PBP
calculations for each household to account for the variability in both energy use and energy price
associated with each household. DOE used EIA’s RECS 2020 to develop the household samples
and, in turn, to establish the variability in both annual energy consumption and energy pricing.
Tables in chapter 7 provide the average annual energy consumption by efficiency level for the
units considered for each product class of consumer conventional cooking products.

8.2.2.2 Energy Prices


DOE used regional energy prices to characterize the variability in consumer operating
costs. DOE’s method for deriving energy prices is described here.

Recent Electricity Prices

DOE derived annual electricity prices in 2022 for each census division using data from
the latest EEI Typical Bills and Average Rates reports.7 For the residential sector and for most of
the major investor-owned utilities (IOUs) in the country, each report provides the total bill
assuming household consumption levels of 500, 750 and 1,000 kWh for the billing period. DOE
calculated electricity prices using the methodology described in Coughlin and Beraki (2018). 8

Because marginal electricity price more accurately captures the incremental savings
associated with a change in energy use from higher efficiency, it provides a better representation
of incremental change in consumer costs than average electricity prices. Therefore, DOE applied
average electricity prices for the energy use of the product purchased in the no-new-standards
case, and marginal electricity prices for the incremental change in energy use associated with the
other efficiency levels considered.

Table 8.2.22 and Table 8.2.23 show the average and marginal price electricity prices for
each census division, respectively.

8-21
Table 8.2.22 Average Residential Electricity Prices in 2022
Geographic Area 2022$/kWh
1 New England Census Division $0.248
2 Middle Atlantic Census Division $0.189
3 East North Central Census Division $0.154
4 West North Central Census Division $0.135
5 South Atlantic Census Division $0.132
6 East South Central Census Division $0.133
7 West South Central Census Division $0.119
8 Mountain North $0.127
9 Mountain South $0.129
10 Pacific Census Division $0.357
Source: EEI 2022.

Table 8.2.23 Marginal Residential Electricity Prices in 2022


Geographic Area 2022$/kWh
1 New England Census Division $0.231
2 Middle Atlantic Census Division $0.176
3 East North Central Census Division $0.146
4 West North Central Census Division $0.117
5 South Atlantic Census Division $0.114
6 East South Central Census Division $0.110
7 West South Central Census Division $0.098
8 Mountain North $0.122
9 Mountain South $0.122
10 Pacific Census Division $0.408

Recent Natural Gas Prices

DOE obtained data for calculating regional prices of natural gas from the EIA
publication, Natural Gas Navigator.9 This publication presents monthly volumes of natural gas
deliveries and average prices by state for residential, commercial, and industrial customers. DOE
used the complete annual data for 2022 to calculate an average annual price for each census
division. The calculation of average prices proceeded in two steps.

1. For each state, DOE calculated the annual residential price of natural gas using a simple
average of data.
2. DOE then calculated a regional price, weighting each state in a census division by its
number of households.

8-22
The prices in Table 8.2.24 are in dollars per million Btu ($/MMBtu).

Table 8.2.24 Average Residential Natural Gas Prices in 2022


Geographic Area 2022$/MMBtu
1 New England Census Division $21.618
2 Middle Atlantic Census Division $17.199
3 East North Central Census Division $16.441
4 West North Central Census Division $16.584
5 South Atlantic Census Division $22.947
6 East South Central Census Division $18.153
7 West South Central Census Division $20.992
8 Mountain North Census Division $12.599
9 Mountain South Census Division $17.711
10 Pacific Census Division $19.072

Residential natural gas prices were adjusted by applying seasonal marginal price factors
to reflect a change in a consumer’s bill associated with a change in energy consumed. They are
appropriate for determining energy cost savings associated with possible changes to efficiency
standards.

EIA provides historical monthly natural gas consumption and expenditures by state. This
data was used to determine 10-year average marginal prices factors for the RECS 2020 census
divisions, which are then used to convert average monthly natural gas prices into marginal
monthly natural gas prices.10 DOE interpreted the slope of the regression line (consumption vs.
expenditures) for each state as the marginal natural gas price factor for that state. Because a
cooking product operates all year around, DOE determined summer and winter marginal price
factors.

Table 8.2.25 shows the natural gas marginal price for each census division.

8-23
Table 8.2.25 Residential Marginal Natural Gas Price in 2022
Geographic Area 2022$/MMBtu
1 New England Census Division $18.12
2 Middle Atlantic Census Division $11.57
3 East North Central Census Division $9.58
4 West North Central Census Division $10.17
5 South Atlantic Census Division $13.84
6 East South Central Census Division $10.63
7 West South Central Census Division $10.34
8 Mountain North Census Division $9.36
9 Mountain South Census Division $11.12
10 Pacific Census Division $17.47

Residential Liquid Petroleum Gas (LPG) Prices

DOE collected 2022 average LPG prices from EIA’s 2022 State Energy Consumption,
Price, and Expenditures Estimates (SEDS)11. DOE weighted the average residential LPG prices
for each State by the amount of LPG consumed by each State. Finally, DOE aggregated and
averaged the prices by nine census divisions. Table 8.2.26 shows the LPG average price for each
census division.

Table 8.2.26 Residential Average LPG Price in 2022


Geographic Area 2022$/MMBtu
1 New England Census Division $36.453
2 Middle Atlantic Census Division $34.614
3 East North Central Census Division $26.772
4 West North Central Census Division $24.147
5 South Atlantic Census Division $33.852
6 East South Central Census Division $30.607
7 West South Central Census Division $31.957
8 Mountain North Census Division $26.637
9 Mountain South Census Division $33.165
10 Pacific Census Division $33.996

8.2.2.3 Energy Price Trends


DOE used EIA’s price forecasts to estimate future trends in electricity and natural gas
prices. To arrive at prices in future years, DOE multiplied the average and marginal prices listed
in section 8.2.2.2 by the forecast of annual average price changes based on the reference case in

8-24
EIA’s AEO 2023. To estimate the trend after 2050, DOE used a constant value derived from the
average values from 2046 through 2050.

DOE calculated LCC and PBP based on three separate projections from AEO 2023:
reference, low economic growth, and high economic growth. These three cases reflect the
uncertainty of economic growth in the projection period. The high and low growth cases show
the projected effects of alternative growth assumptions on energy markets. Figure 8.2.6 and
Figure 8.2.7 show the residential electricity and natural gas price trends, respectively, based on
the three AEO 2023 projections.

AEO 2023 National Electricity Price Trend


1.02
Electricity Price Trend (2022=1.00)

1.00

0.98

0.96

0.94

0.92

0.90

0.88

0.86
2020 2025 2030 2035 2040 2045 2050

Reference High Low

Figure 8.2.6 AEO 2023 Residential Electricity Price Trends

8-25
AEO 2023 National Natural Gas Price Trend
1.05

1.00
Gas Price Trend (2022=1.00)

0.95

0.90

0.85

0.80

0.75

0.70
2020 2025 2030 2035 2040 2045 2050

Reference High Low

Figure 8.2.7 AEO 2023 Residential Natural Gas Price Trends

AEO 2023 National LPG Price Trend


1.20

1.15
LPG Price Trend (2022=1.00)

1.10

1.05

1.00

0.95

0.90

0.85

0.80
2020 2025 2030 2035 2040 2045 2050

Reference High Low

Figure 8.2.8 AEO 2023 Residential LPG Price Trends

8-26
8.2.2.4 Repair and Maintenance Costs
For cooking tops, DOE used data from a 2022 Consumer Reports survey. c DOE assumed
a repair cost of $153 for a gas cooking top, $192 for a non-induction electric smooth element
cooking top, and $536 for an induction electric smooth element cooking top. For ovens, DOE
used data from an online appliance repair website that presented average values of $150 for
electric ovens and $350 for gas ovens.d With the exception of induction electric smooth element
cooking tops, DOE notes repair costs do not vary by efficiency level, and remain the same in the
no-new-standards and standards cases leading to no additional repair cost as a result of a
standard.

8.2.2.5 Product Lifetime


DOE assumed that average lifetime for electric cooking products is 16.8 years and
average lifetime for gas cooking products is 14.5 years.12

To perform the LCC and PBP analysis, DOE had to develop survival functions for
conventional cooking tops. DOE estimated the percentage of appliances of a given age that
would still be in operation in a given year. This survival function, which DOE assumes has the
form of a cumulative Weibull distribution, provides an average and a median appliance lifetime.

The Weibull distribution is a probability distribution commonly used to measure failure


ratese. Its form is similar to that of an exponential distribution, which models a fixed failure rate,
except that a Weibull distribution allows for a failure rate that changes through time. The
cumulative Weibull distribution takes the form:

 x− 
− 
P ( x) = e    for x > θ and
P(x) = 1 for x ≤ θ.
Eq. 8.12
Where:

P(x) = probability that the appliance is still in use at age x;


x = age of appliance;
α = scale parameter, which would be the decay length in an exponential distribution;
β = shape parameter, which determines the way in which the failure rate changes through time;
and
θ = delay parameter, which allows for a delay before any failures occur.

c
Available at www.consumerreports.org/appliances/cooktops/should-you-repair-or-replace-your-broken-cooktop-
a6490859316 (last accessed on Aug. 7, 2023).
d
Available at www.fixr.com/costs/oven-repair (last accessed on Aug. 7, 2023).
e
For reference on the Weibull distribution, see sections 1.3.6.6.8 and 8.4.1.3 of the National Institute of Standards
and Technology (NIST)/SEMATECH e-Handbook of Statistical Methods. www.itl.nist.gov/div898/handbook/ (Last
accessed November 18, 2016.)

8-27
When β = 1, the failure rate is constant over time, giving the distribution the form of a
cumulative exponential distribution. In the case of appliances, β commonly is greater than 1,
reflecting an increasing failure rate as appliances age. Figure 8.2.9 and Figure 8.2.10 show the
Weibull retirement and survival functions for electric and gas cooking products, respectively.
The results of DOE’s analysis are shown in Table 8.2.27. Details of calculations and assumptions
can be found in appendix 8C.

Figure 8.2.9 Weibull Function for Lifetime of Electric Cooking Products

8-28
Figure 8.2.10 Weibull Function for Lifetime of Gas Cooking Products

Table 8.2.27 Lifetime Parameters


Weibull Parameters
Average
Product Fuel Type
(Years) Alpha Beta
(Scale) (Shape)

Electric 16.8 16.88 6.99

Gas 14.5 14.56 5.73

8.2.3 Discount Rate


The consumer discount rate is the rate at which future operating costs of residential
products are discounted to establish their present value in the LCC analysis. The discount rate
value is applied in the LCC to future year energy costs and non-energy operations and
maintenance costs in order to calculate the estimated net life-cycle cost of products of various
efficiency levels and the life-cycle cost savings of higher-efficiency models as compared to the
baseline for a representative sample of consumers.

DOE calculates the consumer discount rate using publicly available data (the Federal
Reserve Board’s Survey of Consumer Finances [SCF]) to estimate a consumer’s required rate of
return or opportunity cost of funds related to appliances.13 In the economics literature,
8-29
opportunity cost reflects potential foregone benefit from choosing one option over another.
Opportunity cost of capital refers to the rate of return that one could earn by investing in an
alternate project with similar risk; similarly, opportunity cost may be defined as the cost
associated with opportunities that are foregone when resources are not put to their highest-value
use.14

DOE’s method views the purchase of a higher efficiency appliance as an investment that
yields a stream of energy cost savings. The stream of savings is discounted at a rate reflecting (1)
the rates of return associated with other investments available to the consumer, and (2) the
observed costs of credit options available to the consumer to reflect the value of avoided debt.
DOE notes that the LCC does not analyze the appliance purchase decision, so the implicit
discount rate is not relevant in this model. The LCC estimates net present value over the lifetime
of the product, so the appropriate discount rate will reflect the general opportunity cost of
household funds, taking this time scale into account.

Given the long time horizon modeled in the LCC, the application of a marginal interest
rate associated with an initial source of funds is inaccurate. Regardless of the method of
purchase, consumers are expected to continue to rebalance their debt and asset holdings over the
LCC analysis period, based on the restrictions consumers face in their debt payment
requirements and the relative size of the interest rates available on debts and assets. DOE
estimates the aggregate impact of this rebalancing using the historical distribution of debts and
assets. The discount rate is the rate at which future savings and expenditures are discounted to
establish their present value.

DOE estimates separate discount rate distributions for six income groups based on
income percentiles as reported in the SCF. These income groups are listed in Table 8.2.28. This
disaggregation reflects the fact that low- and high-income consumers tend to have substantially
different shares of debt and asset types, as well as facing different rates on debts and assets.
Summaries of shares and rates presented in this chapter are averages across the entire population.

8-30
Table 8.2.28 Definitions of Income Groups
Income Group Percentile of Income
1 0 – 19.9
2 20 – 39.9
3 40 – 59.9
4 60 – 79.9
5 80 – 89.9
6 90 - 100
Sources: Federal Reserve Board. Survey of Consumer Finances (SCF) for 1995, 1998, 2001, 2004, 2007, 2010,
2013, 2016, and 2019.

8.2.3.1 Shares of Debt and Asset Classes


DOE’s approach involved identifying all household debt or equity classes in order to
approximate a consumer’s opportunity cost of funds over the product’s lifetime. This approach
assumes that in the long term, consumers are likely to draw from or add to their collection of
debt and asset holdings approximately in proportion to their current holdings when future
expenditures are required or future savings accumulate. DOE now includes several previously
excluded debt types (i.e., vehicle and education loans, mortgages, all forms of home equity loan)
in order to better account for all of the options available to consumers.
The average share of total debt plus equity and the associated rate of each asset and debt
type are used to calculate a weighted average discount rate for each SCF household (Table
8.2.29). The household-level discount rates are then aggregated to form discount rate
distributions for each of the six income groups.f
DOE estimated the average percentage shares of the various types of debt and equity
using data from the SCF for 1995, 1998, 2001, 2004, 2007, 2010, 2013, 2016, and 2019.g DOE
derived the household-weighted mean percentages of each source of across the twenty-one years
covered by the eight survey versions. DOE posits that these long-term averages are most
appropriate to use in its analysis.

f
Note that previously DOE performed aggregation of asset and debt types over households by summing the dollar
value across all households and then calculating shares. Weighting by dollar value gave disproportionate influence
to the asset and debt shares and rates of higher income consumers. DOE has shifted to a household-level weighting
to more accurately reflect the average consumer in each income group.
g
Note that two older versions of the SCF are also available (1989 and 1992); these surveys are not used in this
analysis because they do not provide all of the necessary types of data (e.g., credit card interest rates, etc.). DOE
feels that the time span covered by the eight surveys included is sufficiently representative of recent debt and equity
shares and interest rates.

8-31
Table 8.2.29 Average Shares of Household Debt and Asset Types by Income Group (%)
Income Group
Type of Debt or Equity
1 2 3 4 5 6 All
Debt:
Mortgage 14.3 22.2 33.1 43.3 47.5 37.0 31.0
Home equity loan 1.5 1.8 2.4 3.5 4.6 7.7 3.1
Credit card 15.8 12.2 9.4 6.1 4.0 1.9 9.3
Other installment loan 31.9 28.0 23.9 16.9 11.5 5.9 21.9
Other line of credit 1.4 1.8 1.5 2.0 2.5 2.3 1.8
Other residential loan 0.7 0.4 0.5 0.4 0.3 0.2 0.5
Equity:
Savings account 19.1 15.0 11.6 9.0 8.2 7.5 12.5
Money market account 3.5 4.3 3.8 3.6 4.4 6.7 4.1
Certificate of deposit 6.0 6.4 4.6 3.8 3.1 3.3 4.8
Savings bond 1.5 1.6 1.4 1.6 1.4 1.2 1.5
State & Local bonds 0.0 0.1 0.2 0.2 0.4 1.3 0.3
Corporate bonds 0.1 0.1 0.1 0.2 0.1 0.4 0.1
Stocks 2.3 3.2 3.8 4.8 6.0 12.2 4.6
Mutual funds 1.8 3.0 3.7 4.8 6.1 12.5 4.5
Total 100.0 100.0 100.0 100.0 100.0 100.0 100.0
Sources: Federal Reserve Board. Survey of Consumer Finances (SCF) for 1995, 1998, 2001, 2004, 2007, 2010,
2013, 2016, and 2019.

8.2.3.2 Rates for Types of Debt


DOE estimated interest rates associated with each type of debt. The source for interest
rates for mortgages, loans, credit cards, and lines of credit was the SCF for 1995, 1998, 2001,
2004, 2007, 2010, 2013, 2016, and 2019, which associates an interest rate with each type of debt
for each household in the survey.
DOE adjusted the nominal rates to real rates for each type of debt by using the annual
inflation rate for each year (using the Fisher formula).h In calculating effective interest rates for
home equity loans and mortgages, DOE also accounted for the fact that interest on both such
loans are tax deductible. This rate corresponds to the interest rate after deduction of mortgage
interest for income tax purposes and after adjusting for inflation. The specific inflation rates vary
by SCF year, while the marginal tax rates vary by SCF year and income bin as shown in Table
8.2.30. For example, a 6 percent nominal mortgage rate has an effective nominal rate of 5.5

h
Fisher formula is given by: Real Interest Rate = [(1 + Nominal Interest Rate) / (1 + Inflation Rate)] – 1. Note that
for this analysis DOE used a minimum real effective debt interest rate of 0 percent.

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percent for a household at the 25 percent marginal tax rate. When adjusted for an inflation rate of
2 percent, the effective real rate becomes 2.45 percent.

Table 8.2.30 Data Used to Calculate Real Effective Household Debt Rates
Inflation Applicable Marginal Tax Rate by Income Group (%)
Year
Rate (%) 1 2 3 4 5 6
1995 2.81 15.0 15.0 15.0 28.0 28.0 39.6
1998 1.55 15.0 15.0 15.0 28.0 28.0 39.6
2001 2.83 10.0 15.0 15.0 27.5 27.5 39.1
2004 2.68 10.0 15.0 15.0 25.0 25.0 35.0
2007 2.85 10.0 15.0 15.0 25.0 25.0 35.0
2010 1.64 10.0 15.0 15.0 25.0 25.0 35.0
2013 1.46 10.0 15.0 15.0 25.0 25.0 37.3
2016 1.26 10.0 15.0 15.0 25.0 25.0 37.3
2019 1.81 10.0 12.0 12.0 22.0 22.0 36.0

Table 8.2.31 shows the household-weighted average effective real rates in each year and
the mean rate across years. Because the interest rates for each type of household debt reflect
economic conditions throughout numerous years and various phases of economic growth and
recession, they are expected to be representative of rates in effect in 2025.

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Table 8.2.31 Average Real Effective Interest Rates for Household Debt (%)
Income Group
Type of Debt
1 2 3 4 5 6 All
Mortgage 4.09 3.74 3.60 2.92 2.79 2.19 3.18
Home equity loan 4.29 4.34 3.86 3.24 3.11 2.45 3.35
Credit card 9.80 11.02 11.15 11.26 10.90 10.11 10.64
Other installment loan 6.14 7.09 5.98 5.33 4.54 4.42 6.10
Other line of credit 3.73 3.67 6.23 5.47 4.89 5.33 4.97
Other residential loan 6.53 6.41 5.22 4.96 4.33 3.99 5.32
Sources: Federal Reserve Board. Survey of Consumer Finances (SCF) for 1995, 1998, 2001, 2004, 2007, 2010,
2013, 2016, and 2019.

8.2.3.3 Rates for Types of Assets


No similar rate data are available from the SCF for classes of assets, so DOE derived
asset interest rates from various sources of national historical data (1991-2020). The rates for
stocks are the annual returns on the Standard and Poor’s 500 for 1991–2020.15 The interest rates
associated with AAA corporate bonds were collected from Moody’s time-series data for 1991–
2020.16 Rates on Certificates of Deposit (CDs) accounts came from Cost of Savings Index
(COSI) data covering 1991–2020.17,18,19,20,21,i The interest rates associated with state and local
bonds (20-bond municipal bonds) were collected from Federal Reserve Board economic data
time-series for 1991–2020.22,j The interest rates associated with treasury bills (30-Year treasury
constant maturity rate) were collected from Federal Reserve Board economic data time-series for
1991–2020.23,24,k Rates for money market accounts are based on three-month money market
account rates reported by Organization for Economic Cooperation and Development (OECD)
from 1991–2020.25 Rates for savings accounts are assumed to be half the average real money
market rate. Rates for mutual funds are a weighted average of the stock rates and the bond rates. l
DOE adjusted the nominal rates to real rates using the annual inflation rate in each year (see
appendix 8C). In addition, DOE adjusted the nominal rates to real effective rates by accounting
for the fact that interest on such equity types is taxable. The capital gains marginal tax rate varies
for each household based on income as shown in Table 8.2.32.

i
The Wells COSI is based on the interest rates that the depository subsidiaries of Wells Fargo & Company pay to
individuals on certificates of deposit (CDs), also known as personal time deposits. Wells Fargo COSI started in
November 2009. From July 2007 to October 2009 the index was known as Wachovia COSI and from January 1984
to July 2007 the index was known as GDW (or World Savings) COSI.
j
This index was discontinued in 2016. To calculate the 2017 and after values, DOE compared 1981-2020 data for
30-Year Treasury Constant Maturity Rate32 and Moody’s AAA Corporate Bond Yield24 to the 20-Bond Municipal
Bond Index data.31
k
From 2003-2005 there are no data. For 2003-2005, DOE used 20-Year Treasury Constant Maturity Rate.

8-34
Table 8.2.32 Average Capital Gains Marginal Tax Rate by Income Group (%)
Income Group
Year
1 2 3 4 5 6
1995 12.5 12.5 12.5 28.0 28.0 33.8
1998 12.5 12.5 12.5 24.0 24.0 29.8
2001 7.5 10.0 15.0 21.3 21.3 27.1
2004 7.5 10.0 15.0 21.3 21.3 27.1
2007 7.5 10.0 15.0 20.0 20.0 25.0
2010 5.0 7.5 15.0 20.0 20.0 25.0
2013 5.0 7.5 15.0 20.0 20.0 27.4
2016 5.0 7.5 15.0 20.0 20.0 27.4
2019 5.0 6.0 6.0 18.5 18.5 26.8

Average real effective interest rates for the classes of household assets are listed in Table
8.2.33. Because the interest and return rates for each type of asset reflect economic conditions
throughout numerous years, they are expected to be representative of rates that may be in effect
in the compliance year. The average nominal interest rates and the distribution of real interest
rates by year are shown in appendix 8C of this direct final rule TSD.

l
SCF reports what type of mutual funds the household has (e.g., stock mutual fund, savings bond mutual fund, etc.).
For mutual funds with a mixture of stocks and bonds, the mutual fund interest rate is a weighted average of the stock
rates (two-thirds weight) and the savings bond rates (one-third weight).

8-35
Table 8.2.33 Average Real Interest Rates for Household Assets (%)
Income Group
Equity Type
1 2 3 4 5 6 All
Savings accounts 0.06 0.05 0.05 0.05 0.05 0.04 0.05
Money market accounts 0.11 0.11 0.10 0.09 0.09 0.09 0.10
Certificate of deposit 0.26 0.25 0.24 0.22 0.22 0.20 0.24
Treasury Bills (T-bills) 1.79 1.75 1.68 1.53 1.53 1.41 1.65
State/Local bonds 1.60 1.76 1.68 1.53 1.53 1.40 1.51
AAA Corporate Bonds 1.96 1.98 2.30 2.20 2.12 2.03 2.12
Stocks (S&P 500) 7.89 7.74 7.39 6.70 6.70 6.17 6.93
Mutual funds 6.49 6.55 6.34 5.67 5.75 5.04 5.80

8.2.3.4 Discount Rate Calculation and Summary


Using the asset and debt data discussed above, DOE calculated discount rate distributions
for each income group as follows. First, DOE calculated the discount rate for each consumer in
each of the versions of the SCF, using the following formula:

𝐷𝑅𝑖 = ∑ 𝑆ℎ𝑎𝑟𝑒𝑖,𝑗 × 𝑅𝑎𝑡𝑒𝑖,𝑗


𝑗
Eq. 8.13
Where:

𝐷𝑅𝑖 = discount rate for consumer i,


𝑆ℎ𝑎𝑟𝑒𝑖,𝑗 = share of asset or debt type j for consumer i, and
𝑅𝑎𝑡𝑒𝑖,𝑗 = real interest rate or rate of return of asset or debt type j for consumer i.

The rate for each debt type is drawn from the SCF data for each household. The rate for
each asset type is drawn from the distributions described above.

Once the real discount rate was estimated for each consumer, DOE compiled the
distribution of discount rates in each survey by income group by calculating the proportion of
consumers with discount rates in bins of 1 percent increments, ranging from 0-1 percent at the
low end to 30 percent and greater at the high end. Giving equal weight to each survey, DOE
compiled the overall distribution of discount rates.

Table 8.2.34 presents the average real effective discount rate and its standard deviation
for each of the six income groups. To account for variation among households, DOE sampled a
rate for each RECS household from the distributions for the appropriate income group. (RECS

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provides household income data.) Appendix 8C presents the full probability distributions for
each income group that DOE used in the LCC and PBP analysis.

Table 8.2.34 Average Real Effective Discount Rates


Income Group Discount Rate (%)
1 4.63
2 4.86
3 4.41
4 3.71
5 3.34
6 3.01
Overall Average 4.16
Source: Board of Governors of the Federal Reserve System, Survey of Consumer Finances (1995 – 2019)

8.2.4 Compliance Date of Standard


DOE calculates the LCC and PBP as if all consumers purchase the consumer
conventional cooking products in the expected initial year of compliance with a new or amended
standard for each of the trial standard levels defined in Chapter 10 of this TSD. For TSLs other
than TSL 1 (the Recommended TSL detailed in the Joint Agreement 26), new and amended
standards apply to consumer conventional cooking products manufactured 3 years after the date
on which any new or amended standard is published. (42 U.S.C. 6295(m)(4)(A)(i)) Therefore,
DOE used 2027 as the first year of compliance with any new or amended standards for consumer
conventional cooking products for TSL 2 and 3. For TSL 1, DOE used 2028 as the first year of
compliance for all product classes as specified for the Recommended TSL in the Joint
Agreement. DOE calculated the LCC for all consumers as if each would purchase a new product
in 2027 (for TSLs 2 and 3) or 2028 (for TSL 1).

8.2.5 Product Energy Efficiency in the No-New-Standards Case


To estimate the percentage of consumers who would be affected by a standard at any of
the trial standard levels, DOE considered the projected distribution of efficiencies for products
that consumers purchase under the no-new-standards case (the case without new or amended
energy conservation standards). DOE refers to this distribution of product efficiencies as the no-
new-standards case efficiency distribution. Using the projected distribution of efficiencies for
each product class, DOE randomly assigned a product efficiency to each sampled household.
The energy efficiency distributions that DOE used in the LCC analysis are described below.

For cooking tops, DOE estimated the current efficiency distribution for each product
class from the sample of cooking tops used to develop the engineering analysis as well as data
received from stakeholders in response to the February 2023 SNOPR. For ovens, DOE relied on
model counts of the current market distribution. Given the lack of data on historic efficiency

8-37
trends, DOE assumed no efficiency trend and that the estimated current distributions would
apply to both 2027 (in the case of TSLs 2 and 3) and 2028 (in the case of TSL 1). Table 8.2.35
through Table 8.2.37 show the no-new-standards case efficiency distribution in the first year of
compliance for each product class.

Table 8.2.35 No-New-Standards Case Market Share for Cooking Tops by Efficiency Level
in Compliance Year
Electric Smooth
Gas Cooking Top
EL Element Cooking
Product Classes
Top Product Classes
0 23% 3%
1 62% 56%
2 15% 41%
3 0.02% --

Table 8.2.36 No-New-Standards Case Market Share for Electric Ovens by Efficiency
Level in Compliance Year
Electric Standard Electric Standard Electric Self-Clean Electric Self-
EL Ovens, Ovens, Built- Ovens, Clean Ovens,
Freestanding In/Slide-In Freestanding Built-In/Slide-In
0 5% 5% 5% 5%
1 57% 65% 18% 7%
2 38% 30% 77% 86%
3 0% 0% 0% 2%

Table 8.2.37 No-New-Standards Case Market Share for Gas Ovens by Efficiency Level in
Compliance Year
Gas Standard Gas Standard Gas Self-Clean Gas Self-Clean
EL Ovens, Ovens, Built- Ovens, Ovens, Built-
Freestanding In/Slide-In Freestanding In/Slide-In
0 4% 4% 4% 4%
1 34% 58% 3% 19%
2 62% 38% 93% 77%

8.3 RESULTS OF LIFE-CYCLE COST AND PAYBACK PERIOD ANALYSES


This section presents the results of the LCC and PBP for consumer conventional cooking
products. As discussed in section 8.1.1, DOE’s approach to the LCC analysis relied on
developing samples of households that use each of cooking top product class and, in the case of
ovens, each oven type. DOE also used probability distributions to characterize the uncertainty in
many of the inputs to the analysis. DOE used a Monte Carlo simulation to perform the LCC
calculations on the households in the sample. For each set of sample households that use the
product in each cooking top product class or oven type, DOE calculated the average LCC and

8-38
LCC savings and the median and average PBP for each of the efficiency levels. These standard
levels are also referred to as trial standard levels (TSLs).

DOE calculated LCC savings and PBPs relative to the no-new-standards case products
that it assigned to sample households. For some consumers DOE assigned a no-new-standards
case product that is more efficient than some of the TSLs. For that reason, the average LCC
impacts are not equal to the difference between the LCC of a specific TSL and the LCC of the
baseline product. DOE calculated the average LCC savings and the median PBP values by
excluding the households that are not impacted by a standard at a given efficiency level.

LCC and PBP calculations were performed 10,000 times on the sample of consumers
established for each cooking top product class and oven type. Each LCC and PBP calculation
was performed on a single household selected from the sample. A household was selected based
on its weight (i.e., how representative it was of other households in the distribution). Each LCC
and PBP calculation also sampled from the probability distributions that DOE developed to
characterize many of the inputs to the analysis.

Using the Monte Carlo simulations for each TSL, DOE calculated the percent of
consumers who experience a net LCC benefit, a net LCC cost, and no effect. DOE considered a
consumer to receive no effect at a given standard level if DOE assigned it a baseline product
having the same or higher efficiency than the standard level. The following sections present
figures that illustrate the range of LCC and PBP effects among sample consumers.

8.3.1 Summary of Results


Table 8.3.1 through Table 8.3.8 show the LCC and simple PBP results by efficiency level
for each cooking top product class. Table 8.3.9 through Table 8.3.16 show the LCC and simple
PBP results by efficiency level for each type of electric oven. Aggregated results for all electric
ovens, weighted by product shipments of each type of electric oven, are in Table 8.3.17 and
Table 8.3.18. Table 8.3.19 through Table 8.3.26 show the LCC and simple PBP results by
efficiency level for each type of gas oven. Aggregated results for all gas ovens, weighted by
product shipments of each type of gas oven, are in Table 8.3.27. and Table 8.3.28. The average
operating cost is the discounted sum. In the tables below, results are calculated relative to the
first year of compliance. All TSLs except TSL 1 (the Recommended TSL) have a compliance
year of 2027; TSL 1 has a compliance year of 2028.

8-39
Table 8.3.1 Average LCC and PBP Results by Efficiency Level for Electric Smooth
Element Standalone Cooking Tops
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $571 $20 $259 $830 -- 16.8
1 1 $571 $15 $194 $765 0.6 16.8
2 2 $595 $14 $180 $775 4.0 16.8
3 3 $1,212 $16 $209 $1,422 170.5 16.8
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

Table 8.3.2 Average LCC Savings Relative to the No-New-Standards Case Efficiency
Distribution for Electric Smooth Element Standalone Cooking Tops
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 0% $62.80
2 2 52% $8.54
3 3 100% ($638.87)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

8-40
Table 8.3.3 Average LCC and PBP Results by Efficiency Level for Electric Smooth
Element Cooking Top Component of a Combined Cooking Product
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $571 $20 $259 $830 -- 16.8
1 1 $571 $15 $194 $765 0.6 16.8
2 2 $595 $14 $180 $775 4.0 16.8
3 3 $1,212 $16 $209 $1,422 170.5 16.8
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

Table 8.3.4 Average LCC Savings Relative to the No-New-Standards Case Efficiency
Distribution for Electric Smooth Element Cooking Top Component of a
Combined Cooking Product
Life-Cycle Cost Savings
Efficiency % of Consumers
TSL*, ** Average Savings
Level that Experience
Net Cost 2022$
1 1 0% $62.80
2 2 52% $8.54
3 3 100% ($638.87)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

8-41
Table 8.3.5 Average LCC and PBP Results by Efficiency Level for Gas Standalone
Cooking Tops
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $464 $16 $175 $639 -- 14.5
1 1 $465 $15 $169 $634 6.6 14.5
2,3 2 $492 $13 $145 $637 10.5 14.5
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

Table 8.3.6 Average LCC Savings Relative to the No-New-Standards Case Efficiency
Distribution for Gas Standalone Cooking Tops
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 1% $3.09
2,3 2 38% ($1.03)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

Table 8.3.7 Average LCC and PBP Results by Efficiency Level for Gas Cooking Top
Component of a Combined Cooking Product
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $464 $16 $175 $639 -- 14.5
1 1 $465 $15 $169 $634 6.6 14.5
2,3 2 $492 $13 $145 $637 10.5 14.5
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

8-42
Table 8.3.8 Average LCC Savings Relative to the No-New-Standards Case Efficiency
Distribution for Gas Cooking Top Component of a Combined Cooking
Product
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 1% $3.09
2,3 2 38% ($1.03)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

Table 8.3.9 Average LCC and PBP Results by Efficiency Level for Electric Standard
Ovens, Free-Standing
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- 0 $695 $22 $290 $986 -- 16.8
1 1 $694 $21 $272 $967 2.1 16.8
2 2 $752 $20 $261 $1,013 25.3 16.8
3 3 $806 $17 $221 $1,027 20.7 16.8
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

8-43
Table 8.3.10 Average LCC Savings Relative to the No-New-Standards Case Efficiency
Distribution for Electric Standard Ovens, Free-Standing
Life-Cycle Cost Savings

Efficiency % of Consumers that


TSL*, ** Average Savings
Level Experience
Net Cost
2022$
1 1 0% $16.50
2 2 61% ($42.26)
3 3 85% ($39.88)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

Table 8.3.11 Average LCC and PBP Results by Efficiency Level for Electric Standard
Ovens, Built-In/Slide-In
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- 0 $727 $23 $302 $1,029 -- 16.8
1 1 $726 $22 $284 $1,011 2.1 16.8
2 2 $784 $21 $273 $1,057 25.8 16.8
3 3 $838 $18 $233 $1,071 20.9 16.8
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

8-44
Table 8.3.12 Average LCC Savings Relative to the No-New-Standards Case Efficiency
Distribution for Electric Standard Ovens, Built-In/Slide-In
Life-Cycle Cost Savings

Efficiency % of Consumers
TSL*, ** Average Savings
Level that Experience

Net Cost 2022$


1 1 0% $15.21
2 2 69% ($42.63)
3 3 86% ($43.46)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

Table 8.3.13 Average LCC and PBP Results by Efficiency Level for Electric Self-Clean
Ovens, Free-Standing
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- 0 $750 $27 $352 $1,102 -- 16.8
1 1 $748 $26 $335 $1,083 2.1 16.8
2 2 $806 $25 $323 $1,129 25.3 16.8
3 3 $860 $22 $283 $1,143 20.7 16.8
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

8-45
Table 8.3.14 Average LCC Savings Relative to the No-New-Standards Case Efficiency
Distribution for Electric Self-Clean Ovens, Free-Standing
Life-Cycle Cost Savings

Efficiency % of Consumers that


TSL*, ** Average Savings
Level Experience
Net Cost
2022$
1 1 0% $16.31
2 2 23% ($39.85)
3 3 81% ($23.08)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

Table 8.3.15 Average LCC and PBP Results by Efficiency Level for Electric Self-Clean
Ovens, Built-In/Slide-In
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level Lifetime
Installed First Year’s years years
Operating LCC
Cost Operating Cost
Cost
-- Baseline $782 $28 $362 $1,144 -- 16.8
1 1 $780 $26 $345 $1,126 2.1 16.8
2 2 $838 $26 $334 $1,172 25.7 16.8
3 3 $892 $23 $294 $1,186 20.9 16.8
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

8-46
Table 8.3.16 Average LCC Savings Relative to the No-New-Standards Case Efficiency
Distribution for Electric Self-Clean Ovens, Built-In/Slide-In
Life-Cycle Cost Savings

Efficiency % of Consumers that


TSL*, ** Average Savings
Level Experience
Net Cost
2022$
1 1 0% $16.04
2 2 11% ($37.20)
3 3 78% ($18.35)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

Table 8.3.17 Average LCC and PBP Results by Efficiency Level for All Electric Ovens
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level Lifetime
Installed First Year’s years years
Operating LCC
Cost Operating Cost
Cost
-- Baseline $750 $27 $344 $1,094 -- 16.8
1 1 $749 $25 $327 $1,075 2.1 16.8
2 2 $806 $24 $316 $1,122 25.4 16.8
3 3 $860 $21 $275 $1,135 20.8 16.8
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

8-47
Table 8.3.18 Average LCC Savings Relative to the No-New-Standards Case Efficiency
Distribution for All Electric Ovens
Life-Cycle Cost Savings

Efficiency % of Consumers that


TSL*, ** Average Savings
Level Experience
Net Cost
2022$
1 1 0% $16.23
2 2 27% ($39.55)
3 3 81% ($24.87)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

Table 8.3.19 Average LCC and PBP Results by Efficiency Level for Gas Standard Ovens,
Free-Standing
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $799 $21 $234 $1,033 -- 14.5
1 1 $797 $19 $217 $1,013 1.9 14.5
2, 3 2 $839 $19 $209 $1,048 18.0 14.5
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

8-48
Table 8.3.20 Average LCC Savings Relative to the No-New-Standards Case Efficiency
Distribution for Gas Standard Ovens, Free-Standing
Life-Cycle Cost Savings

Efficiency % of Consumers that


TSL*, ** Average Savings
Level Experience
Net Cost
2022$
1 1 0% $14.98
2, 3 2 37% ($28.31)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

Table 8.3.21 Average LCC and PBP Results by Efficiency Level for Gas Standard Ovens,
Built-In/Slide-In
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $831 $22 $244 $1,074 -- 14.5
1 1 $828 $20 $227 $1,055 1.9 14.5
2, 3 2 $871 $19 $219 $1,089 18.3 14.5
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

8-49
Table 8.3.22 Average LCC Savings Relative to the No-New-Standards Case Efficiency
Distribution for Gas Standard Ovens, Built-In/Slide-In
Life-Cycle Cost Savings

Efficiency % of Consumers that


TSL*, ** Average Savings
Level Experience
Net Cost
2022$
1 1 0% $15.32
2, 3 2 61% ($28.93)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

Table 8.3.23 Average LCC and PBP Results by Efficiency Level for Gas Self-Clean Ovens,
Free-Standing
Average Costs
2022$ Simple Average
Efficienc
TSL* Payback Lifetime
y Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $967 $22 $251 $1,217 -- 14.5
1 1 $963 $20 $233 $1,196 1.9 14.5
2, 3 2 $1,007 $20 $225 $1,232 18.0 14.5
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

Table 8.3.24 Average LCC Savings Relative to the No-New-Standards Case Efficiency
Distribution for Gas Self-Clean Ovens, Free-Standing
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 0% $15.31
2, 3 2 7% ($20.56)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

8-50
Table 8.3.25 Average LCC and PBP Results by Efficiency Level for Gas Self-Clean Ovens,
Built-In/Slide-In
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $998 $23 $261 $1,259 -- 14.5
1 1 $995 $21 $243 $1,238 1.9 14.5
2, 3 2 $1,039 $21 $235 $1,274 18.3 14.5
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

Table 8.3.26 Average LCC Savings Relative to the No-New-Standards Case Efficiency
Distribution for Gas Self-Clean Ovens, Built-In/Slide-In
Life-Cycle Cost Savings

Efficiency % of Consumers that


TSL*, ** Average Savings
Level Experience
Net Cost
2022$
1 1 0% $15.38
2, 3 2 22% ($27.24)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

Table 8.3.27 Average LCC and PBP Results by Efficiency Level for All Gas Ovens
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $892 $22 $244 $1,135 -- 14.5
1 1 $889 $20 $226 $1,115 1.9 14.5
2, 3 2 $932 $19 $218 $1,150 18.0 14.5
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

8-51
Table 8.3.28 Average LCC Savings Relative to the No-New-Standards Case Efficiency
Distribution for All Gas Ovens
Life-Cycle Cost Savings

Efficiency % of Consumers that


TSL*, ** Average Savings
Level Experience
Net Cost
2022$
1 1 0% $15.17
2, 3 2 21% ($24.16)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

8.3.2 Distribution of Impacts


The figures in this section show the distribution of LCCs in the no-new-standards case
for each product class. The figures are presented as frequency charts that show the distribution of
LCCs, and LCC impacts with their corresponding probability of occurrence. DOE generated the
figures for the distributions from a Monte Carlo simulation run based on 10,000 sampled
households.

8.3.2.1 No-New-Standards Case LCC Distributions


Figure 8.3.1 through Figure 8.3.12 show the no-new-standards case LCC distributions for
each product class of consumer conventional cooking tops and each type of oven analyzed for
electric and gas oven product classes.

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Figure 8.3.1 Electric Smooth Element Standalone Cooking Tops: No-New-Standards Case
LCC Distribution

Figure 8.3.2 Electric Smooth Element Cooking Top Component of a Combined Cooking
Product: No-New-Standards Case LCC Distribution

8-53
Figure 8.3.3 Gas Standalone Cooking Tops: No-New-Standards Case LCC Distribution

Figure 8.3.4 Gas Cooking Top Component of a Combined Cooking Product: No-New-
Standards Case LCC Distribution

8-54
Figure 8.3.5 Electric Standard Ovens, Freestanding: No-New-Standards Case LCC
Distribution

Figure 8.3.6 Electric Standard Ovens, Built-in/Slide-in: No-New-Standards Case LCC


Distribution

8-55
Figure 8.3.7 Electric Self-Clean Ovens, Freestanding: No-New-Standards Case LCC
Distribution

Figure 8.3.8 Electric Self-Clean Ovens, Built-in/Slide-in: No-New-Standards Case LCC


Distribution

8-56
Figure 8.3.9 Gas Standard Ovens, Freestanding: No-New-Standards Case LCC
Distribution

Figure 8.3.10 Gas Standard Ovens, Built-in/Slide-in: No-New-Standards Case LCC


Distribution

8-57
Figure 8.3.11 Gas Self-Clean Ovens, Freestanding: No-New-Standards Case LCC
Distribution

Figure 8.3.12 Gas Self-Clean Ovens, Built-in/Slide-in: No-New-Standards Case LCC


Distribution

8.3.2.2 Standard-Level Distributions of LCC Impacts


Figure 8.3.13 is an example of a frequency chart that shows the distribution of LCC
differences for the case of EL 1 for electric smooth element standalone cooking tops. In the

8-58
figure, a text box next to a vertical line at a given value on the x-axis shows the mean change in
LCC (a savings of $62.47 in the example here). Note that the figure only shows affected
consumers that would be impacted by the implementation of a standard. Consumers that
purchased products at or exceeding the efficiency of EL 1 would not be impacted by a standard.
Refer to section 8.2.5 on the distribution of product efficiencies under the no-new-standards case.
DOE can generate a frequency chart like the one shown in Figure 8.3.13 for each efficiency level
and product class.

Figure 8.3.13 Electric Smooth Element Cooking Tops: Distribution of LCC Impacts for
TSL 1

8.3.2.3 Range of Impacts


Figure 8.3.14 through Figure 8.3.25 show the range of LCC savings for all efficiency
levels considered for all consumer conventional cooking products. For each efficiency level, the
top and the bottom of the box indicate the 75th and 25th percentiles, respectively. The bar at the
middle of the box indicates the median: 50 percent of households have LCC savings in excess of
that value. The “whiskers” at the bottom and the top of the box indicate the 5th and 95th
percentiles. The small box shows the average LCC savings for each standard level.

8-59
median
Elec Smooth Cooking Tops average
200
Life Cycle Cost Savings ($)

-200

-400

-600

-800

-1000
Level 1 Level 2 Level 3
Efficiency Level

Figure 8.3.14 Electric Smooth Element Standalone Cooking Tops: Range of LCC Savings

median
Elec Smooth Cooking Tops average
200
Life Cycle Cost Savings ($)

-200

-400

-600

-800

-1000
Level 1 Level 2 Level 3
Efficiency Level

Figure 8.3.15 Electric Smooth Element Cooking Top Component of a Combined Cooking
Product: Range of LCC Savings

8-60
median
Gas Cooking Tops average
40
Life Cycle Cost Savings ($)

30

20

10

-10

-20

-30
Level 1 Level 2
Efficiency Level

Figure 8.3.16 Gas Standalone Cooking Tops: Range of LCC Savings

median
Gas Cooking Tops average
40
Life Cycle Cost Savings ($)

30

20

10

-10

-20

-30
Level 1 Level 2
Efficiency Level

Figure 8.3.17 Gas Cooking Top Component of a Combined Cooking Product: Range of
LCC Savings

8-61
median
Elec Standard Oven - Free-Standing average
80
60
Life Cycle Cost Savings ($)

40
20
0
-20
-40
-60
-80
-100
-120
Level 1 Level 2 Level 3
Efficiency Level

Figure 8.3.18 Electric Standard Ovens, Freestanding: Range of LCC Savings

median
Elec Standard Oven - Built-In/Slide-In average
80
60
Life Cycle Cost Savings ($)

40
20
0
-20
-40
-60
-80
-100
-120
Level 1 Level 2 Level 3
Efficiency Level

Figure 8.3.19 Electric Standard Ovens, Built-In/Slide-In: Range of LCC Savings

8-62
median
Elec Self-Cleaning Oven - Free-Standing average
80
60
Life Cycle Cost Savings ($)

40
20
0
-20
-40
-60
-80
-100
Level 1 Level 2 Level 3
Efficiency Level

Figure 8.3.20 Electric Self-Clean Ovens, Freestanding: Range of LCC Savings

median
Elec Self-Cleaning Oven - Built-In/Slide-In average
80
60
Life Cycle Cost Savings ($)

40
20
0
-20
-40
-60
-80
-100
1 2 3
Efficiency Level

Figure 8.3.21 Electric Self-Clean Ovens, Built-In/Slide-In: Range of LCC Savings

8-63
median
Gas Standard Oven - Free-Standing average
40
Life Cycle Cost Savings ($)

30
20
10
0
-10
-20
-30
-40
Level 1 Level 2
Efficiency Level

Figure 8.3.22 Gas Standard Ovens, Freestanding: Range of LCC Savings

median
Gas Standard Oven - Built-In/Slide-In average
40
Life Cycle Cost Savings ($)

30
20
10
0
-10
-20
-30
-40
Level 1 Level 2
Efficiency Level

Figure 8.3.23 Gas Standard Ovens, Built-In/Slide-In: Range of LCC Savings

8-64
median
Gas Self-Cleaning Oven - Free-Standing
average
40
Life Cycle Cost Savings ($)

30
20
10
0
-10
-20
-30
-40
Level 1 Level 2
Efficiency Level

Figure 8.3.24 Gas Self-Clean Ovens, Freestanding: Range of LCC Savings

median
Gas Self-Cleaning Oven - Built-In/Slide-In average
40
Life Cycle Cost Savings ($)

30
20
10
0
-10
-20
-30
-40
Level 1 Level 2
Efficiency Level

Figure 8.3.25 Gas Self-Clean Ovens, Built-In/Slide-In: Range of LCC Savings

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8.4 REBUTTABLE PAYBACK PERIOD
DOE develops rebuttable PBPs to provide the legally established rebuttable presumption
that an energy conservation standard is economically justified if the additional product costs
attributed to the standard are less than three times the value of the first-year energy cost savings.
(42 U.S.C. §6295 (o)(2)(B)(iii))

The basic equation for rebuttable PBP is the same as that shown for the PBP in section
8.1.1. Unlike the analyses described in section 8.1.1, however, the rebuttable PBP is not based on
household samples and probability distributions. The rebuttable PBP is based instead on discrete,
single-point values. For example, whereas DOE uses a probability distribution of regional energy
prices in the distributional PBP analysis, it uses only the national average energy price to
determine the rebuttable PBP.

Other than the use of single-point values, the most notable difference between the
distributional PBP and the rebuttable PBP is the latter’s reliance on the DOE test procedure to
determine a product’s annual energy consumption. DOE based the annual energy consumption
for the rebuttable PBP on the number of operating hours per year specified in DOE’s proposed
test procedure for conventional cooking tops. The following sections identify the differences, if
any, between the annual energy consumptions determined by the distributional PBP and the
rebuttable PBP for all product classes of consumer conventional cooking products.

8.4.1 Inputs to the Rebuttable Payback Period Analysis


Because inputs for determining total installed cost for calculating the distributional PBP
were based on single-point values, only the variability and/or uncertainty in the inputs for
determining operating cost contributed to variability in the distributional PBPs. The following
summarizes the single-point values that DOE used in determining the rebuttable PBP.

• Manufacturing costs, markups, sales taxes, and installation costs were based on the
single-point values used in the distributional LCC and PBP analysis.
• Energy prices were based on national average values for the year that new standards
would take effect.
• An average discount rate or lifetime is not required in calculating the rebuttable PBP.
• The effective date of any new standard is assumed to be 2027 for all TSLs other than
TSL 1 (the Recommended TSL); 2028 for TSL 1.

8.4.2 Results of Rebuttable Payback Period Analysis


DOE calculated rebuttable PBPs for each efficiency level relative to the distribution of
product efficiencies estimated for the baseline. In other words, DOE did not determine the
rebuttable PBP relative to the no-new-standards case energy efficiency, but relative to the
distribution of product energy efficiencies for the baseline (i.e., the case without new energy
conservation standards). Table 8.4.1 through Table 8.4.4 present the rebuttable PBPs for each
product class of consumer conventional cooking products.

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Table 8.4.1 Rebuttable Payback Periods for Electric Smooth Element Cooking Top
Product Classes
Component of a Combined
Standalone
Cooking Product
TSL
PBP PBP
years years
1 0.5 0.5
2 2.6 2.6
3 59.3 59.3

Table 8.4.2 Rebuttable Payback Periods for Gas Cooking Top Product Classes
Component of a Combined
Standalone
Cooking Product
TSL
PBP PBP
years years
1 3.7 3.7
2, 3 6.0 6.0

Table 8.4.3Rebuttable Payback Periods for Conventional Electric Ovens


Electric All Electric
Electric Electric Self- Electric Self-
Standard, Ovens
Standard, Clean, Clean, Built-
Built-In/Slide-
TSL Freestanding In
Freestanding In/Slide-In

PBP PBP PBP PBP PBP


years years years years years
1 1.6 1.6 1.6 1.6 1.6
2 14.3 14.6 14.3 14.5 14.4
3 9.1 9.1 9.1 9.1 9.1

Table 8.4.4
Rebuttable Payback Periods for Conventional Gas Ovens
Gas Standard, Gas Self-Clean, All Gas Ovens
Gas Standard, Gas Self-Clean,
Built-In/Slide- Built-In/Slide-
Freestanding Freestanding
TSL In In
PBP PBP PBP PBP PBP
years years years years years
1 8.1 8.5 8.3 8.5 8.4
2,3 26.7 27.0 26.7 27.0 26.7

8-67
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3. Desroches, Louis-Benoit, et al., “Incorporating Experience Curves in Appliance


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Households.

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8. Coughlin, K., Beraki, B., Residential Electricity Prices: A Review of Data Sources and
Estimation Methods. 2018. Lawrence Berkeley National Laboratory: Berkeley, CA.
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9. U.S. Department of Energy–Energy Information Administration. Natural Gas Navigator.


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Expenditure Estimates (SEDS). Washington, D.C. (Last accessed March June 25, 2023.)
http://www.eia.gov/state/seds/

12. Association of Home Appliance Manufacturers, AHAM Comments on DOE’s NOPR for
Energy Conservation Standards for Residential Conventional Cooking Products, EERE-
2014-BT-STD-0005, September 9, 2015.

8-68
13. U.S. Board of Governors of the Federal Reserve System. Survey of Consumer Finances.
1995, 1998, 2001, 2004, 2007, 2010, 2013, 2016, and 2019. (Last accessed June 25,
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14. Pindyck, R. S. and D. L. Rubinfeld. Microeconomics. 2001. Prentice Hall: Upper Saddle
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15. Damodaran, A. Data Page: Historical Returns on Stocks, Bonds and Bills-United States.
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24. U.S. Board of Governors of the Federal Reserve System. 20-Year Treasury Constant
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26. Joint recommendations on new appliance efficiency standards and related actions for
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BT-STD-0005-12811, September 5, 2023. www.regulations.gov/comment/EERE-2014-
BT-STD-0005-12811

8-70
CHAPTER 9. SHIPMENTS ANALYSIS

TABLE OF CONTENTS

9.1 INTRODUCTION ........................................................................................................... 9-1


9.2 SHIPMENTS MODEL METHODOLOGY .................................................................... 9-1
9.3 DATA INPUTS AND MODEL CALIBRATION .......................................................... 9-3
9.3.1 Historical Shipments ........................................................................................................ 9-4
9.3.2 Markets and Model Calibration ..................................................................................... 9-10
9.3.2.1 New Construction ........................................................................................ 9-11
9.3.2.2 Replacements ............................................................................................... 9-14
9.3.2.3 Model Calibration—Non-Replacement ....................................................... 9-15
9.3.2.4 Impact of the Inflation Reduction Act on No-New Standards Case
Shipments ..................................................................................................... 9-15
9.3.3 No-New-Standards Case Shipments .............................................................................. 9-16
9.4 IMPACT OF INCREASED PURCHASE PRICE ON SHIPMENTS ........................... 9-18
9.4.1 Purchase Price Elasticity ................................................................................................ 9-18
9.4.2 Impact from Increase in Relative Price .......................................................................... 9-19
9.5 AFFECTED STOCK ..................................................................................................... 9-19
9.6 RESULTS ...................................................................................................................... 9-20
REFERENCES .......................................................................................................................... 9-22

LIST OF TABLES

Table 9.3.1 Consumer Conventional Cooking Products: Product Categories, Product


Types, and Product Classes.................................................................................. 9-5
Table 9.3.2 Market Share of Freestanding and Slide-In Ranges by Fuel Type ...................... 9-6
Table 9.3.3 Conventional Electric Cooking Products: Historical Shipment Market
Shares by Product Type ....................................................................................... 9-7
Table 9.3.4 Conventional Gas Cooking Products: Historical Shipment Market Shares
by Product Type ................................................................................................... 9-8
Table 9.3.5 Conventional Electric Cooking Products: Projected Shipment Market
Shares by Product Type ....................................................................................... 9-9
Table 9.3.6 Conventional Gas Cooking Products: Projected Shipment Market Shares
by Product Type ................................................................................................. 9-10
Table 9.3.7 Saturation Rates of Consumer Conventional Cooking Products in New
Housing Units in RECS 2020 ............................................................................ 9-14
Table 9.3.8 Estimated Saturation Rates of Consumer Conventional Cooking Products
in New Housing Units in 2027........................................................................... 9-14
Table 9.4.1 Change in Relative Price Elasticity Following a Purchase Price Change ......... 9-19

9-i
LIST OF FIGURES

Figure 9.3.1 Historical Shipments: Conventional Electric and Gas Cooking Products ........... 9-6
Figure 9.3.2 Historical Housing Starts by Housing Type (1970 – 2022)............................... 9-12
Figure 9.3.3 Projected Single-Family Starts (2022 – 2050) ................................................... 9-12
Figure 9.3.4 Projected Multi-Family Starts (2022 – 2050) .................................................... 9-13
Figure 9.3.5 Projected Manufactured Home Placements (2022 – 2050) ............................... 9-13
Figure 9.3.6 Consumer Conventional Electric and Gas Cooking Products: Surviving
Functions ............................................................................................................ 9-15
Figure 9.3.7 Electric Cooking Products: Historical and No-New-Standards Case
Shipments Projection ......................................................................................... 9-16
Figure 9.3.8 Gas Cooking Products: Historical and No-New-Standards Case Shipments
Projection ........................................................................................................... 9-17
Figure 9.3.9 Cooking Products: Disaggregated No-New-Standards Case Shipments
Projection ........................................................................................................... 9-17
Figure 9.6.1 Projected Shipments for Consumer Conventional Cooking Products in the
No-New-Standards Case and Each Trial Standards Level ................................ 9-21

9-ii
CHAPTER 9. SHIPMENTS ANALYSIS

9.1 INTRODUCTION
Product shipments estimates are a necessary input to the national energy savings (NES)
and net present value (NPV) calculations associated with the trial standards levels (TSLs)
considered in this direct final rule including the “Recommended TSL” defined in the letter titled
“Energy Efficiency Agreement of 2023” (hereafter, the “Joint Agreement” a). Shipments are also
a necessary input to the manufacturer impact analysis (MIA), which DOE conducts for this direct
final rule. This chapter describes DOE’s methodology for projecting annual shipments and
presents results for consumer conventional cooking products.

DOE estimated shipments for consumer conventional cooking products with a shipments
model. DOE calibrated the shipments model against historical shipments. For purposes of
estimating the impacts of TSLs on product shipments, the shipments model accounts for the
combined effects of changes in purchase price and annual operating cost on the consumer
purchase decision.

The shipments model first considers specific market segments to estimate shipments by
fuel category of consumer conventional cooking products against historical shipments data. The
results for which are then disaggregated to estimate shipments for each product class. DOE
accounted for two market segments: (1) shipments due to new construction; (2) replacements of
retired units from existing households.

The shipments models are Microsoft Excel spreadsheets that are accessible on the
Internet (http://www.eere.energy.gov/buildings/appliance_standards/). Appendix 10A discusses
how to access the shipments model spreadsheet contained in the NIA spreadsheets, and provides
basic instructions for using them. The rest of this chapter explains the shipments models in more
detail. Section 9.2 presents the shipments model methodology; section 9.3 describes the data
inputs and the model calibration; section 9.4 discusses impacts on shipments from changes in
equipment purchase price and operating cost; section 9.5 discusses the affected stock; and
section 9.6 presents the results for the TSLs considered in this direct final rule (see chapter 10 for
TSL definitions).

9.2 SHIPMENTS MODEL METHODOLOGY


DOE first developed a national stock model for estimating annual shipments for the
consumer conventional cooking products (i.e., cooking ranges and ovens) by its fuel category
(i.e., electric and gas) considered for this standards rulemaking. The model considers market
segmentation as a distinct input to the shipments forecast. As represented by the following
equation, the two primary market segments are new installations and replacements.

Ship p ( j ) = Rpl p ( j ) + NI p ( j )

a
This document is available in the docket at: www.regulations.gov/document/EERE-2017-BT-STD-0003-0103.

9-1
Where:

Shipp(j) = total shipments of product p in year j,


Rplp(j) = units of product p retired and replaced in year j, and
NIp(j) = number of new installations of product p in year j.

As the product-specific sections below discuss, DOE also considered a third market
segment for the products to calibrate its shipments models to historical shipments data.

In principle, each market segment and each product class responds differently to both the
no-new-standards case, demographic and economic trends, and to the implementation of
standards. Furthermore, retirements, early replacements, and efficiency trendsb are dynamic and
can vary among product classes. Rather than simply extrapolating a current shipments trend, the
no-new-standards case shipments analysis (i.e., the case without new standards) uses driver input
variables, such as construction projections and product lifetime distributions, to project sales in
each market segment. Thus, DOE’s shipments models assume that construction, i.e., new
housing units, drives new installations. In each year, the product shipments from the new
construction market segment are equal to the number of new housing units built, multiplied by
the purchase rate, which is determined by the product class market share and the market
saturation of the product under consideration.

DOE’s shipments models take an accounting approach, tracking market shares of each
product class, the vintage of units in the existing stock, and expected construction trends. The
models estimate shipments due to replacements using sales in previous years and assumptions
about the lifetime of the equipment. Therefore, estimated sales due to replacements in a given
year are equal to the total stock of the appliance minus the sum of the appliances sold in previous
years that still remain in the stock. DOE determined the useful service life of each appliance to
estimate how long the appliance is likely to remain in stock. The following equation represents
how DOE estimated replacement shipments.

ageMax j _ 1
Rpl p ( j ) = Stock p ( j 1)
_ _
∑ ∑ Ship j  probRtr (age)
age= 0 j = N

Where:

Stockp (j-1) = total stock of in-service appliances in year j-1,


probRtr (age) = probability that an appliance of a particular age will be retired, and
N= start year for when the model begins its stock accounting (start year is
specific to each product based on available historical shipments data).

Stock accounting takes product shipments, a retirement function, and initial in-service
product stock as inputs and provides an estimate of the age distribution of in-service product

b
Efficiency trends affect shipments only in the standards case. A change in the efficiency distribution of the stock
results in a change in the purchase price and operating cost and, therefore, produces a purchase price and operating
cost impact on the shipments. This is discussed later in section 9.4.

9-2
stocks for all years. The age distribution of in-service product stocks is a key input to both the
NES and NPV calculations—the operating costs for any year depend on the age distribution of
the stock. The dependence of operating cost on the equipment age distribution occurs under a
TSL that produces increasing efficiency over time, where older, less efficient units may have
higher operating costs, while younger, more-efficient units will have lower operating costs.

DOE calculated total in-service stock of equipment by integrating historical shipments


data starting from a specific year. The start year depended on the historical data available for the
product. As units are added to the in-service stock, some of the older ones retire and exit the
stock. To estimate future shipments, DOE developed a series of equations that define the
dynamics and accounting of in-service stocks. For new units, the equation is:

Stock ( j, age = 1) = Ship ( j _ 1)

where:

Stock(j, age) = the population of in-service units of a particular age,


j= year for which the in-service stock is being estimated, and
Ship (j) = number of units purchased in year j.

The above equation states that the number of one-year-old units is simply equal to the
number of new units purchased the previous year. The slightly more complicated equations (e.g.,
the following equation) are those that describe the accounting of the existing in-service stock of
units:


Stock ( j + 1, age + 1) = Stock ( j , age)  1 _ prob Rtr (age) 
In the above equation, as the year is incremented from j to j+1, the age is also
incremented from age to age+1. With time, a fraction of the in-service stock is removed, and
that fraction is determined by a retirement probability function, probRtr (age), which is described
in section 9.3. Because the products considered in this rulemaking are common appliances that
have been used by U.S. consumers for a long time, replacements typically constitute the vast
majority of shipments. Most replacements are made when equipment wears out and fails.

9.3 DATA INPUTS AND MODEL CALIBRATION


As discussed above, shipments are driven primarily by two market segments: new
construction and replacements.

DOE estimated new construction shipments using two inputs: new housing projections
and market saturation data. New housing includes newly constructed single- and multi-family
units, referred to as “new housing completions,” and mobile home placements. For new housing
completions and mobile home placements, DOE used historical data through 2022 and adopted
the projections from the DOE Energy Information Administration (EIA)’s Annual Energy
Outlook 2023 for the period of 2023–2050.1 For the years after 2050, DOE used a constant value

9-3
from 2050. To determine new construction shipments for each fuel category product (i.e.,
electric and gas), DOE used estimations of its historical market saturations, combined with
projections of housing starts.

DOE estimated replacements using product retirement functions that it developed from
product lifetimes. DOE based the retirement function on a Weibull probability distribution for
the product lifetime (see chapter 8 of this direct final rule TSD for more details). The shipments
models assume that no units are retired below a minimum product lifetime and all units are
retired before exceeding a maximum product lifetime. The models determine the probability of
retirement at a certain age for all products.

DOE used historical shipments of conventional electric and gas cooking products as the
basis for calibrating its shipments models. For both product types, shipments due to new
construction and replacements were found to overestimate shipments relative to historical data.
DOE developed another market segment associated with the non-replacement of retired units due
to building demolitions to calibrate its shipments models. This additional market segment
represented a small share of total shipments.

The sections below explain in detail each of the data inputs, including the third market
segment that DOE developed to calibrate its shipments model for each fuel category cooking
product.

9.3.1 Historical Shipments


DOE designed its shipments model for cooking tops and ovens by dividing these
products into two general fuel categories: electric and gas. DOE developed two shipments
models: one model estimated the electric cooking product shipments while the other model
estimated gas cooking product shipments. After DOE estimated shipments for each fuel type, it
then disaggregated the shipments into product types—eight product types for conventional
electric cooking products and five product types for conventional gas cooking products. Since
each product class consists of two or more product types, DOE then disaggregated shipments for
each product type into their appropriate product classes. DOE notes that although it is not
adopting a standard for electric open (coil) cooking tops in this direct final rule, DOE models
their contribution to shipments in order to estimate future demand for electric cooking products.
Additionally, DOE analyzed shipments for four types of ovens per conventional oven product
class (i.e., electric ovens and gas ovens) due to each oven type having different energy use
profiles and baseline cost.

Table 9.3.1 shows the product types and product classes under each general fuel category
(i.e., conventional electric and gas cooking products). For conventional electric cooking products
there are eight product types and four product classes; for conventional gas cooking products
there are five product types and three product classes. Because ranges are comprised of cooking
top and oven product classes, DOE needed to disaggregate range shipments into the appropriate
cooking top and oven product classes to obtain the shipments for each product class.

9-4
Table 9.3.1 Consumer Conventional Cooking Products: Product Categories, Product
Types, and Product Classes
Product
Electric Gas
Categories
Standalone
Standalone Standalone Conventional Standalone
Product Conventional Range Cooking
Cooking Tops Oven Range Oven
Types Tops
(PT): PT
8 electric, PT 1. 2. PT 3. PT 4.
PT 5. PT 6. PT 7. PT 8.
PT 9.
PT 10. PT 11.
PT
PT 13.
5 gas Coil- Smth- Smth Gas- 12.
Coil- Coil Smooth Std SC Gas-SC Gas SC
Std Std -SC Std Std
SC
Electric Open (Coil) Element Cooking Tops = Product Type 1, 2, 5
Electric Smooth Element Cooking Tops (Standalone and as a Component of a Combined
Cooking Product) = Product Type 3, 4, 6
Electric Ovens:
Electric Standard Oven – Freestanding = Product Type 1, 3
Product Electric Standard Oven – Built-In/Slide-In = Product Type 7
Classes Electric Self-Clean Oven – Freestanding = Product Type 2, 4
(PC): Electric Self-Clean Oven – Built-In/Slide-In = Product Type 8
4 electric, Gas Cooking Tops (Standalone and as a Component of a Combined Cooking Product) = Product
3 gas Type 9, 10, 11
Gas Ovens:
Gas Standard Oven – Freestanding = Product Type 9
Gas Standard Oven – Built-In/Slide-In = Product Type 12
Gas Self-Clean Oven – Freestanding = Product Type 10
Gas Self-Clean Oven – Built-In/Slide-In = Product Type 13
Std = standard; SC = self-clean; Smth = smooth

Figure 9.3.1 shows the historical shipments data of conventional electric and gas cooking
products. DOE relied on three data sources to establish historical shipments data: (1) data from
the Association of Home Appliance Manufacturers (AHAM) for the period 2013 – 20222, (2)
data from Market Research Magazine provided for the period 2006 – 20123, and (3) data from
DOE’s 2006 technical support document (TSD) on consumer conventional cooking products
covering the period 1970–20054.

9-5
7.0

6.0

5.0
Unit: millions

4.0

3.0

2.0

1.0

0.0

Electric Gas

Figure 9.3.1 Historical Shipments: Conventional Electric and Gas Cooking Products

DOE then used the following sources to establish historical market shares for each
product type under each fuel type: (1) data from AHAM for the period 2013 – 20222 and (2) data
from Market Research Magazine provided for the period 2006 – 20123. Table 9.3.2 shows the
market share between freestanding and slide-in ranges by fuel type using average historical
AHAM sales data between 1989 to 2006. This information enables DOE to reallocate historical
shipments data based on product classes. Table 9.3.3 presents the re-grouped market shares of
the six product types that comprise total electric cooking product shipments. Table 9.3.4 shows
the re-grouped historical market shares of the five product types that comprise total gas cooking
product shipments. For any given year, the sum of the product type market shares equals 100
percent under each fuel type.

Table 9.3.2 Market Share of Freestanding and Slide-In Ranges by Fuel Type
Electric Gas
Range Type Conventional Conventional
Ranges Ranges
Freestanding 82.4% 96.9%
Slide-In 17.6% 3.1%
Total 100.0% 100.0%
Source: AHAM data between 1986 to 2006.

9-6
Table 9.3.3 Conventional Electric Cooking Products: Historical Shipment Market
Shares by Product Type
Percent of Total Shipments
Standalone Cooking
Conventional Ranges Standalone Ovens
Tops
Year
Electric
Standard Self-Clean Coil Smooth Standard Self-Clean
Element
1970–1989 28.7% 27.8% 4.1% 9.0% 9.7% 20.7%
1990 25.0% 31.7% 4.0% 8.8% 11.2% 19.2%
1991 28.1% 30.3% 3.8% 8.3% 6.2% 23.4%
1992 28.6% 29.6% 3.7% 8.3% 6.5% 23.3%
1993 28.7% 30.2% 3.6% 7.9% 5.8% 23.8%
1994 25.1% 35.2% 3.1% 6.9% 9.7% 20.0%
1995 27.0% 34.6% 3.1% 6.8% 5.7% 22.8%
1996 24.8% 37.1% 3.1% 6.9% 5.7% 22.4%
1997 23.1% 38.6% 3.3% 7.2% 5.3% 22.4%
1998 22.2% 39.6% 3.4% 7.5% 4.8% 22.4%
1999 21.6% 41.0% 3.1% 6.8% 4.5% 23.0%
2000 20.7% 42.0% 3.1% 6.8% 4.1% 23.4%
2001 19.8% 42.7% 3.1% 6.8% 3.7% 24.0%
2002 18.9% 43.4% 3.1% 6.8% 3.3% 24.6%
2003 15.6% 46.6% 3.3% 6.4% 3.4% 24.9%
2004 15.7% 46.2% 2.8% 6.5% 2.9% 26.0%
2005 17.1% 45.1% 2.6% 6.2% 2.7% 26.3%
2006 16.7% 44.7% 2.6% 6.5% 2.8% 26.7%
2007 16.8% 45.9% 2.6% 6.7% 2.6% 25.4%
2008 16.8% 46.5% 2.5% 6.8% 2.6% 24.8%
2009 16.7% 47.2% 2.5% 6.9% 2.5% 24.2%
2010 16.3% 46.9% 2.4% 6.9% 2.6% 24.9%
2011 16.2% 47.3% 2.3% 7.0% 2.6% 24.7%
2012 15.9% 47.4% 2.2% 7.0% 2.6% 25.0%
2013 15.6% 47.3% 2.1% 7.0% 2.7% 25.4%
2014 15.3% 47.5% 2.0% 7.1% 2.7% 25.5%
2015 15.1% 47.6% 1.9% 7.1% 2.7% 25.5%
2016 14.9% 47.8% 1.8% 7.2% 2.7% 25.6%
2017 14.6% 47.9% 1.7% 7.2% 2.7% 25.8%
2018 14.3% 47.9% 1.7% 7.3% 2.7% 26.1%
2019 14.1% 48.2% 1.6% 7.3% 2.7% 26.0%
2020 14.0% 48.8% 1.5% 7.4% 2.7% 25.6%
2021 13.8% 49.0% 1.4% 7.5% 2.6% 25.6%
2022 13.8% 49.1% 1.4% 7.4% 2.5% 25.7%

9-7
Table 9.3.4 Conventional Gas Cooking Products: Historical Shipment Market Shares by
Product Type
Percent of Total Shipments
Conventional Ranges Standalone Ovens
Year Standalone
Standard Self-Clean Cooking Tops Standard Self-Clean
1970–1989 61.2% 21.3% 10.1% 6.5% 0.9%
1990 61.2% 20.8% 10.9% 5.9% 1.3%
1991 59.7% 22.3% 11.4% 5.4% 1.2%
1992 59.2% 22.9% 11.7% 5.2% 1.0%
1993 56.4% 25.8% 11.8% 4.4% 1.5%
1994 58.7% 24.4% 11.2% 4.8% 0.9%
1995 56.3% 29.0% 8.8% 4.4% 1.5%
1996 54.1% 30.4% 10.0% 4.3% 1.1%
1997 51.8% 32.6% 10.2% 4.0% 1.3%
1998 48.9% 34.6% 11.4% 3.8% 1.3%
1999 46.5% 36.8% 11.7% 3.7% 1.3%
2000 44.2% 39.0% 11.9% 3.6% 1.3%
2001 41.7% 40.6% 12.6% 3.7% 1.4%
2002 40.0% 42.4% 12.7% 3.5% 1.3%
2003 39.1% 42.9% 13.3% 3.1% 1.6%
2004 36.0% 45.4% 14.2% 3.3% 1.1%
2005 35.7% 45.1% 14.9% 3.2% 1.1%
2006 35.4% 44.6% 15.7% 3.2% 1.1%
2007 35.7% 45.1% 14.9% 3.2% 1.1%
2008 36.3% 45.8% 13.6% 3.2% 1.1%
2009 37.3% 47.1% 11.2% 3.3% 1.2%
2010 37.3% 47.1% 11.3% 3.2% 1.1%
2011 37.3% 47.0% 11.4% 3.1% 1.1%
2012 37.3% 47.1% 11.6% 2.9% 1.0%
2013 36.8% 46.5% 12.9% 2.8% 1.0%
2014 36.8% 46.4% 13.2% 2.7% 1.0%
2015 36.8% 46.5% 13.3% 2.5% 0.9%
2016 37.0% 46.6% 13.0% 2.5% 0.9%
2017 36.6% 46.2% 13.8% 2.5% 0.9%
2018 36.5% 46.0% 14.1% 2.5% 0.9%
2019 36.9% 46.6% 13.0% 2.5% 0.9%
2020 37.1% 46.8% 12.6% 2.5% 0.9%
2021 37.0% 46.6% 13.1% 2.5% 0.9%
2022 36.9% 46.5% 13.1% 2.5% 0.9%

To project future market share of each product type for the period 2023–2057, DOE
conducted a regression analysis to fit the historical market share data as shown in Table 9.3.3 and
Table 9.3.4. DOE then normalized the projected market share of each product type, so the sum of
the total market share equals 100 percent under each fuel type for any given year. Table 9.3.5

9-8
and Table 9.3.6 present the projected market share for conventional electric and gas cooking
products, respectively.

Table 9.3.5 Conventional Electric Cooking Products: Projected Shipment Market Shares
by Product Type
Percent of Total Shipments
Standalone Cooking
Conventional Ranges Standalone Ovens
Year Tops

Standard Self-Clean Coil Smooth Standard Self-Clean

2023 13.8% 49.1% 1.4% 7.4% 2.5% 25.7%


2024 13.8% 49.2% 1.4% 7.3% 2.5% 25.7%
2025 13.8% 49.2% 1.4% 7.2% 2.5% 25.7%
2026 13.9% 49.3% 1.4% 7.2% 2.5% 25.7%
2027 13.9% 49.3% 1.4% 7.1% 2.5% 25.7%
2028 13.9% 49.4% 1.4% 7.1% 2.5% 25.7%
2029 13.9% 49.4% 1.4% 7.0% 2.5% 25.7%
2030 13.9% 49.5% 1.4% 7.0% 2.5% 25.7%
2031 13.9% 49.5% 1.4% 6.9% 2.5% 25.7%
2032 13.9% 49.6% 1.4% 6.9% 2.5% 25.7%
2033 13.9% 49.6% 1.4% 6.8% 2.5% 25.7%
2034 13.9% 49.7% 1.4% 6.8% 2.5% 25.7%
2035 13.9% 49.7% 1.4% 6.7% 2.5% 25.7%
2036 13.9% 49.7% 1.4% 6.7% 2.5% 25.7%
2037 14.0% 49.8% 1.4% 6.6% 2.5% 25.7%
2038 14.0% 49.8% 1.4% 6.6% 2.5% 25.7%
2039 14.0% 49.9% 1.4% 6.5% 2.5% 25.7%
2040 14.0% 49.9% 1.4% 6.5% 2.5% 25.7%
2041 14.0% 49.9% 1.4% 6.5% 2.5% 25.7%
2042 14.0% 50.0% 1.4% 6.4% 2.5% 25.7%
2043 14.0% 50.0% 1.3% 6.4% 2.5% 25.7%
2044 14.0% 50.0% 1.3% 6.3% 2.5% 25.7%
2045 14.0% 50.1% 1.3% 6.3% 2.5% 25.7%
2046 14.0% 50.1% 1.3% 6.3% 2.5% 25.7%
2047 14.0% 50.1% 1.3% 6.2% 2.5% 25.7%
2048 14.0% 50.2% 1.3% 6.2% 2.5% 25.7%
2049 14.0% 50.2% 1.3% 6.2% 2.5% 25.7%
2050 14.1% 50.2% 1.3% 6.1% 2.5% 25.7%
2051 14.1% 50.3% 1.3% 6.1% 2.5% 25.7%
2052 14.1% 50.3% 1.3% 6.1% 2.5% 25.7%
2053 14.1% 50.3% 1.3% 6.0% 2.5% 25.7%
2054 14.1% 50.4% 1.3% 6.0% 2.5% 25.7%
2055 14.1% 50.4% 1.3% 6.0% 2.5% 25.7%
2056 14.1% 50.4% 1.3% 5.9% 2.5% 25.7%
2057 14.1% 50.4% 1.3% 5.9% 2.5% 25.7%

9-9
Table 9.3.6 Conventional Gas Cooking Products: Projected Shipment Market Shares by
Product Type
Percent of Total Shipments
Conventional Ranges Standalone Ovens
Year Standalone
Standard Self-Clean Cooking Tops Standard Self-Clean
2023 36.9% 46.5% 13.2% 2.5% 0.9%
2024 36.8% 46.4% 13.3% 2.5% 0.9%
2025 36.8% 46.4% 13.4% 2.5% 0.9%
2026 36.8% 46.4% 13.5% 2.5% 0.9%
2027 36.7% 46.3% 13.6% 2.4% 0.9%
2028 36.7% 46.3% 13.7% 2.4% 0.9%
2029 36.7% 46.3% 13.8% 2.4% 0.9%
2030 36.6% 46.2% 13.9% 2.3% 0.9%
2031 36.6% 46.2% 14.0% 2.3% 0.9%
2032 36.6% 46.2% 14.1% 2.3% 0.9%
2033 36.5% 46.1% 14.2% 2.3% 0.9%
2034 36.5% 46.1% 14.3% 2.2% 0.9%
2035 36.5% 46.0% 14.4% 2.2% 0.9%
2036 36.4% 46.0% 14.5% 2.2% 0.9%
2037 36.4% 45.9% 14.6% 2.1% 0.9%
2038 36.4% 45.9% 14.7% 2.1% 0.9%
2039 36.3% 45.8% 14.8% 2.1% 0.9%
2040 36.3% 45.8% 15.0% 2.1% 0.9%
2041 36.3% 45.7% 15.1% 2.1% 0.9%
2042 36.2% 45.7% 15.2% 2.0% 0.9%
2043 36.2% 45.6% 15.3% 2.0% 0.9%
2044 36.2% 45.6% 15.4% 2.0% 0.9%
2045 36.2% 45.5% 15.5% 2.0% 0.9%
2046 36.1% 45.5% 15.6% 1.9% 0.9%
2047 36.1% 45.4% 15.7% 1.9% 0.9%
2048 36.1% 45.3% 15.8% 1.9% 0.9%
2049 36.0% 45.3% 16.0% 1.9% 0.9%
2050 36.0% 45.2% 16.1% 1.9% 0.9%
2051 36.0% 45.1% 16.2% 1.8% 0.9%
2052 35.9% 45.1% 16.3% 1.8% 0.9%
2053 35.9% 45.0% 16.4% 1.8% 0.9%
2054 35.9% 44.9% 16.5% 1.8% 0.9%
2055 35.8% 44.9% 16.7% 1.8% 0.8%
2056 35.8% 44.8% 16.8% 1.8% 0.8%
2057 35.8% 44.8% 16.8% 1.8% 0.8%

9.3.2 Markets and Model Calibration


For each general fuel category of consumer conventional cooking products, i.e., electric
and gas, the market is primarily comprised of the following: replacement units for equipment

9-10
that has been retired from service and units for new housing. In addition to normal replacements,
DOE’s shipments model for each general category also assumed that a certain fraction of the
stock would be not be replaced due to demolition of old housing units. Total electric cooking
product shipments are represented by the following equation:

Ship ELEC ( j ) = Rpl ELEC ( j ) + NI ELEC ( j ) + NRELEC ( j )

where:

ShipELEC (j) = total shipments of conventional electric cooking products in year j,


RplELEC (j) = replacement shipments in year j,
NIELEC (j) = shipments to new households in year j, and
NRELEC (j)= non replaced shipments in year j due to building demolition.

Total gas cooking product shipments are represented by the same basic equation:

ShipGAS ( j ) = RplGAS ( j ) + NIGAS ( j ) + NRGAS ( j )

where:

ShipGAS (j) = total shipments of conventional gas cooking products in year j,


RplGAS (j) = replacement shipments in year j,
NIGAS (j) = shipments to new households in year j, and
NRGAS (j)= non replaced shipments in year j due to building demolition.

The sections below discuss in further detail all three of these markets for each general
cooking product category (i.e., cooking tops and ovens).

9.3.2.1 New Construction

To estimate shipments to new construction, DOE used projections of housing starts


coupled with cooking product saturation data. In other words, to project the shipments for new
construction for any given year, DOE multiplied the housing projections by the estimated
saturation of consumer conventional cooking products for new housing units.

Figure 9.3.2 presents historical new housing starts based on the U.S. Census data for the
period 1970 – 20225,6. New housing is comprised of single- and multi-family units and mobile
home placements. Figure 9.3.3 through Figure 9.3.5 present the projected new housing starts
based on EIA’s AEO 2023 for the period 2023–20501. The AEO provides three scenarios of
housing starts: the Reference case, the High Economic Growth case, and the Low Economic
Growth case. All three housing starts projections are presented in Figure 9.3.3 through Figure
9.3.5. DOE used the projections from the Reference case as its default to estimate its shipments
to new construction.

9-11
2.50

2.00
Housing Starts (million)

1.50

1.00

0.50

0.00

Single-Family Starts Multi-Family Starts Manufactured Home Placements

Figure 9.3.2 Historical Housing Starts by Housing Type (1970 – 2022)

1.20

1.00
Housing Starts (million)

0.80

0.60

0.40

0.20

0.00

Reference Low High

Figure 9.3.3 Projected Single-Family Starts (2022 – 2050)

9-12
0.70

0.60
Housing Starts (million)

0.50

0.40

0.30

0.20

0.10

0.00

Reference Low High

Figure 9.3.4 Projected Multi-Family Starts (2022 – 2050)

0.18

0.16

0.14
Housing Starts (million)

0.12

0.10

0.08

0.06

0.04

0.02

0.00

Reference Low High

Figure 9.3.5 Projected Manufactured Home Placements (2022 – 2050)

To project saturation of consumer conventional cooking products in new housing starts,


DOE reviewed data provided by the Residential Energy Consumption Survey (RECS) 1997,
2001, 2005, 2009, 2015, and 20207. DOE used the saturations for the year 2020 as the basis to
estimate the shipments to new construction for future years. Because DOE conducted its
shipments analysis by first projecting overall cooking product shipments by fuel category and

9-13
then disaggregating the total shipments into product types using the historical market share data
in Table 9.3.4 and Table 9.3.5, it used the overall saturation of conventional electric and gas
cooking products to estimate shipments to new construction, respectively. Table 9.3.7
summarizes the saturation rates in new housing units in RECS 2020.

Table 9.3.7 Saturation Rates of Consumer Conventional Cooking Products in New


Housing Units in RECS 2020
Conventional Electric Cooking Products Conventional Gas Cooking Products
Single- Multi- Mobile- Single- Multi- Mobile-
Family Family Home Family Family Home
72.5% 83.1% 71.3% 50.4% 19.7% 18.2%

For this direct final rule, DOE estimated the impact that local electrification policies
would have on product shipments to new construction in the no-new-standards case. DOE
reviewed local and state policies that prohibit gas connections to new construction by the first
year of compliance. DOE found 70 local city policies in the Pacific Census Division (primarily
in California and Oregon) and one state policy in New York prohibiting gas connections in new
construction. DOE adjusted the saturation rates estimate in Table 9.3.7 by determining the
fraction of the population would be impacted by the adopted policies prohibiting gas connections
and assumed all new construction in those areas would have electric cooking products. Table
9.3.8 shows the saturation rates for electric and gas consumer conventional cooking products
used for new construction in 2027 for this direct final rule. Local electrification policies slightly
increase shipments of electric cooking products to new construction by the start of the analysis
period in the no-new-standards case.

Table 9.3.8 Estimated Saturation Rates of Consumer Conventional Cooking Products in


New Housing Units in 2027
Conventional Electric Cooking Products Conventional Gas Cooking Products
Single- Multi- Mobile- Single- Multi- Mobile-
Family Family Home Family Family Home
76.1% 86.8% 72.3% 45.5% 15.8% 17.1%

9.3.2.2 Replacements

DOE determined shipments to the replacement market using an accounting method that
tracks the total stock of units by vintage. DOE estimated stocks of conventional electric and gas
cooking products by vintage and by integrating historical shipments starting from the year 1970.
Over time, some of the units will be retired and removed from the stock, thus triggering the
shipment of a new unit. Because of the relationship between retirements and total stock, there is
a strong correlation between past and future shipments, independent of efficiency standards.

Depending on the vintage, a certain percentage of each type of unit will fail and need to
be replaced. To determine when an electric cooking product fails, DOE used a product survival
function based on a Weibull lifetime distribution with an average value of 16.8 years. For
conventional gas cooking products, DOE used a product survival function based on the same

9-14
Weibull lifetime distribution with an average value of 14.5 years8. For a more complete
discussion of cooking product lifetimes, refer to section 8.2.3 of chapter 8. Figure 9.3.6 shows
the survival functions that DOE used to estimate replacement shipments.

100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%

% Surviving - Gas % Surviving - Electric

Figure 9.3.6 Consumer Conventional Electric and Gas Cooking Products: Surviving
Functions

9.3.2.3 Model Calibration—Non-Replacement

To calibrate estimated shipments with the historical data, DOE introduced into the model
a non-replacement market function. DOE assumed that some of the retiring consumer
conventional cooking products would not be replaced in this category due to building demolition
occurs at the weighted average rate of 0 percent for electric and 1.6 percent for gas consumer
conventional cooking products, respectively. DOE multiplied the not-replaced rates with the
annual retiring conventional electric and gas cooking products, respectively. DOE then excluded
not-replaced units from the annual retiring units to estimate actual replacement of consumer
conventional cooking products per annum for the period 2022–2057.

9.3.2.4 Impact of the Inflation Reduction Act on No-New Standards Case


Shipments

DOE estimated the impact that the Inflation Reduction Act (IRA) would have on product
shipments in the no-new-standards and standards cases. The IRA apportions $4.3 billion to
homeowners to transition from gas products to electric products with a maximum rebate of
$14,000 per household and up to $840 specifically for cooking products. DOE estimated that the
portion of IRA funding used for cooking products was proportional to the ratio of the maximum

9-15
cooking product rebate with the total maximum household rebate. The rebate amount eligible to
households is dependent on household income, ranging from 50 to 100 percent of the cooking
product cost, with a maximum of $840. DOE conservatively assumed not all households would
be eligible for the full rebate and that potential rebates would range from half the full rebate
amount ($420) to the full rebate amount ($840). DOE assumed a typical cooking product rebate
of $630, the midpoint between these two values. From this analysis, DOE estimates that
approximately 410,000 households over the period of 2023–2031 will voluntarily switch from
gas cooking products to electric cooking products, resulting in a 1.6-percent drop in gas cooking
product shipments over this period. DOE notes that the impact of the IRA is exogenous to the
impact of an efficiency standard and is the same in the no-new-standards and standards cases.

9.3.3 No-New-Standards Case Shipments


Figure 9.3.7 and Figure 9.3.8 show the projected shipments of electric and gas cooking
products, respectively, in the no-new-standards case (i.e., the case without new energy efficiency
standards) and the historical shipments DOE used to calibrate the projection.

9.0
8.0
7.0
Shipments (million)

6.0
5.0
4.0
3.0
2.0
1.0
0.0

Historical Projected

Figure 9.3.7 Electric Cooking Products: Historical and No-New-Standards Case


Shipments Projection

9-16
5.0
4.5
4.0
Shipments (million)

3.5
3.0
2.5
2.0
1.5
1.0
0.5
0.0

Historical Projected

Figure 9.3.8 Gas Cooking Products: Historical and No-New-Standards Case Shipments
Projection

Figure 9.3.9 presents total projected electric and gas cooking top shipments under the no-
new-standards case over the analysis period. Note that electric cooking products shipments
comprised approximately 64 percent of the percent of total cooking products shipments during
the analysis period.

14.0

12.0

10.0
Shipments (million)

8.0

6.0

4.0

2.0

0.0

Electric Gas

Figure 9.3.9 Cooking Products: Disaggregated No-New-Standards Case Shipments


Projection

9-17
9.4 IMPACT OF INCREASED PURCHASE PRICE ON SHIPMENTS

9.4.1 Purchase Price Elasticity


Economic theory suggests that, all else being equal, an increase in the price of a good
leads to a decrease in demand for it. Because DOE projects that appliance standards often result
in an increase in the price of the product, DOE conducts a literature review and an analysis of
appliance price and efficiency data to estimate the effects on product shipments from increases in
product price. DOE also considers the decreases in operating costs from higher energy efficiency
and changes over time in household income.

In the case of consumer conventional cooking products, the combined market of


conventional electric and gas products is completely saturated as indicated by the historical
RECS data. Because of the nature of the end-use, every household is likely to be fitted with some
type of cooking product. Therefore, the new construction market segment in the shipments
model, remains inelastic to a potential purchase price increase. A potential increase in purchase
price of the cooking top in the replacement market could, however, impact replacements in two
ways – a unit due for replacement would either get replaced by the consumer immediately or the
consumer would delay replacement by opting for repairing, before the eventual replacement.
DOE estimated the impact on this segment through the use of purchase price elasticity.

DOE’s regression analysis estimates the relative price elasticity of demand for consumer
conventional cooking products to be -0.367. This implies that a 1% price increase in relative
price results in a 0.367 % decrease in aggregate shipments, all things being equal. Note that the
relative price elasticity incorporates the impacts from purchase price, operating cost, household
income and general economic conditions, such that the impact from any single effect can be
mitigated by changes in the other dimensions. DOE estimates of relative price elasticity are short
term estimates.

The relative price elasticity of -0.367 is consistent with estimates in existing literature for
other durable goods. While DOE has tried to account for most of the factors that can affect the
demand for consumer conventional cooking products, it is possible that the resulting elasticity
estimate may be biased because of changes in product attributes and improvement in energy
efficiency over time. DOE’s estimate of relative price elasticity accounts for such potential
impacts by modeling the “unobservables” as random effects (appendix 9A of this direct final rule
TSD provides details on the data and modeling approach used to estimate the relative price).
DOE believes that its estimate of the relative price elasticity of demand provides a reasonable
assessment of the impact of purchase price, operating cost, and household income may have on
product shipments given limitations on data.

Given that DOE’s forecasts of shipments and national impacts attributable to standards is
modelled over a long time frame, it needed to consider how the relative price elasticity estimates
will be affected after a new standard takes effect. Since DOE estimates of relative price elasticity
represent short-term elasticity values, the relative price elasticity needs to be adjusted to account
for long-term adjustments that could occur in shipments. Because there were no existing studies
looking at the relationship between short-run and long-run relative price elasticity estimates in

9-18
durable goods, DOE relied on a study pertaining to automobiles.9 The DOE study on
automobiles found that immediately following a price change, automobile demand is more price
elastic and subsequently becoming more inelastic with time until the relative price elasticity
reaches a terminal value around the tenth year after the price change. Table 9.4.1 shows the
relative change in the price elasticity of demand for automobiles over time. DOE developed a
time series of relative price elasticities based on the relative change in the automobile price
elasticity of demand. For years not shown in Table 9.4.1, DOE performed a linear interpolation
to obtain the relative price elasticity.

Table 9.4.1 Change in Relative Price Elasticity Following a Purchase Price Change
Years Following Price Change
1 2 3 5 10 20
Relative Change in
1.00 0.78 0.63 0.46 0.35 0.33
Elasticity to 1st year
Relative Price Elasticity -0.37 -0.29 -0.23 -0.17 -0.13 -0.12

9.4.2 Impact from Increase in Relative Price


Using the relative price elasticity, DOE was able to estimate the impact of the increase in
relative price from a particular standard level. The impact, as shown in the equation below, is
expressed as a percentage drop in market share for each year, dMS jp .

  RP _ std p ( j ) 
dMS jp = 1 −    e RP ( j )
  RP _ nn p ( j ) 
Where:

dMS jp = percentage market share drop for class p, year j,


RP_stdp(j)= relative price in the standards case for product class p, year j,
RPp_nnp(j)= relative price in the no-new-standards case for product class p, year j, and
eRP(j) = relative price elasticity in year j.

To model the impact of the increase in relative price from a particular standard level on
consumer conventional cooking product shipments, DOE assumed that the affected consumers
would repair their product rather than replace it, extending the life of the product by 5 years.
When the extended repaired units fail after 5 more years, they will be replaced with new ones.

9.5 AFFECTED STOCK


The affected stock is the in-service stock of the appliance or product that is affected by a
TSL. In addition to the projection of product shipments under both the no-new-standards case
and the standards case, the affected stock (which represents the difference in the appliance stock
for the no-new-standards case and the standards case) is a key output of DOE’s shipments model.
The affected stock quantifies the impact that new product shipments have on the appliance stock

9-19
due to a TSL. Therefore, the affected stock consists of those in-service units that are purchased in
or after the year the standard has taken effect, as described by the following equation:
_
j Std _ yr
Aff Stock p ( j ) = Ship p ( j ) + ∑ Stock p (age)
age=1

where:

Aff Stockp(j) = affected stock of units of product p of all vintages that are operational in
year j,
Shipp(j) = shipments of product p in year j,
Stockp(j) = stock of units of product p of all vintages that are operational in year j,
age = age of the units (years), and
Std_yr = effective date of the standard.

As noted in the above equation, to calculate the affected stock, DOE must define the
effective date of the standard. For the NES and NPV results presented in chapter 10 of this TSD
by TSL, DOE assumed that new energy efficiency standards will become effective in the year
2027 for all TSLs other than TSL 1. For TSL 1, DOE used 2028 as the first year of compliance
for all product classes as specified for the “Recommended TSL” in the Joint Agreement. c.

9.6 RESULTS
This section presents the impacts on total shipments resulting from each of the TSLs that
DOE is considering for consumer conventional cooking products. Figure 9.6.1 shows projected
annual shipments of consumer conventional cooking products in the no-new-standards case and
under each standard case. Note, that in the figure below, shipments for cooking top and ovens are
counted separately. That is, a shipment of a combined cooking product such as a range is counted
as both a cooking top and an oven. As shown in Figure 9.6.1, total shipments under each
standards case overlap, indicating the that analyzed TSLs have a minimal impact on cooking
product shipments.

c
Available at www.regulations.gov/comment/EERE-2014-BT-STD-0005-12811.

9-20
25.0

20.0
Unit: million

15.0

10.0

5.0

0.0

No-New-Standards Case TSL1 TSL2 TSL3

Figure 9.6.1 Projected Shipments for Consumer Conventional Cooking Products in the
No-New-Standards Case and Each Trial Standards Level

9-21
REFERENCES

1. U.S. Department of Energy-Energy Information Administration. Annual Energy Outlook


2023, February, 2023. Washington, DC. http://www.eia.gov/forecasts/aeo/.

2. Association of Home Appliance Manufacturers (AHAM), AHAM Distributor Sales by


State, 2020.

3. UBM Canon, Market Research Magazine: Appliance Historical Statistical Review, 2014.

4. U.S. Department of Energy-Energy Efficiency and Renewable Energy Office. Energy


Conservation Standards for Electric and Gas Ranges and Ovens and Microwave Ovens,
Dehumidifiers, and Commercial Clothes Washers, 2006, EERE-2006-STD-0127,
Washington, DC.

5. U.S. Census Bureau, Historical Data: New Privately Owned Housing Units Started, 1959
– 2022.http://www.census.gov/construction/nrc/historical_data/.

6. U.S. Census Bureau, Shipments of New Manufactured Homes, 1959 – 2022.


https://www.census.gov/data/tables/time-series/econ/mhs/shipments.html.

7. U.S. Department of Energy-Energy Information Administration. Residential Energy


Consumption Survey, 1997, 2001, 2005, 2009, 2015, 2020. Washington, DC.
http://www.eia.gov/consumption/residential/data/2020/.

8. AHAM, AHAM Comments on DOE’s SNOPR for Energy Conservation Standards for
Residential Conventional Cooking Products; No. EERE-2014-BT-STD-0005; November
2, 2016.

9. Saul H. Hymans, Gardner Ackley, and F. Thomas Juster. Consumer durable spending:
Explanation and prediction. Brookings Papers on Economic Activity, 1970(2):173–206,
1970. http://www.jstor.org/stable/2534239.

9-22
CHAPTER 10. NATIONAL IMPACT ANALYSIS

TABLE OF CONTENTS

10.1 INTRODUCTION ......................................................................................................... 10-1


10.2 TRIAL STANDARD LEVELS ..................................................................................... 10-2
10.3 PROJECTED EFFICIENCY TRENDS ......................................................................... 10-3
10.3.1 No-New-Standards Case ................................................................................................ 10-3
10.3.2 Standards Case ............................................................................................................... 10-5
10.4 NATIONAL ENERGY SAVINGS ............................................................................... 10-5
10.4.1 Definition ....................................................................................................................... 10-5
10.4.2 Shipments and Product Stock ........................................................................................ 10-6
10.4.3 Annual Energy Consumption per Unit .......................................................................... 10-6
10.4.4 National Annual Energy Consumption .......................................................................... 10-6
10.4.5 Primary Energy Conversion Factors .............................................................................. 10-7
10.4.6 Full-Fuel-Cycle Energy Factors ..................................................................................... 10-8
10.5 NET PRESENT VALUE ............................................................................................... 10-9
10.5.1 Definition ....................................................................................................................... 10-9
10.5.2 Total Installed Cost ...................................................................................................... 10-10
10.5.3 Annual Operating Cost ................................................................................................ 10-11
10.5.4 Discount Factor ............................................................................................................ 10-12
10.6 RESULTS .................................................................................................................... 10-12
10.6.1 National Energy Savings.............................................................................................. 10-12
10.6.2 Net Present Value of Consumer Benefit ...................................................................... 10-13
REFERENCES ........................................................................................................................ 10-15

LIST OF TABLES

Table 10.2.1 Trial Standard Levels for Conventional Cooking Tops ..................................... 10-3
Table 10.2.2 Trial Standard Levels for Conventional Ovens ................................................. 10-3
Table 10.3.1 No-New-Standards Case Efficiency Distributions for Cooking Tops in
Compliance Year ............................................................................................... 10-4
Table 10.3.2 No-New-Standards Case Efficiency Distributions for Electric Ovens in
Compliance Year ............................................................................................... 10-4
Table 10.3.3 No-New-Standards Case Efficiency Distributions for Gas Ovens in
Compliance Year ............................................................................................... 10-5
Table 10.6.1 Estimates of Cumulative Full-Fuel Cycle NES (quads); 30 Years of
Shipments* ....................................................................................................... 10-13
Table 10.6.2 Cumulative NPV Results based on Three-Percent Discount Rates (billion
2022$); 30 Years of Shipments*...................................................................... 10-13
Table 10.6.3 Cumulative NPV Results Based on Seven-Percent Discount Rates (billion
2022$); 30 Years of Shipments*...................................................................... 10-14

10-i
LIST OF FIGURES

Figure 10.4.1 Site-to-Power Plant Energy Use Factor for Consumer Conventional
Cooking Products ............................................................................................... 10-8

10-ii
CHAPTER 10. NATIONAL IMPACT ANALYSIS

10.1 INTRODUCTION

This chapter describes the method the U.S. Department of Energy (DOE) used to
estimate the national impacts of each trial standard level (TSL) considered for consumer
conventional cooking products and presents the results of its calculations including the
“Recommended TSL” defined in the letter titled “Energy Efficiency Agreement of 2023”
(hereafter, the “Joint Agreement”a). For each TSL, DOE evaluated the following impacts: (1)
national energy savings (NES) attributable to each potential standard level; (2) monetary value of
the lifetime energy savings to consumers of cooking products; (3) increased total installed costs;
and (4) the net present value (NPV) of the difference between the value of the operating cost
savings and the increased total installed costs.

The calculations and results are presented in a Microsoft Excel spreadsheet model, which
is accessible through the Department’s websiteb. The spreadsheet model, termed the national
impact analysis (NIA) model, calculates energy savings and NPV for the nation. Details and
instructions for using the NIA model are provided in appendix 10A.

The NIA calculation started with the shipments model, described in chapter 9, that DOE
used to project future purchases of consumer conventional cooking products. DOE used the
annual shipments projection to produce an accounting of annual NES, annual national energy
cost savings, and annual national incremental non-energy costs resulting from purchasing,
installing and operating the covered equipment. The NIA analysis accounts for costs and energy
use over the lifetime of each unit shipped during the analysis period 2027 – 2056 for all TSLs
other than TSL 1 (the Recommended TSL) and 2028-2057 for TSL 1. The national-level results
presented for each year of the analysis period, and as cumulative totals.

To calculate the annual NES, DOE estimated the lifetime site, primary and full-fuel-cycle
(FFC) energy consumption at the unit level for each year in the analysis period. DOE defined
these quantities as follows:

• Site energy consumption is the physical quantity of fossil fuels or electricity consumed at
the site where the end-use service is provided. The site energy consumption is used to
calculate the energy cost input to the NPV calculation.
• Primary energy consumption is defined by converting the site fuel use from physical
units, for example cubic feet for natural gas, or kWh for electricity, to common energy
units (million Btu or MMBtu). This step used the conversion factors listed in appendix
10B. For electricity the conversion factor is a marginal heat rate that incorporate losses
in generation, transmission and distribution, and depends on the sector, end use and year.
For this rule DOE used the values for residential end-use.
• The full-fuel-cycle (FFC) energy use is equal to the primary energy use plus the energy

a
This document is available in the docket at: https://www.regulations.gov/comment/EERE-2014-BT-STD-0005-
12814
b
U.S. Department of Energy, http://www.eere.energy.gov/buildings/appliance_standards/.

10-1
consumed “upstream” of the site in the extraction, processing and distribution of fuels.
The FFC energy use was calculated by applying a fuel-specific FFC energy multiplier to
the primary energy use. These multipliers are presented in appendix 10B.

If a product uses multiple fuels c, the energy use calculation estimated consumption for
each fuel type separately. The unit’s lifetime primary and FFC energy consumptions were then
scaled up to the national level based on the annual shipments projection and according to two
scenarios: the no-new-standards case scenario, with no changes in the existing energy efficiency
standards; and (b) the standards case scenario, where energy efficiency standards are set at the
energy efficiency level corresponding to one of the TSLs.

DOE followed a similar procedure to calculate the annual national energy cost savings
and the annual national incremental installation, maintenance and other non-energy costs. For
each unit shipped during the analysis period, and for each year of its lifetime, DOE estimated
both the energy and the non-energy costs based on the unit’s efficiency and any appropriate price
trends. The unit-level estimates were then scaled up to the national level based on the annual the
shipments projection for the no-new-standards case and the trial standard levels. DOE calculated
the difference between the aggregated national energy cost savings and national incremental non-
energy costs to obtain the NPV of each equipment class. DOE applied a weight to each
equipment class based on its market share to sum these values to define the total NPV.

The two models used in the NIA—the NES model and the NPV model—are described
more fully in subsequent sections. The descriptions include overviews of how DOE performed
each model’s calculations and summaries of the major inputs. After the technical model
descriptions, this chapter presents the results of the NIA calculations.

10.2 TRIAL STANDARD LEVELS

DOE analyzed the benefits and burdens of three TSLs for consumer conventional
cooking products. The proposed criteria for grouping efficiency levels into TSLs to apply to each
product class are outlined below, and the resulting efficiency level groupings by TSL are shown
in Table 10.2.1 and Table 10.2.2. TSL 3 represents the maximum technologically feasible (“max-
tech”) improvements in energy efficiency for all product classes. TSL 2 represents an
intermediate TSL. TSL 1—which corresponds to the Recommended TSL in the Joint
Agreement—corresponds to the minimum efficiency improvement in each product class
corresponding to electronic controls for electric smooth element cooking top product classes,
optimized burners for gas cooking top product classes, and switch-mode power supplies
(SMPSs) for ovens. Table 10.2.1 and Table 10.2.2 present the TSLs and the corresponding
efficiency levels and potential prescriptive standards that DOE has identified for potential new
and amended energy conservation standards for consumer conventional cooking products. DOE
did not evaluate electric open (coil) element cooking tops as part of the efficiency analysis for
this direct final rule.

c
For example, a furnace may use both natural gas for heating and auxiliary electricity.

10-2
Table 10.2.1 Trial Standard Levels for Conventional Cooking Tops
Electric Smooth
Gas Cooking Tops
Trial Element Cooking Tops
(All Classes)
Standard (All Classes)
Level EL IAEC EL IAEC
(kWh/year) (kBtu/year)
1 1 207 1 1,770
2 2 189 2 1,343
3 3 179 2 1,343

Table 10.2.2 Trial Standard Levels for Conventional Ovens


Trial Electric Ovens Gas Ovens
Standard (All Classes) (All Classes)
Level EL Design Option EL Design Option
1 1 SMPS 1 SMPS
SMPS and
SMPS and Convection
2 2 2 Convection mode
mode capability
capability
SMPS, Convection mode SMPS and
3 3 capability, and Oven 2 Convection mode
separator capability
Note: All efficiency levels for conventional gas ovens include the current prescriptive requirement prohibiting the
use of a constant burning pilot light.

10.3 PROJECTED EFFICIENCY TRENDS

10.3.1 No-New-Standards Case

A key component of DOE’s estimates of NES and NPV for cooking products is the
energy efficiency level projected for the no-new-standards case (without new energy
conservation standards) and each standards case (with new energy conservation standards). The
projected annual energy consumption represents the annual shipments-weighted energy
efficiency of cooking products during the analysis period (that is, from the assumed effective
date of a new standard to 30 years after that date).

In calculating the NES, per-unit average annual energy consumption is a direct function
of product energy efficiency. For the NPV, the per-unit total installed cost is a direct function of
energy efficiency. Because it is a function of per-unit annual energy consumption, the per-unit
annual operating cost is indirectly dependent on product energy efficiency. The NES and NPV
inputs are discussed further in sections 10.4 and 10.5.

To project the no-new-standards case energy efficiency for consumer conventional


cooking products, DOE used the shipments-weighted integrated annual energy consumption
(IAEC) as a starting point. DOE first used its engineering analysis results to estimate the no-new-
standards case efficiency distributions under the current market for 2022. Given the lack of data
on historic efficiency trends, DOE assumed that the estimated current distributions would apply

10-3
in the compliance year and throughout the analysis period. DOE then assumed there is no annual
shipments weighted IAEC improvement during the analysis period.

Table 10.3.1 through Table 10.3.3 show no-new-standards case efficiency distribution for
each consumer conventional cooking product class in the first year of compliance. Note that
DOE is not projecting an efficiency trend for consumer conventional cooking products, the
efficiency distributions are projected to be the same regardless of a 2027 or 2028 compliance
year.

Table 10.3.1 No-New-Standards Case Efficiency Distributions for Cooking Tops in


Compliance Year
Electric Smooth
Gas Cooking Top
EL Element Cooking
Product Classes
Top Product Classes
0 23% 3%
1 62% 56%
2 15% 41%
3 0.02% --

Table 10.3.2 No-New-Standards Case Efficiency Distributions for Electric Ovens in


Compliance Year
Electric Standard Electric Standard Electric Self- Electric Self-
EL Ovens, Ovens, Built- Clean Ovens, Clean Ovens,
Freestanding In/Slide-In Freestanding Built-In/Slide-In
0 5% 5% 5% 5%
1 57% 65% 18% 7%
2 38% 30% 77% 86%
3 0% 0% 0% 2%

10-4
Table 10.3.3 No-New-Standards Case Efficiency Distributions for Gas Ovens in
Compliance Year
EL Gas Standard Gas Standard Gas Self- Gas Self-Clean
Ovens, Ovens, Built- Clean Ovens, Ovens, Built-
Freestanding In/Slide-In Freestanding In/Slide-In
0 4% 4% 4% 4%
1 34% 58% 3% 19%
2 62% 38% 93% 77%

10.3.2 Standards Case

For its determination of standards case projected efficiencies, DOE assumed a “roll-up”
scenario to establish the efficiency distribution under different TSLs. Product efficiencies in the
no-new-standards case that do not meet the standard under consideration would “roll up” to meet
the new standard level. All efficiency shares in the no-new-standards case that were above the
standard under consideration would not be affected.

These assumptions are used to determine the average per-unit energy consumption

UEC(L,F,v)= UEC(L,F,v)*eff(v,y0)

Where:

UEC = average annual per-unit site energy consumption


L= trial standard level
F = fuel type
v= vintage (year of purchase)
y0 = compliance year (2027 for all TSLs other than TSL 1, 2028 for TSL 1)
eff = population-average efficiency trend relative to first year of compliance

10.4 NATIONAL ENERGY SAVINGS

DOE calculates annual NES and cumulative NES throughout the projected period.
Positive values of NES represent energy savings, meaning national energy consumption under
the proposed standards is lower than in the no-new-standards case.

10.4.1 Definition

The NES calculation begins with the calculation of the projected annual site energy
consumption (ASEC) over the analysis period. DOE calculated the ASEC in the no-new-
standards case (without new standards) and for each TSL. The trial standard level is labelled L,
with L=0 corresponding to the no-new-standards case.

10-5
DOE calculated the ASEC by multiplying the number or stock of a given product by its
unit energy consumption (UEC). For each equipment class, both the stock and the UEC are
calculated as a function of the TSL, the analysis year and the vintage (year of purchase of the
equipment). The derivation of the stock model is described in chapter 9. For each equipment
class, the calculation of the national AEC is represented by the following equation:

AECy =  STOCKV UECV


Where:

AEC = annual national energy consumption each year in quadrillion Btus (quads),
summed over vintages of the product stock, STOCKV;
STOCKV = stock of product (millions of units) of vintage V that survive in the year for
which DOE calculated annual energy consumption;
UECV = annual energy consumption of consumer conventional cooking products in
kilowatt-hours (kWh);
V = year in which the product was purchased as a new unit; and
y = year in the forecast.

10.4.2 Shipments and Product Stock

DOE projected shipments of each product class under the no-new-standards case and
each standards case. Several factors affect projected shipments, including purchase cost,
operating cost, and household income. As noted previously, the increased cost of more-efficient
products causes some consumers to forego buying the products. Consequently, shipments
projected under the standards cases are lower than under the no-new-standards case. The method
DOE used to calculate and generate the shipments projections for each considered product class
is described in detail in chapter 9, Shipments Analysis.

The product stock in a given year is the number of products shipped from earlier years
that survive in that year. DOE assumes that products have an increasing probability of retiring as
they age. The probability of survival as a function of years since the date of purchase constitutes
the survival function. Chapter 9 provides additional details on the survival function that DOE
used.

10.4.3 Annual Energy Consumption per Unit

DOE developed annual per-unit energy consumption as a function of product energy


efficiency for each product class (see chapter 7, Energy Use Analysis, and chapter 8, Life-Cycle
Cost and Payback Period Analysis). For the NES calculation DOE used a national average value
for each equipment class exported from the LCC (chapter 8) to define the UEC in the starting
year of the analysis period, y0 = 2027 for TSLs other than TSL 1 and y0 = 2028 for TSL 1.

10.4.4 National Annual Energy Consumption

DOE used two steps to convert the annual site energy consumption numbers to an NES
value. First, the site energy numbers are converted to common units, using the conversion factors

10-6
presented in appendix 10B, and the energy consumption is summed over fuel type. This converts
the site energy ASEC to primary energy APEC:

APEC(L,y) = ∑F ASEC(L,F,y)* h(F,y).

In this equation h(F,y) is the conversion factor for fuel type F in year y. For electricity the
conversion factor is a marginal heat rate that incorporates losses in generation, transmission and
distribution, and depends on the sector, end use and year. For this rule, DOE used the values for
residential end-use.

DOE then defined the NES as the difference between the APEC in the no-new-standards
case (L=0) and in the standards case:

NES(L,y) = APEC(L=0,y) – APEC(L,y).

DOE presented results of the NES calculation as a cumulative sum over the analysis
period. This period is defined as 30 years from the start date of the standard DOE included in its
NES estimate the lifetime energy savings for units shipped in the final year of the analysis
period; hence the stock model is continued to 2085 for TSLs other than TSL 1 and 2086 for TSL
1 in order to account for these savings. This calculation is represented by the equation

NEScum(L) = ∑y NES(L,y)

10.4.5 Primary Energy Conversion Factors

DOE calculates primary energy savings as the total site consumption across all fuel types
converted to common units (MMBtu). For fossil fuels such as natural gas, fuel oil or propane, the
conversion factor is a constant equal to the low-heating value for the fuel (listed in appendix
10B). For electricity use, the conversion from site kWh to power plant primary MMBtu uses a
marginal heat rate factor that accounts for losses associated with the generation, transmission,
and distribution of electricity. DOE derived these marginal factors using data published with the
Energy Information Administration (EIA’s) Annual Energy Outlook 2023 (AEO 2023),
following the methodology outlined in appendix 15A.1 The factors depend on the sector and end-
use, and also vary with time due to changes in the mix of fuels used for electric power
generation. Figure 10.4.1 shows the site-to-power plant factors from 2023 to the end of the AEO
analysis period (2050). For years after 2050, DOE held the factors constant and equal to at the
average value between 2046-2050.

10-7
9.8
9.6
9.4
9.2
mn Btu/MWh

9.0
8.8
8.6
8.4
8.2
8.0

Year

Figure 10.4.1 Site-to-Power Plant Energy Use Factor for Consumer Conventional Cooking
Products

10.4.6 Full-Fuel-Cycle Energy Factors

The full-fuel-cycle (FFC) energy use is equal to the primary energy use plus the energy
consumed “upstream” of the site in the extraction, processing and distribution of fuels. The FFC
energy use was calculated by applying a fuel-specific FFC energy multiplier to the primary
energy use. DOE developed FFC multipliers using the data and projections generated by the
National Energy Modeling System (NEMS) used for AEO2023. The AEO provides extensive
information about the energy system, including projections of future oil, natural gas and coal
supply, energy use for oil and gas field and refinery operations, and fuel consumption and
emissions related to electric power production. This information can be used to define a set of
parameters representing the energy intensity of energy production. The multiplier for electricity
represents the energy needed to produce and deliver the fuels that are consumed in electricity
generation. The multipliers are dimensionless numbers that express the upstream energy use as a
percentage of the primary energy use.

Because the FFC energy multipliers depend on the fuel type, the FFC energy is calculated
starting with the annual site energy numbers ASEC. The equation is:

FFC(L,y) = ∑F ASEC(L,F,y)* h(F,y)*µ(F,y).

Where:

ASEC = annual site energy consumption


L= trial standard level
F= fuel type
y= analysis year

10-8
h= energy unit conversion factor
µ= full fuel cycle multiplier
FFC = annual full fuel cycle energy consumption

If a product uses only one fuel, then the FFC energy is equal to the primary energy APEC
multiplied by the FFC multiplier µ. For products that use multiple fuels, the relationship between
the primary energy use and the FFC energy is less straight-forward.

As with the NES, DOE calculated cumulative, national level energy savings in the full-
fuel-cycle metric by calculating the difference relative to the no-new-standards case and
summing over the analysis period:

NES-FFC(L,y) = FFC(L=0,y) – FFC(L,y),

NES-FFCcum(L) = ∑y NES-FFC(L,y)

10.5 NET PRESENT VALUE

DOE defined NPV as the net consumer benefit associated with each trial standard level.
The net consumer benefit is defined as the sum of the change in operating cost relative to the no-
new-standards case and the change in the total installed cost relative to the no-new-standards
case. Typically, the change in operating cost is positive (a savings to consumers), while the
change in total installed cost is negative (a cost to consumers). The costs and savings are
calculated in each year of the analysis period for all the equipment shipped in that year,
discounted, and summed to provide a net present value.

10.5.1 Definition

The NPV is equal to the sum of two present-value estimates:

NPV = PVOCS + PVTIC

Where:

PVOCS = present value of the reduction in operating cost relative to the no-new-standards
case
PVTIC = present value of the increase in total installed cost relative to the no-new-
standards case

DOE determined the PV-OCS and PVC according to the following expressions:

PVOCS(L) = ∑y ( OC(L=0,y) – OC(L,y) )* DF(y)

PVTIC(L) = ∑y ( TIC(L=0,y) – TIC(L,y) )* DF(y)

10-9
Where:

OC = operating cost of the stock in year y


L= trial standard level, with L=0 corresponding to the no-new-standards case
y= analysis year
DF = discount factor
TIC = total installed cost of the shipments in year y

DOE calculated the energy-related component of the operating cost based on the site
energy use (described in section 10.4.4), the energy price and the energy price trend over the
analysis period. The operating cost also includes routine repair and maintenance costs. The
operating costs are incurred over the full lifetime of the unit, so the operating cost calculation
uses the equipment stock. DOE calculated the total installed cost by multiplying the number of
shipments times in each year by the sum of the equipment price and installation cost. These costs
are incurred only in the year of purchase, so the TIC calculation uses the shipments only. If the
maintenance, repair or installation costs do not depend on the trial standard level, they can be left
out of the calculation. Each of these calculation steps are discussed in more detail in the
following sections. As with the NES, the analysis period covers shipments shipped in the
compliance year of the standard and concludes after thirty years. For all TSLs other than TSL 1,
this spans the period 2027-2056. For TSL 1, this spans the period 2028-2057. Operating costs are
calculated until the units shipped in the last year of the analysis period (2056 for all TSLs other
than TSL 1 and 2057 for TSL 1) retire from operation.

10.5.2 Total Installed Cost

DOE described the total per-unit installed cost for each product class as a function of
product efficiency in chapter 8. For the NPV calculation, DOE used the population average total
installed cost exported from the life cycle cost (LCC) analysis in the first year of compliance for
the no-new-standards and standards cases for each product class included in the model. In
calculating the TIC, DOE used the shipments exported from the shipments model, which depend
on TSL.

DOE investigated the possibility that equipment prices, measured in constant dollars,
might change over the analysis period. Incorporating the equipment price trend β(y), the equation
for TIC is:

TIC(L,y) = Ship(L,y)*UIC(L,y0)* b(y, y0),

Where:

Ship = total shipments in year y as calculated in the shipments model,


y0 = compliance year 2027 for TSLs other than TSL 1 and 2028 for TSL 1,
L= trial standard level, with L=0 corresponding to the no-new-standards case,
UIC = average per-unit total installed cost in the compliance year, y0, from the LCC, and
b= equipment price trend relative to the compliance year, y0.

10-10
DOE determined that the equipment price trend followed the equation below.

Y = a X -b
Where:

a = an initial price (or cost),


b = a positive constant known as the learning rate parameter,
X = cumulative production, and
Y = the price as a function of cumulative production.

Thus, as experience (production) accumulates, the cost of producing the next unit
decreases. The percentage reduction in cost that occurs with each doubling of cumulative
production is known as the learning rate (LR), given by:

LR = 1 – 2-b

In typical learning curve formulations, the learning rate parameter is derived using two
historical data series: cumulative production and price (or cost). See chapter 8 of this direct final
rule TSD for details on the estimated learning rates for consumer conventional cooking products.

10.5.3 Annual Operating Cost

The per-unit annual operating cost includes costs for energy, repair, and maintenance.
DOE determined the per-unit annual energy cost based on the annual site energy consumption
(ASEC) discussed in section 10.4.3. The ASEC incorporates both changes in shipments and
changes in equipment efficiency at each TSL. For each fuel type, DOE used the energy price in
the start year that was used in the life-cycle cost analysis (chapter 8). To estimate energy prices
in future years, DOE multiplied the recent energy prices by a projection of annual national-
average residential energy prices consistent with the AEO 2023 energy price trends. The energy
prices and price trends are described in chapter 8.

DOE described the total per-unit repair and maintenance costs for each product class as a
function of product efficiency in the LCC analysis in chapter 8. The NPV calculation is based on
the population average repair and maintenance costs exported from the LCC, for each TSL.
These costs are assumed to remain constant in real terms over the analysis period.

The equation for the operating cost in year y and TSL L is:

OC(L,y) = ∑F ASEC(L,F,y)*e(F,y0)*a(F,y, y0)

Where:

ASEC = annual site energy consumption


L= trial standard level, with L=0 corresponding to the no-new-standards case
F= fuel type
y0 = compliance year 2027 for TSLs other than TSL 1 and 2028 for TSL 1

10-11
e= electricity and gas price exported from the LCC
L= trial standard level, with L=0 corresponding to the no-new-standards case
a= fuel price trend

10.5.4 Discount Factor

DOE multiplied monetary values in future years by a discount factor to determine the
present value. The discount factor (DF) is described by the equation:

DF(y) = (1+r) -(y-yP)

Where:

r= discount rate,
y= analysis year
yP = year relative to which the present value is being determined.

Although DOE used consumer discount rates to determine the life-cycle cost of consumer
conventional cooking products (chapter 8), it used national discount rates to calculate national
NPV. DOE estimated NPV using both a 3-percent and a 7-percent real discount rate, in
accordance with the Office of Management and Budget’s guidance to Federal agencies on the
development of regulatory analysis, particularly section E therein: Identifying and Measuring
Benefits and Costs.2 DOE defined the present year as 2024.

10.6 RESULTS

10.6.1 National Energy Savings

This section provides the national energy savings that DOE calculated for each of the
TSLs analyzed for consumer conventional cooking products. DOE based the inputs to the NIA
model on weighted-average values, producing results that are discrete point values, rather than a
distribution of values such as is generated by the life-cycle cost and payback period analysis.
Table 10.6.1 shows FFC energy savings for consumer conventional cooking products by product
class.

10-12
Table 10.6.1 Estimates of Cumulative Full-Fuel Cycle NES (quads); 30 Years of
Shipments*
Product Class TSL1 TSL2 TSL3
Electric Smooth Element Standalone Cooking Tops 0.02 0.04 0.04
Electric Smooth Element Cooking Top Component of
0.16 0.28 0.30
a Combined Cooking Product
Gas Standalone Cooking Tops 0.00 0.04 0.04
Gas Cooking Top Component of a Combined Cooking
0.00 0.20 0.20
Product
Electric Ovens 0.02 0.07 0.91
Gas Ovens 0.01 0.03 0.03
All 0.22 0.66 1.52
*2027–2056 for all TSLs except TSL 1 (the Recommended TSL); 2028–2057 for TSL 1

10.6.2 Net Present Value of Consumer Benefit

This section provides results of calculating the NPV for each trial standard level considered
for consumer conventional cooking products. Results were calculated for the nation as a whole.
Results, which are cumulative, are shown as the discounted dollar value of the net savings. DOE
based the inputs to the NIA model on weighted-average values, yielding results that are discrete
point values, rather than a distribution of values such as produced by the life-cycle cost and
payback period analyses.

Table 10.6.2 and Table 10.6.3 list the results for cumulative NPV for consumer
conventional cooking products for 3-percent and seven-percent discount rates, respectively. A
negative NPV indicates that the costs of a standard at a given efficiency level exceed the savings.

Table 10.6.2 Cumulative NPV Results based on Three-Percent Discount Rates (billion
2022$); 30 Years of Shipments*

Product Class TSL1 TSL2** TSL3**


Electric Smooth Element Standalone Cooking
0.17 0.17 (5.67)
Tops
Electric Smooth Element Cooking Top
1.20 1.19 (38.14)
Component of a Combined Cooking Product
Gas Standalone Cooking Tops 0.00 0.05 0.05
Gas Cooking Top Component of a Combined
0.01 0.18 0.18
Cooking Product
Electric Ovens 0.14 (0.96) (0.02)
Gas Ovens 0.05 (0.28) (0.28)
All 1.56 0.34 (43.89)
*2027–2056 for all TSLs except TSL 1 (the Recommended TSL); 2028–2057 for TSL 1
**Negative values denoted in parenthesis.

10-13
Table 10.6.3 Cumulative NPV Results Based on Seven-Percent Discount Rates (billion
2022$); 30 Years of Shipments*
Product Class TSL1 TSL2** TSL3**
Electric Smooth Element Standalone Cooking
0.07 0.05 (3.31)
Tops
Electric Smooth Element Cooking Top
0.50 0.38 (21.82)
Component of a Combined Cooking Product
Gas Standalone Cooking Tops 0.00 0.00 0.00
Gas Cooking Top Component of a Combined
0.00 (0.02) (0.02)
Cooking Product
Electric Ovens 0.06 (0.64) (1.01)
Gas Ovens 0.02 (0.19) (0.19)
All 0.65 (0.40) (26.34)
*2027–2056 for all TSLs except TSL 1 (the Recommended TSL); 2028–2057 for TSL 1
**Negative values denoted in parenthesis.

10-14
REFERENCES

1. Energy Information Administration, Annual Energy Outlook 2023 with Projections to


2050, 2023. Washington, DC. http://www.eia.gov/forecasts/aeo/

2. U.S. Office of Management and Budget (OMB), Circular A-4: Regulatory Analysis, 2003.
(Posted September 17, 2003) (Last accessed June 2022.)
https://obamawhitehouse.archives.gov/omb/circulars_a004_a-4/

10-15
CHAPTER 11. CONSUMER SUBGROUP ANALYSIS

TABLE OF CONTENTS

11.1 INTRODUCTION ......................................................................................................... 11-1


11.2 IDENTIFIED SUBGROUPS ......................................................................................... 11-1
11.2.1
Senior-Only Households ................................................................................................ 11-1
11.2.2
Low-Income Households ............................................................................................... 11-1
11.2.2.1 Low-Income Households Life-Cycle Cost and Payback Calculation
Methodology ................................................................................................. 11-3
11.3 RESULTS ...................................................................................................................... 11-4
REFERENCES ........................................................................................................................ 11-30

LIST OF TABLES

Table 11.2.1 US Census Poverty Thresholds for 2020 by Household Size and
Number of Related Children Under 18 Years.............................................. 11-2
Table 11.2.2 Estimated Fraction of Low-income Households by RECS 2020 Income
Bins and Household Size ............................................................................. 11-3
Table 11.2.3 Summarized Low-Income Sample and Potential Net Benefits
Compared to DOE’s LCC Analysis Results ................................................ 11-4
Table 11.3.1 Senior Only Households: Summary of LCC and PBP Results by
Efficiency Level for Electric Smooth Element Standalone Cooking
Top ............................................................................................................... 11-5
Table 11.3.2 Senior Only Households: Summary of Life-Cycle Costs Savings
Relative to the Base Case Efficiency Distribution for Electric Smooth
Element Standalone Cooking Top ............................................................... 11-5
Table 11.3.3 Senior Only Households: Summary of LCC and PBP Results by
Efficiency Level for Electric Smooth Element Cooking Top
Component of a Combined Cooking Product .............................................. 11-6
Table 11.3.4 Senior Only Households: Summary of Life-Cycle Costs Savings
Relative to the Base Case Efficiency Distribution for Electric Smooth
Element Cooking Top Component of a Combined Cooking Product ......... 11-6
Table 11.3.5 Senior Only Households: Summary of LCC and PBP Results by
Efficiency Level for Gas Standalone Cooking Tops ................................... 11-7
Table 11.3.6 Senior Only Households: Summary of Life-Cycle Costs Savings
Relative to the Base Case Efficiency Distribution for Gas Standalone
Cooking Tops ............................................................................................... 11-7
Table 11.3.7 Senior Only Households: Summary of LCC and PBP Results by
Efficiency Level for Gas Cooking Top Component of a Combined
Cooking Product .......................................................................................... 11-7
Table 11.3.8 Senior Only Households: Summary of Life-Cycle Costs Savings
Relative to the Base Case Efficiency Distribution for Gas Cooking Top
Component of a Combined Cooking Product .............................................. 11-8

11-i
Table 11.3.9 Senior Only Households: Summary of LCC and PBP Results by
Efficiency Level for Electric Standard Ovens, Freestanding....................... 11-8
Table 11.3.10 Senior Only Households: Summary of Life-Cycle Costs Savings
Relative to the Base Case Efficiency Distribution for Electric Standard
Ovens, Freestanding ..................................................................................... 11-9
Table 11.3.11 Senior Only Households: Summary of LCC and PBP Results by
Efficiency Level for Electric Standard Ovens, Built-In/Slide-In................. 11-9
Table 11.3.12 Senior Only Households: Summary of Life-Cycle Costs Savings
Relative to the Base Case Efficiency Distribution for Electric Standard
Ovens, Built-In/Slide-In ............................................................................... 11-9
Table 11.3.13 Senior Only Households: Summary of LCC and PBP Results by
Efficiency Level for Electric Self-Clean Ovens, Freestanding .................. 11-10
Table 11.3.14 Senior Only Households: Summary of Life-Cycle Costs Savings
Relative to the Base Case Efficiency Distribution for Electric Self-
Clean Ovens, Freestanding ........................................................................ 11-10
Table 11.3.15 Senior Only Households: Summary of LCC and PBP Results by
Efficiency Level for Electric Self-Clean Ovens, Built-In/Slide-In ............ 11-11
Table 11.3.16 Senior Only Households: Summary of Life-Cycle Costs Savings
Relative to the Base Case Efficiency Distribution for Electric Self-
Clean Ovens, Built-In/Slide-In .................................................................. 11-11
Table 11.3.17 Senior Only Households: Summary of LCC and PBP Results by
Efficiency Level for All Electric Ovens .................................................... 11-12
Table 11.3.18 Senior Only Households: Summary of Life-Cycle Costs Savings
Relative to the Base Case Efficiency Distribution for Electric Self-
Clean Ovens, Built-In/Slide-In .................................................................. 11-12
Table 11.3.19 Senior Only Households: Summary of LCC and PBP Results by
Efficiency Level for Gas Standard Ovens, Freestanding ........................... 11-13
Table 11.3.20 Senior Only Households: Summary of Life-Cycle Costs Savings
Relative to the Base Case Efficiency Distribution for Gas Standard
Ovens, Freestanding ................................................................................... 11-13
Table 11.3.21 Senior Only Households: Summary of LCC and PBP Results by
Efficiency Level for Gas Standard Ovens, Built-In/Slide-In ..................... 11-13
Table 11.3.22 Senior Only Households: Summary of Life-Cycle Costs Savings
Relative to the Base Case Efficiency Distribution for Gas Standard
Ovens, Built-In/Slide-In ............................................................................. 11-14
Table 11.3.23 Senior Only Households: Summary of LCC and PBP Results by
Efficiency Level for Gas Self-Clean Ovens, Freestanding ........................ 11-14
Table 11.3.24 Senior Only Households: Summary of Life-Cycle Costs Savings
Relative to the Base Case Efficiency Distribution for Gas Self-Clean
Ovens, Freestanding ................................................................................... 11-14
Table 11.3.25 Senior Only Households: Summary of LCC and PBP Results by
Efficiency Level for Gas Self-Clean Ovens, Built-In/Slide-In .................. 11-15
Table 11.3.26 Senior Only Households: Summary of Life-Cycle Costs Savings
Relative to the Base Case Efficiency Distribution for Gas Self-Clean
Ovens, Built-In/Slide-In ............................................................................. 11-15

11-ii
Table 11.3.27 Senior Only Households: Summary of LCC and PBP Results by
Efficiency Level for All Gas Ovens........................................................... 11-16
Table 11.3.28 Senior Only Households: Summary of Life-Cycle Costs Savings
Relative to the Base Case Efficiency Distribution for All Gas Ovens ...... 11-16
Table 11.3.29 Low Income Households: Summary of LCC and PBP Results by
Efficiency Level for Electric Smooth Element Standalone Cooking
Tops............................................................................................................ 11-17
Table 11.3.30 Low Income Households: Summary of Life-Cycle Costs Savings
Relative to the Base Case Efficiency Distribution for Electric Smooth
Element Standalone Cooking Tops ............................................................ 11-17
Table 11.3.31 Low Income Households: Summary of LCC and PBP Results by
Efficiency Level for Electric Smooth Element Cooking Top
Component of a Combined Cooking Product ............................................ 11-18
Table 11.3.32 Low Income Households: Summary of Life-Cycle Costs Savings
Relative to the Base Case Efficiency Distribution for Electric Smooth
Element Cooking Top Component of a Combined Cooking Product ....... 11-18
Table 11.3.33 Low Income Households: Summary of LCC and PBP Results by
Efficiency Level for Gas Standalone Cooking Tops ................................. 11-19
Table 11.3.34 Low Income Households: Summary of Life-Cycle Costs Savings
Relative to the Base Case Efficiency Distribution for Gas Standalone
Cooking Tops ............................................................................................. 11-19
Table 11.3.35 Low Income Households: Summary of LCC and PBP Results by
Efficiency Level for Gas Cooking Top Component of a Combined
Cooking Product ........................................................................................ 11-19
Table 11.3.36 Low Income Households: Summary of Life-Cycle Costs Savings
Relative to the Base Case Efficiency Distribution for Gas Cooking Top
Component of a Combined Cooking Product ............................................ 11-20
Table 11.3.37 Low Income Households: Summary of LCC and PBP Results by
Efficiency Level for Electric Standard Ovens, Freestanding..................... 11-20
Table 11.3.38 Low Income Households: Summary of Life-Cycle Costs Savings
Relative to the Base Case Efficiency Distribution for Electric Standard
Ovens, Freestanding ................................................................................... 11-21
Table 11.3.39 Low Income Households: Summary of LCC and PBP Results by
Efficiency Level for Electric Standard Ovens, Built-In/Slide-In............... 11-21
Table 11.3.40 Low Income Households: Summary of Life-Cycle Costs Savings
Relative to the Base Case Efficiency Distribution for Electric Standard
Ovens, Built-In/Slide-In ............................................................................. 11-22
Table 11.3.41 Low Income Households: Summary of LCC and PBP Results by
Efficiency Level for Electric Self-Clean Ovens, Freestanding .................. 11-22
Table 11.3.42 Low Income Households: Summary of Life-Cycle Costs Savings
Relative to the Base Case Efficiency Distribution for Electric Self-
Clean Ovens, Freestanding ........................................................................ 11-23
Table 11.3.43 Low Income Households: Summary of LCC and PBP Results by
Efficiency Level for Electric Self-Clean Ovens, Built-In/Slide-In ............ 11-23

11-iii
Table 11.3.44 Low Income Households: Summary of Life-Cycle Costs Savings
Relative to the Base Case Efficiency Distribution for Electric Self-
Clean Ovens, Built-In/Slide-In .................................................................. 11-24
Table 11.3.45 Low Income Households: Summary of LCC and PBP Results by
Efficiency Level for All Electric Ovens .................................................... 11-24
Table 11.3.46 Low Income Households: Summary of Life-Cycle Costs Savings
Relative to the Base Case Efficiency Distribution for All Electric
Ovens ......................................................................................................... 11-25
Table 11.3.47 Low Income Households: Summary of LCC and PBP Results by
Efficiency Level for Gas Standard Ovens, Freestanding ........................... 11-25
Table 11.3.48 Low Income Households: Summary of Life-Cycle Costs Savings
Relative to the Base Case Efficiency Distribution for Gas Standard
Ovens, Freestanding ................................................................................... 11-25
Table 11.3.49 Low Income Households: Summary of LCC and PBP Results by
Efficiency Level for Gas Standard Ovens, Built-In/Slide-In ..................... 11-26
Table 11.3.50 Low Income Households: Summary of Life-Cycle Costs Savings
Relative to the Base Case Efficiency Distribution for Gas Standard
Ovens, Built-In/Slide-In ............................................................................. 11-26
Table 11.3.51 Low Income Households: Summary of LCC and PBP Results by
Efficiency Level for Gas Self-Clean Ovens, Freestanding ........................ 11-27
Table 11.3.52 Low Income Households: Summary of Life-Cycle Costs Savings
Relative to the Base Case Efficiency Distribution for Gas Self-Clean
Ovens, Freestanding ................................................................................... 11-27
Table 11.3.53 Low Income Households: Summary of LCC and PBP Results by
Efficiency Level for Gas Self-Clean Ovens, Built-In/Slide-In .................. 11-28
Table 11.3.54 Low Income Households: Summary of Life-Cycle Costs Savings
Relative to the Base Case Efficiency Distribution for Gas Self-Clean
Ovens, Built-In/Slide-In ............................................................................. 11-28
Table 11.3.55 Low Income Households: Summary of LCC and PBP Results by
Efficiency Level for All Gas Ovens........................................................... 11-29
Table 11.3.56 Low Income Households: Summary of Life-Cycle Costs Savings
Relative to the Base Case Efficiency Distribution for All Gas Ovens ...... 11-29

11-iv
CHAPTER 11. CONSUMER SUBGROUP ANALYSIS

11.1 INTRODUCTION
Chapter 8 of this technical support document (TSD) describes the life-cycle cost (LCC)
and payback period (PBP) analysis that examines energy savings and cost impacts of energy
conservation standards on the U.S. population. In analyzing the potential impact of new or
amended standards on consumers, the U.S. Department of Energy (DOE) further evaluates the
impacts on identifiable groups of consumers (subgroups) that may be disproportionately affected
by a national standard level. The consumer subgroup analysis evaluates effects by analyzing the
LCC and PBPs for subgroups of residential consumers. For cooking products, DOE identified
two consumer subgroups that warranted further study: (1) senior-only households and (2) low
income households.

DOE determined the impact on consumer subgroups for consumer conventional cooking
products using the LCC spreadsheet model, which enables DOE to analyze the LCC for any
subgroup by sampling only the data that apply to those subgroups. (Chapter 8 explains in detail
the inputs to the model used in determining LCC and PBPs.) As described in section 11.3, the
energy use and energy price characteristics of the two subgroups (senior-only and low-income)
differ from those for the general population.

This chapter describes the identification of the two subgroups and gives the results of the
LCC and PBP analyses for those subgroups.

11.2 IDENTIFIED SUBGROUPS


The following two sections describe how DOE defined the two consumer subgroups
identified for further examination.

11.2.1 Senior-Only Households


Senior-only households comprise occupants who are all at least 65 years of age. Limited
information was provided regarding the occupants age in DOE’s Energy Information
Administration’s Residential Energy Consumption Survey of 2020 (RECS). DOE assumes that
those households in which householder is at least 65 years of age and do not have members of
age 17 or younger are senior-only households. Senior-only households represent 23.5 percent of
the U.S. households.1

11.2.2 Low-Income Households


As defined in the 2009 RECS, low-income household residents are living at or below the
poverty line. The poverty line varies with household size, age of head of household and family
income.

11-1
To identify potential low-income households in RECS 2020, DOE used the poverty
thresholds in 2020 defined by the U.S. Bureau of the Census (see
Table 11.2.1) along with the RECS 2020 reported household income bins by household
size. Of the households selected as low income, 76 percent of households are reported with
income bins under the US census poverty thresholds, and 24 percent of households are reported
with an income bin that is within the US Census poverty value. For the latter, DOE assumed that
the distribution of incomes within the bin was proportional, so that the RECS weight would be
adjusted by a factor derived by the difference between the US Census poverty value and the
minimum of the RECS 2020 income bin divided by the difference between the high and low of
the RECS 2020 income bin (i.e., $12,500 US Census poverty value in a $10-15,000 RECS 2020
income bin would be equal to 50 percent weighting factor). The average weighting factors for
households with different income bin and household member number combinations are shown in
Table 11.2.2. The resulting fraction of RECS 2020 households classified as low income is 13.4
percent of the total households.a

Table 11.2.1 US Census Poverty Thresholds for 2020 by Household Size and Number of
Related Children Under 18 Years
Weighted Related Children under 18 years, 2020$
Household Average
Size Threshold None 1 2 3 4 5 6 7 8+
2020$
1 13,171
Under 65 13,465 13,465
Over 65 12,413 12,413
2 16,733
Under 65 17,413 17,331 17,839
Over 65 15,659 15,644 17,771
3 20,591 20,244 20,832 20,852
4 26,496 26,695 27,131 26,246 26,338
5 31,417 32,193 32,661 31,661 30,887 30,414
6 35,499 37,027 37,174 36,408 35,674 34,582 33,935
7 40,406 42,605 42,871 41,954 41,314 40,124 38,734 37,210
8 44,755 47,650 48,071 47,205 46,447 45,371 44,006 42,585 42,224
9+ 53,905 57,319 57,597 56,831 56,188 55,132 53,679 52,366 52,040 50,035
Source: US Census poverty threshold values for 20202.

a
Note that this low-income fraction coincides with the increase in government support offered in 2020 during the
COVID-19 pandemic, so this could partly explain the decreased fraction compared to the RECS 2009 survey, which
classified approximately 14.8 percent of U.S. households as low-income.

11-2
Table 11.2.2 Estimated Fraction of Low-income Households by RECS 2020 Income Bins
and Household Size
RECS 2020 Income Bins
Househol less $10,000 $12,500 $15,000 $20,000 $25,000 $30,000 $35,000 $40,000
d Size $50,000
than - - - - - - - -
or more
$10,000 $12,499 $14,999 $19,999 $24,999 $29,999 $34,999 $39,999 $49,999
1 100 98 12 0 0 0 0 0 0 0
2 100 100 100 30 0 0 0 0 0 0
3 100 100 100 100 12 0 0 0 0 0
4 100 100 100 100 100 32 0 0 0 0
5 100 100 100 100 100 100 31 0 0 0
6 100 100 100 100 100 100 96 18 0 0
7 100 100 100 100 100 100 100 100 12 0

11.2.2.1 Low-Income Households Life-Cycle Cost and Payback Calculation


Methodology

For this consumer subgroup analysis, DOE used RECS data to divide low-income
households into three sub-subgroups: 1) renters who pay energy bill; 2) renters who do not pay
energy bill; and 3) homeowners. For large appliances such as consumer conventional cooking
products, renters are unlikely to be purchasers. Instead, DOE assumes the landlord would bear
the cost, and some or none of the cost would get passed on to the renter. Renters who pay the
energy bill would receive the energy cost savings from higher-efficiency appliances. Low-
income renters are also relatively likely to live in subsidized housing units, and DOE notes that
in these cases the landlord may pay the electricity bill as well. RECS 2020 includes data on
whether a household pays for the electricity bill, allowing DOE to categorize households
appropriately in the analysis. b

For this direct final rule analysis, DOE considers low-income households who are
homeowners and do pay for the product and energy costs would have an impact using the same
methodology applied to the national LCC analysis. For low-income households who are renters
and pay for energy bills, DOE considers that the incremental first costs would not be passed on
to those households. For low-income households who are renters and do not pay for energy bills,
DOE considers the amended standards would have no impact on those households. Thus, DOE
considers the impact on the low-income household narrowly, excluding any costs or benefits that
are accrued by either a landlord or subsidized housing.c This disaggregation allows DOE to
determine whether low-income households are disproportionately affected by an amended
energy conservation standard in a more accurate manner compared to using the same

b
RECS 2020 includes a category for households that pay only some of the electricity bill. For the low-income
consumer subgroup analysis, DOE assumes that these households pay all of the electricity bill, and, therefore, would
receive all of the operating cost benefits of an amended energy conservation standard.
c
Given that in the low-income subgroup analysis, DOE assumed that the low-income renters paid 0% of incremental
cost, and in the national analysis, DOE assumed that all consumers paid 100% of the equipment cost, the results
have covered the possible range of the outcomes. Any fraction selected between 0% and 100% would produce
results between the national and the subgroup results, and DOE would still have a high degree of confidence that the
impacts are economically justified.

11-3
methodology applied to the national LCC analysis. DOE did not assume a difference in annual
energy use or electricity prices for low-income consumers compared to the national sample

Table 11.2.3 Summarized Low-Income Sample and Potential Net Benefits Compared to
DOE’s LCC Analysis Results
Type of Percentage of Low-Income Sample* Impact
Household** Electric Gas Electric on Impact of
(Pay for Gas Energy First Cost
Cooking Cooking Ovens
Electricity?)*** Ovens Bill
Tops Tops
Renters
Full
(Pay for Energy 56.0% 40.6% 56.9% 43.9% None†
savings
Bill)
Renters
(Do Not Pay 12.8% 8.9% 12.9% 7.4% None None†
for Energy Bill)
Full
Owners 31.3% 44.2% 30.2% 49.0% Full
savings
* Total may not sum to 100.0 due to rounding.
** RECS 2020 lists three categories: (1) Owned (classified as “Owners” in this table); (2) Rented (classified as
“Renters” in this table); (3) Occupied without payment of rent (also classified as “Renters” in this table). Therefore,
renters include occupants in subsidized housing including public housing, subsidized housing in private properties,
and other households that do not pay rent.
*** RECS 2020 lists four categories: (1) Household is responsible for paying for all electricity used in this home;
(2) All electricity used in this home is included in the rent or condo fee; (3) Some is paid by the household, and
some is included in the rent or condo fee; and 4) Other. “Pay for Energy Bill” includes only category (1), all other
categories are included in “Do Not Pay for Energy Bill.”

It is assumed that incremental costs usually are not included in rent increases.

11.3 RESULTS
Table 11.3.1 through Table 11.3.56 summarize the LCC and PBP results from DOE’s
subgroup analysis. The results describe the financial effects of potential standards on senior-only
and low-income households. The tables present the average installed price; average lifetime
operating cost (discounted); average life-cycle cost; average life-cycle cost savings; percentage
of each subgroup who are burdened with net costs, realize net savings, or are not affected; and
the simple payback period.

11-4
Table 11.3.1 Senior Only Households: Summary of LCC and PBP Results by Efficiency
Level for Electric Smooth Element Standalone Cooking Top
Average Costs
2022$ Simple
Efficiency
TSL* Payback
Level Lifetime
First Year’s years
Installed Cost Operating LCC
Operating Cost
Cost
-- Baseline $572 $21 $268 $839 --
1 1 $572 $16 $203 $774 0.6
2 2 $596 $15 $188 $784 3.9
3 3 $1,213 $17 $216 $1,429 165.0
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

Table 11.3.2 Senior Only Households: Summary of Life-Cycle Costs Savings Relative to
the Base Case Efficiency Distribution for Electric Smooth Element
Standalone Cooking Top
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 0% $62.32
2 2 51% $9.03
3 3 100% ($637.64)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

11-5
Table 11.3.3 Senior Only Households: Summary of LCC and PBP Results by Efficiency
Level for Electric Smooth Element Cooking Top Component of a Combined
Cooking Product
Average Costs
2022$ Simple
Efficiency
TSL* Payback
Level Lifetime
First Year’s years
Installed Cost Operating LCC
Operating Cost
Cost
-- Baseline $572 $21 $268 $839 --
1 1 $572 $16 $203 $774 0.6
2 2 $596 $15 $188 $784 3.9
3 3 $1,213 $17 $216 $1,429 165.0
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

Table 11.3.4 Senior Only Households: Summary of Life-Cycle Costs Savings Relative to
the Base Case Efficiency Distribution for Electric Smooth Element Cooking
Top Component of a Combined Cooking Product
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 0% $62.32
2 2 51% $9.03
3 3 100% ($637.64)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

11-6
Table 11.3.5 Senior Only Households: Summary of LCC and PBP Results by Efficiency
Level for Gas Standalone Cooking Tops
Average Costs
2022$ Simple
Efficiency
TSL* Lifetime Payback
Level First Year’s
Installed Cost Operating LCC years
Operating Cost
Cost
-- Baseline $460 $16 $181 $641 --
1 1 $462 $15 $174 $636 6.4
2,3 2 $488 $13 $150 $638 10.2
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

Table 11.3.6 Senior Only Households: Summary of Life-Cycle Costs Savings Relative to
the Base Case Efficiency Distribution for Gas Standalone Cooking Tops
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 1% $3.12
2,3 2 37% ($0.36)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

Table 11.3.7 Senior Only Households: Summary of LCC and PBP Results by Efficiency
Level for Gas Cooking Top Component of a Combined Cooking Product
Average Costs
2022$ Simple
Efficiency
TSL* Lifetime Payback
Level First Year’s
Installed Cost Operating LCC years
Operating Cost
Cost
-- Baseline $460 $16 $181 $641 --
1 1 $462 $15 $174 $636 6.4
2,3 2 $488 $13 $150 $638 10.2
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

11-7
Table 11.3.8 Senior Only Households: Summary of Life-Cycle Costs Savings Relative to
the Base Case Efficiency Distribution for Gas Cooking Top Component of a
Combined Cooking Product
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 1% $3.12
2,3 2 37% ($0.36)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

Table 11.3.9 Senior Only Households: Summary of LCC and PBP Results by Efficiency
Level for Electric Standard Ovens, Freestanding
Average Costs
2022$ Simple
Efficiency
TSL* Payback
Level Lifetime
First Year’s years
Installed Cost Operating LCC
Operating Cost
Cost
-- 0 $695 $22 $282 $977 --
1 1 $694 $20 $264 $958 2.1
2 2 $751 $20 $254 $1,005 25.4
3 3 $805 $17 $215 $1,020 21.1
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

11-8
Table 11.3.10 Senior Only Households: Summary of Life-Cycle Costs Savings Relative to
the Base Case Efficiency Distribution for Electric Standard Ovens,
Freestanding
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 0% $15.99
2 2 61% ($42.62)
3 3 86% ($41.38)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

Table 11.3.11 Senior Only Households: Summary of LCC and PBP Results by Efficiency
Level for Electric Standard Ovens, Built-In/Slide-In
Average Costs
2022$ Simple
Efficiency
TSL* Lifetime Payback
Level First Year’s
Installed Cost Operating LCC years
Operating Cost
Cost
-- 0 $727 $23 $293 $1,020 --
1 1 $726 $21 $276 $1,001 2.1
2 2 $783 $21 $265 $1,048 26.0
3 3 $837 $18 $226 $1,063 21.3
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

Table 11.3.12 Senior Only Households: Summary of Life-Cycle Costs Savings Relative to
the Base Case Efficiency Distribution for Electric Standard Ovens, Built-
In/Slide-In
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 0% $14.92
2 2 69% ($42.88)
3 3 87% ($44.91)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

11-9
Table 11.3.13 Senior Only Households: Summary of LCC and PBP Results by Efficiency
Level for Electric Self-Clean Ovens, Freestanding
Average Costs
2022$ Simple
Efficiency
TSL* Lifetime Payback
Level First Year’s
Installed Cost Operating LCC years
Operating Cost
Cost
-- 0 $749 $27 $343 $1,092 --
1 1 $748 $25 $326 $1,074 2.1
2 2 $805 $25 $315 $1,120 25.4
3 3 $859 $21 $276 $1,135 21.1
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

Table 11.3.14 Senior Only Households: Summary of Life-Cycle Costs Savings Relative to
the Base Case Efficiency Distribution for Electric Self-Clean Ovens,
Freestanding
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 0% $16.72
2 2 23% ($39.92)
3 3 82% ($24.37)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

11-10
Table 11.3.15 Senior Only Households: Summary of LCC and PBP Results by Efficiency
Level for Electric Self-Clean Ovens, Built-In/Slide-In
Average Costs
2022$ Simple
Efficiency
TSL* Payback
Level Lifetime
First Year’s years
Installed Cost Operating LCC
Operating Cost
Cost
-- Baseline $781 $27 $353 $1,134 --
1 1 $780 $26 $336 $1,116 2.1
2 2 $837 $25 $325 $1,163 25.9
3 3 $891 $22 $287 $1,178 21.3
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

Table 11.3.16 Senior Only Households: Summary of Life-Cycle Costs Savings Relative to
the Base Case Efficiency Distribution for Electric Self-Clean Ovens, Built-
In/Slide-In
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 0% $16.09
2 2 11% ($36.79)
3 3 79% ($19.53)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

11-11
Table 11.3.17 Senior Only Households: Summary of LCC and PBP Results by Efficiency
Level for All Electric Ovens
Average Costs
2022$ Simple
Efficiency
TSL* Payback
Level Lifetime
First Year’s years
Installed Cost Operating LCC
Operating Cost
Cost
-- Baseline $749 $26 $336 $1,085 --
1 1 $748 $24 $318 $1,066 2.1
2 2 $805 $24 $307 $1,113 25.6
3 3 $859 $21 $268 $1,128 21.2
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

Table 11.3.18 Senior Only Households: Summary of Life-Cycle Costs Savings Relative to
the Base Case Efficiency Distribution for Electric Self-Clean Ovens, Built-
In/Slide-In
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 0% $16.38
2 2 27% ($39.54)
3 3 82% ($26.16)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

11-12
Table 11.3.19 Senior Only Households: Summary of LCC and PBP Results by Efficiency
Level for Gas Standard Ovens, Freestanding
Average Costs
2022$ Simple
Efficiency
TSL* Payback
Level Lifetime
First Year’s years
Installed Cost Operating LCC
Operating Cost
Cost
-- Baseline $798 $21 $232 $1,029 --
1 1 $795 $19 $214 $1,010 1.9
2, 3 2 $838 $19 $206 $1,044 18.0
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

Table 11.3.20 Senior Only Households: Summary of Life-Cycle Costs Savings Relative to
the Base Case Efficiency Distribution for Gas Standard Ovens, Freestanding
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 0% $15.19
2, 3 2 37% ($28.49)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

Table 11.3.21 Senior Only Households: Summary of LCC and PBP Results by Efficiency
Level for Gas Standard Ovens, Built-In/Slide-In
Average Costs
2022$ Simple
Efficiency
TSL* Payback
Level Lifetime
First Year’s years
Installed Cost Operating LCC
Operating Cost
Cost
-- Baseline $829 $22 $241 $1,071 --
1 1 $827 $20 $224 $1,051 1.9
2, 3 2 $870 $19 $216 $1,086 18.3
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

11-13
Table 11.3.22 Senior Only Households: Summary of Life-Cycle Costs Savings Relative to
the Base Case Efficiency Distribution for Gas Standard Ovens, Built-
In/Slide-In
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 0% $15.20
2, 3 2 61% ($28.98)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

Table 11.3.23 Senior Only Households: Summary of LCC and PBP Results by Efficiency
Level for Gas Self-Clean Ovens, Freestanding
Average Costs
2022$ Simple
Efficiency
TSL* Payback
Level Lifetime
First Year’s years
Installed Cost Operating LCC
Operating Cost
Cost
-- Baseline $965 $22 $248 $1,213 --
1 1 $962 $20 $231 $1,192 1.9
2, 3 2 $1,005 $20 $223 $1,228 18.0
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

Table 11.3.24 Senior Only Households: Summary of Life-Cycle Costs Savings Relative to
the Base Case Efficiency Distribution for Gas Self-Clean Ovens,
Freestanding
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 0% $14.95
2, 3 2 7% ($21.20)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

11-14
Table 11.3.25 Senior Only Households: Summary of LCC and PBP Results by Efficiency
Level for Gas Self-Clean Ovens, Built-In/Slide-In
Average Costs
2022$ Simple
Efficiency
TSL* Payback
Level Lifetime
First Year’s years
Installed Cost Operating LCC
Operating Cost
Cost
-- Baseline $997 $23 $258 $1,255 --
1 1 $993 $21 $241 $1,234 1.9
2, 3 2 $1,037 $21 $233 $1,270 18.3
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

Table 11.3.26 Senior Only Households: Summary of Life-Cycle Costs Savings Relative to
the Base Case Efficiency Distribution for Gas Self-Clean Ovens, Built-
In/Slide-In
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 0% $14.82
2, 3 2 22% ($27.48)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

11-15
Table 11.3.27 Senior Only Households: Summary of LCC and PBP Results by Efficiency
Level for All Gas Ovens
Average Costs
2022$ Simple
Efficiency
TSL* Payback
Level Lifetime
First Year’s years
Installed Cost Operating LCC
Operating Cost
Cost
-- Baseline $891 $22 $241 $1,131 --
1 1 $888 $20 $223 $1,111 1.9
2, 3 2 $931 $19 $216 $1,146 18.0
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

Table 11.3.28 Senior Only Households: Summary of Life-Cycle Costs Savings Relative to
the Base Case Efficiency Distribution for All Gas Ovens
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 0% $15.06
2, 3 2 21% ($24.58)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

11-16
Table 11.3.29 Low Income Households: Summary of LCC and PBP Results by Efficiency
Level for Electric Smooth Element Standalone Cooking Tops
Average Costs
2022$ Simple
Efficiency
TSL* Payback
Level Lifetime
First Year’s years
Installed Cost Operating LCC
Operating Cost
Cost
-- Baseline $188 $20 $258 $446 --
1 1 $188 $15 $194 $382 0.2
2 2 $196 $14 $180 $376 1.3
3 3 $402 $16 $209 $611 58.0
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

Table 11.3.30 Low Income Households: Summary of Life-Cycle Costs Savings Relative to
the Base Case Efficiency Distribution for Electric Smooth Element
Standalone Cooking Tops
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 0% $62.53
2 2 17% $21.37
3 3 41% ($245.84)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

11-17
Table 11.3.31 Low Income Households: Summary of LCC and PBP Results by Efficiency
Level for Electric Smooth Element Cooking Top Component of a Combined
Cooking Product
Average Costs
2022$ Simple
Efficiency
TSL* Payback
Level Lifetime
First Year’s years
Installed Cost Operating LCC
Operating Cost
Cost
-- Baseline $188 $20 $258 $446 --
1 1 $188 $15 $194 $382 0.2
2 2 $196 $14 $180 $376 1.3
3 3 $402 $16 $209 $611 58.0
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

Table 11.3.32 Low Income Households: Summary of Life-Cycle Costs Savings Relative to
the Base Case Efficiency Distribution for Electric Smooth Element Cooking
Top Component of a Combined Cooking Product
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 0% $62.53
2 2 17% $21.37
3 3 41% ($245.84)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

11-18
Table 11.3.33 Low Income Households: Summary of LCC and PBP Results by Efficiency
Level for Gas Standalone Cooking Tops
Average Costs
2022$ Simple
Efficiency
TSL* Lifetime Payback
Level First Year’s
Installed Cost Operating LCC years
Operating Cost
Cost
0 Baseline $247 $15.1 $169 $416 --
1 1 $248 $14.1 $162 $410 3.9
2,3 2 $263 $12.5 $140 $403 6.1
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

Table 11.3.34 Low Income Households: Summary of Life-Cycle Costs Savings Relative to
the Base Case Efficiency Distribution for Gas Standalone Cooking Tops
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 1% $4.31
2,3 2 22% $8.57
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

Table 11.3.35 Low Income Households: Summary of LCC and PBP Results by Efficiency
Level for Gas Cooking Top Component of a Combined Cooking Product
Average Costs
2022$ Simple
Efficiency
TSL* Lifetime Payback
Level First Year’s
Installed Cost Operating LCC years
Operating Cost
Cost
0 Baseline $247 $15.1 $169 $416 --
1 1 $248 $14.1 $162 $410 3.9
2,3 2 $263 $12.5 $140 $403 6.1
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

11-19
Table 11.3.36 Low Income Households: Summary of Life-Cycle Costs Savings Relative to
the Base Case Efficiency Distribution for Gas Cooking Top Component of a
Combined Cooking Product
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 1% $4.31
2,3 2 22% $8.57
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

Table 11.3.37 Low Income Households: Summary of LCC and PBP Results by Efficiency
Level for Electric Standard Ovens, Freestanding
Average Costs
2022$ Simple
Efficiency
TSL* Payback
Level Lifetime
First Year’s years
Installed Cost Operating LCC
Operating Cost
Cost
-- 0 $219 $26 $339 $558 --
1 1 $218 $25 $322 $540 0.7
2 2 $236 $24 $308 $545 7.5
3 3 $254 $20 $260 $514 5.8
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

11-20
Table 11.3.38 Low Income Households: Summary of Life-Cycle Costs Savings Relative to
the Base Case Efficiency Distribution for Electric Standard Ovens,
Freestanding
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 0% $17.97
2 2 20% ($6.93)
3 3 26% $22.86
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

Table 11.3.39 Low Income Households: Summary of LCC and PBP Results by Efficiency
Level for Electric Standard Ovens, Built-In/Slide-In
Average Costs
2022$ Simple
Efficiency
TSL* Payback
Level Lifetime
First Year’s years
Installed Cost Operating LCC
Operating Cost
Cost
-- 0 $229 $27 $353 $582 --
1 1 $228 $26 $336 $564 0.7
2 2 $247 $25 $323 $569 7.7
3 3 $264 $21 $275 $538 5.8
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

11-21
Table 11.3.40 Low Income Households: Summary of Life-Cycle Costs Savings Relative to
the Base Case Efficiency Distribution for Electric Standard Ovens, Built-
In/Slide-In
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 0% $16.94
2 2 21% ($6.61)
3 3 26% $22.63
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

Table 11.3.41 Low Income Households: Summary of LCC and PBP Results by Efficiency
Level for Electric Self-Clean Ovens, Freestanding
Average Costs
2022$ Simple
Efficiency
TSL* Payback
Level Lifetime
First Year’s years
Installed Cost Operating LCC
Operating Cost
Cost
-- 0 $236 $31 $402 $638 --
1 1 $235 $29 $385 $620 0.7
2 2 $254 $29 $371 $625 7.5
3 3 $271 $25 $323 $594 5.8
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

11-22
Table 11.3.42 Low Income Households: Summary of Life-Cycle Costs Savings Relative to
the Base Case Efficiency Distribution for Electric Self-Clean Ovens,
Freestanding
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 0% $17.90
2 2 7% ($4.23)
3 3 24% $26.15
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

Table 11.3.43 Low Income Households: Summary of LCC and PBP Results by Efficiency
Level for Electric Self-Clean Ovens, Built-In/Slide-In
Average Costs
2022$ Simple
Efficiency
TSL* Payback
Level Lifetime
First Year’s years
Installed Cost Operating LCC
Operating Cost
Cost
-- Baseline $246 $32 $414 $660 --
1 1 $246 $30 $398 $643 0.7
2 2 $264 $30 $384 $648 7.7
3 3 $281 $26 $336 $617 5.8
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

11-23
Table 11.3.44 Low Income Households: Summary of Life-Cycle Costs Savings Relative to
the Base Case Efficiency Distribution for Electric Self-Clean Ovens, Built-
In/Slide-In
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 0% $17.34
2 2 4% ($0.43)
3 3 23% $27.22
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

Table 11.3.45 Low Income Households: Summary of LCC and PBP Results by Efficiency
Level for All Electric Ovens
Average Costs
2022$ Simple
Efficiency
TSL* Payback
Level Lifetime
First Year’s years
Installed Cost Operating LCC
Operating Cost
Cost
-- Baseline $236 $31 $395 $630 --
1 1 $236 $29 $377 $613 0.7
2 2 $254 $28 $364 $618 7.6
3 3 $271 $24 $316 $587 5.8
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

11-24
Table 11.3.46 Low Income Households: Summary of Life-Cycle Costs Savings Relative to
the Base Case Efficiency Distribution for All Electric Ovens
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 0% $17.72
2 2 8% ($3.65)
3 3 24% $25.85
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

Table 11.3.47 Low Income Households: Summary of LCC and PBP Results by Efficiency
Level for Gas Standard Ovens, Freestanding
Average Costs
2022$ Simple
Efficiency
TSL* Lifetime Payback
Level First Year’s
Installed Cost Operating LCC years
Operating Cost
Cost
-- Baseline $471 $24 $265 $737 --
1 1 $470 $22 $249 $719 1.2
2, 3 2 $495 $21 $239 $735 10.5
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

Table 11.3.48 Low Income Households: Summary of Life-Cycle Costs Savings Relative to
the Base Case Efficiency Distribution for Gas Standard Ovens, Freestanding
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 0% $16.27
2, 3 2 22% ($12.16)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

11-25
Table 11.3.49 Low Income Households: Summary of LCC and PBP Results by Efficiency
Level for Gas Standard Ovens, Built-In/Slide-In
Average Costs
2022$ Simple
Efficiency
TSL* Payback
Level Lifetime
First Year’s years
Installed Cost Operating LCC
Operating Cost
Cost
-- Baseline $490 $25 $276 $767 --
1 1 $489 $23 $260 $749 1.2
2, 3 2 $515 $22 $251 $765 10.7
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

Table 11.3.50 Low Income Households: Summary of Life-Cycle Costs Savings Relative to
the Base Case Efficiency Distribution for Gas Standard Ovens, Built-
In/Slide-In
Life-Cycle Cost Savings

Efficiency % of Consumers that


TSL*, ** Average Savings
Level Experience

Net Cost 2022$


1 1 0% $15.44
2, 3 2 36% ($13.13)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

11-26
Table 11.3.51 Low Income Households: Summary of LCC and PBP Results by Efficiency
Level for Gas Self-Clean Ovens, Freestanding
Average Costs
2022$ Simple
Efficiency
TSL* Payback
Level Lifetime
First Year’s years
Installed Cost Operating LCC
Operating Cost
Cost
-- Baseline $572 $25 $275 $848 --
1 1 $570 $22 $259 $829 1.2
2, 3 2 $596 $22 $249 $846 10.5
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

Table 11.3.52 Low Income Households: Summary of Life-Cycle Costs Savings Relative to
the Base Case Efficiency Distribution for Gas Self-Clean Ovens,
Freestanding
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 0% $14.80
2, 3 2 4% ($5.51)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

11-27
Table 11.3.53 Low Income Households: Summary of LCC and PBP Results by Efficiency
Level for Gas Self-Clean Ovens, Built-In/Slide-In
Average Costs
2022$ Simple
Efficiency
TSL* Payback
Level Lifetime
First Year’s years
Installed Cost Operating LCC
Operating Cost
Cost
-- Baseline $591 $25 $286 $878 --
1 1 $589 $23 $270 $860 1.2
2, 3 2 $616 $23 $261 $876 10.7
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

Table 11.3.54 Low Income Households: Summary of Life-Cycle Costs Savings Relative to
the Base Case Efficiency Distribution for Gas Self-Clean Ovens, Built-
In/Slide-In
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 0% $15.43
2, 3 2 13% ($10.93)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

11-28
Table 11.3.55 Low Income Households: Summary of LCC and PBP Results by Efficiency
Level for All Gas Ovens
Average Costs
2022$ Simple
Efficiency
TSL* Payback
Level Lifetime
First Year’s years
Installed Cost Operating LCC
Operating Cost
Cost
-- Baseline $527 $24 $271 $799 --
1 1 $525 $22 $255 $780 1.2
2, 3 2 $551 $22 $245 $797 10.5
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year of
2028.

Table 11.3.56 Low Income Households: Summary of Life-Cycle Costs Savings Relative to
the Base Case Efficiency Distribution for All Gas Ovens
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 0% $15.45
2, 3 2 12% ($8.61)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 (the Recommended TSL) have a compliance year of 2027; TSL 1 has a compliance year
of 2028.

The low-income and senior-only consumer subgroups show the same trend in average
LCC differences and consumer impacts (i.e., percentage of consumers significantly or
insignificantly impacted) as the overall sample. For all cooking products, the average LCC costs,
savings and payback periods for low-income and senior-only households mirror the general trend
for the national population.

In the absence to data specific to each consumer subgroup, DOE assumed the efficiency
distribution developed for the reference case analysis (see section chapter 8 of this direct final
rule TSD document for details).

11-29
REFERENCES

1. U.S. Department of Energy–Energy Information Administration. Residential Energy


Consumption Survey, 2020 Public Use Data Files. 2020. Washington, D.C. (Last accessed
June 25, 2023.)
http://www.eia.gov/consumption/residential/data/2020/index.cfm?view=characteristics

2. United States Census Bureau – Poverty Thresholds. Poverty Threshold by Size of Family and
Number of Children. 2020 (Last accessed June 25, 2023)
https://www.census.gov/data/tables/time-series/demo/income-poverty/historical-poverty-
thresholds.html

11-30
CHAPTER 12. MANUFACTURER IMPACT ANALYSIS

TABLE OF CONTENTS

12.1 INTRODUCTION ......................................................................................................... 12-1


12.2 METHODOLOGY ........................................................................................................ 12-1
12.2.1 Phase I: Industry Profile................................................................................................. 12-1
12.2.2 Phase II: Industry Cash-Flow Analysis and Interview Guide ........................................ 12-2
12.2.2.1 Industry Cash-Flow Analysis ....................................................................... 12-2
12.2.3 Phase III: Subgroup Analysis......................................................................................... 12-3
12.2.3.1 Manufacturer Small Business Analysis ....................................................... 12-3
12.2.3.2 Manufacturing Capacity Impact .................................................................. 12-4
12.2.3.3 Direct Employment Impact .......................................................................... 12-4
12.2.3.4 Cumulative Regulatory Burden ................................................................... 12-4
12.3 GRIM INPUTS AND ASSUMPTIONS........................................................................ 12-4
12.3.1 Overview of the GRIM .................................................................................................. 12-4
12.3.2 Sources for GRIM Inputs ............................................................................................... 12-5
12.3.2.1 Corporate Annual Reports ........................................................................... 12-5
12.3.2.2 Standard and Poor Credit Ratings ................................................................ 12-6
12.3.2.3 Shipments Analysis ...................................................................................... 12-6
12.3.2.4 Engineering Analysis ................................................................................... 12-6
12.3.3 Financial Parameters ...................................................................................................... 12-6
12.3.4 Corporate Discount Rate ................................................................................................ 12-7
12.3.5 Trial Standard Levels ..................................................................................................... 12-9
12.3.6 Manufacturer Production Costs ..................................................................................... 12-9
12.3.7 Capital and Product Conversion Costs ........................................................................ 12-13
12.3.8 Manufacturer Markup Scenarios.................................................................................. 12-16
12.3.8.1 Preservation of Gross Margin Scenario ..................................................... 12-17
12.3.8.2 Preservation of Operating Profit Scenario ................................................. 12-17
12.4 INDUSTRY FINANCIAL IMPACTS ........................................................................ 12-20
12.4.1 Impacts on Industry Net Present Value ....................................................................... 12-20
12.4.2 Impacts on Annual Cash Flow ..................................................................................... 12-21
12.5 IMPACTS ON MANUFACTURER SUBGROUPS ................................................... 12-23
12.5.1 Impacts on Small Business Manufacturers .................................................................. 12-23
12.5.2 Impacts on Premium Product Manufacturers .............................................................. 12-26
12.6 OTHER IMPACTS ...................................................................................................... 12-27
12.6.1 Direct Employment ...................................................................................................... 12-27
12.6.2 Manufacturer Production Capacity .............................................................................. 12-29
12.6.3 Cumulative Regulatory Burden ................................................................................... 12-30
12.7 CONCLUSION ............................................................................................................ 12-32
REFERENCES ........................................................................................................................ 12-36

12-i
LIST OF TABLES

Table 12.2.1 SBA and NAICS Classifications of Small Businesses Potentially Affected
by This Rulemaking ........................................................................................... 12-3
Table 12.3.1 Financial Parameters for Consumer Conventional Cooking Products .............. 12-7
Table 12.3.2 Cost of Equity Calculation ................................................................................. 12-8
Table 12.3.3 Cost of Debt Calculation .................................................................................... 12-9
Table 12.3.4 Trial Standard Levels for Consumer Conventional Cooking Products ............. 12-9
Table 12.3.5 Manufacturer Production Cost Breakdown (2022$) for Electric Smooth
Element Standalone Cooking Top ................................................................... 12-10
Table 12.3.6 Manufacturer Production Cost Breakdown (2022$) for Electric Smooth
Element Cooking Top Component of a Combined Cooking Product ............. 12-10
Table 12.3.7 Manufacturer Production Cost Breakdown (2022$) for Gas Standalone
Cooking Top .................................................................................................... 12-10
Table 12.3.8 Manufacturer Production Cost Breakdown (2022$) for Gas Cooking Top
Component of a Combined Cooking Products ................................................ 12-11
Table 12.3.9 Manufacturer Production Cost Breakdown (2022$) for Electric Standard
Oven Free Standing.......................................................................................... 12-11
Table 12.3.10 Manufacturer Production Cost Breakdown (2022$) for Electric Standard
Oven Built-In ................................................................................................... 12-11
Table 12.3.11 Manufacturer Production Cost Breakdown (2022$) for Electric Self-Clean
Oven Free Standing.......................................................................................... 12-11
Table 12.3.12 Manufacturer Production Cost Breakdown (2022$) for Electric Self-Clean
Oven Built-In ................................................................................................... 12-12
Table 12.3.13 Manufacturer Production Cost Breakdown (2022$) for Gas Standard Oven
Free Standing ................................................................................................... 12-12
Table 12.3.14 Manufacturer Production Cost Breakdown (2022$) for Gas Standard Oven
Built-Oven........................................................................................................ 12-12
Table 12.3.15 Manufacturer Production Cost Breakdown (2022$) for Gas Self-Clean
Oven Free Standing.......................................................................................... 12-12
Table 12.3.16 Manufacturer Production Cost Breakdown (2022$) for Gas Self-Clean
Oven Built-In ................................................................................................... 12-13
Table 12.3.17 Capital Conversion Costs for all Consumer Conventional Cooking
Products by TSL .............................................................................................. 12-14
Table 12.3.18 Per-Model Engineering Hours to Redesign each Consumer Conventional
Cooking Product by Product Class and Efficiency Level ................................ 12-15
Table 12.3.19 Product Conversion Costs for all Consumer Conventional Cooking
Products by TSL .............................................................................................. 12-16
Table 12.3.20 Preservation of Operating Profit for Electric Smooth Element Standalone
Cooking Top .................................................................................................... 12-17
Table 12.3.21 Preservation of Operating Profit for Electric Smooth Element Cooking
Top Component of a Combined Cooking Product .......................................... 12-18
Table 12.3.22 Preservation of Operating Profit for Gas Standalone Cooking Top ................ 12-18
Table 12.3.23 Preservation of Operating Profit for Gas Cooking Top Component of a
Combined Cooking Product ............................................................................. 12-18
Table 12.3.24 Preservation of Operating Profit for Electric Standard Oven Free Standing ... 12-18

12-ii
Table 12.3.25 Preservation of Operating Profit for Electric Standard Oven Built-In ............ 12-18
Table 12.3.26 Preservation of Operating Profit for Electric Self-Clean Oven Free
Standing ........................................................................................................... 12-19
Table 12.3.27 Preservation of Operating Profit for Electric Self-Clean Oven Built-In .......... 12-19
Table 12.3.28 Preservation of Operating Profit for Gas Standard Oven Free Standing ......... 12-19
Table 12.3.29 Preservation of Operating Profit for Gas Standard Oven Built-In ................... 12-19
Table 12.3.30 Preservation of Operating Profit for Gas Self-Clean Oven Free Standing ...... 12-19
Table 12.3.31 Preservation of Operating Profit for Gas Self-Clean Oven Built-In ................ 12-19
Table 12.4.1 Industry Net Present Value for Consumer Conventional Cooking Products
– Preservation of Gross Margin Scenario ........................................................ 12-20
Table 12.4.2 Industry Net Present Value for Consumer Conventional Cooking Products
– Preservation of Operating Profit Scenario .................................................... 12-21
Table 12.4.3 Industry Free Cash Flow Impacts in the Year before Compliance .................. 12-22
Table 12.5.1 Number of Unique Basic Models for each Small Business ............................. 12-25
Table 12.5.2 Estimated Conversion Costs and Annual Revenue for each Small Business .. 12-26
Table 12.6.1 Domestic Employment for Consumer Conventional Cooking Products in
the Analyzed Compliance Year ....................................................................... 12-28
Table 12.6.2 Compliance Dates and Expected Conversion Expenses of Federal Energy
Conservation Standards Affecting Consumer Conventional Cooking
Products Manufacturers ................................................................................... 12-31
Table 12.7.1 Manufacturer Impact Analysis Results ............................................................ 12-33

LIST OF FIGURES

Figure 12.3.1 Using the GRIM to Calculate Cash Flow .......................................................... 12-5
Figure 12.4.1 Annual Industry Free Cash Flows for Consumer Conventional Cooking
Products – Preservation of Gross Margin Scenario ......................................... 12-22
Figure 12.4.2 Annual Industry Free Cash Flows for Consumer Conventional Cooking
Products – Preservation of Operating Profit Scenario ..................................... 12-23

12-iii
CHAPTER 12. MANUFACTURER IMPACT ANALYSIS

12.1 INTRODUCTION

In determining whether a standard is economically justified, the U.S. Department of


Energy (DOE) is required to consider “the economic impact of the standard on the manufacturers
and on the consumers of the consumer conventional cooking products subject to such a
standard.” (42 U.S.C. 6295(o)(2)(B)(i)) The law also calls for an assessment of the impact of any
lessening of competition as determined in writing by the Attorney General. Id. DOE conducted a
manufacturer impact analysis (MIA) to estimate the financial impact of new and amended energy
conservation standards on manufacturers of consumer conventional cooking products and
assessed the impact of such standards on direct employment and manufacturing capacity.

The MIA has both quantitative and qualitative aspects. The quantitative part of the MIA
primarily relies on the Government Regulatory Impact Model (GRIM), an industry cash-flow
model adapted for the product in this rulemaking. The GRIM inputs include information on
industry cost structure, shipments, and pricing strategies. The GRIM’s key output is the industry
net present value (INPV). The model estimates the financial impact of new and amended energy
conservation standards for each product by comparing changes in INPV between a no-new-
standards case and the various trial standard levels (TSLs) in the standards cases. The qualitative
part of the MIA addresses product characteristics, manufacturer characteristics, market and
product trends, as well as the impact of standards on subgroups of manufacturers.

12.2 METHODOLOGY

DOE conducted the MIA in phases. Phase I, “Industry Profile,” consisted of preparing an
industry characterization for the consumer conventional cooking products industry. This
characterization included data on sales volumes, pricing, employment, and financial structure. In
phase II, “Industry Cash Flow Analysis,” DOE used the GRIM to assess the potential impacts of
new and amended energy conservation standards on manufacturers. In phase III, “Subgroup
Impact Analysis,” DOE developed additional analyses for subgroups that may be affected in
various ways. Each phase of the MIA is described in greater detail in the following sections.

12.2.1 Phase I: Industry Profile

In Phase I of the MIA, DOE prepared a profile of the consumer conventional cooking
products industry that built upon the market and technology assessment, see chapter 3 of this
direct final rule technical support document (TSD). Before initiating the detailed impact studies,
DOE collected information on the present and past structure and market characteristics of the
industry. The industry profile included a top-down cost analysis of consumer conventional
cooking products manufacturers that DOE used to derive cost and preliminary financial inputs
for the GRIM (e.g., revenues; material; labor; overhead; depreciation; selling, general and
administrative expenses (SG&A); and research and development (R&D) expenses). These
parameters allowed DOE to derive preliminary industry financial inputs for the GRIM as
discussed in section 12.3.3.

12-1
DOE used public information to develop its initial characterization of the industry,
including Securities and Exchange Commission (SEC) 10-K reports,a Standard & Poor’s stock
reports,b market research tools (i.e., D&B Hoovers)c, corporate annual reports, and the U.S.
Census Bureau’s 2021 Annual Survey of Manufactures (ASM).d DOE also used information
from its engineering analysis to enhance its industry profile.

12.2.2 Phase II: Industry Cash-Flow Analysis and Interview Guide

Phase II focused on the financial impacts of new and amended energy conservation
standards on consumer conventional cooking products manufacturers. More stringent energy
conservation standards can affect manufacturers’ cash flows in three distinct ways: (1) create a
need for increased investment, (2) raise per-unit production costs, and (3) alter revenue due to
higher per-unit prices and/or possible changes in sales volumes. To quantify these impacts, DOE
used the GRIM to perform a cash-flow analysis on consumer conventional cooking products
manufacturers. In performing this analysis, DOE used the financial values derived during Phase I
and the shipment projections derived in the shipment analysis.

12.2.2.1 Industry Cash-Flow Analysis

The GRIM uses several factors to determine a series of annual cash flows from the
announcement year of new and amended energy conservation standards until several years after
the standards’ compliance date. These factors include annual expected revenues, costs of goods
sold, SG&A, taxes, and capital expenditures related to the new and amended standards. Inputs
for the GRIM include manufacturer production costs (MPCs) and shipment forecasts which are
developed in other analyses. DOE used the MPCs from the engineering analysis which are
derived from purchasing and tearing down product. DOE then estimated typical manufacturer
margins for consumer conventional cooking products from public financial reports and
interviews with manufacturers to calculate manufacturer selling prices (MSPs) for all covered
consumer conventional cooking products. In addition to the no-new-standards case scenario,
DOE developed alternative manufacturer margin scenarios for the standards case scenarios for
the GRIM based on discussions with manufacturers. DOE’s shipments analysis, presented in
chapter 9 of this direct final rule TSD, provided the basis for the shipment projections used in the
GRIM. The financial parameters were developed using a combination of publicly available
manufacturer data and manufacturer input that allowed DOE to update the financial parameters
used in the notice of proposed determination (NOPD) for consumer conventional cooking
products that DOE published on December 14, 2020 (December 2020 NOPD). 85 FR 80982 The
GRIM results are compared to no-new-standards case projections for the industry. The financial
impact of new and amended energy conservation standards is the difference between the
discounted annual cash flows from the no-new-standards case and the standards cases.

a
www.sec.gov/edgar.shtml
b
www.spglobal.com/ratings/en/
c
D&B Hoovers reports can be accessed at: app.dnbhoovers.com.
d
www.census.gov/programs-surveys/asm/data/tables.html

12-2
12.2.3 Phase III: Subgroup Analysis

Using average cost and financial assumptions to develop an industry cash-flow model is
not adequate for assessing differential impacts among a potential subgroup of manufacturers.
Small manufacturers, niche players, or manufacturers exhibiting a cost structure that differs
largely from the industry average could be more negatively impacted. DOE identified two
subgroups for separate analysis: small business manufacturers and premium product
manufacturers. Both of these subgroups could be adversely impacted by an energy conservation
standard based on the results of a generalized industry characterization.

12.2.3.1 Manufacturer Small Business Analysis

For the small business manufacturer subgroup, DOE used the Small Business
Administration (SBA) small business size standards published on March 17, 2023, as amended,
and the North American Industry Classification System (NAICS) code, presented in Table
12.2.1, to determine whether any small entities would be affected by this rulemaking.e For the
industry under review, the SBA bases its small business definition on the total number of
employees for a business, its subsidiaries, and its parent companies. An aggregated business
entity with fewer employees than the listed limit is considered a small business.

Table 12.2.1 SBA and NAICS Classifications of Small Businesses Potentially Affected by
This Rulemaking
Industry Description Revenue Limit Employee Limit NAICS
Major Household Appliance Manufacturing N/A 1,500 335220

DOE used DOE’s compliance certification database (CCD),f California Energy


Commission’s (CEC’s) Modernized Appliance Efficiency Database System (MAEDbS),g
Canada’s Natural Resources Canada (NRCan) database,h and information from previous
consumer conventional cooking products rulemakings to create a list of companies that
potentially sell consumer conventional cooking products covered by this rulemaking.
Additionally, DOE received feedback from interested parties in response to previous stages of
this rulemaking. DOE contacted select companies on its list, as necessary, to determine whether
they met the SBA’s definition of a consumer conventional cooking products small business.
DOE screened out companies that did not offer products covered by this rulemaking, did not
meet the definition of a “small business,” or are foreign owned and operated.

DOE used the publicly available information and subscription-based market research
tools (e.g., reports from D&B Hoovers) to identify 35 companies that manufacture consumer
conventional cooking products covered by this rulemaking in the United States. Of these 35
companies that sell consumer conventional cooking products in the United States, 15 have
employee counts less than 1,500 and are domestically located. DOE has analyzed small
businesses as part of the regulatory flexibility analysis presented in section 12.5.1 of this TSD.

e
The size standards are available on the SBA’s website at www.sba.gov/content/table-small-business-size-standards
f
www.regulations.doe.gov/certification-data
g
cacertappliances.energy.ca.gov/Pages/Search/AdvancedSearch.aspx
h
oee.nrcan.gc.ca/pml-lmp/index.cfm?action=app.welcome-bienvenue.

12-3
12.2.3.2 Manufacturing Capacity Impact

One significant outcome of new and amended energy conservation standards could be the
obsolescence of existing manufacturing assets, including tooling and investment. DOE examined
the potential impacts of new and amended standards on manufacturing capacity. These include
capacity utilization and plant location decisions in the United States (with and without new and
amended standards); the ability of manufacturers to upgrade or remodel existing facilities to
accommodate the new requirements; and estimates for any one-time changes to existing PPE.
DOE’s estimates of the one-time capital changes affect the cash-flow estimates in the GRIM.
These estimates can be found in section 12.3.7; DOE’s discussion of the capacity impacts can be
found in section 12.6.2.

12.2.3.3 Direct Employment Impact

The impact of new and amended energy conservation standards on employment is an


important consideration in the rulemaking process. To assess how domestic direct employment
patterns might be affected, DOE obtained data from the U.S. Census Bureau’s 2021 ASM about
current direct employment trends in the consumer conventional cooking products manufacturing
industry. The employment impacts are reported in section 12.6.1.

12.2.3.4 Cumulative Regulatory Burden

DOE seeks to mitigate the overlapping effects on manufacturers due to new and amended
energy conservation standards and other regulatory actions affecting the same products. DOE
analyzed the impact on manufacturers of multiple, product-specific regulatory actions. DOE
identified regulations relevant to consumer conventional cooking products manufacturers, such
as state regulations and other Federal regulations that impact other products made by the same
manufacturers. A discussion of the cumulative regulatory burden can be found in section 12.6.3.

12.3 GRIM INPUTS AND ASSUMPTIONS

The GRIM serves as the main tool for assessing the impacts on the industry due to new
and amended energy conservation standards. DOE relies on several sources to obtain inputs for
the GRIM. Data and assumptions from these sources are then inputted into the accounting model
that calculates the industry cash flow both with and without new and amended energy
conservation standards.

12.3.1 Overview of the GRIM

The basic structure of the GRIM, illustrated in Figure 12.3.1, is an annual cash-flow
analysis that uses manufacturer prices, manufacturing costs, shipments, and industry financial
information as inputs, and accepts a set of regulatory conditions such as changes in costs,
investments, and associated margins. The GRIM spreadsheet uses a number of inputs to arrive at
a series of annual cash flows, beginning with the reference year of the analysis, 2024, and
continuing to the end of the analysis period (30 years after the analyzed compliance date).i The

i
For the no-new-standards case and all TSLs except the Recommended TSL, the analysis period ranges from 2024–
2056. For the Recommended TSL, the analysis period ranges from 2024–2057.

12-4
model calculates the INPV by summing the stream of annual discounted cash flows during this
period and adding a discounted terminal value. 1

Figure 12.3.1 Using the GRIM to Calculate Cash Flow

The GRIM projects cash flows using standard accounting principles and compares
changes in INPV between the no-new-standards case and the standard cases induced by new and
amended energy conservation standards. The difference in INPV between the no-new-standards
case and the standard cases represents the estimated financial impact of the new and amended
energy conservation standards on manufacturers. Appendix 12A provides more technical details
and user information for the GRIM.

12.3.2 Sources for GRIM Inputs

The GRIM uses several different sources for data inputs in determining industry cash
flow. These sources include corporate annual reports, company profiles, Census data, credit
ratings, the shipments analysis, the engineering analysis, and manufacturer interviews.

12.3.2.1 Corporate Annual Reports

Corporate annual reports to the SEC (SEC 10-Ks) provided many of the initial financial
inputs to the GRIM. These reports exist for publicly held companies and are publicly available.
DOE developed initial financial inputs for the GRIM using similar financial inputs that were
used in the December 2020 NOPD. DOE compared the financial parameters used in the
December 2020 NOPD with current annual reports and found no significant differences.
Therefore, DOE used the financial parameters from the December 2020 NOPD to develop its
initial estimates of the financial parameters. The financial parameters used in the GRIM are
listed below:

• Tax rate
• Working capital
• SG&A

12-5
• R&D
• Depreciation
• Capital expenditures
• Net PPE

12.3.2.2 Standard and Poor Credit Ratings

S&P provides independent credit ratings, research, and financial information. DOE relied
on S&P reports to determine the industry’s average cost of debt when calculating the cost of
capital.

12.3.2.3 Shipments Analysis

The GRIM estimates manufacturer revenues based on total unit shipment projections and
the distribution of those shipments by efficiency level (EL). Changes in sales volumes and
efficiency mix over time can significantly affect manufacturer finances. For this analysis, the
GRIM uses the NIA’s annual shipment projections derived from the shipments analysis from
2024 (the reference year) to the end of the analysis period (30 years after the analyzed
compliance date)j. See chapter 9 of this direct final rule TSD for additional details.

12.3.2.4 Engineering Analysis

The engineering analysis develops the relationship between the MPC and energy
efficiency for the products analyzed in this rulemaking. This relationship serves as the basis for
the cost-benefit calculations for consumers, manufacturers, and the nation. In determining the
cost-efficiency relationship, DOE estimates the increase in manufacturing costs associated with
increasing the efficiency of the product above the baseline up to the maximum technologically
feasible (max-tech) EL for each product class.

DOE conducted this engineering analysis for consumer conventional cooking products
using a combination of the efficiency-level approach to determine the ELs for analysis and
performed physical teardowns for the cost analysis. Chapter 5 of this direct final rule TSD
describes the methodology DOE used to conduct the engineering analysis.

12.3.3 Financial Parameters

As part of the MIA, DOE estimated eight key financial parameters for use in the GRIM.
DOE developed its initial estimates of industry financial parameters for the December 2020
NOPD. These inputs were then compared to the financial parameters found in SEC 10-Ks, the
results of the engineering analysis, and other available sources. Additionally, DOE sought
comments from industry stakeholders on these parameters in previous stages of this rulemaking
process.

j
For the no-new-standards case and all TSLs except the Recommended TSL, the analysis period ranges from 2024–
2056. For the Recommended TSL, the analysis period ranges from 2024–2057.

12-6
Table 12.3.1 Financial Parameters for Consumer Conventional Cooking Products
Value Used in
Financial Parameter GRIM
(%)
Tax Rate
21.0
(% of taxable income)
Discount Rate 9.1
Working Capital
4.5
(% of revenue)
Net PPE
16.2
(% of revenue)
SG&A
11.2
(% of revenue)
R&D
2.4
(% of revenue)
Depreciation
3.4
(% of revenues)
Capital Expenditures
3.4
(% of revenue)

12.3.4 Corporate Discount Rate

DOE used the weighted-average cost of capital (WACC) as the discount rate to calculate
the INPV. A company’s assets are financed by a combination of debt and equity. The WACC is
the total cost of debt and equity weighted by their respective proportions in the capital structure
of the industry. DOE estimated the WACC for the consumer conventional cooking product
industry based on representative companies, using the following formula:

WACC = After-Tax Cost of Debt x (Debt Ratio) + Cost of Equity x (Equity Ratio)

The cost of equity is the rate of return that equity investors (including, potentially, the
company) expect to earn on a company’s stock. These expectations are reflected in the market
price of the company’s stock. The capital asset pricing model (CAPM) provides one widely used
means to estimate the cost of equity. According to the CAPM, the cost of equity (expected
return) is:

Cost of Equity = Riskless Rate of Return + β x Risk Premium

where:

Riskless rate of return is the rate of return on a “safe” benchmark investment, typically
considered the short-term Treasury Bill (T-Bill) yield.

Risk premium is the difference between the expected return on stocks and the riskless rate
of return.

12-7
Beta (β) is the correlation between the movement in the price of the stock and that of the
broader market. In this case, Beta equals one if the stock is perfectly correlated with the S&P 500
market index. A Beta lower than one means the stock is less volatile than the market index.

DOE determined that the industry average cost of equity for the consumer conventional
cooking product industry is 15.5 percent.

Table 12.3.2 Cost of Equity Calculation


Industry- Manufacturers
Parameter Weighted
A B
Average
(1) Average Beta 1.70 1.70 1.71
(2) Yield on 10-Year T-Bill (1928- 5.2 - -
2013) %
(3) Market Risk Premium (1928-2013) 6.1 - -
%
Cost of Equity (2)+[(1)*(3)] % 15.5 - -
Equity/Total Capital % 66.8 72.7 54.5

Bond ratings are a tool to measure default risk and arrive at a cost of debt. Each bond
rating is associated with a particular spread. One way of estimating a company’s cost of debt is
to treat it as a spread (usually expressed in basis points) over the risk-free rate. DOE used this
method to calculate the cost of debt for both manufacturers by using S&P ratings and adding the
relevant spread to the risk-free rate.

In practice, investors use a variety of different maturity Treasury bonds to estimate the
risk-free rate. DOE used the 10-year Treasury bond return because it captures long-term inflation
expectations and is less volatile than short-term rates. The risk-free rate is estimated to be
approximately 5.2 percent, which is the average 10-year Treasury bond return between 1928 and
2013.

For the cost of debt, S&P’s Credit Services provided the average spread of corporate
bonds for both the public manufacturers. DOE added the industry-weighted average spread to the
average T-Bill rate. Since proceeds from debt issuance are tax deductible, DOE adjusted the
gross cost of debt by the industry average tax rate to determine the net cost of debt for the
industry. Table 12.3.3 presents the derivation of the cost of debt and the capital structure of the
industry (i.e., the debt ratio [debt/total capital]).

12-8
Table 12.3.3 Cost of Debt Calculation
Industry- Manufacturer
Parameter Weighted
A B
Average
S&P Bond Rating - BBB BBB
(1) Yield on 10-Year T-Bill (1928-
5.2 - -
2013) %
(2) Gross Cost of Debt % 6.8 6.8 6.8
(3) Tax Rate % 19.5 15.3 28.3
Net Cost of Debt (2) x (1-(3)) % 5.4 5.7 4.8
Debt/Total Capital % 33.2 27.3 45.5

Using public information for both these companies, the initial estimate for the consumer
conventional cooking product industry WACC was approximately 12.2 percent. Subtracting an
inflation rate of 3.1 percent between 1928 and 2013, the inflation-adjusted WACC, which was
the initial estimate of the discount rate used in the straw-man GRIM, was 9.1 percent. DOE
asked for feedback on the 9.1 percent discount rate during manufacturer interviews. Most
manufacturers agreed the 9.1 discount rate was appropriate to use for the consumer conventional
cooking product industry. This is the same value that was used in the February 2023 SNOPR.

12.3.5 Trial Standard Levels

DOE developed ELs for each product class. TSLs were then developed by selecting
groupings of ELs for all product types. Table 12.3.4 presents the TSLs examined as part of this
rulemaking.

Table 12.3.4 Trial Standard Levels for Consumer Conventional Cooking Products
PC Product Class Name TSL 1 TSL 2 TSL 3
PC 1 Electric Smooth Element Standalone Cooking Top EL 1 EL 2 EL 3
Electric Smooth Element Component of a Combined
PC 2 EL 1 EL 2 EL 3
Cooking Product
PC 3 Gas Standalone Cooking Top EL 1 EL 2 EL 2
Gas Cooking Top Component of a Combined Cooking
PC 4 EL 1 EL 2 EL 2
Product
PC 5 Electric Oven EL 1 EL 2 EL 3
PC 6 Gas Oven EL 1 EL 2 EL 2

12.3.6 Manufacturer Production Costs

Manufacturing a higher efficiency product is typically more expensive than


manufacturing a baseline product due to the use of more complex components, which are
typically more costly than baseline components. The changes in the MPCs of the analyzed
product can affect the revenues, gross margins, and cash flow of the industry, making these
product cost data key GRIM inputs for DOE’s analysis.

DOE used the MPC’s calculated in the engineering analysis as described in the
engineering analysis section of the direct final rule and chapter 5 of this direct final rule TSD.

12-9
For this direct final rule analysis, DOE used a design-option approach supported by testing and
supplemented by reverse engineering (physical teardowns and testing of existing products in the
market) to identify the incremental cost and efficiency improvement associated with each design
option or design option combination. DOE used these updated MPCs for the engineering analysis
in this MIA.

After calculating MPCs, DOE applied a manufacturer markup to arrive at the total MSP
for each product class at each EL in the no-new-standards case. DOE applied an average no-new-
standards case markup of 1.20 for all product classes. As discussed in section 12.3.8, DOE varied
this markup under a set of manufacturer markup scenarios to analyze a range of potential
financial impacts on the industry resulting from new and amended standards in the standards
cases.

Table 12.3.5 through Table 12.3.16 present the MPC and MSP for each product class at
each EL analyzed in the no-new-standards case.

Table 12.3.5 Manufacturer Production Cost Breakdown (2022$) for Electric Smooth
Element Standalone Cooking Top
EL Materials Labor Depreciation Overhead MPC Markup MSP
Baseline $168.43 $25.56 $9.48 $28.85 $232.32 1.200 $278.78
EL 1 $169.88 $25.78 $9.56 $29.10 $234.32 1.200 $281.18
EL 2 $179.90 $27.30 $10.12 $30.82 $248.14 1.200 $297.77
EL 3 $350.66 $53.20 $19.73 $60.07 $483.67 1.200 $580.40

Table 12.3.6 Manufacturer Production Cost Breakdown (2022$) for Electric Smooth
Element Cooking Top Component of a Combined Cooking Product
EL Materials Labor Depreciation Overhead MPC Markup MSP
Baseline $168.43 $25.56 $9.48 $28.85 $232.32 1.200 $278.78
EL 1 $169.88 $25.78 $9.56 $29.10 $234.32 1.200 $281.18
EL 2 $179.90 $27.30 $10.12 $30.82 $248.14 1.200 $297.77
EL 3 $350.66 $53.20 $19.73 $60.07 $483.67 1.200 $580.40

Table 12.3.7 Manufacturer Production Cost Breakdown (2022$) for Gas Standalone
Cooking Top
EL Materials Labor Depreciation Overhead MPC Markup MSP
Baseline $99.75 $15.13 $5.61 $17.09 $137.58 1.200 $165.10
EL 1 $101.68 $15.43 $5.72 $17.42 $140.25 1.200 $168.30
EL 2 $113.32 $17.19 $6.38 $19.41 $156.30 1.200 $187.56

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Table 12.3.8 Manufacturer Production Cost Breakdown (2022$) for Gas Cooking Top
Component of a Combined Cooking Products
EL Materials Labor Depreciation Overhead MPC Markup MSP
Baseline $99.75 $15.13 $5.61 $17.09 $137.58 1.200 $165.10
EL 1 $101.68 $15.43 $5.72 $17.42 $140.25 1.200 $168.30
EL 2 $113.32 $17.19 $6.38 $19.41 $156.30 1.200 $187.56

Table 12.3.9 Manufacturer Production Cost Breakdown (2022$) for Electric Standard
Oven Free Standing
EL Materials Labor Depreciation Overhead MPC Markup MSP
Baseline $221.77 $33.65 $12.48 $37.99 $305.89 1.200 $367.07
EL 1 $223.22 $33.87 $12.56 $38.24 $307.89 1.200 $369.47
EL 2 $248.38 $37.68 $13.98 $42.55 $342.59 1.200 $411.11
EL 3 $273.89 $41.56 $15.41 $46.92 $377.78 1.200 $453.34

Table 12.3.10 Manufacturer Production Cost Breakdown (2022$) for Electric Standard
Oven Built-In
EL Materials Labor Depreciation Overhead MPC Markup MSP
Baseline $234.37 $35.56 $13.19 $40.15 $323.27 1.200 $387.92
EL 1 $235.82 $35.78 $13.27 $40.40 $325.27 1.200 $390.32
EL 2 $260.98 $39.60 $14.69 $44.71 $359.97 1.200 $431.96
EL 3 $286.49 $43.47 $16.12 $49.08 $395.16 1.200 $474.19

Table 12.3.11 Manufacturer Production Cost Breakdown (2022$) for Electric Self-Clean
Oven Free Standing
EL Materials Labor Depreciation Overhead MPC Markup MSP
Baseline $243.16 $36.89 $13.68 $41.66 $335.39 1.200 $402.47
EL 1 $244.61 $37.11 $13.77 $41.90 $337.39 1.200 $404.87
EL 2 $269.77 $40.93 $15.18 $46.21 $372.09 1.200 $446.51
EL 3 $295.28 $44.80 $16.62 $50.58 $407.28 1.200 $488.74

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Table 12.3.12 Manufacturer Production Cost Breakdown (2022$) for Electric Self-Clean
Oven Built-In
EL Materials Labor Depreciation Overhead MPC Markup MSP
Baseline $255.76 $38.80 $14.39 $43.81 $352.77 1.200 $423.32
EL 1 $257.21 $39.02 $14.47 $44.06 $354.77 1.200 $425.72
EL 2 $282.37 $42.84 $15.89 $48.37 $389.47 1.200 $467.36
EL 3 $307.88 $46.71 $17.33 $52.74 $424.66 1.200 $509.59

Table 12.3.13 Manufacturer Production Cost Breakdown (2022$) for Gas Standard Oven
Free Standing
EL Materials Labor Depreciation Overhead MPC Markup MSP
Baseline $236.69 $35.91 $13.32 $40.55 $326.47 1.200 $391.76
EL 1 $238.13 $36.13 $13.40 $40.79 $328.46 1.200 $394.15
EL 2 $255.71 $38.80 $14.39 $43.81 $352.70 1.200 $423.24

Table 12.3.14 Manufacturer Production Cost Breakdown (2022$) for Gas Standard Oven
Built-Oven
EL Materials Labor Depreciation Overhead MPC Markup MSP
Baseline $249.29 $37.82 $14.03 $42.71 $343.85 1.200 $412.62
EL 1 $250.73 $38.04 $14.11 $42.95 $345.84 1.200 $415.01
EL 2 $268.31 $40.71 $15.10 $45.96 $370.08 1.200 $444.10

Table 12.3.15 Manufacturer Production Cost Breakdown (2022$) for Gas Self-Clean Oven
Free Standing
EL Materials Labor Depreciation Overhead MPC Markup MSP
Baseline $302.96 $45.97 $17.05 $51.90 $417.88 1.200 $501.46
EL 1 $304.41 $46.19 $17.13 $52.15 $419.87 1.200 $503.84
EL 2 $321.98 $48.85 $18.12 $55.16 $444.11 1.200 $532.93

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Table 12.3.16 Manufacturer Production Cost Breakdown (2022$) for Gas Self-Clean Oven
Built-In
EL Materials Labor Depreciation Overhead MPC Markup MSP
Baseline $315.56 $47.88 $17.76 $54.06 $435.26 1.200 $522.31
EL 1 $317.01 $48.10 $17.84 $54.31 $437.25 1.200 $524.70
EL 2 $334.58 $50.76 $18.83 $57.32 $461.49 1.200 $553.79

12.3.7 Capital and Product Conversion Costs

Energy conservation standards typically cause manufacturers to incur one-time


conversion costs to bring their production facilities and product designs into compliance with
regulations. For the MIA, DOE classified these one-time conversion costs into two major groups:
capital conversion costs and product conversion costs. Capital conversion costs are one-time
investments in plant, property, and equipment to adapt or change existing production facilities in
order to fabricate and assemble new product designs that comply with new and amended energy
conservation standards. Product conversion costs are one-time investments in research,
development, testing, marketing, and other costs to make product designs comply with new and
amended energy conservation standards.

DOE used the same number of consumer conventional cooking models that were
identified in the February 2023 SNOPR for this direct final rule MIA. For this final rule, DOE
conducted a top-down analysis to calculate the capital conversion costs (including capital
investments associated with conducting DOE compliance testing) and a bottom-up analysis to
calculate the product conversion costs (including the engineering time associated with
conducting all the necessary DOE compliance testing) for each TSL analyzed in this rulemaking.
DOE asked manufacturers during interviews to estimate the total capital conversion costs they
would incur to be able to produce their products at specific efficiency levels. Additionally, DOE
asked manufacturers the cost associated with any potential new lab space to conduct in-house
testing and the equipment that would need to be purchased to conduct DOE compliance testing.
DOE then summed these values to arrive at a total industry capital conversion cost estimate for
consumer conventional cooking products. DOE assumed that capital conversion costs associated
with testing would be the same across all TSLs, while capital conversion costs associated with
manufacturing more efficient products would increase at higher TSLs.

DOE’s estimates of the capital conversion costs for all consumer conventional cooking
products can be found in Table 12.3.17.

12-13
Table 12.3.17 Capital Conversion Costs for all Consumer Conventional Cooking Products
by TSL
Testing
Non-Testing Capital Total Capital Conversion
CCC
Product Product Conversion Costs Costs
millions
Group Description millions 2022$ millions 2022$
2022$
All TSLs TSL 1 TSL 2 TSL 3 TSL 1 TSL 2 TSL 3
Electric
Smooth
4.7 4.2 16.7 83.3 8.8 21.3 88.0
Cooking Element
Tops Cooking Tops
Gas Cooking
4.6 16.7 33.3 33.3 21.3 37.9 37.9
Tops
Electric
Standard - 4.2 45.8 129.1 4.2 45.8 129.1
Ovens
Electric Self-
- 4.2 45.8 129.1 4.2 45.8 129.1
Ovens Clean Ovens
Gas Standard
- 4.2 45.8 45.8 4.2 45.8 45.8
Ovens
Gas Self-Clean
- 4.2 45.8 45.8 4.2 45.8 45.8
Ovens
All Total 9.2 37.5 233.2 466.4 46.8 242.5 475.7

Using feedback from manufacturer interviews, DOE estimated a per model product
conversion cost for each product class at each efficiency level. DOE then used DOE’s CCD,
CEC’s MAEDBC database, Canada’s NRCan database, information from previous stages of this
rulemaking, and individual company websites to create a database of all conventional cooking
product models covered by this rulemaking. DOE estimated there were approximately 2,300
unique basic models of cooking tops and 2,300 unique basic models of ovens. DOE used the
shipment analysis to estimate the model efficiency distributions for each product class.

To estimate the per-model testing costs, DOE asked manufacturers about the testing cost
estimates used in the test procedure final rule that DOE published on August 22, 2022 (August
2022 TP Final Rule). 87 FR 51492, 51532–51533. Manufacturers stated the in-house cost
estimates should be increased. For the February 2023 SNOPR analysis and this final rule
analysis, DOE increased the per-burner testing time to be 8 hours per burner. DOE estimated that
the average cooking top model has 5 burners. Therefore, DOE estimated it would take a
technician approximately 40 hours to test each cooking top basic model in-house. DOE
continued to use the third-party per-model testing cost of $8,200 for all cooking tops.

To estimate the per-model redesign costs. DOE estimated the engineering hours to
redesign a single model for each product class at each efficiency level. Table 12.3.18 displays the
estimated per-model redesign engineering hour estimates. All engineering hours in Table 12.3.18
are the same that were used in the February 2023 SNOPR except for the gas cooking top product
classes at EL 2. DOE increased the number of engineering hours from 1,560 hours (used in the
February 2023 SNOPR) to 2,080 hours (used in this direct final rule analysis).
12-14
Table 12.3.18 Per-Model Engineering Hours to Redesign each Consumer Conventional
Cooking Product by Product Class and Efficiency Level
Engineering Hours to Redesign One Model
Product Class
EL 1 EL 2 EL 3*
Electric Smooth Element Standalone Cooking
160 hrs 1,200 hrs 8,480 hrs
Top
Electric Smooth Element Cooking Top
160 hrs 1,200 hrs 8,480 hrs
Component of a Combined Cooking Product
Gas Standalone Cooking Top 1,040 hrs 2,080 hrs
Gas Cooking Top Component of a Combined
Cooking Product
Electric Standard Oven 160 hrs 4,320 hrs 8,480 hrs
Gas Standard Oven 160 hrs 4,320 hrs
* Black shading indicates that there is no EL 3 for that product class. EL 2 is the max-tech for those product classes.

Using the per-model engineering hour estimates in Table 12.3.18, the total number of
consumer conventional cooking product models estimate previously discussed, the product class
and efficiency distribution in the shipment analysis, and the wage rate from the Bureau of Labor
Statistics,k DOE estimated the total redesign costs for each product class at each TSL. The results
of these product conversion cost estimates are presented in Table 12.3.19.

k
Hourly wage for a Mechanical Engineer is $48.47 (www.bls.gov/oes/current/oes172141.htm) and wages are
approximately 70.5% of total compensation for a “Private Industry Worker”
(https://www.bls.gov/news.release/archives/ecec_06162023.pdf).

12-15
Table 12.3.19 Product Conversion Costs for all Consumer Conventional Cooking Products
by TSL
Testing
Non-Testing Product Total Product
PCC
Product Product Conversion Costs Conversion Costs
millions
Group Description millions 2022$ millions 2022$
2022$
All TSLs TSL 1 TSL 2 TSL 3 TSL 1 TSL 2 TSL 3
Electric
Smooth
Element 4.6 2.5 69.0 574.3 7.1 73.6 578.9
Cooking
Cooking
Tops
Tops
Gas Cooking
4.6 7.0 82.7 82.7 11.6 87.2 87.2
Tops
Electric
Standard - 0.2 51.1 158.6 0.2 51.1 158.6
Ovens
Electric Self-
- 0.7 71.0 717.7 0.7 71.0 717.7
Clean Ovens
Ovens
Gas
Standard - 0.2 41.9 41.9 0.2 41.9 41.9
Ovens
Gas Self-
- 0.2 9.2 9.2 0.2 9.2 9.2
Clean Ovens
All Total 9.2 10.7 324.8 1,584.3 19.9 334.0 1,593.5

In general, DOE assumes all conversion-related investments occur between the year of
publication of the direct final rule and the year by which manufacturers must comply with the
new and amended standards. The conversion cost figures used in the GRIM can be found in the
results section of the direct final rule.

12.3.8 Manufacturer Markup Scenarios

DOE used publicly available financial data to estimate an average manufacturer markup
for the consumer conventional cooking products industry. In the no-new-standards case, DOE
estimated this manufacturer markup, which captures all non-production costs, including SG&A
expenses, R&D expenses, interest, and profit, to be 1.20 for all consumer conventional cooking
product classes. This corresponds to a manufacturer margin of 17 percent for all consumer
conventional cooking products.

In the standards cases, DOE used two scenarios to represent the uncertainty about the
impacts of new and amended energy conservation standards on prices and profitability following
the implementation of new and amended energy conservation standards: (1) a preservation of
gross margin scenario and (2) a preservation of operating profit scenario. These scenarios lead to

12-16
different manufacturer markups that, when applied to MPCs, result in varying revenue and cash
flow impacts.

12.3.8.1 Preservation of Gross Margin Scenario

Under the preservation of gross margin scenario, DOE applied the same “gross margin
percentage” across all efficiency levels in the standards cases that is used in the no-new-
standards case, which assumes that manufacturers would be able to maintain the same amount of
profit as a percentage of revenues at all efficiency levels within a product class. DOE continued
to use a manufacturer markup of 1.20 for all consumer conventional cooking products, which
corresponds to a 17 percent gross margin percentage and the same manufacturer markup that was
used in the February 2023 SNOPR. This manufacturer markup scenario represents the upper
bound to industry profitability under new and amended energy conservation standards.

12.3.8.2 Preservation of Operating Profit Scenario

Under the preservation of operating profit scenario, DOE modeled a situation in which
manufacturers are not able to increase per-unit operating profit in proportion to increases in
manufacturer production costs. Under this scenario, as the MPCs increase, manufacturers reduce
their margins (on a percentage basis) to a level that maintains the no-new-standards case
operating profit (in absolute dollars). The implicit assumption behind this scenario is that the
industry can only maintain its operating profit in absolute dollars after compliance with new and
amended standards. Therefore, operating profit in percentage terms is reduced between the no-
new-standards case and the analyzed standards cases. DOE adjusted the margins in the GRIM at
each TSL to yield approximately the same earnings before interest and taxes in the standards
cases in the year after the compliance date of the new and amended standards as in the no-new-
standards case. This scenario represents the lower bound to industry profitability under new and
amended energy conservation standards.

For consumer conventional cooking products, Table 12.3.20 through Table 12.3.31 list
the product classes DOE analyzed with corresponding preservation of operating profit markups
at each analyzed efficiency level.

Table 12.3.20 Preservation of Operating Profit for Electric Smooth Element Standalone
Cooking Top
Efficiency Markups by Selected EL
Level Baseline EL 1 EL 2 EL 3
Baseline 1.200
EL 1 1.200 1.200
EL 2 1.200 1.200 1.198
EL 3 1.200 1.200 1.200 1.178

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Table 12.3.21 Preservation of Operating Profit for Electric Smooth Element Cooking Top
Component of a Combined Cooking Product
Efficiency Markups by Selected EL
Level Baseline EL 1 EL 2 EL 3
Baseline 1.200
EL 1 1.200 1.200
EL 2 1.200 1.200 1.198
EL 3 1.200 1.200 1.200 1.178

Table 12.3.22 Preservation of Operating Profit for Gas Standalone Cooking Top
Efficiency Markups by Selected EL
Level Baseline EL 1 EL 2
Baseline 1.200
EL 1 1.200 1.200
EL 2 1.200 1.200 1.197

Table 12.3.23 Preservation of Operating Profit for Gas Cooking Top Component of a
Combined Cooking Product
Efficiency Markups by Selected EL
Level Baseline EL 1 EL 2
Baseline 1.200
EL 1 1.200 1.200
EL 2 1.200 1.200 1.197

Table 12.3.24 Preservation of Operating Profit for Electric Standard Oven Free Standing
Efficiency Markups by Selected EL
Level Baseline EL 1 EL 2 EL 3
Baseline 1.200
EL 1 1.200 1.200
EL 2 1.200 1.200 1.197
EL 3 1.200 1.200 1.200 1.194

Table 12.3.25 Preservation of Operating Profit for Electric Standard Oven Built-In
Efficiency Markups by Selected EL
Level Baseline EL 1 EL 2 EL 3
Baseline 1.200
EL 1 1.200 1.200
EL 2 1.200 1.200 1.197
EL 3 1.200 1.200 1.200 1.194

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Table 12.3.26 Preservation of Operating Profit for Electric Self-Clean Oven Free Standing
Efficiency Markups by Selected EL
Level Baseline EL 1 EL 2 EL 3
Baseline 1.200
EL 1 1.200 1.200
EL 2 1.200 1.200 1.199
EL 3 1.200 1.200 1.200 1.195

Table 12.3.27 Preservation of Operating Profit for Electric Self-Clean Oven Built-In
Efficiency Markups by Selected EL
Level Baseline EL 1 EL 2 EL 3
Baseline 1.200
EL 1 1.200 1.200
EL 2 1.200 1.200 1.200
EL 3 1.200 1.200 1.200 1.196

Table 12.3.28 Preservation of Operating Profit for Gas Standard Oven Free Standing
Efficiency Markups by Selected EL
Level Baseline EL 1 EL 2
Baseline 1.200
EL 1 1.200 1.200
EL 2 1.200 1.200 1.199

Table 12.3.29 Preservation of Operating Profit for Gas Standard Oven Built-In
Efficiency Markups by Selected EL
Level Baseline EL 1 EL 2
Baseline 1.200
EL 1 1.200 1.200
EL 2 1.200 1.200 1.198

Table 12.3.30 Preservation of Operating Profit for Gas Self-Clean Oven Free Standing
Efficiency Markups by Selected EL
Level Baseline EL 1 EL 2
Baseline 1.200
EL 1 1.200 1.200
EL 2 1.200 1.200 1.200

Table 12.3.31 Preservation of Operating Profit for Gas Self-Clean Oven Built-In
Efficiency Markups by Selected EL
Level Baseline EL 1 EL 2
Baseline 1.200
EL 1 1.200 1.200
EL 2 1.200 1.200 1.199

12-19
12.4 INDUSTRY FINANCIAL IMPACTS

Using the inputs and scenarios described in the previous sections, the GRIM estimates the
financial impact on the consumer conventional cooking products industry. The following
sections detail additional inputs and assumptions for consumer conventional cooking products
manufacturing. The main results of the MIA are also reported in this section. The MIA results
consists of two key financial metrics: INPV and annual cash flows.

12.4.1 Impacts on Industry Net Present Value

The INPV calculated in the GRIM measures the consumer conventional cooking products
industry value and is used in the MIA to compare the economic impacts of different TSLs in the
standards cases. The INPV is the sum of all net cash flows discounted at the industry’s cost of
capital, or discount rate. The consumer conventional cooking products GRIM estimates cash
flows from 2024 to the end of the analysis period (30 years after the analyzed compliance date). l
This timeframe represents both the short-term impacts on the industry from the announcement of
the standards until the compliance date and the long-term assessment over the 30-year analysis
period.

In the MIA, DOE compares the INPV of the no-new-standards case to that of each TSL
in the standards cases. The difference between the no-new-standards case and a standards case
INPV is an estimate of the economic impacts that adopting that particular TSL would have on
the industry. For the consumer conventional cooking products industry, DOE examined the two
manufacturer markup scenarios previously described: the preservation of gross margin scenario
and the preservation of operating profit scenario.

Table 12.4.1 and Table 12.4.2 provide the INPV estimates for the two scenarios for the
consumer conventional cooking products industry.

Table 12.4.1 Industry Net Present Value for Consumer Conventional Cooking Products –
Preservation of Gross Margin Scenario
Trial Standard Level*
Units No-New Standards Case
1 2 3
INPV 2022$ millions 1,601 1,458 1,078 (25)
2022$ millions - (143) (522) (1,626)
Change in INPV
% - (9.0) (32.6) (101.6)
Product Conversion
2022$ millions - 19.9 334.0 1,593.5
Costs
Capital Conversion
2022$ millions - 46.8 242.5 475.7
Costs
Total Conversion Costs 2022$ millions - 66.7 576.5 2,069.2
*Numbers in parentheses indicate a negative number. Some numbers may not sum exactly due to rounding.

l
For the no-new-standards case and all TSLs except the Recommended TSL, the analysis period ranges from 2024–
2056. For the Recommended TSL, the analysis period ranges from 2024–2057.

12-20
Table 12.4.2 Industry Net Present Value for Consumer Conventional Cooking Products –
Preservation of Operating Profit Scenario
Trial Standard Level*
Units No-New Standards Case
1 2 3
INPV 2022$ millions 1,601 1,457 1,042 (302)
2022$ millions - (144) (559) (1,903)
Change in INPV
% - (9.0) (34.9) (118.9)
Product Conversion
2022$ millions - 19.9 334.0 1,593.5
Costs
Capital Conversion
2022$ millions - 46.8 242.5 475.7
Costs
Total Conversion Costs 2022$ millions - 66.7 576.5 2,069.2
*Numbers in parentheses indicate a negative number. Some numbers may not sum exactly due to rounding.

12.4.2 Impacts on Annual Cash Flow

While INPV is useful for evaluating the long-term effects of new and amended energy
conservation standards, short-term changes in cash flow are also important indicators of the
industry’s financial situation. For example, a large investment over one or two years could strain
the industry’s access to capital. Consequently, the sharp drop in financial performance could
cause investors to flee, even though recovery may be possible. Thus, a short-term disturbance
can have long-term effects that the INPV cannot capture. To get an idea of the behavior of
annual free cash flows, Figure 12.4.1 and Figure 12.4.2 present the annual free cash flows from
2024 through 2034 for the no-new-standards case and different TSLs in the standards cases. In
addition, Table 12.4.3 presents estimated free cash flow impacts in the year prior to the standard.

Annual cash flows are discounted to the reference year, 2024. After the standards
announcement date (i.e., the publication of this direct final rule), industry cash flows begin to
decline as companies use their financial resources to prepare for the new and amended energy
conservation standards. Cash flows between the announcement date and the compliance date are
driven by the level of conversion costs and the proportion of these investments spent each year.
The more stringent the energy conservation standard, and the higher the expected conversion
costs, the greater the impact on industry cash flows in the years leading up to the compliance
date. This is because product conversion costs increase operational expenses, thereby reducing
net operating profit, while capital conversion costs increase capital expenses, resulting in higher
cash outflows and further reducing free cash flow.

In the years following the compliance date of standards, the impact on cash flow depends
on the operating revenue. In the preservation of gross margin scenario, the amount of profit
increases as manufacturers attempt to maintain their gross margin through higher prices. The
implicit assumption is that manufacturers can freely pass on manufacturer margins at a higher
cost per unit. The result under this scenario is that operating profit increases (in absolute terms)
as revenue increases. Using this markup, allows the DOE to account for the lowest magnitude of
the range of potential impacts.

12-21
In the years following the compliance date of the standards in the preservation of
operating profit scenario, cash flow recovers more slowly as manufacturers may see less profit as
a percentage of revenue even as revenue rises.

Table 12.4.3 presents free cash flow impacts in the year before the standard takes effect. m
Figure 12.4.1 and Figure 12.4.2 present the annual free cash flows for the consumer conventional
cooking products industry.

Table 12.4.3 Industry Free Cash Flow Impacts in the Year before Compliance
No-New- Trial Standard Level*
Units Standards-
1*** 2 3
Case
2022$
Free Cash Flow (2026) 133.8** 100.6 (94.0) (763.7)
millions
2022$
Change in Free Cash - (28.1) (227.9) (897.5)
millions
Flow
% - (21.8) (170.2) (670.6)
* Numbers in parentheses indicate a negative number. Some numbers may not sum exactly due to rounding.
** The no-new-standards case free cash flow in 2027 is $128.7 million.
*** Change in free cash flow for TSL 1 (the Recommended TSL) is compared to the no-new-standards case free
cash flow in 2027.

Figure 12.4.1 Annual Industry Free Cash Flows for Consumer Conventional Cooking
Products – Preservation of Gross Margin Scenario

m
For all TSLs except the Recommended TSL (i.e., TSL 2 and TSL 3), the year before the standard takes effect is
2026. For the Recommended TSL (TSL 1), the year before the standard takes effect is 2027.

12-22
Figure 12.4.2 Annual Industry Free Cash Flows for Consumer Conventional Cooking
Products – Preservation of Operating Profit Scenario

12.5 IMPACTS ON MANUFACTURER SUBGROUPS

As described in Section 12.2.3, DOE identified small business manufacturers and


premium product manufacturers. The results of this manufacturer subgroup analysis are
described in the following section.

12.5.1 Impacts on Small Business Manufacturers

For manufacturers of consumer conventional cooking products, the SBA has set a size
threshold, which defines those entities classified as “small businesses” for the purposes of the
statute. DOE used the SBA’s small business size standards to determine whether any small
entities would be subject to the requirements of the rule. (See 13 CFR part 121.) The size
standards are listed by the NAICS code and industry description and are available at
www.sba.gov/document/support-table-size-standards. Manufacturing consumer conventional
cooking products are classified under NAICS 335220, “Major Household Appliance
Manufacturing.” The SBA sets a threshold of 1,500 employees or fewer for an entity to be
considered as a small business for this category.

DOE identified manufacturers using DOE’s CCD, CEC’s MAEDbS, NRCan database,
and prior consumer conventional cooking products rulemakings. Based on DOE’s analysis, DOE
identified 35 companies that manufacture consumer conventional cooking products covered by
this rulemaking. DOE screened out companies that have more than 1,500 total employees, are
not original equipment manufacturers (i.e., do not manufacturer the products they sell), or are
entirely foreign owned and operated, and therefore do not meet SBA’s requirements to be
considered a small entity. Of the 35 companies DOE identified as manufacturers of consumer
conventional cooking products sold in the United States, 15 were identified as small businesses.

12-23
DOE is adopting TSL 1 in this direct final rule. For all oven product classes, TSL 1
requires that the ovens not be equipped with a linear power supply. Based on DOE’s shipments
analysis more than 95 percent of ovens use an SMPS and therefore are not equipped with a linear
power supply. Based on DOE’s shipment analysis, DOE assumed most, if not all, small
businesses already use SMPSs for the ovens they manufacture. If any small businesses do still
use linear power supplies in their ovens, there would be minimal conversion costs to these small
businesses, as SMPSs can be purchased as a separate component and would most likely not
require a significant redesign to incorporate these SMPSs. The remainder of this cost analysis
focuses on the costs associated with complying with the adopted cooking top energy
conservation standards.

DOE identified 15 small manufacturers of consumer conventional cooking products. All


15 of these small businesses manufacture cooking tops. These 15 small businesses can be
grouped into two manufacturing groups: those that manufacture premium cooking tops and those
that manufacture non-premium cooking tops.

Gas cooking top non-premium products typically have thinner non-continuous grates
with one or no HIR burner (although some of these small businesses may offer a limited number
of models with thicker continuous grates). Electric cooking top non-premium products mostly
have electric open (coil) element cooking tops (although a few small businesses may have up to
25 percent of their electric ranges or electric cooking tops using electric smooth element cooking
tops). These non-premium small businesses usually compete on price in the market.

Gas cooking top premium products typically have thicker continuous grates with multiple
HIR burners. Electric cooking top premium products use smooth elements, typically with
induction technology. Small businesses manufacturing premium products do not offer electric
open (coil) element cooking tops. Lastly, small businesses manufacturing premium products
typically compete on the high quality and professional look and design of their products. These
ranges or cooking tops are typically significantly more expensive than non-premium products.

Based on data from each small business’s websites, DOE estimated the number of basic
models each small business offers.

12-24
Table 12.5.1 Number of Unique Basic Models for each Small Business
Number of Cooking Top Basic Models
Small Business
Manufacturer (by Fuel Type)
Type
Gas Electric Smooth Element
Small Business 1 Non-Premium 4 4
Small Business 2 Non-Premium - 30
Small Business 3 Non-Premium 27 13
Small Business 4 Non-Premium 24 -
Small Business 5 Non-Premium 14 -
Small Business 6 Non-Premium 3 2
Small Business 7 Premium 11 -
Small Business 8 Premium 24 5
Small Business 9 Premium 20 7
Small Business 10 Premium 16 -
Small Business 11 Premium 14 1
Small Business 12 Premium 12 -
Small Business 13 Premium 42 -
Small Business 14 Premium 13 -
Small Business 15 Premium 14 -

DOE estimated the small business conversion costs and testing costs using the same
methodology used to estimate the industry conversion costs, described in section 12.3.7. There
are two types of conversion costs that small businesses could incur due to the adopted standards:
product conversion costs (including any testing costs) and capital conversion costs. In the August
2022 TP Final Rule, DOE estimated a lower per-unit testing cost for testing done in-house and a
more-costly third-party laboratory per-unit testing cost. For this direct final rule analysis, DOE
assumed all small businesses would incur the more costly third-party laboratory per-unit testing
cost, as most small businesses do not have in-house testing capabilities or capacity to test all
their products in accordance with the DOE test procedure.

Product conversion costs are investments in R&D, testing, marketing, and other non-
capitalized costs necessary to make product designs comply with new and amended energy
conservation standards. Capital conversion costs are investments in property, plant, and
equipment necessary to adapt or change existing production facilities such that new compliant
product designs can be fabricated and assembled. Manufacturers would have to incur testing
costs for all gas cooking tops and all electric smooth element cooking tops since DOE is
establishing new energy conservation standards for cooking tops. Therefore, even products that
meet the adopted energy conservation standards would incur testing costs to test these gas
cooking tops and electric smooth element cooking tops to demonstrate compliance with the
adopted energy conservation standards. However, manufacturers would only incur R&D product
conversion costs and capital conversion costs if they have products that do not meet the energy
conservation standards.

Based on the estimated model counts for each conventional cooking top type shown in
Table 12.5.1 and the conversion cost and testing cost methodology used to calculate industry
conversion costs, DOE estimated the conversion costs and testing costs for each small business,
displayed in Table 12.5.2. DOE then used D&B Hoovers to estimate the annual revenue for each

12-25
small business. Manufacturers will have 4 years between publication of this direct final rule and
compliance with the energy conservation standards. Therefore, DOE presents the estimated
conversion costs and testing costs as a percent of the estimated 4 years of annual revenue for
each small business.

Table 12.5.2 Estimated Conversion Costs and Annual Revenue for each Small Business
Small Conversion Cost as a
Total Conversion
Manufacturer Business Annual Revenue % of 4-Years of
and Testing Costs
Type Annual Revenue
Small Business 1 Non-Premium $326,600 $950,000 9%
Small Business 2 Non-Premium $573,002 $8,780,000 2%
Small Business 3 Non-Premium $611,001 $58,630,000 <1%
Small Business 4 Non-Premium $196,800 $31,370,000 <1%
Small Business 5 Non-Premium $114,800 $23,980,000 <1%
Small Business 6 Non-Premium $302,000 $107,350,000 <1%
Small Business 7 Premium $733,204 $2,730,000 7%
Small Business 8 Premium $1,224,306 $5,000,000 6%
Small Business 9 Premium $1,136,404 $8,800,000 3%
Small Business 10 Premium $774,204 $7,990,000 2%
Small Business 11 Premium $1,027,004 $8,648,000 3%
Small Business 12 Premium $741,404 $10,970,000 2%
Small Business 13 Premium $1,201,909 $32,600,000 1%
Small Business 14 Premium $749,604 $19,800,000 1%
Small Business 15 Premium $757,804 $23,730,000 1%

12.5.2 Impacts on Premium Product Manufacturers

The premium product manufacturer subgroup consists of consumer conventional cooking


product manufacturers that primarily sell gas cooking tops, gas ovens, and electric self-clean
ovens marketed as premium or professional style, either as a standalone product or as a
component of a combined cooking product. These products are typically significantly more
expensive than the market average costs. For the cooking top product classes, some premium
product manufacturers do manufacture electric smooth element cooking tops. Of the premium
product manufacturers that manufacture electric smooth element cooking tops, all have products
that use induction technology and would be able to meet the max-tech efficiency level for these
product classes.

Premium product manufacturers would likely face more difficulty meeting potential
standards set for the gas cooking top product classes than other consumer conventional cooking
product manufacturers. However, all analyzed efficiency levels for the gas cooking top product
classes are achievable with multiple HIR burner and continuous cast-iron grates. Therefore,
while premium product manufacturers would likely have to redesign a higher portion of their gas
cooking top models compared to other consumer conventional cooking product manufacturers,
all efficiency levels for the gas cooking top product classes are achievable for premium product
manufacturers.

12-26
For the oven product classes, the vast majority of premium product electric and gas ovens
already use SMPSs in their ovens and would not have difficulty meeting potential standard levels
requiring SMPSs for any oven product classes. Additionally, premium product manufacturers
typically have a higher percentage of gas oven models with convection mode capability
compared to other consumer conventional cooking product manufacturers. However, like the rest
of the market, there are very few, if any, premium product electric ovens equipped with an oven
separator, and it would be difficult for premium product manufacturers to convert all their oven
cavities into ovens equipped with oven separators.

12.6 OTHER IMPACTS

12.6.1 Direct Employment

DOE quantitatively assessed the impacts of new and amended energy conservation
standards on direct employment. DOE used the GRIM to calculate the number of production
employees from labor expenditures. DOE used statistical data from the 2021 ASM and the
results of the engineering analysis to calculate industry-wide labor expenditures. Labor
expenditures related to product manufacturing depend on the labor intensity of the product, the
sales volume, and an assumption that wages remain fixed in real terms over time. The total labor
expenditures in the GRIM were then converted to domestic production employment levels by
dividing production labor expenditures by the annual payment per production worker.

Non-production employees account for those workers that are not directly engaged in the
manufacturing of the covered products. This could include sales, human resources, engineering,
and management. DOE estimated non-production employment levels by multiplying the number
of consumer conventional cooking product workers by a scaling factor. The scaling factor is
calculated by taking the ratio of the total number of employees, and the total production workers
associated with the industry NAICS code 335220, which covers consumer conventional cooking
product manufacturing.

The employment impacts shown in Table 12.7.1 represent the potential domestic
production employment that could result following the new and amended energy conservation
standards. The upper bound of the results estimates the maximum change in the number of
production workers that could occur after compliance with the new and amended energy
conservation standards when assuming that manufacturers continue to produce the same scope of
covered products in the same production facilities. It also assumes that domestic production does
not shift to lower labor-cost countries. Because there is a risk of manufacturers evaluating
sourcing decisions in response to new and amended energy conservation standards, the lower
bound of the employment results includes DOE’s estimate of the total number of U.S. production
workers in the industry who could lose their jobs if some existing domestic production was
moved outside of the United States. While the results present a range of domestic employment
impacts following 2027 or 2028 (depending on the TSL being analyzed), the following sections
also include qualitative discussions of the likelihood of negative employment impacts at the
various TSLs.

Using 2021 ASM data and interviews with manufacturers, DOE estimates that around 40
percent of consumer conventional cooking products manufacturing occurs outside of the United

12-27
States. With this assumption, DOE estimates that in the absence of new and amended energy
conservation standards, there would be approximately 4,208 domestic production workers
involved in manufacturing consumer conventional cooking products in 2027. Table 12.6.1 shows
the range of impacts of the new and amended energy conservation standards on U.S. production
workers in the consumer conventional cooking product industry.

Table 12.6.1 Domestic Employment for Consumer Conventional Cooking Products in the
Analyzed Compliance Year
No-New- Trial Standard Level*
Standards-
1*** 2 3
Case
Domestic Product Workers in
4,208** 4,195 4,333 4,808
2027
Domestic Non-Production in
506** 504 521 578
2027
Total Direct Employment in
4,714** 4,699 4,854 5,386
2027
Potential Changes in Total (1,123) -
- (13) – 0 (939) - 125
Direct Employment in 2027* 600
* DOE presents a range of potential impacts. Numbers in parentheses indicate a negative number.
** In the no-new-standards case in 2028 there are 4,193 domestic production workers; there are 504 domestic non-
production workers; and the total direct employment is 4,697 in 2028.
*** Change in employment for TSL 1 (the Recommended TSL) is compared to the no-new-standards case
employment in 2028.

At the upper end of the range, all examined TSLs show an increase in the number of
domestic production workers for consumer conventional cooking products. The upper end of the
range represents a scenario where manufacturers increase production hiring due to the increase in
the labor associated with adding the required components to make consumer conventional
products more efficient. However, as previously stated, this assumes that in addition to hiring
more production employees, all existing domestic production would remain in the United States
and not shift to lower labor cost countries.

At the lower end of the range, all examined TSLs show either no change in domestic
production employment or a decrease in domestic production employment. The lower end of the
domestic employment range assumes that gas cooking top domestic production employment
does not change at any TSL. Manufacturing more efficient gas cooking tops by optimizing the
burner and improving grates would not impact the location where production occurs for these
product classes. Additionally, this lower range assumes that at TSL 1, the Recommended TSL,
which sets all oven product classes and all electric smooth element cooking top product classes
at EL 1, domestic production employment would not change. EL 1 would require SMPSs for all
oven product classes and can be achieved using low-standby-loss electronic controls for the
electric smooth element cooking top product classes. The majority of manufacturers already use
SMPSs in their ovens and are able to meet the efficiency requirements at EL 1 for the electric
smooth element cooking top product classes using purchased components. Adding these standby
features to models currently not using these features would not change the location where
production occurs for these product classes.

12-28
At the lower end of the range for TSL 2, DOE estimated that up to 25 percent of the
domestic employment for the electric smooth element cooking top product classes could be
relocated abroad at EL 2. Additionally, DOE estimated that up to 25 percent of domestic
production employment for the oven product classes could be relocated abroad at TSL 2. DOE
estimates that there would be approximately 736 domestic production employees involved in the
production of electric smooth element cooking tops and 3,020 domestic production employees
involved in the production covering all oven product classes in 2027 in the no-new-standards
case. Using these values to estimate the lower end of the range, DOE estimated that up to 939
domestic production employees could be eliminated at TSL 2 (due to standards being set at EL 2
for all electric smooth element cooking top product classes and for all oven product classes).n

At the lower end of the range for TSL 3, DOE estimated that up to 50 percent of domestic
production employment for the electric smooth element cooking top product classes could be
relocated abroad at max-tech. Additionally, DOE estimated that up to 25 percent of domestic
production employment for the oven product classes could be relocated abroad at TSL 3. DOE
estimates that there would be approximately 736 domestic production employees involved in the
production of electric smooth element cooking tops and 3,020 domestic production employees
involved in the production covering all oven product classes in 2027 in the no-new-standards
case. Using these values to estimate the lower end of the range, DOE estimated that up to 1,123
domestic production employees could be eliminated at TSL 3 (due to standards being set at max-
tech for all electric smooth element cooking top product classes and for all oven product
classes).o

DOE provides a range of potential impacts to domestic production employment as each


manufacturer would make a business decision that best suits their individual product needs.
However, manufacturers stated during interviews that due to the larger size of most consumer
conventional cooking products, there are few units that are manufactured and shipped from far
distances such as Asia or Europe. The vast majority of consumer conventional cooking products
are currently made in North America. Some manufacturers stated that even significant changes to
production lines would not cause them to shift their production abroad, as several manufacturers
either only produce consumer conventional cooking products domestically or have made
significant investments to continue to produce consumer conventional cooking products
domestically.

12.6.2 Manufacturer Production Capacity

Manufacturers stated that any standard requiring induction heating technology for electric
smooth element cooking tops would be very difficult to meet since there are less than 1 percent
of shipments currently using this technology. Additionally, any standards requiring oven
separators for the electric oven product class would be very difficult to meet since that would
require completely redesigning the oven cavity of almost every electric oven model currently on
the market.

n
736 x 25% + 3,020 x 25% = 939
o
736 x 50% + 3,020 x 25% = 1,123

12-29
Based on comments received in response to the February 2023 SNOPR, DOE further
examined the potential impacts of the gas cooking top market in this direct final rule analysis and
agrees that some gas cooking top manufacturers might not be willing to make the investments
required to comply with the max-tech gas cooking top efficiency level that was proposed in the
February 2023 SNOPR and the max-tech gas cooking top efficiency level analyzed in this direct
final rule analysis. If energy conservation standards are set at max-tech for gas cooking tops it
could result in some gas cooking top manufacturers leaving the gas cooking top market (either
by exclusively manufacturing electric cooking tops or exiting the cooking top market all
together). However, DOE notes that 97 percent of gas cooking top shipments on the market
today would meet EL 1 for the gas cooking tops product classes. Therefore, DOE does not
anticipate that adopting energy conservation standards at EL 1 for the gas cooking tops product
classes would cause any manufacturer to exit the gas cooking top market and all manufacturers
would be able to continue to differentiate their products based on features other than energy
efficiency.

DOE updated the efficiency levels for gas cooking tops for this direct final rule. Based on
the updated efficiency levels for gas cooking tops, DOE estimates that approximately 41 percent
of gas cooking shipments would meet the efficiency requirements at max-tech. Based on DOE’s
further analysis, including the updated efficiency levels for gas cooking tops for this direct final
rule, DOE understands that there is a risk that some manufacturers might not be willing or able to
make the investments required to comply with standards for gas cooking tops if standards are set
at max-tech for gas cooking tops. DOE notes that 97 percent of gas cooking top shipments on the
market today would meet EL 1 for the gas cooking tops product classes.

Other than the max-tech ELs for the electric cooking top product classes and the gas
cooking top product classes, all other ELs require making incremental improvements to existing
designs and should not present any manufacturing capacity constraints given a compliance
period of 3 or more years (depending on the TSL analyzed).

12.6.3 Cumulative Regulatory Burden

One aspect of assessing manufacturer burden involves looking at the cumulative impact
of multiple DOE standards and the regulatory actions of other Federal agencies and States that
affect the manufacturers of a covered product or equipment. While any one regulation may not
impose a significant burden on manufacturers, the combined effects of several existing or
impending regulations may have serious consequences for some manufacturers, groups of
manufacturers, or an entire industry. Multiple regulations affecting the same manufacturer can
strain profits and lead companies to abandon product lines or markets with lower expected future
returns than competing products. For these reasons, DOE conducts an analysis of cumulative
regulatory burden as part of its rulemakings pertaining to appliance efficiency.

DOE evaluates product-specific regulations that will take effect approximately 3 years
before or after the estimated 2028 compliance date of the new and amended energy conservation
standards for consumer conventional cooking products. This information is presented in Table
12.6.2.

12-30
Table 12.6.2 Compliance Dates and Expected Conversion Expenses of Federal Energy
Conservation Standards Affecting Consumer Conventional Cooking
Products Manufacturers
Number of Industry Industry
Approx.
Federal Energy Number Manufacturers Conversion Conversion
Standards
Conservation Standard of Mfrs* Affected by Costs Costs/Product
Year
this Rule** (millions) Revenue***
Portable Air Conditioners
$320.9
85 FR 1378 11 4 2025 6.7%
(2015$)
(Jan. 10, 2020)
Room Air Conditioners
$24.8
88 FR 34298 8 4 2026 0.4%
(2021$)
(May 26, 2023)
Microwave Ovens
$46.1
88 FR 39912 18 10 2026 0.7%
(2021$)
(Jun. 20, 2023)
Clothes Dryers†
$149.7
87 FR 51734 15 10 2027 1.8%
(2020$)
(Aug. 23, 2022)
Automatic Commercial
Ice Makers† $15.9
23 4 2027 0.6%
88 FR 30508 (2022$)
(May 11, 2023)
Dishwashers†
$125.6
88 FR 32514 21 14 2027 2.1%
(2021$)
(May 19, 2023)
Electric Motors
$468.5
88 FR 36066 74 1 2027 2.6%
(2021$)
(Jun. 1, 2023)
Residential Clothes
Washers† $690.8
19 11 2027 5.2%
88 FR 13520 (2021$)
(Mar. 3, 2023)
Ceiling Fans†
$107.2
88 FR 40932 91 1 2028 1.9%
(2022$)
(Jun. 22, 2023)
Commercial Refrigeration
Equipment† $226.4
89 7 2028 1.6%
88 FR 70196 (2022$)
(Oct. 10, 2023)
Dehumidifiers†
$7.0
88 FR 76510 20 4 2028 0.4%
(2022$)
(Nov. 6, 2023)
General Service Lamps†
$407
88 FR 1638 100+ 1 2028 4.5%
(2021$)
(Jan. 11, 2023)
Consumer Furnaces
$162.0
88 FR 87502 15 1 2029 1.8%
(2022$)
(Dec. 18, 2023)
Miscellaneous 38 9 2029 $126.9 3.1%

12-31
Number of Industry Industry
Approx.
Federal Energy Number Manufacturers Conversion Conversion
Standards
Conservation Standard of Mfrs* Affected by Costs Costs/Product
Year
this Rule** (millions) Revenue***
Refrigeration Products† (2021$)
88 FR 19382
(Mar. 31, 2023)
Refrigerators,
Refrigerator-Freezers, and
2029 & $830.3
Freezers 49 14 1.3%
2030‡ (2022$)
88 FR 3026
(Jan. 17, 2024)
* This column presents the total number of manufacturers identified in the energy conservation standard rule
contributing to cumulative regulatory burden.
** This column presents the number of manufacturers producing consumer conventional cooking products that are
also listed as manufacturers in the listed energy conservation standard contributing to cumulative regulatory burden.
*** This column presents industry conversion costs as a percentage of product revenue during the conversion
period. Industry conversion costs are the upfront investments manufacturers must make to sell compliant
products/equipment. The revenue used for this calculation is the revenue from just the covered product/equipment
associated with each row. The conversion period is the time frame over which conversion costs are made and lasts
from the publication year of the final rule to the compliance year of the energy conservation standard. The
conversion period typically ranges from 3 to 5 years, depending on the rulemaking.
† Indicates a NOPR publication. Values may change on publication of a final rule.
‡ For the refrigerators, refrigerator-freezers, and freezers energy conservation standards direct final rule, the
compliance year (2029 or 2030) varies by product class.

12.7 CONCLUSION

The following section summarizes the impacts for the scenarios DOE believes are most
likely to capture the range of impacts on consumer conventional cooking products manufacturers
as a result of proposed new and amended energy conservation standards. DOE also notes that
while these scenarios bound the range of most plausible impacts on manufacturers, there
potentially could be circumstances that cause manufacturers to experience impacts outside of this
range. Table 12.7.1 summarizes INPV impacts and conversion costs projected to result from
each of the TSLs analyzed.

12-32
Table 12.7.1 Manufacturer Impact Analysis Results
No-New Trial Standard Level
Units Standards
Case 1 2 3
2022$
INPV 1,601 1,457 – 1,458 1,042 – 1,078 (302) – (25)
millions
2022$
- (144) – (143) (559) – (522) (1,903) – (1,626)
Change in millions
INPV (34.9) –
% - (9.0) – (9.0) (118.9) – (101.6)
(32.6)
Product
2022$
Conversion - 19.9 334.0 1,593.5
millions
Costs
Capital
2022$
Conversion - 46.8 242.5 475.7
millions
Costs
Total
2022$
Conversion - 66.7 576.5 2,069.2
millions
Costs

At TSL 3, DOE estimates the change in INPV will range from -$1,903 million to -$1,626
million, which represents a change in INPV of -118.9 percent to -101.6 percent, respectively. At
TSL 3, industry free cash flow decreases to -$763.7 million, which represents a decrease of
approximately 670.6 percent, compared to the no-new-standards case value of $133.8 million in
2026, the year before the compliance date.

TSL 3 would set the energy conservation standard at EL 2 for the gas cooking top
product classes (standalone and component of a combined cooking products) and for the gas
oven product class and at EL 3 for the electric smooth element cooking top product classes
(standalone and component of a combined cooking products) and for the electric oven product
class. This represents max-tech for all product classes. DOE estimates that less than 1 percent of
electric smooth element cooking top shipments (standalone and component of a combined
cooking products), 41 percent of gas cooking top shipments (standalone and component of a
combined cooking products), there are no electric standard oven (freestanding and built-in)
shipments, there are no electric self-clean oven (freestanding) shipments, 2 percent of electric
self-clean (built-in) shipments, 62 percent of gas standard oven (freestanding) shipments, 38
percent of gas standard oven (built-in) shipments, 93 percent of gas self-clean oven
(freestanding) shipments, and 77 percent of gas self-clean (built-in) shipments would already
meet the efficiency levels required at TSL 3 in 2027.

At TSL 3, DOE expects consumer conventional cooking product manufacturers to incur


approximately $1,593.5 million in product conversion costs. This includes testing costs and
product redesign costs. At TSL 3, electric smooth element cooking top manufacturers would
have to completely redesign most of their electric smooth element cooking top models to use
induction technology. Electric oven manufacturers would have to completely redesign almost all
their electric oven models to use oven separators. Additionally, consumer conventional cooking
product manufacturers would incur approximately $475.7 million in capital conversion costs to

12-33
purchase new tooling and equipment necessary to produce the numerous redesigned cooking top
and oven models at TSL 3.

At TSL 3, the shipment weighted average MPC for consumer conventional cooking
products significantly increases by 22.3 percent relative to the no-new-standards case shipment
weighted average MPC in 2027. In the preservation of gross margin scenario, manufacturers can
fully pass along this cost increase, which causes an increase in manufacturers’ free cash flow.
However, the $2,069.2 million in conversion costs estimated at TSL 3, ultimately results in a
significantly negative change in INPV at TSL 3 under the preservation of gross margin scenario.

Under the preservation of operating profit scenario, manufacturers earn the same per-unit
operating profit as would be earned in the no-new-standards case, but manufacturers do not earn
additional profit from their investments or higher MPCs. In this scenario, the 22.3 percent
increase in the shipment weighted average MPC results in a reduction in the margin after the
compliance year. This reduction in the margin and the $2,069.2 million in conversion costs
incurred by manufacturers causes a significantly negative change in INPV at TSL 3 under the
preservation of operating profit scenario.

At TSL 2, DOE estimates the change in INPV will range from -$559 million to -$522
million, which represents a change in INPV of -34.9 percent to -32.6 percent, respectively. At
TSL 2, industry free cash flow decreases to -$94.0 million, which represents a decrease of
approximately 170.2 percent, compared to the no-new-standards case value of $133.8 million in
2026, the year before the compliance date.

TSL 2 would set the energy conservation standard at EL 2 for all product classes. DOE
estimates that 15 percent of electric smooth element cooking top shipments (standalone and
component of a combined cooking products), 41 percent of gas cooking top shipments
(standalone and component of a combined cooking products), 38 percent of electric standard
oven (freestanding) shipments, 30 percent of electric standard oven (built-in) shipments, 77
percent of electric self-clean oven (freestanding) shipments, 88 percent of electric self-clean
(built-in) shipments, 62 percent of gas standard oven (freestanding) shipments, 38 percent of gas
standard oven (built-in) shipments, 93 percent of gas self-clean oven (freestanding) shipments,
and 77 percent of gas self-clean (built-in) shipments would already meet the efficiency levels
required at TSL 2 in 2027.

At TSL 2, DOE expects consumer conventional cooking product manufacturers to incur


approximately $334.0 million in product conversion costs. This includes testing costs and
product redesign costs. Additionally, consumer conventional cooking product manufacturers
would incur approximately $242.5 million in capital conversion costs to purchase new tooling
and equipment necessary to produce all electric smooth element cooking top models and all oven
models to use SMPSs and to purchase new molds for grates and burners for gas cooking top
models that would not meet this energy conservation standard.

At TSL 2, the shipment weighted average MPC for consumer conventional cooking
products slightly increases by 3.1 percent relative to the no-new-standards case shipment
weighted average MPC in 2027. In the preservation of gross margin scenario, manufacturers can
fully pass on this cost increase, which causes an increase in manufacturers’ free cash flow.

12-34
However, the $576.5 million in conversion costs estimated at TSL 2, ultimately results in a
moderately negative change in INPV at TSL 2 under the preservation of gross margin scenario.

Under the preservation of operating profit scenario, the 3.1 percent increase in the
shipment weighted average MPC results in a reduction in the margin after the compliance year.
This reduction in the margin and the $576.5 million in conversion costs incurred by
manufacturers causes a moderately negative change in INPV at TSL 2 under the preservation of
operating profit scenario.

At TSL 1 (i.e., the Recommended TSL), DOE estimates the change in INPV will range
from -$144 million to -$143 million, which represents a change of -9.0 percent. At TSL 1,
industry free cash flow decreases to $100.6 million, which represents a decrease of
approximately 21.8 percent, compared to the no-new-standards case value of $128.7 million in
2027, the year before the compliance date.

TSL 1 would set the energy conservation standard at EL 1 for all product classes. DOE
estimates that 77 percent of all electric smooth element cooking top shipments, 97 percent of all
gas cooking top shipments, 95 percent of all electric oven shipments, and 96 percent of all gas
oven shipments would already meet or exceed the efficiency levels required at TSL 1 in 2028.

At TSL 1, DOE expects consumer conventional cooking product manufacturers to incur


approximately $19.9 million in product conversion costs to redesign all non-compliant cooking
top models and oven models, as well as to test all (both compliant and newly redesigned)
cooking top models to DOE’s cooking top test procedure. Additionally, consumer conventional
cooking product manufacturers would incur approximately $46.8 million in capital conversion
costs to purchase new tooling and equipment necessary to produce all electric smooth element
cooking top models and all oven models to use SMPSs and to purchase new molds for grates and
burners for gas cooking top models that would not meet this energy conservation standard.

At TSL 1, the shipment weighted average MPC for consumer conventional cooking
products slightly increases by 0.1 percent relative to the no-new-standards case shipment
weighted average MPC in 2028. In the preservation of gross margin scenario, manufacturers can
fully pass on this slight cost increase, which causes an increase in manufacturers’ free cash flow.
However, the $66.7 million in conversion costs estimated at TSL 1, ultimately results in a
slightly negative change in INPV at TSL 1 under the preservation of gross margin scenario.

Under the preservation of operating profit scenario, the 0.1 percent increase in the
shipment weighted average MPC results in a reduction in the margin after the compliance year.
This reduction in the margin and the $66.7 million in conversion costs incurred by manufacturers
causes a slightly negative change in INPV at TSL 1 under the preservation of operating profit
scenario.

12-35
REFERENCES

1. McKinsey & Company, Inc. Valuation: Measuring and Managing the Value of
Companies, 3rd Edition, Copeland, Koller, Murrin. New York: John Wiley & Sons,
2000.

12-36
CHAPTER 13. EMISSIONS IMPACT ANALYSIS

TABLE OF CONTENTS

13.1 INTRODUCTION ......................................................................................................... 13-1


13.2 EMISSIONS IMPACT RESULTS ................................................................................ 13-2
REFERENCES .......................................................................................................................... 13-9

LIST OF TABLES

Table 13.2.1 Cumulative Emissions Reduction for Potential Standards for


Consumer Conventional Cooking Products ................................................. 13-3
Table 13.2.2 Emissions Reduction at Selected Standard Level (TSL 1) .......................... 13-7

LIST OF FIGURES

Figure 13.2.1 Consumer Conventional Cooking Products: CO2 Total Emissions


Reduction ..................................................................................................... 13-4
Figure 13.2.2 Consumer Conventional Cooking Products: SO2 Total Emissions
Reduction ..................................................................................................... 13-4
Figure 13.2.3 Consumer Conventional Cooking Products: NOx Total Emissions
Reduction ..................................................................................................... 13-5
Figure 13.2.4 Consumer Conventional Cooking Products: Hg Total Emissions
Reduction ..................................................................................................... 13-5
Figure 13.2.5 Consumer Conventional Cooking Products: N2O Total Emissions
Reduction ..................................................................................................... 13-6
Figure 13.2.6 Consumer Conventional Cooking Products: CH4 Total Emissions
Reduction ..................................................................................................... 13-6

13-i
CHAPTER 13. EMISSIONS IMPACT ANALYSIS

13.1 INTRODUCTION
The emissions analysis consists of two components. The first component estimates the
effect of potential energy conservation standards on power sector emissions and, if present, site
combustion emissions, of carbon dioxide (CO2), nitrogen oxides (NOX), sulfur dioxide (SO2),
and mercury (Hg). The second component estimates the impacts of potential standards on
emissions of two additional greenhouse gases, methane (CH4) and nitrous oxide (N2O), as well
as the impacts to emissions of all species due to “upstream” activities in the fuel production
chain, which are included in accordance with DOE’s FFC Statement of Policy. 76 FR 51282
(Aug. 18, 2011). These upstream activities comprise extraction, processing, and transporting fuels
to the site of combustion.

The analysis of power sector emissions of CO2, NOX, SO2, and Hg uses emissions
intensity factors intended to represent the marginal impacts of the change in electricity
consumption associated with amended or new standards. The methodology is based on results
published for the Annual Energy Outlook (AEO) prepared by the Energy Information
Administration, including a set of side cases that implement a variety of efficiency-related
policies. The methodology is described in appendix 13A in this TSD, and in the report “Utility
Sector Impacts of Reduced Electricity Demand” (Coughlin, 2014; Coughlin 2019).1,2 The
analysis presented in this chapter uses projections from AEO 2023.3

Emissions of SO2 and NOX from site combustion of natural gas or petroleum fuels are
calculated using emissions intensity factors from a publication of the Environmental Protection
Agency (EPA).4 Power sector combustion emissions of CH4 and N2O are derived using Emission
Factors for Greenhouse Gas Inventories published by the EPA, as are site combustion emissions
of CO2, CH4, and N2O.a

The FFC upstream emissions are estimated based on the methodology and data described
in appendix 10B and in Coughlin (2013).5 The upstream emissions include emissions from fuel
combustion during extraction, processing, and transportation of fuels, and direct leakage to the
atmosphere of CH4 and CO2 from the oil and natural gas industry and coal mining.

The emissions intensity factors are expressed in terms of physical units per MWh or
MMBtu of site energy savings. Total emissions reductions are estimated by multiplying the
emissions intensity factor by the energy savings calculated in the national impact analysis
(chapter 10). The emissions factors used in the calculations are provided in appendix 13A. For
power sector emissions, the factors depend on the sector and end use. The results presented here
use factors for the power plant types that supply electricity for cooking in homes.

Each annual version of the AEO incorporates the projected impacts of existing air quality
regulations on emissions. The AEO generally represents current Federal and State legislation and
final implementation regulations in place as at the time of its preparation. After publication of the

a
https://www.epa.gov/sites/default/files/2021-04/documents/emission-factors_apr2021.pdf.

13-1
AEO 2023, EPA finalized the Federal ‘‘Good Neighbor Plan’’ for the 2015 Ozone National
Ambient Air Quality Standards in March 2023 (88 FR 36654). Among other requirements, this
rule reduces allowable emissions in ozone season, from May 1 through September 30, from
fossil fuel-fired power plants in 22 states beginning in 2023. EPA projects a nationwide annual
decrease in power sector ozone-season NOX, annual NOX, SO2, and CO2 emissions of 9%, 5%,
4%, and 1% respectively in 2026 when the regulation is fully implemented, and 15%, 12%, 17%
and 2% in 2030.b These percentage reductions are greater in the 22 states subject to the
regulation. After 2030 the percentage reductions decline as baseline power sector emissions are
expected to fall as a result of other economic factors. The estimates below for power sector
emissions changes would likely be lower if this regulation were accounted for in the AEO 2023.
For details of the regulations reflected in the AEO 2023, see Summary of Legislation and
Regulations Included in the AEO 2023, Appendix, Electric power sector. c

13.2 EMISSIONS IMPACT RESULTS


Table 13.2.1 presents the estimated cumulative emissions reductions for the lifetime of
products sold during the analysis period of each TSL. Negative values indicate that emissions
increase.

b
EPA, 2023. Regulatory Impact Analysis for the Final Federal Good Neighbor Plan Addressing Regional Ozone
Transport for the 2015 Ozone National Ambient Air Quality Standard. https://www.epa.gov/csapr/good-neighbor-
plan-2015-ozone-naaqs Accessed 8/29/2023.
c
https://www.eia.gov/outlooks/aeo/assumptions/

13-2
Table 13.2.1 Cumulative Emissions Reduction for Potential Standards for Consumer
Conventional Cooking Products
TSL
1 2 3
Power Sector and Site Emissions
CO2 (million metric tons) 3.61 18.80 32.90
CH4 (thousand tons) 0.25 0.73 1.77
N2O (thousand tons) 0.04 0.09 0.24
NOX (thousand tons) 1.75 13.82 20.46
SO2 (thousand tons) 1.13 2.21 6.83
Hg (tons) 0.01 0.01 0.05
Upstream Emissions
CO2 (million metric tons) 0.38 2.37 3.79
CH4 (thousand tons) 34.45 234.68 364.45
N2O (thousand tons) 0.00 0.01 0.01
NOX (thousand tons) 5.87 37.32 59.57
SO2 (thousand tons) 0.02 0.05 0.13
Hg (tons) 0.00003 0.00005 0.00017
Total Emissions
CO2 (million metric tons) 3.99 21.16 36.69
CH4 (thousand tons) 34.70 235.42 366.22
N2O (thousand tons) 0.04 0.10 0.25
NOX (thousand tons) 7.61 51.14 80.03
SO2 (thousand tons) 1.15 2.26 6.96
Hg (tons) 0.01 0.01 0.05

Figure 13.2.1 through Figure 13.2.6 show the annual reductions for total emissions for
each type of emission from each TSL. The reductions reflect the lifetime impacts of products
sold during the analysis period.

13-3
Figure 13.2.1 Consumer Conventional Cooking Products: CO2 Total Emissions Reduction

Figure 13.2.2 Consumer Conventional Cooking Products: SO2 Total Emissions Reduction

13-4
Figure 13.2.3 Consumer Conventional Cooking Products: NOx Total Emissions Reduction

Figure 13.2.4 Consumer Conventional Cooking Products: Hg Total Emissions Reduction

13-5
Figure 13.2.5 Consumer Conventional Cooking Products: N2O Total Emissions Reduction

Figure 13.2.6 Consumer Conventional Cooking Products: CH4 Total Emissions Reduction

13-6
Table 13.2.2 displays annual emissions reductions from the selected standards (TSL 1).

Table 13.2.2 Emissions Reduction at Selected Standard Level (TSL 1)


CO2
CH4 N2O SO2
Emissions (million NOX (‘000 Hg
(‘000 (‘000 (‘000
Year metric tons) (tons)
tons) tons) tons)
tons)
2028 0.011 0.077 0.00012 0.019 0.0036 0.000026
2029 0.020 0.147 0.00021 0.035 0.0061 0.000043
2030 0.028 0.211 0.00029 0.049 0.0084 0.000058
2031 0.036 0.272 0.00037 0.064 0.0109 0.000075
2032 0.044 0.332 0.00045 0.078 0.0136 0.000092
2033 0.052 0.394 0.00055 0.093 0.0167 0.000111
2034 0.061 0.453 0.00064 0.108 0.0193 0.000128
2035 0.069 0.515 0.00074 0.123 0.0222 0.000146
2036 0.077 0.581 0.00082 0.139 0.0245 0.000161
2037 0.084 0.650 0.00089 0.154 0.0264 0.000173
2038 0.091 0.725 0.00095 0.170 0.0279 0.000181
2039 0.099 0.796 0.00101 0.185 0.0292 0.000190
2040 0.106 0.871 0.00105 0.201 0.0304 0.000199
2041 0.113 0.937 0.00113 0.215 0.0323 0.000212
2042 0.120 0.999 0.00119 0.229 0.0339 0.000223
2043 0.125 1.048 0.00122 0.240 0.0347 0.000230
2044 0.127 1.080 0.00121 0.246 0.0350 0.000234
2045 0.129 1.108 0.00120 0.249 0.0352 0.000238
2046 0.128 1.117 0.00118 0.250 0.0350 0.000239
2047 0.128 1.123 0.00116 0.249 0.0352 0.000243
2048 0.127 1.133 0.00113 0.249 0.0346 0.000241
2049 0.127 1.138 0.00112 0.247 0.0357 0.000248
2050 0.125 1.141 0.00108 0.242 0.0356 0.000247
2051 0.126 1.151 0.00109 0.244 0.0359 0.000249
2052 0.127 1.160 0.00110 0.246 0.0362 0.000251
2053 0.128 1.170 0.00111 0.248 0.0365 0.000254
2054 0.130 1.179 0.00112 0.250 0.0368 0.000256
2055 0.131 1.189 0.00113 0.252 0.0371 0.000258
2056 0.132 1.198 0.00114 0.254 0.0374 0.000260
2057 0.133 1.208 0.00115 0.256 0.0377 0.000262
2058 0.125 1.136 0.00108 0.241 0.0355 0.000247
2059 0.117 1.064 0.00101 0.225 0.0333 0.000231
2060 0.109 0.992 0.00094 0.210 0.0310 0.000216
2061 0.101 0.919 0.00088 0.195 0.0288 0.000200
2062 0.093 0.846 0.00081 0.179 0.0266 0.000185
2063 0.085 0.773 0.00074 0.164 0.0243 0.000169

13-7
CO2
CH4 N2O SO2
Emissions (million NOX (‘000 Hg
(‘000 (‘000 (‘000
Year metric tons) (tons)
tons) tons) tons)
tons)
2064 0.077 0.700 0.00067 0.148 0.0221 0.000153
2065 0.069 0.626 0.00060 0.133 0.0198 0.000137
2066 0.061 0.552 0.00053 0.117 0.0175 0.000121
2067 0.053 0.477 0.00046 0.101 0.0152 0.000105
2068 0.045 0.403 0.00039 0.085 0.0129 0.000089
2069 0.037 0.331 0.00032 0.070 0.0106 0.000074
2070 0.029 0.261 0.00025 0.055 0.0084 0.000059
2071 0.022 0.196 0.00019 0.041 0.0064 0.000044
2072 0.015 0.138 0.00014 0.029 0.0045 0.000031
2073 0.010 0.090 0.00009 0.019 0.0029 0.000020
2074 0.006 0.052 0.00005 0.011 0.0017 0.000012
2075 0.003 0.026 0.00003 0.006 0.0009 0.000006
Cumulative 3.99 34.7 0.037 7.61 1.15 0.008
Note: While emissions extend to 2081, values after 2075 are very low and, therefore, not listed here.

13-8
REFERENCES

1. Coughlin, K. Utility Sector Impacts of Reduced Electricity Demand. 2014. Lawrence


Berkeley National Laboratory: Berkeley, CA. Report No. LBNL-6864E. (Last accessed
May 1, 2023.) https://www.osti.gov/biblio/1165372.

2. Coughlin, K. Utility Sector Impacts of Reduced Electricity Demand: Updates to


Methodology and Results. 2019. Lawrence Berkeley National Laboratory: Berkeley, CA.
Report No. LBNL-2001256. (Last accessed May 1, 2023.)
https://www.osti.gov/biblio/1580427.

3. U.S. Department of Energy–Energy Information Administration. Annual Energy Outlook


2023 with Projections to 2050. 2023. (Last accessed May 1, 2023.)
https://www.eia.gov/outlooks/aeo/.

4. U.S. Environmental Protection Agency. AP-42: Compilation of Air Pollutant Emissions


Factors. 1998. Washington, D.C. (Last accessed May 1, 2023.) https://www.epa.gov/air-
emissions-factors-and-quantification/ap-42-fifth-edition-volume-i-chapter-1-external-0.

5. Coughlin, K. Projections of Full-Fuel-Cycle Energy and Emissions Metrics. 2013.


Lawrence Berkeley National Laboratory: Berkeley, CA. Report No. LBNL-6025E. (Last
accessed May 1, 2023.) https://eta-
publications.lbl.gov/sites/default/files/lbnl6025e_ffc.pdf.

13-9
CHAPTER 14. MONETIZATION OF EMISSIONS REDUCTION BENEFITS

TABLE OF CONTENTS

14.1 INTRODUCTION ......................................................................................................... 14-1


14.2 MONETIZING AVOIDED GREENHOUSE GAS EMISSIONS ................................ 14-1
14.2.1 Social Cost of Carbon .................................................................................................... 14-5
14.2.2 Social Cost of Methane and Nitrous Oxide ................................................................... 14-6
14.3 VALUATION OF OTHER EMISSIONS REDUCTIONS ........................................... 14-7
14.4 ESTIMATED BENEFITS ............................................................................................. 14-8
14.4.1 Benefits for Considered TSLs ........................................................................................ 14-8
14.4.2 Annual and Cumulative Benefits for Selected Standards (TSL 1) .............................. 14-10
REFERENCES ........................................................................................................................ 14-19

LIST OF TABLES

Table 14.2.1 Annual SC-CO2 Value Based on 2021 Interagency Update and 2021
EPA Analysis, 2020–2070 (2020 dollars per metric ton)* .......................... 14-6
Table 14.2.2 Annual SC-CH4 and SC-N2O Values Based on 2021 Interagency
Update and 2021 EPA Analysis, 2020–2070 (2020$ per metric ton)* ........ 14-7
Table 14.3.1 Summary of the Total Dollar Value per Ton of Directly Emitted PM 2.5
Precursor Reduced from Area Sources (2015$) .......................................... 14-8
Table 14.4.1 Present Social Value of Cumulative CO2 Emissions Reduction from
Potential Standards for Consumer Conventional Cooking Products ........... 14-9
Table 14.4.2 Present Social Value of Cumulative Methane Emissions Reduction
from Potential Standards for Consumer Conventional Cooking
Products........................................................................................................ 14-9
Table 14.4.3 Present Social Value of Cumulative Nitrous Oxide Emissions
Reduction from Potential Standards for Consumer Conventional
Cooking Products ......................................................................................... 14-9
Table 14.4.4 Present Social Value of Cumulative NOX and SO2 Emissions
Reduction from Potential Standards for Consumer Conventional
Cooking Products ....................................................................................... 14-10
Table 14.4.5 Climate Benefits from GHG Emissions Reduction (CO2, CH4, and
N2O) at Selected Standards (TSL 1) for Consumer Conventional
Cooking Products (million 2022$)............................................................. 14-11
Table 14.4.6 Climate Benefits from Changes in CO2 Emissions from Selected
Standards (TSL 1) for Consumer Conventional Cooking Products
(million 2022$) .......................................................................................... 14-12
Table 14.4.7 Climate Benefits from Changes in Methane Emissions from Selected
Standards (TSL 1) for Consumer Conventional Cooking Products
(million 2022$) .......................................................................................... 14-13
Table 14.4.8 Climate Benefits from Changes in N2O Emissions from Selected
Standards (TSL 1) for Consumer Conventional Cooking Products
(million 2022$) .......................................................................................... 14-15

14-i
Table 14.4.9 Health Benefits from Changes in NOx and SO2 Emissions from
Selected Standards (TSL 1) for Consumer Conventional Cooking
Products (million 2022$) ........................................................................... 14-17

14-ii
CHAPTER 14. MONETIZATION OF EMISSIONS REDUCTION BENEFITS

14.1 INTRODUCTION
As part of its assessment of energy conservation standards for consumer conventional
cooking products, the U.S. Department of Energy (DOE) considered the estimated monetary
benefits likely to result from the reduced emissions of carbon dioxide (CO2), methane (CH4),
nitrous oxide (N2O), sulfur dioxide (SO2), and nitrogen oxides (NOx) that are expected to result
from each of the potential standard levels considered. This chapter summarizes the basis for the
benefit-per-ton values used for each of these emissions and presents the estimated total benefits
for each TSL.

14.2 MONETIZING AVOIDED GREENHOUSE GAS EMISSIONS


DOE estimates the monetized benefits of the reductions in greenhouse gas (GHG)
emissions of CO2, CH4, and N2O by using a measure of the social cost (SC) of each pollutant
(e.g., SC-CO2). These estimates represent the monetary value of the net harm to society
associated with a marginal increase in emissions of these pollutants in a given year, or the benefit
of avoiding that increase. These estimates are intended to include (but are not limited to) climate-
change-related changes in net agricultural productivity, human health, property damages from
increased flood risk, disruption of energy systems, risk of conflict, environmental migration, and
the value of ecosystem services. DOE exercises its own judgment in presenting monetized
climate benefits as recommended by applicable Executive Orders, and DOE would reach the
same conclusion presented in the final rule in the absence of the social cost of greenhouse gases,
including the February 2021 interim estimates presented by the Interagency Working Group on
the Social Cost of Greenhouse Gases.

DOE estimated the global social benefits of CO2, CH4, and N2O reductions using SC-
GHG values that were based on the interim values presented in the Technical Support Document:
Social Cost of Carbon, Methane, and Nitrous Oxide Interim Estimates under Executive Order
(EO) 13990, published in February 2021 by the Interagency Working Group on the Social Cost
of Greenhouse Gases (IWG).1 The SC-GHG is the monetary value of the net harm to society
associated with a marginal increase in emissions in a given year, or the benefit of avoiding that
increase. In principle, SC-GHGs includes the value of all climate change impacts, including (but
not limited to) changes in net agricultural productivity, human health effects, property damage
from increased flood risk and natural disasters, disruption of energy systems, risk of conflict,
environmental migration, and the value of ecosystem services. The SC-GHGs therefore, reflects
the societal value of reducing emissions of the gas in question by one metric ton. The SC-GHGs
is the theoretically appropriate value to use in conducting benefit-cost analyses of policies that
affect CO2, N2O, and CH4 emissions. As a member of the IWG involved in the development of
the February 2021 SC-GHG TSD, DOE agrees that the interim SC-GHG estimates represent the
most appropriate estimate of the SC-GHG until revised estimates have been developed reflecting
the latest peer-reviewed science.

The SC-GHG estimates presented here were developed over many years, using
transparent process, peer-reviewed methodologies, the best science available at the time of that

14-1
process, and with input from the public. Specifically, in 2009, an IWG that included the DOE
and other executive branch agencies and offices was established to ensure that agencies were
using the best available science and to promote consistency in the social cost of carbon (SC-CO2)
values used across agencies. The IWG published SC-CO2 estimates in 2010 that were developed
from an ensemble of three widely cited integrated assessment models (IAMs) that estimate
global climate damages using highly aggregated representations of climate processes and the
global economy combined into a single modeling framework. The three IAMs were run using a
common set of input assumptions in each model for future population, economic, and CO 2
emissions growth, as well as equilibrium climate sensitivity – a measure of the globally averaged
temperature response to increased atmospheric CO2 concentrations. These estimates were
updated in 2013 based on new versions of each IAM. In August 2016 the IWG published
estimates of the social cost of methane (SC-CH4) and nitrous oxide (SC-N2O) using
methodologies that are consistent with the methodology underlying the SC-CO2 estimates. The
modeling approach that extends the IWG SC-CO2 methodology to non-CO2 GHGs has
undergone multiple stages of peer review. The SC-CH4 and SC-N2O estimates were developed
by Marten et al. (2015) and underwent a standard double-blind peer review process prior to
journal publication.2

In 2015, as part of the response to public comments received to a 2013 solicitation for
comments on the SC-CO2 estimates, the IWG announced a National Academies of Sciences,
Engineering, and Medicine review of the SC-CO2 estimates to offer advice on how to approach
future updates to ensure that the estimates continue to reflect the best available science and
methodologies. In January 2017, the National Academies released their final report, Valuing
Climate Damages: Updating Estimation of the Social Cost of Carbon Dioxide, and recommended
specific criteria for future updates to the SC-CO2 estimates, a modeling framework to satisfy the
specified criteria, and both near-term updates and longer-term research needs pertaining to
various components of the estimation process.3 Shortly thereafter, in March 2017, President
Trump issued Executive Order 13783, which disbanded the IWG, withdrew the previous TSDs,
and directed agencies to ensure SC-CO2 estimates used in regulatory analyses are consistent with
the guidance contained in OMB’s Circular A-4, “including with respect to the consideration of
domestic versus international impacts and the consideration of appropriate discount rates” (EO
13783, Section 5(c)). Benefit-cost analyses following E.O. 13783 used SC-GHG estimates that
attempted to focus on the U.S.-specific share of climate change damages as estimated by the
models and were calculated using two discount rates recommended by Circular A-4, 3 percent
and 7 percent. All other methodological decisions and model versions used in SC-GHG
calculations remained the same as those used by the IWG in 2010 and 2013, respectively.

On January 20, 2021, President Biden issued Executive Order 13990, which re-
established the IWG and directed it to ensure that the U.S. Government’s estimates of the social
cost of carbon and other greenhouse gases reflect the best available science and the 2017
recommendations of the National Academies. The IWG was tasked with first reviewing the SC-
GHG estimates currently used in Federal analyses and publishing interim estimates within 30
days of the EO that reflect the full impact of GHG emissions, including by taking global
damages into account. The interim SC-GHG estimates published in February 2021 are used here
to estimate the climate benefits for this rulemaking. The EO instructs the IWG to undertake a
fuller update of the SC-GHG estimates that takes into consideration the advice of the National
Academies (2017) and other recent scientific literature.

14-2
The February 2021 SC-GHG TSD provides a complete discussion of the IWG’s initial
review conducted under EO 13990. In particular, the IWG found that the SC-GHG estimates
used under EO 13783 fail to reflect the full impact of GHG emissions in multiple ways. First, the
IWG found that the SC-GHG estimates used under E.O. 13783 fail to fully capture many climate
impacts that affect the welfare of U.S. citizens and residents, and those impacts are better
reflected by global measures of the SC-GHG. Examples of omitted effects from the EO 13783
estimates include direct effects on U.S. citizens, assets, and investments located abroad, supply
chains, U.S. military assets and interests abroad, and tourism, and spillover pathways such as
economic and political destabilization and global migration that can lead to adverse impacts on
U.S. national security, public health, and humanitarian concern. In addition, assessing the
benefits of U.S. GHG mitigation activities requires consideration of how those actions may
affect mitigation activities by other countries, as those international mitigation actions will
provide a benefit to U.S. citizens and residents by mitigating climate impacts that affect U.S.
citizens and residents. A wide range of scientific and economic experts have emphasized the
issue of reciprocity as support for considering global damages of GHG emissions. If the United
States does not consider impacts on other countries, it is difficult to convince other countries to
consider the impacts of their emissions on the United States. The only way to achieve an
efficient allocation of resources for emissions reduction on a global basis—and so benefit the
U.S. and its citizens—is for all countries to base their policies on global estimates of damages.
As a member of the IWG involved in the development of the February 2021 SC-GHG TSD,
DOE agrees with this assessment and, therefore, in this proposed rule DOE centers attention on a
global measure of SC-GHG. This approach is the same as that taken in DOE regulatory analyses
from 2012 through 2016. A robust estimate of climate damages that accrue only to U.S. citizens
and residents does not currently exist in the literature. As explained in the February 2021 TSD,
existing estimates are both incomplete and an underestimate of total damages that accrue to the
citizens and residents of the U.S. because they do not fully capture the regional interactions and
spillovers discussed above, nor do they include all of the important physical, ecological, and
economic impacts of climate change recognized in the climate change literature. As noted in the
February 2021 SC–GHG TSD, the IWG will continue to review developments in the literature,
including more robust methodologies for estimating a U.S.-specific SC–GHG value, and explore
ways to better inform the public of the full range of carbon impacts. As a member of the IWG,
DOE will continue to follow developments in the literature pertaining to this issue.

Second, the IWG found that the use of the social rate of return on capital (7 percent under
current OMB Circular A-4 guidance) to discount the future benefits of reducing GHG emissions
inappropriately underestimates the impacts of climate change for the purposes of estimating the
SC-GHG. Consistent with the findings of the National Academies (2017) and the economic
literature, the IWG continued to conclude that the consumption rate of interest is the theoretically
appropriate discount rate in an intergenerational context, and recommended that discount rate
uncertainty and relevant aspects of intergenerational ethical considerations be accounted for in
selecting future discount rates.4,5,6,7Furthermore, the damage estimates developed for use in the
SC-GHG are estimated in consumption-equivalent terms, and so an application of OMB Circular
A-4's guidance for regulatory analysis would then use the consumption discount rate to calculate
the SC-GHG. DOE agrees with this assessment and will continue to follow developments in the
literature pertaining to this issue. DOE also notes that while OMB Circular A-4, as published in
2003, recommends using 3% and 7% discount rates as "default" values, Circular A-4 also
reminds agencies that "different regulations may call for different emphases in the analysis,
14-3
depending on the nature and complexity of the regulatory issues and the sensitivity of the benefit
and cost estimates to the key assumptions." On discounting, Circular A-4 recognizes that
"special ethical considerations arise when comparing benefits and costs across generations," and
Circular A-4 acknowledges that analyses may appropriately "discount future costs and
consumption benefits…at a lower rate than for intragenerational analysis." In the 2015 Response
to Comments on the Social Cost of Carbon for Regulatory Impact Analysis, OMB, DOE, and the
other IWG members recognized that "Circular A-4 is a living document" and "the use of 7
percent is not considered appropriate for intergenerational discounting. There is wide support for
this view in the academic literature, and it is recognized in Circular A-4 itself." Thus, DOE
concludes that a 7% discount rate is not appropriate to apply to value the social cost of
greenhouse gases in the analysis presented in this analysis. In this analysis, to calculate the
present and annualized values of climate benefits, DOE uses the same discount rate as the rate
used to discount the value of damages from future GHG emissions, for internal consistency. That
approach to discounting follows the same approach that the February 2021 TSD recommends "to
ensure internal consistency—i.e., future damages from climate change using the SC-GHG at 2.5
percent should be discounted to the base year of the analysis using the same 2.5 percent rate."
DOE has also consulted the National Academies' 2017 recommendations on how SC-GHG
estimates can "be combined in RIAs with other cost and benefits estimates that may use different
discount rates." The National Academies reviewed "several options," including "presenting all
discount rate combinations of other costs and benefits with [SC-GHG] estimates."

As a member of the IWG involved in the development of the February 2021 SC-GHG
TSD, DOE agrees with this assessment and will continue to follow developments in the literature
pertaining to this issue.

While the IWG works to assess how best to incorporate the latest, peer reviewed science
to develop an updated set of SC-GHG estimates, it set the interim estimates to be the most recent
estimates developed by the IWG prior to the group being disbanded in 2017. The estimates rely
on the same models and harmonized inputs and are calculated using a range of discount rates. As
explained in the February 2021 SC-GHG TSD, the IWG has recommended that agencies revert
to the same set of four values drawn from the SC-GHG distributions based on three discount
rates as were used in regulatory analyses between 2010 and 2016 and subject to public comment.
For each discount rate, the IWG combined the distributions across models and socioeconomic
emissions scenarios (applying equal weight to each) and then selected a set of four values
recommended for use in benefit-cost analyses: an average value resulting from the model runs
for each of three discount rates (2.5 percent, 3 percent, and 5 percent), plus a fourth value,
selected as the 95th percentile of estimates based on a 3 percent discount rate. The fourth value
was included to provide information on potentially higher-than-expected economic impacts from
climate change. As explained in the February 2021 SC-GHG TSD, and DOE agrees, this update
reflects the immediate need to have an operational SC-GHG for use in regulatory benefit-cost
analyses and other applications that was developed using a transparent process, peer-reviewed
methodologies, and the science available at the time of that process. Those estimates were
subject to public comment in the context of dozens of proposed rulemakings as well as in a
dedicated public comment period in 2013.

There are a number of limitations and uncertainties associated with the SC-GHG
estimates. First, the current scientific and economic understanding of discounting approaches

14-4
suggests discount rates appropriate for intergenerational analysis in the context of climate change
are likely to be less than 3 percent, near 2 percent or lower.1 Second, the IAMs used to produce
these interim estimates do not include all of the important physical, ecological, and economic
impacts of climate change recognized in the climate change literature and the science underlying
their “damage functions” – i.e., the core parts of the IAMs that map global mean temperature
changes and other physical impacts of climate change into economic (both market and
nonmarket) damages – lags behind the most recent research. For example, limitations include the
incomplete treatment of catastrophic and non-catastrophic impacts in the integrated assessment
models, their incomplete treatment of adaptation and technological change, the incomplete way
in which inter-regional and intersectoral linkages are modeled, uncertainty in the extrapolation of
damages to high temperatures, and inadequate representation of the relationship between the
discount rate and uncertainty in economic growth over long time horizons. Likewise, the
socioeconomic and emissions scenarios used as inputs to the models do not reflect new
information from the last decade of scenario generation or the full range of projections. The
modeling limitations do not all work in the same direction in terms of their influence on the SC-
CO2 estimates. However, as discussed in the February 2021 TSD, the IWG has recommended
that, taken together, the limitations suggest that the interim SC-GHG estimates used in this final
rule likely underestimate the damages from GHG emissions. DOE concurs with this assessment.

DOE's derivations of the SC-GHGs (i.e., SC-CO2, SC-N2O, and SC-CH4) values are
discussed in the following sections.

14.2.1 Social Cost of Carbon


The SC-CO2 values used for DOE’s analysis were generated using the values presented
in the 2021 TSD from the IWG, which end in 2050, and values after 2050 based on modeling
conducted by EPA using the same methods, assumptions, and parameters as were used in
developing the 2020-2050 estimates published by the IWG. a Table 14.2.1 shows the four sets of
SC-CO2 estimates in five-year increments from 2020 to 2070. DOE expects additional climate
benefits to accrue for any longer-life consumer conventional cooking products, but a lack of
available SC-CO2 estimates for emissions years beyond 2070 prevents DOE from monetizing
these additional benefits in this analysis. The case labeled “95th percentile” refers to values in the
95th percentile of simulations. Appendix 14A provides the full set of SC-CO2 estimates. For
purposes of capturing the uncertainties involved in regulatory impact analysis, the interagency
group emphasizes the importance of including all four sets of SC-CO2 values.

a
See “Revised 2023 and Later Model Year Light-Duty Vehicle GHG Emissions Standards: Regulatory Impact
Analysis,” published by EPA in December 2021. Available at: www.epa.gov/system/files/documents/2021-
12/420r21028.pdf.

14-5
Table 14.2.1 Annual SC-CO2 Value Based on 2021 Interagency Update and 2021 EPA
Analysis, 2020–2070 (2020 dollars per metric ton)*
Discount Rate and Statistic
Year 5% 3% 2.5% 3%
th
Average Average Average 95 Percentile
2020 14 51 76 151
2025 17 56 83 169
2030 19 62 89 186
2035 22 67 96 205
2040 25 73 103 224
2045 28 79 109 242
2050 32 84 116 259
2055 35 89 122 265
2060 38 93 128 275
2065 44 100 135 300
2070 49 108 143 326
* For 2020-2050, there are slight differences from the IWG report in a few cases that are likely due to the GDP
deflator used.

DOE multiplied the CO2 emissions reduction estimated for each year by the SC-CO2
value for that year in each of the four cases. To calculate a present value of the stream of
monetary values, DOE discounted the values in each of the four cases using the specific discount
rate that had been used to obtain the SC-CO2 values in each case.

14.2.2 Social Cost of Methane and Nitrous Oxide


The SC-CH4 and SC-N2O values used for the present analysis were generated using the
values presented in the 2021 TSD from the IWG. Table 14.2.2 shows the four sets of SC-CH4
and SC- N2O estimates from the latest interagency update in 5-year increments from 2020 to
2070. For purposes of capturing the uncertainties involved in regulatory impact analysis, the
interagency group emphasizes the importance of including all four sets of SC-CH4 and SC- N2O
values. The full set of annual values is reported in appendix 14A of this TSD.

DOE multiplied the CH4 and N2O emissions reduction estimated for each year by the SC-
CH4 and SC-N2O estimates for that year in each of the cases. To calculate a present value of the
stream of monetary values, DOE discounted the values in each of the cases using the specific
discount rate that had been used to obtain the SC-CH4 and SC-N2O estimates in each case.

14-6
Table 14.2.2 Annual SC-CH4 and SC-N2O Values Based on 2021 Interagency Update and
2021 EPA Analysis, 2020–2070 (2020$ per metric ton)*
SC-CH4 SC-N2O
Discount Rate and Statistic Discount Rate and Statistic
Year 3% 3%
5% 3% 2.5% 5% 3% 2.5 %
95th 95th
Average Average Average Average Average Average
percentile percentile
2020 663 1,480 1,946 3,893 5,760 18,342 27,037 48,090
2025 799 1,714 2,223 4,533 6,766 20,520 29,811 54,108
2030 935 1,948 2,499 5,173 7,772 22,698 32,585 60,125
2035 1,106 2,224 2,817 5,939 9,007 25,149 35,632 66,898
2040 1,277 2,500 3,136 6,705 10,241 27,600 38,678 73,670
2045 1,464 2,778 3,450 7,426 11,687 30,238 41,888 80,766
2050 1,651 3,057 3,763 8,147 13,133 32,875 45,098 87,863
2055 1,772 3,221 3,942 8,332 14,758 35,539 48,236 94,117
2060 1,899 3,395 4,130 8,539 16,424 38,300 51,507 100,845
2065 2,508 4,163 4,960 11,177 19,687 42,625 56,397 115,590
2070 3,130 4,976 5,867 14,079 23,018 47,072 61,428 130,928
* For 2020-2050, there are slight differences from the IWG report in a few cases that are likely due to the GDP
deflator used.

14.3 VALUATION OF OTHER EMISSIONS REDUCTIONS


As noted in chapter 13, new or amended energy conservation standards would reduce
SO2 emissions from electricity generation, and NOx emissions from electricity generation in
those States that are not affected by emissions caps. For each of the considered TSLs, DOE
estimated monetized values of NOx and SO2 emissions reductions from electricity generation
using the latest benefit-per-ton estimates for that sector from the EPA’s Benefits Mapping and
Analysis Program.b DOE used EPA’s values for PM2.5-related benefits associated with NOx and
SO2 and for ozone-related benefits associated with NOx for 2025, 2030, 2035 and 2040,
calculated with discount rates of 3 percent and 7 percent. DOE used linear interpolation to define
values for the years not given in the 2025 to 2040 period; for years beyond 2040 the values are
held constant (rather than extrapolated) to be conservative with the valuation estimate. c

The ozone-related benefits associated with NOx occur only in the ozone-season (May to
September). EPA data indicate that ozone-season NOx emissions from electricity generation are
slightly less than half of all-year NOX emissions. Therefore, DOE only applied a corresponding
benefit-per-ton value to half of the estimated avoided NOx emissions from potential standards. d

b
U.S. Environmental Protection Agency. Estimating the Benefit per Ton of Reducing Directly-Emitted PM2.5,
PM2.5 Precursors and Ozone Precursors from 21 Sectors. https://www.epa.gov/benmap/estimating-benefit-ton-
reducing-directly-emitted-pm25-pm25-precursors-and-ozone-precursors
c
DOE recognizes that there is considerable uncertainty regarding benefit-per-ton values in the period after 2040.
Given that EPA's values increase over time, maintaining the 2040 values rather than extrapolating the trends
represents a conservative approach, and is preferable to not placing any value on avoided emissions after 2040.
d
For the purposes of this analysis, DOE assumes that NOx emissions associated with electricity savings from
consumer conventional cooking products are spread evenly over the year.

14-7
EPA provided estimates of benefit-per-ton of NOX and SO2 emissions reductions in 40
regions of the continental U.S. DOE combined the EPA data with regional information on
electricity consumption and emissions from AEO2023 to estimate weighted-average national
benefit-per-ton values. Appendix 14B provides methodological details and values that DOE
used. DOE multiplied the emissions reduction (in tons) in each year by the associated $/ton
values, and then discounted each series using discount rates of 3 percent and 7 percent as
appropriate.

The considered standards for consumer conventional cooking products also reduce NOx
and SO2 emissions from combustion at the home. The 2023 EPA TSD does not have a category
that would be appropriate to represent houses as an emissions source. To monetize the value of
these emissions reductions, DOE used benefit-per-ton estimates from the Benefits Mapping and
Analysis Program’s 2018 “Technical Support Document Estimating the Benefit per Ton of
Reducing PM2.5 Precursors from 17 Sectors.”8 Although none of the sectors refers specifically to
residential and commercial buildings, the sector called “Area sources” would be a reasonable
proxy for residential and commercial buildings. "Area sources" represents all emission sources
for which states do not have exact (point) locations in their emissions inventories. Because exact
locations would tend to be associated with larger sources, "area sources" would be fairly
representative of small dispersed sources like homes and businesses.

The EPA document provides high and low estimates for 2025 and 2030 at 3 and 7 percent
discount rates (see Table 14.3.1). DOE converted the values to 2022$, and interpolated and
extrapolated values in a similar manner as described above.

Table 14.3.1 Summary of the Total Dollar Value per Ton of Directly Emitted PM2.5
Precursor Reduced from Area Sources (2015$)
Low High
Year of
Emission 3% Discount 7% Discount 3% Discount 7% Discount
Rate Rate Rate Rate
NOX
2025 9,700 8,800 22,000 20,000
2030 11,000 9,500 24,000 21,000
SO2
2025 61,000 55,000 140,000 120,000
2030 67,000 60,000 150,000 140,000

14.4 ESTIMATED BENEFITS

14.4.1 Benefits for Considered TSLs


The tables in this section show the emissions monetization results for each considered
TSL.

14-8
Table 14.4.1 Present Social Value of Cumulative CO2 Emissions Reduction from Potential
Standards for Consumer Conventional Cooking Products
SC-CO2 Case
Discount Rate and Statistic
TSL 5% 3% 2.5% 3%
Average Average Average 95th percentile
million 2022$
1 40.2 172 270 523
2 222 940 1,466 2,853
3 386 1,635 2,550 4,964

Table 14.4.2 Present Social Value of Cumulative Methane Emissions Reduction from
Potential Standards for Consumer Conventional Cooking Products
SC-CH4 Case
Discount Rate and Statistic
TSL 5% 3% 2.5% 3%
Average Average Average 95th Percentile
million 2022$
1 16.1 48.5 67.7 128
2 114 337 468 890
3 178 524 729 1,386

Table 14.4.3 Present Social Value of Cumulative Nitrous Oxide Emissions Reduction from
Potential Standards for Consumer Conventional Cooking Products
SC-N2O Case
Discount Rate and Statistic
TSL 5% 3% 2.5% 3%
Average Average Average 95th Percentile
million 2022$
1 0.143 0.570 0.883 1.52
2 0.392 1.55 2.39 4.12
3 1.00 3.95 6.10 10.5

14-9
Table 14.4.4 Present Social Value of Cumulative NOX and SO2 Emissions Reduction from
Potential Standards for Consumer Conventional Cooking Products
NOX SO2
TSL
7% discount rate 3% discount rate 7% discount rate 3% discount rate
million 2022$ million 2022$
1 134 347 29.2 74.6
2 805 1,999 60.6 149
3 1,368 3,388 191 466

14.4.2 Annual and Cumulative Benefits for Selected Standards (TSL 1)


The tables in this section present climate and health benefits estimated for the selected
standards. The benefits of reduced CO2, CH4, and N2O emissions are collectively referred to as
climate benefits. The benefits of reduced SO2 and NOX emissions are collectively referred to as
health benefits.

The annual values reflect the benefits from reduced emissions in each year. The
associated benefits accrue over very many years in the case of GHG emissions, and over several
years in the case of NOx and SO2 emissions. The time stream of benefits has been discounted to
estimate the benefit-per-ton values for each year, but the total benefits associated with each
emissions year are not discounted in these tables. The cumulative present value does reflect
discounting at the noted discount rates.

14-10
Table 14.4.5 Climate Benefits from GHG Emissions Reduction (CO2, CH4, and N2O) at
Selected Standards (TSL 1) for Consumer Conventional Cooking Products
(million 2022$)
Discount Rate and Statistic
Emissions Year* 5% 3% 2.5% 3% 95th
Average Average Average percentile
2030 0.815 2.38 3.37 7.02
2035 2.30 6.36 8.89 19.0
2040 4.13 10.9 15.1 32.7
2045 5.76 14.5 19.7 43.4
2050 6.38 15.5 20.8 46.0
2055 7.26 16.9 22.7 49.1
2060 6.56 14.9 19.8 42.4
2065 4.99 10.5 13.7 30.5
2070 2.45 4.83 6.22 14.4
Cumulative Present Value** 56.5 222 338 653
Annualized** 4.1 12.0 17.0 35.3
* Annual benefits shown are undiscounted values.
** The cumulative present value and the annualized value are calculated, for internal consistency, using the same
discount rate used to discount the value of damages from future emissions in each SC-GHG case; both include
annual values that extend from the compliance year through 2070. The cumulative present value refers to the present
year (2024) and the annualized value refers to the cumulative present value annualized over the 30-year analysis
period (2028-2057).

14-11
Table 14.4.6 Climate Benefits from Changes in CO2 Emissions from Selected Standards
(TSL 1) for Consumer Conventional Cooking Products (million 2022$)
Discount Rate and Statistic
3%
Emissions Year* 5% 3% 2.5%
95th
Average Average Average
Percentile
2028 0.234 0.76 1.10 2.28
2029 0.429 1.38 2.01 4.17
2030 0.611 1.95 2.82 5.89
2031 0.811 2.56 3.69 7.74
2032 1.02 3.19 4.59 9.66
2033 1.24 3.83 5.50 11.6
2034 1.47 4.49 6.43 13.7
2035 1.71 5.17 7.38 15.8
2036 1.96 5.89 8.38 18.0
2037 2.20 6.55 9.29 20.0
2038 2.45 7.23 10.2 22.2
2039 2.72 7.96 11.2 24.4
2040 2.99 8.68 12.2 26.7
2041 3.27 9.41 13.2 28.9
2042 3.55 10.1 14.2 31.1
2043 3.80 10.7 15.0 32.9
2044 3.96 11.1 15.5 34.0
2045 4.09 11.4 15.8 34.9
2046 4.16 11.5 15.9 35.2
2047 4.25 11.6 16.1 35.6
2048 4.31 11.7 16.2 35.9
2049 4.39 11.8 16.3 36.3
2050 4.44 11.9 16.3 36.5
2051 4.60 12.1 16.7 36.9
2052 4.72 12.3 17.0 37.3
2053 4.85 12.5 17.3 37.8
2054 4.97 12.8 17.6 38.2
2055 5.10 13.0 17.9 38.9
2056 5.23 13.2 18.2 39.5
2057 5.36 13.5 18.5 40.1
2058 5.13 12.8 17.6 38.0
2059 4.88 12.1 16.6 35.9
2060 4.62 11.4 15.6 33.7
2061 4.42 10.8 14.7 31.8
2062 4.19 10.1 13.7 29.8
2063 3.95 9.34 12.6 27.8
2064 3.67 8.57 11.6 25.6
2065 3.38 7.78 10.5 23.3
2066 3.06 6.96 9.35 20.9

14-12
Discount Rate and Statistic
3%
Emissions Year* 5% 3% 2.5%
95th
Average Average Average
Percentile
2067 2.72 6.11 8.19 18.4
2068 2.36 5.24 7.01 15.8
2069 1.99 4.36 5.82 13.2
2070 1.61 3.49 4.65 10.6
Cumulative Present Value** 40.2 172 270 523
Annualized** 2.89 9.34 13.5 28.3
* Annual benefits shown are undiscounted values.
** The cumulative present value and the annualized value are calculated, for internal consistency, using the same
discount rate used to discount the value of damages from future emissions in each SC-GHG case; both include
annual values that extend from the compliance year through 2070. The cumulative present value refers to the present
year (2024) and the annualized value refers to the cumulative present value annualized over the 30-year analysis
period (2028-2057).

Table 14.4.7 Climate Benefits from Changes in Methane Emissions from Selected
Standards (TSL 1) for Consumer Conventional Cooking Products (million
2022$)
Discount Rate and Statistic
3%
Emissions Year* 5% 3% 2.5%
95th
Average Average Average
Percentile
2028 0.069 0.146 0.188 0.386
2029 0.136 0.285 0.366 0.756
2030 0.201 0.419 0.538 1.11
2031 0.269 0.556 0.711 1.48
2032 0.340 0.697 0.889 1.86
2033 0.417 0.849 1.08 2.26
2034 0.495 1.00 1.27 2.67
2035 0.581 1.17 1.48 3.12
2036 0.675 1.35 1.71 3.61
2037 0.778 1.55 1.95 4.14
2038 0.893 1.76 2.22 4.73
2039 1.01 1.98 2.49 5.31
2040 1.13 2.22 2.78 5.95
2041 1.25 2.44 3.05 6.54
2042 1.38 2.66 3.32 7.12
2043 1.48 2.85 3.55 7.62
2044 1.57 3.00 3.73 8.02
2045 1.65 3.14 3.89 8.38
2046 1.71 3.22 4.00 8.61
2047 1.76 3.31 4.09 8.83
2048 1.82 3.40 4.20 9.07
2049 1.87 3.48 4.29 9.28
2050 1.92 3.56 4.38 9.48

14-13
Discount Rate and Statistic
3%
Emissions Year* 5% 3% 2.5%
95th
Average Average Average
Percentile
2051 1.97 3.63 4.46 9.61
2052 2.01 3.70 4.54 9.73
2053 2.06 3.76 4.62 9.85
2054 2.10 3.83 4.69 9.97
2055 2.15 3.90 4.77 10.1
2056 2.19 3.98 4.86 10.2
2057 2.24 4.05 4.94 10.4
2058 2.14 3.85 4.69 9.79
2059 2.03 3.64 4.44 9.21
2060 1.92 3.43 4.17 8.63
2061 1.89 3.32 4.02 8.49
2062 1.85 3.19 3.85 8.27
2063 1.78 3.04 3.65 7.98
2064 1.70 2.86 3.42 7.60
2065 1.60 2.66 3.16 7.13
2066 1.48 2.43 2.89 6.61
2067 1.34 2.18 2.59 6.00
2068 1.18 1.91 2.26 5.31
2069 1.01 1.62 1.92 4.55
2070 0.832 1.32 1.56 3.74
Cumulative Present Value** 16.1 48.5 67.7 128
Annualized** 1.16 2.62 3.40 6.94
* Annual benefits shown are undiscounted values.
** The cumulative present value and the annualized value are calculated, for internal consistency, using the same
discount rate used to discount the value of damages from future emissions in each SC-GHG case; both include
annual values that extend from the compliance year through 2070. The cumulative present value refers to the present
year (2024) and the annualized value refers to the cumulative present value annualized over the 30-year analysis
period (2028-2057).

14-14
Table 14.4.8 Climate Benefits from Changes in N2O Emissions from Selected Standards
(TSL 1) for Consumer Conventional Cooking Products (million 2022$)
Discount Rate and Statistic
3%
Emissions Year* 5% 3% 2.5%
95th
Average Average Average
Percentile
2028 0.001 0.003 0.004 0.007
2029 0.002 0.005 0.007 0.013
2030 0.002 0.007 0.009 0.017
2031 0.003 0.009 0.012 0.023
2032 0.004 0.011 0.016 0.029
2033 0.005 0.014 0.019 0.036
2034 0.006 0.016 0.023 0.043
2035 0.007 0.019 0.027 0.050
2036 0.008 0.021 0.030 0.057
2037 0.009 0.024 0.034 0.063
2038 0.009 0.026 0.036 0.069
2039 0.010 0.028 0.039 0.074
2040 0.011 0.030 0.042 0.079
2041 0.012 0.032 0.045 0.086
2042 0.013 0.035 0.048 0.092
2043 0.014 0.036 0.051 0.097
2044 0.014 0.037 0.051 0.098
2045 0.014 0.037 0.051 0.099
2046 0.014 0.037 0.051 0.099
2047 0.015 0.037 0.051 0.099
2048 0.014 0.037 0.050 0.098
2049 0.015 0.037 0.051 0.099
2050 0.015 0.036 0.050 0.097
2051 0.015 0.037 0.051 0.099
2052 0.015 0.038 0.052 0.101
2053 0.016 0.039 0.053 0.103
2054 0.016 0.040 0.054 0.106
2055 0.017 0.041 0.056 0.108
2056 0.018 0.042 0.057 0.111
2057 0.018 0.043 0.058 0.113
2058 0.017 0.041 0.055 0.108
2059 0.017 0.039 0.052 0.103
2060 0.016 0.037 0.050 0.097
2061 0.015 0.035 0.047 0.093
2062 0.015 0.033 0.044 0.088
2063 0.014 0.031 0.041 0.083
2064 0.013 0.029 0.038 0.077
2065 0.012 0.026 0.035 0.071
2066 0.011 0.024 0.031 0.064

14-15
Discount Rate and Statistic
3%
Emissions Year* 5% 3% 2.5%
95th
Average Average Average
Percentile
2067 0.010 0.021 0.027 0.057
2068 0.009 0.018 0.024 0.050
2069 0.007 0.015 0.020 0.042
2070 0.006 0.012 0.016 0.034
Cumulative Present Value** 0.143 0.570 0.883 1.52
Annualized** 0.010 0.031 0.044 0.082
* Annual benefits shown are undiscounted values.
** The cumulative present value and the annualized value are calculated, for internal consistency, using the same
discount rate used to discount the value of damages from future emissions in each SC-GHG case; both include
annual values that extend from the compliance year through 2070. The cumulative present value refers to the present
year (2024) and the annualized value refers to the cumulative present value annualized over the 30-year analysis
period (2028-2057).

14-16
Table 14.4.9 Health Benefits from Changes in NOx and SO2 Emissions from Selected
Standards (TSL 1) for Consumer Conventional Cooking Products (million
2022$)
Emissions Year* NOx (as PM2.5 and Ozone) SO2

Discount Rate 7% 3% 7% 3%
2028 1.16 1.30 0.314 0.350
2029 2.31 2.58 0.549 0.611
2030 3.47 3.87 0.778 0.866
2031 4.58 5.12 1.05 1.17
2032 5.73 6.39 1.34 1.49
2033 6.97 7.78 1.68 1.87
2034 8.13 9.06 2.00 2.23
2035 9.42 10.5 2.36 2.62
2036 10.8 12.1 2.64 2.94
2037 12.4 13.8 2.94 3.27
2038 14.4 16.0 3.21 3.57
2039 16.0 17.8 3.46 3.84
2040 17.6 19.6 3.74 4.15
2041 18.9 21.0 3.95 4.39
2042 20.1 22.4 4.16 4.62
2043 21.1 23.5 4.30 4.78
2044 21.6 24.1 4.33 4.82
2045 21.8 24.4 4.42 4.91
2046 21.9 24.5 4.41 4.90
2047 21.8 24.4 4.46 4.95
2048 21.9 24.4 4.39 4.88
2049 21.6 24.1 4.56 5.07
2050 21.2 23.6 4.53 5.03
2051 21.3 23.8 4.57 5.08
2052 21.5 24.0 4.60 5.12
2053 21.7 24.2 4.64 5.16
2054 21.9 24.4 4.68 5.20
2055 22.0 24.6 4.72 5.25
2056 22.2 24.8 4.76 5.29
2057 22.4 25.0 4.80 5.33
2058 21.1 23.5 4.51 5.02
2059 19.7 22.0 4.23 4.70
2060 18.4 20.5 3.95 4.39
2061 17.1 19.0 3.66 4.07
2062 15.7 17.5 3.38 3.76
2063 14.4 16.0 3.09 3.44
2064 13.0 14.5 2.81 3.12
2065 11.6 13.0 2.52 2.80
14-17
Emissions Year* NOx (as PM2.5 and Ozone) SO2

Discount Rate 7% 3% 7% 3%
2066 10.3 11.4 2.22 2.47
2067 8.88 9.91 1.93 2.15
2068 7.51 8.38 1.64 1.82
2069 6.17 6.88 1.35 1.50
2070 4.87 5.43 1.07 1.19
2071 3.67 4.09 0.809 0.900
2072 2.59 2.88 0.574 0.638
2073 1.68 1.87 0.375 0.416
2074 0.978 1.09 0.219 0.244
2075 0.494 0.551 0.111 0.123
Cumulative Present Value** 134 347 29.2 74.6
Annualized** 12.4 18.8 2.70 4.04
* Annual benefits shown are undiscounted values.
** The cumulative present value and the annualized value are calculated using the discount rate indicated on top of
each column, and both include annual values that extend from the compliance year through the year corresponding
to the end of the life of units shipped in the last year of the analysis period. The cumulative present value refers to
the present year (2024) and the annualized value refers to the cumulative present value annualized over the 30-year
analysis period (2028-2057). While emissions extend through 2081, the monetized health benefits after 2075 are
very low and, therefore, not listed here.

14-18
REFERENCES
1. Interagency Working Group on Social Cost of Greenhouse Gasses, United States
Government. Technical Support Document: Social Cost of Carbon, Methane, and Nitrous
Oxide Interim Estimates under Executive Order 13990. February 2021. (Last accessed
January 18, 2022.) https://www.whitehouse.gov/wp-
content/uploads/2021/02/TechnicalSupportDocument_SocialCostofCarbonMethaneNitro
usOxide.pdf.

2. Marten, A. L., E. A. Kopits, C. W. Griffiths, S. C. Newbold, and A. Wolverton.


Incremental CH4 and N2O mitigation benefits consistent with the US Government’s SC-
CO2 estimates. Climate Policy. 2015. 15(2): pp. 272–298.

3. National Academies of Sciences, Engineering, and Medicine. Valuing Climate Damages:


Updating Estimation of the Social Cost of Carbon Dioxide. 2017. The National
Academies Press: Washington, DC. (Last accessed September 28, 2021.)
https://www.nap.edu/catalog/24651/valuing-climate-damages-updating-estimation-of-
the-social-cost-of.

4. Interagency Working Group on Social Cost of Carbon. Social Cost of Carbon for
Regulatory Impact Analysis under Executive Order 12866. 2010. United States
Government. (Last accessed April 15, 2022.)
https://www.epa.gov/sites/default/files/2016-12/documents/scc_tsd_2010.pdf.

5. Interagency Working Group on Social Cost of Carbon. Technical Update of the Social
Cost of Carbon for Regulatory Impact Analysis Under Executive Order 12866. 2013.
(Last accessed April 15, 2022.)
https://www.federalregister.gov/documents/2013/11/26/2013-28242/technical-support-
document-technical-update-of-the-social-cost-of-carbon-for-regulatory-impact.

6. Interagency Working Group on Social Cost of Greenhouse Gases, United States


Government. Technical Support Document: Technical Update on the Social Cost of
Carbon for Regulatory Impact Analysis-Under Executive Order 12866. August 2016.
(Last accessed January 18, 2022.) https://www.epa.gov/sites/default/files/2016-
12/documents/sc_co2_tsd_august_2016.pdf.

7. Interagency Working Group on Social Cost of Greenhouse Gases, United States


Government. Addendum to Technical Support Document on Social Cost of Carbon for
Regulatory Impact Analysis under Executive Order 12866: Application of the
Methodology to Estimate the Social Cost of Methane and the Social Cost of Nitrous
Oxide. August 2016. (Last accessed January 18, 2022.)
https://www.epa.gov/sites/default/files/2016-12/documents/addendum_to_sc-
ghg_tsd_august_2016.pdf.

8. U.S. Environmental Protection Agency. Estimating the Benefit per Ton of Reducing
PM2.5 Precursors from 17 Sectors. 2018. (Last accessed February 1, 2022.)
https://www.epa.gov/benmap/estimating-benefit-ton-reducing-pm25-precursors-17-
sectors.

14-19
CHAPTER 15. UTILITY IMPACT ANALYSIS

TABLE OF CONTENTS

15.1 INTRODUCTION ......................................................................................................... 15-1


15.2 ELECTRIC UTILITIES................................................................................................. 15-1
15.2.1
Methodology .................................................................................................................. 15-1
15.2.2
Utility Impact Results .................................................................................................... 15-2
15.2.2.1 Installed Capacity .......................................................................................... 15-2
15.2.2.2 Electricity Generation ................................................................................... 15-5
15.2.2.3 Results Summary .......................................................................................... 15-7
15.3 GAS UTILITIES ............................................................................................................ 15-8
REFERENCES ........................................................................................................................ 15-10

LIST OF TABLES

Table 15.2.1 Consumer Conventional Cooking Products: Summary of Electric


Utility Impact Results .................................................................................. 15-8

LIST OF FIGURES

Figure 15.2.1 Consumer Conventional Cooking Products: Total Electric Capacity


Reduction ..................................................................................................... 15-3
Figure 15.2.2 Consumer Conventional Cooking Products: Coal Capacity Reduction ...... 15-3
Figure 15.2.3 Consumer Conventional Cooking Products: Gas Combined Cycle
Capacity Reduction ...................................................................................... 15-4
Figure 15.2.4 Consumer Conventional Cooking Products: Peaking Capacity
Reduction ..................................................................................................... 15-4
Figure 15.2.5 Consumer Conventional Cooking Products: Renewables Capacity
Reduction ..................................................................................................... 15-5
Figure 15.2.6 Consumer Conventional Cooking Products: Total Generation
Reduction ..................................................................................................... 15-5
Figure 15.2.7 Consumer Conventional Cooking Products: Coal Generation
Reduction ..................................................................................................... 15-6
Figure 15.2.8 Consumer Conventional Cooking Products: Gas Combined Cycle
Generation Reduction .................................................................................. 15-6
Figure 15.2.9 Consumer Conventional Cooking Products: Oil Generation Reduction ..... 15-7
Figure 15.2.10 Consumer Conventional Cooking Products: Renewables Generation
Reduction ..................................................................................................... 15-7
Figure 15.3.1 Consumer Conventional Cooking Products: Total Reduction in Natural
Gas Delivered to Consumers ....................................................................... 15-9

15-i
CHAPTER 15. UTILITY IMPACT ANALYSIS

15.1 INTRODUCTION
In the utility impact analysis, the U.S. Department of Energy (DOE) analyzes several
aggregate impacts on electric and gas utilities that DOE projects would result for each trial
standard level (TSL).

15.2 ELECTRIC UTILITIES


The electric utility impact analysis is based on output of the DOE/Energy Information
Administration (EIA)’s National Energy Modeling System (NEMS).a NEMS is a public domain,
multi-sectored, partial equilibrium model of the U.S. energy sector. Each year, DOE/EIA uses
NEMS to produce an energy forecast for the United States, the Annual Energy Outlook (AEO).
The EIA publishes a Reference case, which incorporates all existing energy-related policies at
the time of publication, and a variety of side cases which analyze the impact of different policies,
energy price and market trends. The current analysis is based on results published for the AEO
2023.2

DOE’s AEO-based methodology has a number of advantages:

• The assumptions used in the AEO reference case and side cases are fully documented and
receive detailed public scrutiny.
• NEMS is updated each year, with each edition of the AEO, to reflect changes in energy
prices, supply trends, regulations, etc.
• The comprehensiveness of NEMS permits the modeling of interactions among the
various energy supply and demand sectors.
• Using EIA published reference and side cases to estimate the utility impacts enhances the
transparency of DOE’s analysis.
The details of the methodology vary based on the number and type of side cases
published with each edition of the AEO. The approach adopted for this analysis is described in
appendix 15A. A more detailed discussion of the general approach is presented in K. Coughlin,
“Utility Sector Impacts of Reduced Electricity Demand.”3,4

This chapter presents the results for consumer conventional cooking products.

15.2.1 Methodology
DOE estimates the marginal impacts of reduction in energy demand on the energy supply
sector. In principle, marginal values should provide a better estimate of the actual impact of

a
For more information on NEMS, refer to the U.S. Department of Energy, Energy Information Administration
documentation. A useful summary is National Energy Modeling System: An Overview.1

15-1
energy conservation standards. DOE represents these marginal impacts using time series of
impact factors.

The impact factors are calculated based on output from NEMS for AEO 2023. NEMS
uses predicted growth in demand for each end use to build up a projection of the total electric
system load growth. The system load shapes are converted internally to load duration curves,
which are then used to estimate the most cost-effective additions to capacity. When electricity
demand deviates from the AEO reference case, in general there are three inter-related effects: the
annual generation (TWh) from the stock of electric generating capacity changes, the total
generation capacity itself (GW) may change, and the mix of capacity types and technologies may
change. Technology changes lead to a change in the proportion of fuel consumption to electricity
generated (referred to as the heat rate). Each of these effects can vary for different types of end
use. The change in total generating capacity is sensitive to the degree to which the end-use is
peak coincident, while the capacity mix is sensitive to the hourly load shape associated with the
end use. Changes in generation by fuel type lead in turn to changes in total power sector
emissions of SO2, NOx, Hg, and CO2.

DOE defined impact factors describing the change in emissions, installed capacity, and
fuel consumption per unit reduction of site electricity demand. The impact factors vary by sector
and end-use, as well as by year. DOE multiplied the impact factors by the stream of site energy
savings calculated in the NIA (chapter 10) to produce estimates of the utility impacts. The utility
impact factors are presented in appendix 15A. For consumer conventional cooking products
DOE used the impact factors for cooking in homes.

15.2.2 Utility Impact Results

15.2.2.1 Installed Capa,city


The figures in this section show the changes in U.S. electricity installed capacity that
result for each TSL by major plant type for selected years. The changes have been calculated
based on the impact factors for capacity presented in appendix 15A. Units are megawatts of
capacity per gigawatt-hour of site electricity use (MW/GWh). b Note that a negative number
means an increase in capacity under a TSL.

b
These units are identical to GW/TWh.

15-2
Figure 15.2.1 Consumer Conventional Cooking Products: Total Electric Capacity
Reduction

Figure 15.2.2 Consumer Conventional Cooking Products: Coal Capacity Reduction

15-3
Figure 15.2.3 Consumer Conventional Cooking Products: Gas Combined Cycle Capacity
Reduction

Figure 15.2.4 Consumer Conventional Cooking Products: Peaking Capacity Reduction

15-4
Figure 15.2.5 Consumer Conventional Cooking Products: Renewables Capacity Reduction

15.2.2.2 Electricity Generation


The figures in this section show the annual change in electricity generation that result for
each TSL by fuel type. The change by fuel type has been calculated based on factors calculated
as described in appendix 15A.

Figure 15.2.6 Consumer Conventional Cooking Products: Total Generation Reduction

15-5
Figure 15.2.7 Consumer Conventional Cooking Products: Coal Generation Reduction

Figure 15.2.8 Consumer Conventional Cooking Products: Gas Combined Cycle


Generation Reduction

15-6
Figure 15.2.9 Consumer Conventional Cooking Products: Oil Generation Reduction

Figure 15.2.10 Consumer Conventional Cooking Products: Renewables Generation


Reduction

15.2.2.3 Results Summary


Table 15.2.1 presents a summary of the utility impact results for consumer conventional
cooking products.

15-7
Table 15.2.1 Consumer Conventional Cooking Products: Summary of Electric Utility
Impact Results
TSL
1 2 3
Installed Capacity Reduction (MW)
2030 47.0 119 362
2035 138 293 957
2040 230 464 1,511
2045 301 579 1,843
2050 327 622 1,959
Electricity Generation Reduction (GWh)
2030 113 287 874
2035 319 679 2,219
2040 535 1,079 3,517
2045 689 1,323 4,215
2050 733 1,391 4,385

15.3 GAS UTILITIES


The gas utility impact analysis considers the projected effect of potential standards on
aggregate natural gas delivered to consumers in million cubic feet.

Figure 15.3.1 shows the annual change in natural gas delivered to consumers that result
for each TSL. Note that results for TSLs 2 and 3 are the same and, therefore, overlap in the
figure. For reference, total U.S. natural gas delivered to all consumers was 27,440,492 million
cubic feet in 2021.c

c
EIA, Natural Gas Consumption by End Use.
https://www.eia.gov/dnav/ng/ng_cons_sum_a_EPG0_vgt_mmcf_a.htm

15-8
Figure 15.3.1 Consumer Conventional Cooking Products: Total Reduction in Natural Gas
Delivered to Consumers

15-9
REFERENCES

1. U.S. Department of Energy–Energy Information Administration. The National Energy


Modeling System: An Overview 2009. 2009. Report No. DOE/EIA-0581(2009). (Last
accessed September 1, 2022.) http://www.eia.gov/forecasts/archive/0581(2009).pdf.

2. U.S. Department of Energy–Energy Information Administration. Annual Energy Outlook


2023 with Projections to 2050. 2023. (Last accessed May 1, 2023.)
https://www.eia.gov/outlooks/aeo/.

3. Coughlin, K. Utility Sector Impacts of Reduced Electricity Demand. 2014. Lawrence


Berkeley National Laboratory: Berkeley, CA. Report No. LBNL-6864E. (Last accessed
May 1, 2023.) https://www.osti.gov/biblio/1165372.

4. Coughlin, K. Utility Sector Impacts of Reduced Electricity Demand: Updates to


Methodology and Results. 2019. Lawrence Berkeley National Laboratory: Berkeley, CA.
Report No. LBNL-2001256. (Last accessed May 1, 2023.)
https://www.osti.gov/biblio/1580427.

15-10
CHAPTER 16. EMPLOYMENT IMPACT ANALYSIS

TABLE OF CONTENTS

16.1 INTRODUCTION ......................................................................................................... 16-1


16.2 ASSUMPTIONS ............................................................................................................ 16-1
16.3 METHODOLOGY ........................................................................................................ 16-1
16.4 SHORT-TERM RESULTS ............................................................................................ 16-2
16.5 LONG-TERM RESULTS ............................................................................................ 16-3
REFERENCES .......................................................................................................................... 16-4

LIST OF TABLES

Table 16.4.1 Net National Short-term Change in Employment (1000s of Jobs) .................... 16-3

16-i
CHAPTER 16. EMPLOYMENT IMPACT ANALYSIS

16.1 INTRODUCTION

DOE’s employment impact analysis for cooking products is designed to estimate indirect
national job creation or elimination (i.e., not directly associated with manufacturers subject to an
amended standard) resulting from possible standards, due to reallocation of the associated
expenditures for purchasing and operating cooking products. Job increases or decreases reported
in this chapter are separate from the manufacturing sector employment impacts reported in the
manufacturer impact analysis (Chapter 12), and reflect the employment impact of efficiency
standards on all other sectors of the economy.

16.2 ASSUMPTIONS

DOE expects energy conservation standards to decrease energy consumption, and


therefore to reduce energy expenditures. The savings in energy expenditures may be spent on
new investment or not at all. The standards may increase the purchase price of products,
including the retail price plus sales tax, and change installation and maintenance costs.

Using the ImSET input/output econometric model of the U.S. economy, this analysis
estimated the short-term effect of these expenditure impacts on net economic output and
employment. DOE intends this analysis to quantify the indirect employment impacts of these
expenditure changes. It evaluated direct employment impacts at manufacturers’ facilities in the
manufacturer impact analysis (see Chapter 12).

DOE notes that ImSET is not a general equilibrium forecasting model, and understands
the uncertainties involved in projecting employment impacts, especially changes in the later
years of the analysis.1 ImSET does not account for how behavior will both change prices and
respond to changing prices. Instead, ImSET is based on fixed input shares across sectors. As such,
the employment effects predicted by ImSET would over-estimate the magnitude of actual job
impacts over the long run for this rule. Since input/output models do not allow prices to bring
markets into equilibrium, they are best used for short-run analysis. DOE therefore includes a
qualitative discussion of how labor markets are likely to respond in the longer term at the end of
this chapter. In future rulemakings, DOE may consider the use of other modeling approaches for
examining long run employment impacts.

16.3 METHODOLOGY

The Department based its analysis on an input/output model of the U.S. economy that
estimates the effects of standards on major sectors of the economy related to buildings and the
net impact of standards on jobs. The Pacific Northwest National Laboratory developed the
model, ImSET 4 (Impact of Sector Energy Technologies)2 as a successor to ImBuild,3 a special-
purpose version of the IMPLAN4 national input/output model. ImSET estimates the
employment and income effects of building energy technologies. In comparison with simple
economic multiplier approaches, ImSET allows for more complete and automated analysis of
the economic impacts of energy-efficiency investments in buildings.

16-1
In an input/output model, the level of employment in an economy is determined by the
relationships between different sectors of the economy and the spending flows among them.
Different sectors have different levels of labor intensity, thus changes in the level of spending
(e.g., due to the effects of an efficiency standard) in one sector of the economy will affect flows
in other sectors, which affects the overall national level of employment.

ImSET uses a 187-sector model of the national economy to predict the economic
effects of residential and commercial buildings technologies. ImSET inputs estimates of
initial investments, energy savings, and economic activity associated with spending the
savings resulting from standards (e.g., changes in final demand in personal consumption,
business investment and spending, and government spending). It provides overall estimates of
the change in output, measured by the total value of produced goods or services, for each
sector. The model uses estimates of employment and wage income per dollar of output for
each sector and calculates impacts on national employment.

Energy-efficiency technology primarily affects the U.S. economy along three spending
pathways. First, general investment funds are diverted to sectors that manufacture, install, and
maintain energy-efficient products. The increased cost of products leads to higher employment
in the product manufacturing sectors and lower employment in other economic sectors.
Second, for commercial firm and residents that purchase equipment subject to the standard,
their spending is redirected from energy (and potentially water) inputs toward firms that supply
other production inputs. Third, utility sector expenditures are released for use in other sectors
of the economy. When consumers use less energy or water, utilities experience relative
reductions in demand which leads to reductions in utility sector investment and employment.

DOE also notes that the employment impacts estimated with ImSET for the entire
economy differ from the employment impacts in the cooking products manufacturing sector
estimated in Chapter 12 using the Government Regulatory Impact Model (GRIM). The
methodologies used and the sectors analyzed in the ImSET and GRIM models are different.

16.4 SHORT-TERM RESULTS

The results in this section refer to impacts of cooking products standards relative to the
baseline (“no-new-standards” case). DOE presents the summary impact.

Conceptually, one can consider the impact of the rule in its first year on three
aggregate sectors, the cooking products manufacturing sector, the energy generation sector,
and all other sectors (as mentioned above ImSET’s calculations are made at a much more
disaggregate level). By raising energy efficiency, the rule generally requires more inputs to
produce cooking products; these increased inputs may include more employment in this
sector. At the same time, the improvements in energy efficiency reduce consumer
expenditures on energy, freeing up income to be spent in other sectors, potentially increasing
employment therein. The reduction in energy demand causes a reduction in employment in
that sector. Finally, based on the net impact of increased expenditures on cooking products
and reduced expenditures on energy, consumer expenditures on everything else are either
positively or negatively affected, increasing or reducing jobs in each sector accordingly. The
model also captures any indirect jobs created or lost by changes in consumption due to

16-2
changes in employment (e.g., as more workers are hired they consume more goods,
which generates more employment; the converse is true for workers laid off).

Table 16.4.1 presents the modeled annual net employment impact from the rule in 2027
(2028 for TSL 1), rounded to the nearest hundred jobs (i.e., the estimated difference in the annual
number of jobs compared to the case of no new standard). Approximately 26% of cooking
products are domestically produced, with the remaining 74% imported. The net employment
impact estimate is sensitive to assumptions regarding the return to the U.S. economy of money
spent on imported products. The two scenarios bounding the ranges presented in Table 16.4.1
represent situations in which none of the money spent on imported cooking products returns to
the U.S. economy and all of the money spent on imported cooking products returns to the U.S.
economy. The U.S. trade deficit in recent years suggests that between 50% and 75% of the money
spent on imported products is likely to return, and therefore short-term impacts would fall within
the ranges presented below.

Table 16.4.1 Net National Short-term Change in Employment (1000s of Jobs)


Trial
Standard 2027 2032
Level
TSL 1* 0.0 0.0
TSL 2 0.0 to 0.2 0.0 to 0.3
TSL 3 -0.1 to 0.8 0.4 to 1.4
Notes: For each year, the range represents the potential change in employment under the assumptions that 0% of
import spending returns to the U.S. economy (low end) and 100% of import spending returns to the U.S. economy
(high end). * TSL 1 has a compliance year of 2028; values for TSL 1 are presented for 2028 and 2033.

For context, the Congressional Budget Office projects that over the relevant time
period, the unemployment rate will be close to “full employment.”5 When an economy is at full
employment any effects on net employment are likely to be transitory as workers change jobs,
rather than enter or exit longer-term employment. The ImSET model projections, assuming no
price or wage effects until 2032 (2033 for TSL 1), are included in the second column of Table
16.4.1.

16.5 LONG-TERM RESULTS


Over the long term DOE expects the energy savings to consumers to increasingly
dominate the increase in product costs, resulting in increased aggregate savings to consumers to
increase. As a result, DOE expects demand for electricity to decline over time, reducing energy
expenses to consumers allowing demand for other goods to increase. Since the electricity
generation sector is relatively capital intensive compared to the consumer goods sector, the net
effect will be an increase in labor demand and a shift in employment away from energy towards
consumer goods. Increased demand for labor will increase the equilibrium price of labor, (i.e.,
wages). Note that in long-run equilibrium it is possible that there is no net effect on total
employment since wages adjust to bring the labor market into equilibrium. Nonetheless, even to
the extent that markets are slow to adjust, DOE anticipates that net labor market impacts will in
general be negligible over time due to the small magnitude of the short-term effects presented in
Table 16.4.1.

16-3
REFERENCES

1. Scott, M. J., J. M. Roop, R. W. Schultz, D. M. Anderson, and K. A. Cort. The Impact of


DOE Building Technology Energy Efficiency Programs on U.S. Employment, Income,
and Investment. Energy Economics. 2008. 30(5): pp. 2283–2301.

2. Livingston, O. and et al. ImSET 4.0: Impact of Sector Energy Technologies Model
Description and User’s Guide. 2015. Pacific Northwest National Laboratory. (Last
accessed August 1, 2023.)
https://www.pnnl.gov/main/publications/external/technical_reports/PNNL-24563.pdf.

3. Scott, M. J., D. J. Hostick, and D. B. Belzer. ImBuild: Impact of Building Energy


Efficiency Programs. 1998. Pacific Northwest National Laboratory: Richland, WA.
Report No. PNNL-11884. (Last accessed August 1, 2023.)
http://www.osti.gov/scitech/biblio/656887.

4. Minnesota IMPLAN Group Inc. IMPLAN Professional: User’s Guide, Analysis Guide,
Data Guide. 1997. Minnesota IMPLAN Group Inc.: Stillwater, MN.

5. U.S. Congressional Budget Office. The Budget and Economic Outlook: 2022 to 2032.
Congress of the United States - Congressional Budget Office. (Last accessed August 1,
2023.) https://www.cbo.gov/publication/57950.

16-4
CHAPTER 17. REGULATORY IMPACT ANALYSIS

TABLE OF CONTENTS

17.1 INTRODUCTION ......................................................................................................... 17-1


17.2 NON-REGULATORY POLICIES ................................................................................ 17-2
17.2.1 Methodology .................................................................................................................. 17-2
17.2.2 Assumptions Regarding Non-Regulatory Policies ........................................................ 17-3
17.2.3 Policy Interactions ......................................................................................................... 17-4
17.3 NON-REGULATORY POLICY ASSUMPTIONS ...................................................... 17-4
17.3.1 No New Regulatory Action ........................................................................................... 17-4
17.3.2 Consumer Rebates ......................................................................................................... 17-4
17.3.2.1 Methodology ................................................................................................. 17-4
17.3.2.2 Analysis ......................................................................................................... 17-5
17.3.3 Consumer Tax Credits ................................................................................................. 17-10
17.3.4 Manufacturer Tax Credits ............................................................................................ 17-12
17.3.5 Voluntary Energy Efficiency Targets .......................................................................... 17-14
17.3.6 Bulk Government Purchases ........................................................................................ 17-16
17.4 IMPACTS OF NON-REGULATORY ALTERNATIVES ......................................... 17-18
REFERENCES ........................................................................................................................ 17-22

LIST OF TABLES

Table 17.1.1 Non-Regulatory Alternatives to National Standards ................................... 17-1


Table 17.2.1 Minimum Energy Efficiency by TSL .......................................................... 17-3
Table 17.3.1 Benefit/Cost Ratios Without and With Rebates........................................... 17-6
Table 17.3.2 Market Penetrations Attributable to Consumer Rebates in the
Compliance Year ....................................................................................... 17-10
Table 17.3.3 Market Penetrations Attributable to Consumer Tax Credits in TSL’s
Compliance Year ....................................................................................... 17-12
Table 17.3.4 Market Penetrations Attributable to Manufacturer Tax Credits in the
Compliance Year ....................................................................................... 17-13
Table 17.3.5 Market Barriers Changes Attributable to Voluntary Energy Efficiency
Targets (TSL 1) .......................................................................................... 17-15
Table 17.3.6 Market Penetrations Attributable to Voluntary Energy Efficiency
Targets in the Compliance Year ................................................................ 17-15
Table 17.3.7 Market Penetrations in Selected Years Attributable to Voluntary
Energy Efficiency Targets for TSL 1......................................................... 17-16
Table 17.3.8 Market Penetrations Attributable to Bulk Government Purchases in the
Compliance Year ....................................................................................... 17-18
Table 17.4.1 Impacts of Non-Regulatory Policy Alternatives (TSL 1) .......................... 17-21

17-i
LIST OF FIGURES

Figure 17.3.1 Market Penetration Curves for Consumer Conventional Cooking


Products........................................................................................................ 17-9
Figure 17.4.1 Market Penetration of Efficient Electric Smooth Element Standalone
Cooking Tops (TSL 1) ............................................................................... 17-19
Figure 17.4.2 Market Penetration of Efficient Electric Smooth Element Cooking Top
Component of Combined Cooking Products (TSL 1) ............................... 17-19
Figure 17.4.3 Market Penetration of Efficient Gas Element Standalone Cooking
Tops (TSL 1) .............................................................................................. 17-20
Figure 17.4.4 Market Penetration of Efficient Gas Cooking Top Component of
Combined Cooking Products (TSL 1) ....................................................... 17-20

17-ii
CHAPTER 17. REGULATORY IMPACT ANALYSIS

17.1 INTRODUCTION
The Administrator of the Office of Information and Regulatory Affairs (OIRA) in the
OMB has determined that the regulatory action in this document is a significant regulatory action
within the scope of section (3)(f)(1) of Executive Order (E.O.) 12866. Regulatory Planning and
Review. 58 FR 51735 (October 4, 1993), as amended by E.O. 14094. Modernizing Regulatory
Review. 88 FR 21879 (April 11, 2023). For such actions, E.O. 12866 requires Federal agencies
to provide “an assessment, including the underlying analysis, of costs and benefits of potentially
effective and reasonably feasible alternatives to the planned regulation, identified by the agencies
or the public (including improving the current regulation and reasonably viable non-regulatory
actions), and an explanation why the planned regulatory action is preferable to the identified
potential alternatives.” 58 FR 51735, 51741.

To conduct this analysis, DOE used an integrated National Impact Analysis (NIA)-RIA
model built on a modifieda version of the NIA model discussed in chapter 10. DOE identified
five non-regulatory policy alternatives that possibly could provide incentives for the same energy
efficiency levels as the ones in the selected trial standard level (TSL) for the consumer
conventional cooking products that are the subject of this rulemaking. The non-regulatory policy
alternatives are listed in Table 17.1.1, which also includes the “no new regulatory action”
alternative. DOE evaluated each alternative in terms of its ability to achieve significant energy
savings at a reasonable cost, and compared the effectiveness of each to the effectiveness of the
selected standards for the four product classes of consumer conventional cooking products
covered by this RIA.b

Table 17.1.1 Non-Regulatory Alternatives to National Standards


No New Regulatory Action
Consumer Rebates
Consumer Tax Credits
Manufacturer Tax Credits
Voluntary Energy Efficiency Targets
Bulk Government Purchases

Sections 17.2 and 17.3 discuss the analysis of five selected policies listed in Table 17.1.1
(excluding the alternative of “No New Regulatory Action”). Section 17.4 presents the results of
the policy alternatives.

a
For this RIA, DOE developed an alternative NIA model where shipments in the policy case do not account for any
consumer-choice decision making. DOE believes that the national benefits from standards calculated this way are
more comparable to the benefits from the alternative policies.
b
This RIA covers the four product classes that make up most of the shipments and energy savings from consumer
conventional cooking products: Electric Smooth Element Standalone Cooking Tops, Electric Smooth Element
Cooking Top Component of Combined Cooking Products, Gas Element Standalone Cooking Tops, and Gas
Cooking Top Component of Combined Cooking Products.

17-1
17.2 NON-REGULATORY POLICIES
This section describes the method DOE used to analyze the energy savings and cost
effectiveness of the non-regulatory policy alternatives for consumer conventional cooking
products. This section also describes the assumptions underlying the analysis.

17.2.1 Methodology
DOE used its integrated NIA-RIA spreadsheet model to calculate the national energy
savings (NES) and net present value (NPV) associated with each non-regulatory policy
alternative. Chapter 10 of this technical support document (TSD) describes the NIA spreadsheet
model. Appendix 17A discusses the NIA-RIA integrated model approach.

DOE quantified the effect of each alternative on the purchase of equipment that meets the
efficiency levels corresponding to each TSL. After establishing the quantitative assumptions
underlying each alternative, DOE appropriately revised inputs to the NIA-RIA spreadsheet
model. The primary model inputs revised were market shares of equipment meeting the target
efficiency levels set for each TSL. The shipments of equipment for any given year reflect a
shipment distribution across efficiency levels. DOE assumed, for each TSL, that new energy
efficiency standards would affect 100 percent of the shipments of products that did not meet the
TSL target levels in the no-new-standards case, whereas the non-regulatory policies would affect
a smaller percentage of those shipments. DOE made certain assumptions about the percentage of
shipments affected by each alternative policy. DOE used those percentages to calculate the
shipment-weighted average energy consumption and costs of consumer conventional cooking
products attributable to each policy alternative.

Increasing the efficiency of a product often increases its average installed cost. However,
operating costs generally decrease because energy consumption declines. DOE therefore
calculated an NPV for each non-regulatory alternative in the same way it did for the selected
standards. In some policy scenarios, increases in total installed cost are mitigated by government
rebates or tax credits. Because government expenditures on tax credits and rebates would be
covered to a significant extent by income taxes paid by consumers in the aggregate, DOE did not
include rebates or tax credits as a consumer benefit when calculating national NPV. DOE’s
analysis also excluded any administrative costs for the non-regulatory policies; including such
costs would decrease the NPVs slightly.

The following are key measures for evaluating the impact of each alternative.

• National Energy Savings (NES), given in quadrillion Btus (quads), describes the
cumulative national energy saved over the lifetime of equipment purchased during the
30-year analysis period starting in the compliance year, which is the effective date of the
policy.
• Net Present Value (NPV), represents the value of net monetary savings in 2024,
expressed in 2022$, from equipment purchased during the 30-year analysis period
starting in the compliance year. DOE calculated the NPV as the difference between the
present values of installed equipment cost and operating expenditures in the no-new-

17-2
standards case and the present values of those costs in each policy case. DOE calculated
operating expenses (including energy costs) for the life of the product.

17.2.2 Assumptions Regarding Non-Regulatory Policies


The effects of non-regulatory policies are by nature uncertain because they depend on
program implementation, marketing efforts, and on consumers’ response to a program. Because
the projected effects depend on assumptions regarding the rate of consumer participation, they
are subject to more uncertainty than are the impacts of mandatory standards, which DOE
assumes will be met with full compliance. To increase the robustness of the analysis, DOE
conducted a literature review regarding each non-regulatory policy and consulted with
recognized experts to gather information on similar incentive programs that have been
implemented in the United States. By studying experiences with the various types of programs,
DOE sought to make credible assumptions regarding potential market impacts. Section 17.3
presents the sources DOE relied on in developing assumptions about each alternative policy and
reports DOE’s conclusions as they affected the assumptions that underlie the modeling of each
alternative policy.

Each non-regulatory policy that DOE considered would improve the average efficiency
of new consumer conventional cooking products relative to their no-new-standards case
efficiency scenario (which involves no new regulatory action). The analysis considered that each
alternative policy would induce consumers to purchase units having the same technology as
required by standards (the target efficiency level, referred to as the “target level” throughout the
RIA), according to the minimum energy efficiency set for each TSL. As opposed to the standards
case, however, the policy cases may not lead to 100 percent market penetration of units that meet
the target level.

Table 17.2.1 shows the minimum energy efficiency of the consumer conventional
cooking products product classes at each TSL.

Table 17.2.1 Minimum Energy Efficiency by TSL


TSL 1 TSL 2 TSL 3
Electric Smooth Element Standalone Cooking Tops
207 189 179
(kWh/yr)
Electric Smooth Element Cooking Top Component of
207 189 179
Combined Cooking Products (kWh/yr)
Gas Element Standalone Cooking Tops (kBtu/yr) 1770 1343 1343
Gas Cooking Top Component of Combined Cooking
1770 1343 1343
Products (kBtu/yr)

DOE assumed that the effects of non-regulatory policies would last from the compliance
year through the end of the analysis period.

17-3
17.2.3 Policy Interactions
DOE calculated the effects of each non-regulatory policy separately from those of the
other policies. In practice, some policies are most effective when implemented in combination,
such as voluntary efficiency targets implemented with consumer rebates or tax credits. However,
DOE attempted to make conservative assumptions to avoid double-counting policy impacts. The
resulting policy impacts are therefore not additive, and the combined effect of several or all
policies cannot be inferred from summing their results.

Section 17.4 presents graphs that show the market penetration estimated under each non-
regulatory policy for consumer conventional cooking products.

17.3 NON-REGULATORY POLICY ASSUMPTIONS


The following subsections describe DOE’s analysis of the impacts of the five non-
regulatory policy alternatives to the standards selected for consumer conventional cooking
products. (Because the alternative of “No New Regulatory Action” has no energy or economic
impacts, essentially representing the NIA no-new-standards case, DOE did not perform any
additional analysis for that alternative.) DOE developed estimates of the market penetration of
more efficient products both with and without each of the non-regulatory policy alternatives.

17.3.1 No New Regulatory Action


The case in which no new regulatory action is taken with regard to the energy efficiency
of consumer conventional cooking products constitutes the no-new-standards case, as described
in chapter 10, National Impact Analysis. The no-new-standards case provides the basis of
comparison for all other policies. By definition, no new regulatory action yields zero NES and an
NPV of zero dollars.

17.3.2 Consumer Rebates


DOE considered the scenario in which the Federal government would provide financial
incentives in the form of rebates to consumers for purchasing energy-efficient equipment. This
policy provides a consumer rebate for purchasing consumer conventional cooking products that
operate at the same efficiency levels as stipulated in each TSL.

17.3.2.1 Methodology
DOE based its evaluation methodology for consumer rebates on a comprehensive study
of California’s potential for achieving energy efficiency. The study, performed by XENERGY,
Inc.,c summarized experiences with various utility rebate programs.1 XENERGY’s analytical
method utilized graphs, or penetration curves, that estimate the market penetration of a
technology based on its benefit/cost (B/C) ratio. DOE consulted with experts and reviewed other
methods of estimating the effect of consumer rebate programs on the market penetration of
efficient technologies. The other methods, developed after the referenced XENERGY report was
published,2, 3, 4, 5, 6, 7, 8 used different approaches: other economic parameters (e.g., payback
period), expert surveys, or model calibration based on specific utility program data rather than
c
XENERGY is now owned by KEMA, Inc. (www.kema.com)

17-4
multi-utility data. Some models in use by energy efficiency program evaluation experts were so
client-specific that generic relationships between economic parameters and consumer response
could not be established.5, 6 DOE decided that the most appropriate available method for this
RIA was the XENERGY approach of penetration curves based on B/C ratio, which incorporates
lifetime operating cost savings.

XENERGY’s model estimates market impacts induced by financial incentives based on


the premise that two types of information diffusion drive the adoption of new technologies.
Internal sources of information encourage consumers to purchase new equipment primarily
through word-of-mouth from early adopters. External sources affect consumer purchase
decisions through marketing efforts and information from outside the consumer group. Appendix
17A contains additional details on internal and external information diffusion.

XENERGY’s model equation accounts for the influences of both internal and external
sources of information by superimposing the two components. Combining the two mechanisms
for information diffusion, XENERGY’s model generates a set of penetration (or implementation)
curves for a policy measure. XENERGY calibrated the curves based on participation data from
utility rebate programs. The curves illustrate the increased penetration (i.e., increased market
share) of efficient equipment driven by consumer response to changes in B/C ratio induced by
rebate programs. The penetration curves depict various diffusion patterns based on perceived
market barriers (from no-barriers to extremely-high-barriers) to consumer purchase of high-
efficiency equipment. DOE adjusted the XENERGY former penetration curves based on expert
advice founded on more recent utility program experience.5, 6, 9

DOE modeled the effects of a consumer rebate policy for consumer conventional cooking
products by determining, for each TSL, the increase in market penetration of equipment meeting
the target level relative to their market penetration in the no-new-standards case. It used the
interpolation method presented in Blum et al (2011)10 to create customized penetration curves
based on relationships between actual no-new-standards case market penetrations and actual B/C
ratios. To inform its estimate of B/C ratios provided by a rebate program DOE performed a
thorough nationwide search for existing rebate programs for consumer conventional cooking
products. DOE did not find rebate programs for the product classes covered in this RIA. DOE
assumed that a rebate program would cover all or part of the increased installed cost of units that
meet the target efficiency levels compared to units meeting the baseline efficiency level. Based
on that assumption, DOE calibrated the customized penetration curves it developed for each
product class covered by this RIA to best reflect the market barrier levels that consumer rebates
for consumer conventional cooking products would face. Section 17.3.2.2 shows the resulting
interpolated curves used in the analysis.

17.3.2.2 Analysis
DOE estimated the effect of increasing the B/C ratio of consumer conventional cooking
products via a rebate that would pay – depending on the product class – part or all of the
increased installed cost of units that meet the target efficiency levels compared to units meeting

17-5
the baseline efficiency level. d DOE then estimated a market representative rebate value for each
product class covered by this RIA which it applied in the calculation of the B/C ratio of
consumer conventional cooking products under the effect of consumer rebates. (Appendix 17A
presents the market representative rebate amounts.) DOE assumed that rebates would remain in
effect at the same level throughout the analysis period.

DOE first calculated the B/C ratio of a consumer conventional cooking products without
a rebate using the difference in total installed costs (C) and lifetime operating cost savings e (B)
between a unit meeting the target level and a baseline unit. It then calculated the B/C ratio given
a rebate for the unit meeting the target efficiency level. Because the rebate reduced the
incremental cost, the unit receiving the rebate had a larger B/C ratio. Table 17.3.1 shows the
effect of consumer rebates for each TSL on the B/C ratio of consumer conventional cooking
products shipped in the first year of the analysis period.

Table 17.3.1 Benefit/Cost Ratios Without and With Rebates


TSL 1 TSL 2 TSL 3
Electric Smooth Element Standalone Cooking Tops
B/C Ratio without Rebate 22.9 3.4 0.09
Rebate Amount (2022$) 2.84 22.63 100.00
B/C Ratio with Rebate infinite infinite 0.11
Estimated Market Barriers Low-Mod Moderate Moderate
Electric Smooth Element Cooking Top Component of Combined Cooking Products
B/C Ratio without Rebate 22.9 3.4 0.09
Rebate Amount (2022$) 2.84 22.63 100.00
B/C Ratio with Rebate infinite infinite 0.11
Estimated Market Barriers Low-Mod Moderate Moderate
Gas Element Standalone Cooking Tops
B/C Ratio without Rebate 1.6 0.9 0.9
Rebate Amount (2022$) 3.77 26.64 26.64
B/C Ratio with Rebate infinite infinite infinite
Estimated Market Barriers No No No
Gas Cooking Top Component of Combined Cooking Products
B/C Ratio without Rebate 1.6 0.9 0.9
Rebate Amount (2022$) 3.77 26.64 26.64
B/C Ratio with Rebate infinite infinite infinite
Estimated Market Barriers No No No
* Low-Mod: Low-to-Moderate market barriers; No: No market barriers.
** When a rebate covers in full the incremental installed cost, the denominator of the benefit/cost ratio is zero, and
the ratio is therefore represented as 'infinite.' This means that the market penetration of efficient consumer
conventional cooking products will be the highest possible share estimated for this product, given the market
barriers estimated for the product class.

d The baseline technology is defined in the engineering analysis, chapter 5, as the technology that represents the
basic characteristics of conventional cooking products. A baseline unit typically is one that just meets current
Federal energy conservation standards and provides basic consumer utility.
e
The cash flow of the operating cost savings is discounted to the purchase year using a 7 percent discount rate.

17-6
DOE used the B/C ratio along with the customized penetration curves shown in Figure
17.3.1 to estimate the percentage of consumers who would purchase consumer conventional
cooking products that meet the target levels both with and without a rebate incentive. Table
17.3.1 indicates the estimated levels of market barriers corresponding to the penetration curves
DOE calculated to represent the market behavior for consumer conventional cooking products at
the selected TSL.

Selected TSL
Electric Smooth Element Standalone Cooking Tops

17-7
Electric Smooth Element Cooking Top Component of
Gas Element Standalone Cooking Tops
Combined Cooking Products

17-8
Selected TSL
Gas Cooking Top Component of Combined Cooking Selected TSL
Products

Figure 17.3.1 Market Penetration Curves for Consumer Conventional Cooking Productsf

DOE next estimated the percent increase represented by the change in penetration rate
shown on the corresponding penetration curve. It then added this percent increase to the market
share of units that meet the target level in the no-new-standards case to obtain the market share
of units that meet the target level in the rebate policy case.

Table 17.3.2 summarizes DOE’s assumptions for consumer conventional cooking


products regarding the market penetration of products in the compliance year that meet the target
levels at each TSL given a consumer rebate.

f
Because the B/C ratio with rebates is infinite for all product classes (see Table 17.3.1), the data points that refer to
the market penetration with rebates are not shown in any of the charts.

17-9
Table 17.3.2 Market Penetrations Attributable to Consumer Rebates in the Compliance
Year
TSL 1 TSL 2 TSL 3
Electric Smooth Element Standalone Cooking Tops
Base-Case Market Share 61.9% 15.1% 0.02%
Policy Case Market Share 71.9% 68.7% 0.02%
Increased Market Share 10.0% 53.6% 0.0%
Electric Smooth Element Cooking Top Component of Combined Cooking Products
Base-Case Market Share 61.9% 15.1% 0.02%
Policy Case Market Share 71.9% 68.7% 0.02%
Increased Market Share 10.0% 53.6% 0.0%
Gas Element Standalone Cooking Tops
Base-Case Market Share 56.0% 41.0% 41.0%
Policy Case Market Share 59.0% 96.9% 96.9%
Increased Market Share 3.0% 55.9% 55.9%
Gas Cooking Top Component of Combined Cooking Products
Base-Case Market Share 56.0% 41.0% 41.0%
Policy Case Market Share 59.0% 96.9% 96.9%
Increased Market Share 3.0% 55.9% 55.9%

DOE used the resulting annual increases in market shares as inputs to represent the rebate
policy case scenario in its NIA-RIA model. Appendix 17A shows the annual market share
increases due to this policy for the whole analysis period. Section 17.4 presents the resulting
market penetration trends for the policy case of consumer rebates for consumer conventional
cooking products.

17.3.3 Consumer Tax Credits


DOE estimated the effects of tax credits on consumer purchases based on its previous
analysis of consumer participation in tax credits. DOE supported its approach using data from
Oregon State’s tax credit program for energy-efficient appliances. DOE also incorporated
previous research that disaggregated the effect of rebates and tax credits into a direct price effect,
which derives from the savings in purchase price, and an announcement effect, which is
independent of the amount of the incentive.11, 12 The announcement effect derives from the
credibility that a technology receives from being included in an incentive program, as well as
changes in product marketing and modifications in markup and pricing. DOE assumed that the
rebate and consumer tax credit policies would encompass both direct price effects and
announcement effects, and that half the increase in market penetration associated with either
policy would be due to the direct price effect and half to the announcement effect.

In estimating the effects of a tax credit on purchases of consumer products that meet new
efficiency standards, DOE assumed the amount of the tax credit would be the same as the
corresponding rebate amount discussed above.

DOE estimated that fewer consumers would participate in a tax credit program than
would take advantage of a rebate. Research has shown that the delay required for a consumer to
receive a tax credit, plus the added time and cost in preparing the tax return, make a tax credit
17-10
incentive less effective than a rebate received at the time of purchase. Based on previous
analyses, DOE assumed that only 60 percent of the consumers who would take advantage of a
rebate would take advantage of a tax credit.13

In preparing its assumptions to estimate the effects of tax credits on consumer purchases
of consumer conventional cooking products, DOE also reviewed other tax credit programs that
have been offered at both the Federal and State levels for energy-efficient appliances.

The Energy Policy Act of 2005 (EPACT 2005) included Federal tax credits for
consumers who purchase energy-efficient products.14 Those tax credits were in effect in 2006
and 2007, expired in 2008, were reinstated for 2009–2010 by the American Recovery and
Reinvestment Act of 2009 (ARRA), extended by Congress for 2011 with some modifications,
and expired at the end of 2011.15,16 The American Taxpayer Relief Act of 2012 extended, with
some modifications, residential tax credits for air conditioners, heat pumps, furnaces, and water
heaters placed in service between January 1, 2012 and December 31, 2013.17 DOE reviewed
Internal Revenue Service data on the numbers of taxpayers who claimed the tax credits during
tax years 2006 and 2007. DOE also reviewed data from an earlier Federal energy conservation
tax credit program in place in the 1980s. However, DOE did not find data specific enough to
consumer conventional cooking products to warrant adjusting its analysis method for the
Consumer Tax Credits policy case. Appendix 17A contains more information on Federal
consumer tax credits.

DOE also reviewed its previous analysis of Oregon’s tax credits for clothes washers to
provide support for its assumptions.18 In that previous analysis, DOE compared the market
shares of ultra-high efficiency (UHE) residential clothes washers in Oregon, which offered both
State tax credits and utility rebates, with those in Washington State, which offered only utility
rebates during the same period. Based on this analysis, DOE estimated that in Oregon the impact
of tax credits was 62 percent of the impact of rebates for UHE clothes washers having equivalent
efficiency. This finding supports its original assumption that participation in a tax credit program
would be about 60 percent of participation in a rebate program. Additional discussion of State
tax credits for Oregon and other states is in appendix 17A.

DOE applied the assumed 60 percent participation described above to the increase in
penetration rates estimated for the rebate policy to estimate penetration rates attributable to
consumer tax credits. In doing so, DOE incorporated the assumptions for consumer response to
financial incentives from the customized penetration curves it developed for consumer
conventional cooking products (See Figure 17.3.1).

Table 17.3.3 summarizes DOE’s assumptions for consumer conventional cooking


products regarding the market penetration of products in the compliance year that meet the target
levels at each TSL given a consumer tax credit.

17-11
Table 17.3.3 Market Penetrations Attributable to Consumer Tax Credits in TSL’s
Compliance Year
TSL 1 TSL 2 TSL 3
Electric Smooth Element Standalone Cooking Tops
Base-Case Market Share 61.9% 15.1% 0.02%
Policy Case Market Share 67.9% 47.3% 0.02%
Increased Market Share 6.0% 32.2% 0.0%
Electric Smooth Element Cooking Top Component of Combined Cooking Products
Base-Case Market Share 61.9% 15.1% 0.02%
Policy Case Market Share 67.9% 47.3% 0.02%
Increased Market Share 6.0% 32.2% 0.0%
Gas Element Standalone Cooking Tops
Base-Case Market Share 56.0% 41.0% 41.0%
Policy Case Market Share 57.8% 74.5% 74.5%
Increased Market Share 1.8% 33.5% 33.5%
Gas Cooking Top Component of Combined Cooking Products
Base-Case Market Share 56.0% 41.0% 41.0%
Policy Case Market Share 57.8% 74.5% 74.5%
Increased Market Share 1.8% 33.5% 33.5%

The increased market shares attributable to consumer tax credits shown in Table 17.3.3
were used as inputs in the NIA-RIA model. Appendix 17A shows the annual market share
increases due to this policy for the whole analysis period. Section 17.4 presents the resulting
market penetration trends for the policy case of consumer tax credits for consumer conventional
cooking products that meet the efficiency level for the selected TSL. Because the increase in
market penetration for consumer tax credits is proportional to the increase in market penetration
DOE calculated for consumer rebates, they follow similar increasing trends over the analysis
period.

17.3.4 Manufacturer Tax Credits


To analyze the potential effects of a policy that offers tax credits to manufacturers that
produce consumer conventional cooking products that meet the target efficiency levels at each
TSL, DOE assumed that a manufacturer tax credit would lower the consumer’s purchase cost by
an amount equivalent to that provided by the consumer rebates or tax credits described above.
DOE further assumed that manufacturers would pass on some of their reduced costs to
consumers, causing a direct price effect. DOE assumed that no announcement effect would
occur, because the program would not be visible to consumers.g Because the direct price effect is
approximately equivalent to the announcement effect,11 DOE estimated that a manufacturer tax
credit would induce half the number of consumers assumed to take advantage of a consumer tax

g
Note that this is a conservative assumption, since it is possible that manufacturers or utility/agency efficiency
programs might promote the models for which manufacturers increase production due to the tax credits, which in
turn might induce some announcement effect. However, DOE found no data on such programs on which to base an
estimate of the magnitude of this possible announcement effect on consumer behavior.

17-12
credit to purchase more efficient products. Thus, the assumed participation rate is equal to 30
percent of the number of consumers who would participate in a rebate program.

DOE attempted to investigate manufacturer response to the Energy Efficient Appliance


Credits for manufacturers mandated by EPACT 2005.14 Those manufacturer tax credits have
been in effect for dishwashers, clothes washers and refrigerators produced beginning in 2009.
DOE was unable to locate data from the Internal Revenue Service or other sources on
manufacturer response to the Federal credits. Appendix 17A presents details on Federal
manufacturer tax credits.

DOE applied the assumption of 30 percent participation to the increase in penetration


rates predicted for the rebate policy to estimate the effects of a manufacturer tax credit policy. In
doing so, DOE incorporated the assumptions for consumer response to financial incentives from
the customized penetration curves it developed for consumer conventional cooking products.
(See Figure 17.3.1).

Table 17.3.4 summarizes DOE’s assumptions for consumer conventional cooking


products regarding the market penetration of products in the compliance year that meet the target
levels at each TSL given a manufacturer tax credit.

Table 17.3.4 Market Penetrations Attributable to Manufacturer Tax Credits in the


Compliance Year
TSL 1 TSL 2 TSL 3
Electric Smooth Element Standalone Cooking Tops
Base-Case Market Share 61.9% 15.1% 0.02%
Policy Case Market Share 64.9% 31.2% 0.02%
Increased Market Share 3.0% 16.1% 0.0%
Electric Smooth Element Cooking Top Component of Combined Cooking Products
Base-Case Market Share 61.9% 15.1% 0.02%
Policy Case Market Share 64.9% 31.2% 0.02%
Increased Market Share 3.0% 16.1% 0.0%
Gas Element Standalone Cooking Tops
Base-Case Market Share 56.0% 41.0% 41.0%
Policy Case Market Share 56.9% 57.8% 57.8%
Increased Market Share 0.9% 16.8% 16.8%
Gas Cooking Top Component of Combined Cooking Products
Base-Case Market Share 56.0% 41.0% 41.0%
Policy Case Market Share 56.9% 57.8% 57.8%
Increased Market Share 0.9% 16.8% 16.8%

The increased market shares attributable to a manufacturer tax credit shown in Table
17.3.4 were used as inputs in the NIA-RIA model. Appendix 17A shows the annual market share
increases due to this policy for the whole analysis period. Section 17.4 presents the resulting
market penetration trends for the policy case of manufacturer tax credits for consumer
conventional cooking products. Because the increase in market penetration for manufacturer tax
17-13
credits is proportional to the increase in market penetration DOE calculated for consumer
rebates, they follow similar increasing trends over the analysis period.

17.3.5 Voluntary Energy Efficiency Targets


DOE assumed that voluntary energy efficiency targets would lead manufacturers of
consumer conventional cooking products to gradually stop producing units that operate below
the efficiency levels set for each TSL. DOE assumed that the impetus for phasing out production
of low-efficiency units would be a program with impacts similar to those of the ENERGY STAR
labeling program conducted by the Environmental Protection Agency (EPA) and DOE in
conjunction with industry partners. The ENERGY STAR program specifies the minimum energy
efficiencies that various products must have to receive the ENERGY STAR label. ENERGY
STAR encourages consumers to purchase efficient products via marketing that promotes
consumer label recognition, various incentive programs that adopt the ENERGY STAR
specifications, and manufacturers’ promotion of their qualifying appliances. ENERGY STAR
projects market penetration of compliant appliances and estimates the percentage of sales of
compliant appliances that are attributable to the ENERGY STAR program.

Researchers have analyzed the ENERGY STAR program’s effects on sales of several
consumer products. Program efforts generally involve a combination of information
dissemination and utility or agency rebates. The analyses have been based on State-specific data
on percentages of shipments of various appliances that meet ENERGY STAR specifications. The
analyses generally have concluded that the market penetration of ENERGY STAR-qualifying
appliances is higher in regions or States where ancillary promotional programs have been
active.19, 20, 21

DOE believes that informational incentive programs – like ENERGY STAR, or any other
labeling program sponsored by industry or other organizations – are likely to reduce the market
barriers to more efficient products over time. During the rebate analysis, when assessing the B/C
ratio and market penetration in the no-new-standards case for consumer conventional cooking
products, DOE observed market barriers to adoption of electric smooth element cooking tops that
are more efficient than their corresponding baseline models. DOE estimates that voluntary
energy efficiency targets could reduce these barriers over 10 years. Table 17.3.5 presents the
levels of market barriers DOE estimated for consumer conventional cooking products in the no-
new-standards case and in the policy case of voluntary energy efficiency targets. DOE followed
the methodology presented by Blum et al (2011)10 to evaluate the effects that such a reduction in
market barriers would have on the market penetration of efficient consumer conventional
cooking products.h The methodology relies on interpolated market penetration curves to calculate
– given a B/C ratio – how the market penetration of more efficient units increases as the market
barrier level to those units decreases.

h
For the calculation of B/C ratios DOE discounted the cash flow of the operating cost savings to the purchase year
using a 7 percent discount rate.

17-14
Table 17.3.5 Market Barriers Changes Attributable to Voluntary Energy Efficiency
Targets (TSL 1)
No-new- Voluntary Energy
standards Case Efficiency Targets
Electric Smooth Element Standalone
Cooking Tops Low-Moderate Low
Electric Smooth Element Cooking Top
Component of Combined Cooking Products Low-Moderate Low

Table 17.3.6 summarizes DOE’s assumptions for consumer conventional cooking


products regarding the market penetration of products in the compliance year that meet the target
levels at each TSL given voluntary energy efficiency targets. Table 17.3.7 expands on Table
17.3.6 to include, for the selected TSL, DOE’s assumptions regarding the market penetration of
units in selected years.

Table 17.3.6 Market Penetrations Attributable to Voluntary Energy Efficiency Targets in


the Compliance Year
TSL 1 TSL 2 TSL 3
Electric Smooth Element Standalone Cooking Tops
Base-Case Market Share 61.9% 15.1% 0.02%
Policy Case Market Share 63.4% 16.4% 0.02%
Increased Market Share 1.5% 1.3% 0.0%
Electric Smooth Element Cooking Top Component of Combined Cooking Products
Base-Case Market Share 61.9% 15.1% 0.02%
Policy Case Market Share 63.4% 16.4% 0.02%
Increased Market Share 1.5% 1.3% 0.0%
Gas Element Standalone Cooking Tops
Base-Case Market Share 56.0% 41.0% 41.0%
Policy Case Market Share 56.3% 41.3% 41.3%
Increased Market Share 0.3% 0.3% 0.3%
Gas Cooking Top Component of Combined Cooking Products
Base-Case Market Share 56.0% 41.0% 41.0%
Policy Case Market Share 56.3% 41.3% 41.3%
Increased Market Share 0.3% 0.3% 0.3%

17-15
Table 17.3.7 Market Penetrations in Selected Years Attributable to Voluntary Energy
Efficiency Targets for TSL 1
2028 2037 2057
Electric Smooth Element Standalone Cooking Tops
Base-Case Market Share 61.9% 61.9% 61.9%
Policy Case Market Share 63.4% 74.1% 74.8%
Increased Market Share 1.5% 12.2% 12.9%
Electric Smooth Element Cooking Top Component of Combined Cooking Products
Base-Case Market Share 61.9% 61.9% 61.9%
Policy Case Market Share 63.4% 74.1% 74.8%
Increased Market Share 1.5% 12.2% 12.9%
Gas Element Standalone Cooking Tops
Base-Case Market Share 56.0% 56.0% 56.0%
Policy Case Market Share 56.3% 59.0% 59.0%
Increased Market Share 0.3% 3.0% 3.0%
Gas Cooking Top Component of Combined Cooking Products
Base-Case Market Share 56.0% 56.0% 56.0%
Policy Case Market Share 56.3% 59.0% 59.0%
Increased Market Share 0.3% 3.0% 3.0%

The increased market shares attributable to voluntary energy efficiency targets shown in
Table 17.3.6 were used as inputs in the NIA-RIA model. Appendix 17A shows the annual market
share increases due to this policy for the whole analysis period. Section 17.4 presents the
resulting market penetration trends for the policy case of voluntary energy efficiency targets for
consumer conventional cooking products that meet the efficiency level for the selected TSL.
Because of the decrease in the market barriers level over the first 10 years of the analysis period,
the market penetration of more efficient consumer conventional cooking products significantly
increases over that period.

17.3.6 Bulk Government Purchases


Bulk government purchases can lead to Federal, State, and local governments purchasing
large quantities of products that meet a certain, target efficiency level. Combining the market
demands of multiple public sectors can provide a market signal to manufacturers and vendors
that some of their largest customers seek products that meet an efficiency target at favorable
prices. Such a program also can induce “market pull,” whereby manufacturers and vendors
would achieve economies of scale for high efficiency products.

Most of the previous bulk government purchase (procurement) initiatives at the Federal,
State, and municipal levels have not tracked data on numbers of purchases or degree of
compliance with procurement specifications. In many cases, procurement programs are
decentralized, being part of larger State or regional initiatives. DOE based its assumptions
regarding the effects of this policy on studies the Federal Energy Management Program (FEMP)
performed regarding the savings potential of its procurement specifications for appliances and
other products. FEMP, however, does not track purchasing data, because of the complex range of
purchasing systems, large number of vendors, and so on. States, counties, and municipalities
17-16
have demonstrated increasing interest and activity in “green purchasing." Although many of the
programs target office equipment, the growing infrastructure for developing and applying
efficient purchasing specifications indicates that bulk government purchase programs are
feasible.22, 23

DOE assumed that government agencies would administer bulk purchasing programs for
consumer conventional cooking products. At the federal level, this type of program could lead to
FEMP procurement guidelines for consumer conventional cooking products, which would refer
to the target levels of the selected TSL as the minimum efficiency levels of consumer
conventional cooking products to be purchased. DOE reviewed its own previous research on the
potential for market transformation through bulk government purchases. Its major study analyzed
several scenarios based on the assumption that 20 percent of Federal equipment purchases in
2000 already incorporated energy efficiency requirements based on FEMP guidelines. One
scenario in the DOE report showed energy efficient purchasing ramping up during 10 years from
20 percent to 80 percent of all Federal purchases.24 Based on this study, DOE estimated that a
bulk government purchase program instituted within a 10-year period would result in at least 80
percent of government-purchased consumer conventional cooking products meeting the target
efficiency level.

DOE assumed that bulk government purchases would affect a subset of housing units for
which government agencies purchased or influenced the purchase of consumer conventional
cooking products. This subset would consist primarily of public housing and housing on military
bases.

According to the 2019 American Housing Survey (AHS 2019), about 1.1 percent of all
U.S. households are housing units in a public housing authority that rely on electricity for
cooking and 0.6 percent rely on gas for cooking.i DOE therefore estimated that the percent of
U.S. housing units constituting the market to which this policy would apply is 1.1 percent for
electric smooth cooking tops and 0.6 percent for gas cooking tops.

DOE estimated that starting in the compliance year, each year of a bulk government
purchase policy would result in an increasing percent of shipments of government-purchased
units beyond the no-new-standards case that would meet the target efficiency level. DOE
estimated that within 10 years bulk government purchasing programs would result in 80 percentj
of the market for consumer conventional cooking products used in publicly owned housing
meeting the target level. DOE modeled the bulk government purchase program assuming that the
market share for consumer conventional cooking products achieved 9 years after the compliance
year would be at least maintained throughout the rest of the analysis period.

i
https://www.census.gov/programs-surveys/ahs/data/2019/ahs-2019-public-use-file--puf-/ahs-2019-national-public-
use-file--puf-.html
j
The 80 percent target to be achieved within 10 years may not be reached, as it is constrained by the market share
below the target level in the no-new-standards case scenario.

17-17
Table 17.3.8 summarizes DOE’s assumptions for consumer conventional cooking
products regarding the market penetration of products in the compliance year that meet the target
levels at each TSL given bulk government purchases.

Table 17.3.8 Market Penetrations Attributable to Bulk Government Purchases in the


Compliance Year
TSL 1 TSL 2 TSL 3
Electric Smooth Element Standalone Cooking Tops
Base-Case Market Share 61.9% 15.1% 0.02%
Policy Case Market Share 61.9% 15.2% 0.11%
Increased Market Share 0.02% 0.1% 0.09%
Electric Smooth Element Cooking Top Component of Combined Cooking Products
Base-Case Market Share 61.9% 15.1% 0.02%
Policy Case Market Share 61.9% 15.2% 0.11%
Increased Market Share 0.02% 0.1% 0.09%
Gas Element Standalone Cooking Tops
Base-Case Market Share 56.0% 41.0% 41.0%
Policy Case Market Share 56.0% 41.0% 41.0%
Increased Market Share 0.003% 0.04% 0.04%
Gas Cooking Top Component of Combined Cooking Products
Base-Case Market Share 56.0% 41.0% 41.0%
Policy Case Market Share 56.0% 41.0% 41.0%
Increased Market Share 0.003% 0.04% 0.04%

The increased market shares attributable to bulk government purchases shown in Table
17.3.8 were used as inputs in the NIA-RIA model. Appendix 17A shows the annual market share
increases due to this policy for the whole analysis period. Section 17.4 presents the resulting
market penetration trends for the policy case of bulk government purchases for consumer
conventional cooking products. Market penetrations increase over the first 10 years of the
analysis period, and remain steady for the rest of the analysis period.

17.4 IMPACTS OF NON-REGULATORY ALTERNATIVES


Figure 17.4.1 and Figure 17.4.4 show the effects of each non-regulatory policy alternative
on the market penetration of more efficient consumer conventional cooking products. Relative to
the no-new-standards case, the alternative policy cases increase the market shares that meet the
target level. Recall the selected standards (not shown in the figures) would result in a 100-
percent market penetration of products that meet the more efficient technology.

17-18
Figure 17.4.1 Market Penetration of Efficient Electric Smooth Element Standalone
Cooking Tops (TSL 1)

Figure 17.4.2 Market Penetration of Efficient Electric Smooth Element Cooking Top
Component of Combined Cooking Products (TSL 1)

17-19
Figure 17.4.3 Market Penetration of Efficient Gas Element Standalone Cooking Tops (TSL
1)

Figure 17.4.4 Market Penetration of Efficient Gas Cooking Top Component of Combined
Cooking Products (TSL 1)

Table 17.4.1 shows the national energy savings and net present value for the five non-
regulatory policy alternatives analyzed in detail for consumer conventional cooking products.
The target level for each policy corresponds to the same efficient technology selected for
standards at TSL 1. The case in which no regulatory action is taken with regard to consumer
conventional cooking products constitutes the no-new-standards case (or "No New Regulatory
Action" scenario), in which NES and NPV are zero by definition. For comparison, the tables
include the impacts of the selected standards calculated as described in footnote ‘a’. Energy
savings are given in quadrillion British thermal units (quads) of primary energy savings.k The
NPVs shown in Table 17.4.1 are based on two discount rates, 7 percent and 3 percent. Under
both discount rates, the selected standards carry a considerably higher NPV than any non-
regulatory alternative.

k
For the alternative policies whose market penetration depends on B/C ratio, the energy savings in 0 correspond to
the case where the cash flow of the operating cost savings was discounted to the purchase year using a 7 percent
discount rate.

17-20
The policy with the highest projected cumulative energy savings is consumer rebates.
Savings from manufacturer tax credits and consumer tax credits range from 11.8 to 23.7 percent
of the savings from selected standards calculated as described in footnote ‘a’. Bulk government
purchases have the lowest cumulative energy savings. Overall, the energy saving benefits from
the alternative policies, range from 0.1 percent to 44.5 percent of the benefits from the selected
standards calculated as described in footnote ‘a’.

Table 17.4.1 Impacts of Non-Regulatory Policy Alternatives (TSL 1)


Net Present Value*
Energy Savings* million 2022$
Policy Alternative
quads
7% Disc Rate 3% Disc Rate
Consumer Rebates 0.08 44.5%*** 251 532
Consumer Tax Credits 0.04 23.7% 151 319
Manufacturer Tax Credits 0.02 11.8% 75 160
Voluntary Energy Efficiency Targets 0.02 8.4% 38 112
Bulk Government Purchases 0.0002 0.1% 0.5 1
Selected Standards** 0.18 100.0% 573 1,372
* For products shipped 2028-2057.
**Calculated as described in footnote ‘a’.
***The percentages show how the energy savings from each policy alternative compare to the (primary) energy
savings from the proposed standards (represented in the table as 100%), when the latter are calculated as described
in footnote ‘a’.

17-21
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nergy_efficiency.

2. ICF International. Arizona Public Service Energy Efficient Market Potential Study. 2007.
Fairfax, VA.

3. Mosenthal, P. (Optimal, Energy) and B. Atkinson (LBNL). Telephone conversation.


January 2008.

4. Lee, A. (Quantec, LLC) and B. Atkinson (LBNL). Telephone conversation. 2008.

5. Rufo, M. (Itron) and B. Atkinson (LBNL). Telephone conversation. January 2008.

6. Rufo, M. (Itron) and B. Atkinson (LBNL). Telephone conversation. March 2009.

7. Itron, Inc. and KEMA, Inc. California Energy Efficiency Potential Study. 2008. Pacific
Gas & Electric Company: San Francisco, CA. Report No. PGE0264.01. (Last accessed
February 1, 2022.) http://calmac.org/publications/PGE0264_Final_Report.pdf.

8. Global Energy Partners, LLC. AmerenUE DSM Market Research Report: Volume 2:
Market Research, Results from the Saturation, Program Interest and Trade Ally
Research. 2010. Walnut Creek, CA. Report No. 1287–2. (Last accessed February 1,
2022.) http://www.ameren.com/-/media/missouri-
site/Files/Environment/Renewables/AmerenUEVolume2MarketResearchReport2.pdf.

9. Coito, F. (KEMA). Personal communication. E-mail to Barbara Atkinson, LBNL. June


2010.

10. Blum, H., B. A. Atkinson, and A. B. Lekov. A Framework for Comparative Assessments
of Energy Efficiency Policy Measures. 2011. Lawrence Berkeley National Laboratory:
Berkeley, CA. Report No. LBNL-4749E. (Last accessed February 1, 2022.)
https://eta.lbl.gov/publications/framework-comparative-assessments.

11. Koomey, J. and C. Richey. Analysis of Tax Credits for Efficient Equipment. 1998.
Lawrence Berkeley National Laboratory, Lawrence Berkeley National Laboratory, End-
Use Forecasting Group.

12. Train, K. Customer Decision Study: Analysis of Residential Customer Equipment


Purchase Decisions. 1994. Prepared for Southern California Edison by Cambridge
Systematics, Pacific Consulting Services, The Technology Applications Group, and
California Survey Research Services.

13. U.S. Department of Energy–Office of Energy Efficiency and Renewable Energy. Energy
Conservation Program for Consumer Products: Technical Support Document: Energy

17-22
Efficiency Standards for Consumer Products: Refrigerators, Refrigerator-Freezers, and
Freezers, Including Environmental Assessment and Regulatory Impact Analysis. 1995.
Report No. DOE/EE-0064.

14. Energy Policy Act of 2005. 42 U.S. Code 15801. 2005. (Last accessed February 1, 2022.)
https://www1.eere.energy.gov/femp/pdfs/epact_2005.pdf.

15. American Recovery and Reinvestment Act of 2009. Public Law 111-5. 2009. (Last
accessed February 1, 2022.) https://www.govinfo.gov/content/pkg/BILLS-
111hr1enr/pdf/BILLS-111hr1enr.pdf.

16. Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010.
Public Law 111-312. (Last accessed April 19, 2022.)
https://www.congress.gov/111/plaws/publ312/PLAW-111publ312.htm.

17. The Tax Incentives Assistance Project. The Tax Incentives Assistance Project (TIAP).
December 2014. (Last accessed February 1, 2022.) http://energytaxincentives.org/.

18. U.S. Department of Energy–Office of Energy Efficiency and Renewable Energy.


Technical Support Document: Energy Efficiency Program for Consumer Products and
Commercial and Industrial Equipment, Residential Dishwashers, Dehumidifiers, and
Cooking Products, and Commercial Clothes Washers. 2008. Washington, D.C. (Last
accessed July 8, 2022.) https://www.regulations.gov/document/EERE-2006-STD-0127-
0070.

19. Feldman, S., L. Hoegfen, L. Wilson-Wright, and A. Li. Modelling the Effects of U.S.
ENERGY STAR® Appliance Programs. 2005. ECEEE 2005 Summer Study: Mandelieu
La Napoule, France. (Last accessed February 1, 2022.)
https://www.eceee.org/library/conference_proceedings/eceee_Summer_Studies/2005c/Pa
nel_4/4228feldman/.

20. Rosenberg, M. The Impact of Regional Programs on the Market Share of Energy Star®
Appliances. 2003. Seattle, WA.

21. Titus, E. and S. Feldman. Tracking the Effectiveness of Energy-Efficient Appliance


Programs in the U.S. 2003. International Energy Program Evaluation Conference:
Seattle, WA.

22. Smith, N. (National, Association of State Procurement Officials) and B. Atkinson


(LBNL). Telephone conversation. April 2008.

23. Responsible Purchasing Network. Responsible Purchasing Network. (Last accessed


February 1, 2022.) www.responsiblepurchasing.org/.

24. Harris, J. and F. Johnson. Potential Energy, Cost, and CO2 Savings from Energy-
Efficient Government Purchase. 2000. 2000 ACEEE Summer Study on Energy
Efficiency in Buildings: Asilomar, CA. (Last accessed February 1, 2022.)
http://aceee.org/files/proceedings/2000/data/papers/SS00_Panel4_Paper13.pdf.

17-23
APPENDIX 6A. DETAILED DATA FOR EQUIPMENT PRICE MARKUPS

TABLE OF CONTENTS

6A.1 STATE SALES TAX RATES ..................................................................................... 6A-1

LIST OF TABLES

Table 6A.1.1 State Sales Tax Rates ...................................................................................... 6A-1

6A-i
APPENDIX 6A. DETAILED DATA FOR EQUIPMENT PRICE MARKUPS

6A.1 STATE SALES TAX RATES

Table 6A.1.1 State Sales Tax Rates


Average State Average State Average State
and Local Tax and Local Tax and Local Tax
State State State
Rate Rate Rate
% % %
Alabama 8.70 Kentucky 6.00 North Dakota 6.25
Alaska 1.30 Louisiana 9.40 Ohio 7.20
Arizona 7.30 Maine 5.50 Oklahoma 8.60
Arkansas 9.15 Maryland 6.00 Oregon --
California 8.80 Massachusetts 6.25 Pennsylvania 6.35
Colorado 6.40 Michigan 6.00 Rhode Island 7.00
Connecticut 6.35 Minnesota 7.45 South Carolina 7.45
Delaware -- Mississippi 7.05 South Dakota 6.00
Dist. of Columbia 6.00 Missouri 7.00 Tennessee 9.50
Florida 7.00 Montana -- Texas 8.00
Georgia 7.40 Nebraska 6.10 Utah 7.15
Hawaii 4.00 Nevada 8.25 Vermont 6.10
Idaho New Virginia
6.05 Hampshire -- 5.75
Illinois 8.60 New Jersey 6.60 Washington 9.30
Indiana 7.00 New Mexico 7.05 West Virginia 6.15
Iowa 6.95 New York 8.45 Wisconsin 5.45
Kansas 8.40 North Carolina 7.00 Wyoming 5.40
Source: The Sales Tax Clearinghouse at https://thestc.com/STRates.stm (Accessed June 14, 2023).

6A-1
APPENDIX 7A. COOKING PRODUCTS: DETERMINATION OF ENERGY-USING
COMPONENTS

TABLE OF CONTENTS

7A.1 INTRODUCTION .................................................................................................. 7A-1


7A.2 METHODOLOGY FOR DISAGGREGATING ELECTRIC RANGE
ANNUAL ENERGY CONSUMPTION................................................................. 7A-1
7A.3 METHODOLOGY FOR ESTABLISHING GAS COOKING ENERGY-
USING COMPONENTS ........................................................................................ 7A-4
REFERENCES ......................................................................................................................... 7A-6

LIST OF TABLES

Table 7A.2.1 Electric Cooking Products Baseline Energy-Using Components ............... 7A-3
Table 7A.3.1 Gas Cooking Products: Energy-Using Components ................................... 7A-5

7A-i
APPENDIX 7A. COOKING PRODUCTS: DETERMINATION OF ENERGY-USING
COMPONENTS

7A.1 INTRODUCTION
As presented in chapter 7, section 7.2, based on recent survey data, DOE determined that
the representative annual energy consumption of an electric range is 282 kWh per year based on
available field metering data. Because DOE’s analysis of cooking products consists of analyzing
conventional oven and cooking top product classes, DOE had to disaggregate the range energy
consumption into the portion allocated to the oven and the portion allocated to the cooking top.
In addition, because oven and cooking top energy use may consist of several energy-using
components (i.e., cooking, self-clean, and combined low power mode energy) and potential
increases in efficiency may affect only a subset of these components, DOE had to further
disaggregate the oven and cooking top energy consumption into its specific energy-using
components. The following sections detail: (1) DOE’s method for disaggregating the
representative electric range energy consumption into the various energy-using components of
electric ovens and cooking tops; and (2) DOE’s method for establishing the representative
energy use of gas cooking product energy-using components based on the values that were
determined for the electric cooking product energy-using components.

7A.2 METHODOLOGY FOR DISAGGREGATING ELECTRIC RANGE ANNUAL


ENERGY CONSUMPTION
As noted above, DOE determined that the representative annual energy consumption of
an electric range is 282 kWh. Based on the following equation, DOE assumed the energy
consumption was equal to the weighted-average of standard and self-clean oven energy
consumption plus the cooking top energy consumption based on the efficiency distribution
presented in chapter 8 of this direct final rule technical support document (TSD). Also included
is the low power mode energy consumption associated with electric ovens and cooking tops.

𝑈𝐸𝐶𝑒𝑙𝑒𝑐𝑐𝑜𝑜𝑘𝑖𝑛𝑔 = 282 𝑘𝑊ℎ/𝑦𝑟


= 𝑀𝑆𝑒𝑆𝐶 × (𝐸𝐶𝑂 _ 𝑆𝐶 + 𝐸𝑠𝑐) + (1 − 𝑀𝑆𝑒𝑆𝐶 ) × 𝐸𝐶𝑂 _ 𝑆𝑇𝐷 + 𝐸𝐶𝐴 + (𝐸𝐶𝑇𝐿𝑃_𝐶𝐾 + 𝐸𝐶𝑇𝐿𝑃_𝑂𝑉 )

Where:

UECelec cooking = Annual energy consumption of electric cooking (kWh/yr),


MSeSC = Market share of electric ovens that are self-clean, 73.2%,1
ECO_SC = Annual cooking energy consumption of self-clean electric ovens
(kWh/yr),
Esc = Average annual self-clean energy consumption for electric self-clean
ovens, 34 kWh,
ECO_STD = Annual cooking energy consumption of standard electric ovens
(kWh/yr),
ECA = Annual cooking energy consumption of electric cooking tops (kWh/yr),

7A-1
ECTLP_CK = Market-weighted low power mode for electric cooktops, 9.75 (kWh/yr)
(weighted average of electric smooth element and coil cooktops)
ECTLP_OV = Market-weighted low power mode for electric ovens, 6.21 (kWh/yr)

DOE estimated the annual cooking energy consumption of electric self-clean ovens as a
fraction of the cooking energy consumption of a standard electric oven. Similarly, DOE
estimated the annual cooking energy consumption of electric cooking tops as a fraction of the
cooking energy consumption of standard electric ovens. These fractions were taken from the
ratio of energy consumption as established by the DOE test procedure and presented in the
engineering analysis (see chapter 5 of this direct final rule technical support document). The
following equations represents the ratios used by DOE:

E CO _ SC = Re SC _ STD × E CO _ STD

E CA = ReCT _ STD × E CO _ STD

Where:

ReSC_STD = Ratio of annual self-clean electric oven cooking energy to annul


standard electric cooking energy and
ReCT_STD = Ratio of annual cooktop cooking energy to annul standard electric
cooking energy.

To calculate the above ratios, DOE used the annual cooking energy output values using
the DOE test procedure and market-weighting based on the efficiency distributions presented in
chapter 8 of the direct final rule TSD.

𝐸𝐴𝑂_𝑆𝐶,𝑇𝑃
𝑅𝑒𝑆𝐶 _ 𝑆𝑇𝐷 = = 1.00
𝐸𝐴𝑂_𝑆𝑇𝐷,𝑇𝑃

Where:

EAO_SC,TP = Market-weighted annual cooking energy in active mode for self-clean


ovens as measured by the withdrawn DOE test procedure, 292 kWh/yr,
EAO_STD,TP = Market-weighted annual cooking energy in active mode for standard
ovens as measured by the withdrawn DOE test procedure, 292 kWh/yr,

𝐸𝐶𝐴,𝑇𝑃
𝑅𝑒𝐶𝑇 _ 𝑆𝑇𝐷 = = 0.695
𝐸𝐴𝑂_𝑆𝑇𝐷,𝑇𝑃

Where:

ECA,TP = Market-weighted annual cooking energy in active mode for electric


cooking tops as measured by the DOE test procedure, 200 kWh/yr,

7A-2
EAO_STD,TP = Market-weighted annual cooking energy in active mode for standard
ovens as measured by the DOE test procedure, 291 kWh/yr,

With the annual cooking energy consumption of self-clean electric ovens expressed as a
function of standard electric oven annual cooking energy consumption, DOE solved for the
standard electric oven annual cooking energy consumption by the using the following equation:

282 − 𝑀𝑆𝑒𝑆𝐶 × 𝐸𝑆𝐶 − 𝐸𝐶𝑇𝐿𝑃_𝐶𝐾 − 𝐸𝐶𝑇𝐿𝑃_𝑂𝑉


𝐸𝐶𝑂 _ 𝑆𝑇𝐷 =
𝑀𝑆𝑒𝑆𝐶 × 𝑅𝑒𝑆𝐶 _ 𝑆𝑇𝐷 + 1 − 𝑀𝑆𝑒𝑆𝐶 + 𝑅𝐶𝑇_𝑆𝑇𝐷
282 − 73.2% × 34.4 − 9.75 − 6.21
= = 142 𝑘𝑊ℎ/𝑦𝑟
73.2% × 1.00 + 1 − 73.2% + 0.695

With the standard electric oven annual cooking energy consumption established
(EAO_STD), DOE solved for the self-clean electric oven annual cooking energy consumption
values and the electric cooking top cooking energy consumption:

𝐸𝐶𝑂 _ 𝑆𝐶 = 𝑅𝑒𝑆𝐶 _ 𝑆𝑇𝐷 × 𝐸𝐶𝑂 _ 𝑆𝑇𝐷


= 1.00 × 142 = 142 𝑘𝑊ℎ/𝑦𝑟

𝐸𝐶𝐴 _ 𝑆𝐶 = 𝑅𝑒𝐶𝑇 _ 𝑆𝑇𝐷 × 𝐸𝐶𝑂 _ 𝑆𝑇𝐷


= 0.695 × 142 = 97 𝑘𝑊ℎ/𝑦𝑟

Note that the above estimates above represent the market-weight annual cooking energy
consumption for electric cooking tops (97 kWh/yr), electric standard ovens (142 kWh/yr), and
electric self-clean ovens (142 kWh/yr). DOE used the market efficiency distribution presented in
chapter 8 of this direct final rule TSD to infer the energy use of the baseline level for electric
cooking product classes. Table 7A.2.1 summarizes the baseline energy-using components of
electric cooking products.

Table 7A.2.1 Electric Cooking Products Baseline Energy-Using Components


Electric Smooth Element Standard Oven Self-Clean Oven
Energy-Use Components
Cooking Tops
FS BI/SI FS BI/SI
Cooking Energy (kWh/yr) 99 146 146 149 149
Self-clean Energy
34 34
(kWh/yr)
Fan Energy (kWh/yr) 7 7
Combined Low Power
47 18 18 18 18
Energy (kWh/yr)
Total (kWh/yr) 146 164 171 202 208

7A-3
7A.3 METHODOLOGY FOR ESTABLISHING GAS COOKING ENERGY-USING
COMPONENTS
DOE estimated the annual energy consumption of gas cooking products based on the
active cooking energy consumption values that DOE deduced from the electric range annual
energy consumption of 282 kWh per year. DOE assumed that the ratio of the test-to-field annual
active energy consumption values for electric cooking products applied to gas cooking products
as well. DOE used the following equations to calculate the annual cooking energy consumption
of gas cooking products.

𝐸𝐶𝑇_𝐸𝐿𝐸𝐶
𝐸𝐶𝑇 _ 𝐺𝐴𝑆 = × 𝐸𝐴𝑂_𝐶𝑇_𝐺𝐴𝑆,𝑇𝑃 = 925 𝑘𝐵𝑡𝑢/𝑦𝑟
𝐸𝐴𝑂_𝐶𝑇_𝐸𝐿𝐸𝐶,𝑇𝑃

Where:

E_CT_GAS = Annual cooking energy consumption of gas cooking tops,


ECT__ELEC = Annual cooking energy consumption of electric cooking tops,
EAO_CT_ELEC_TP = Annual active mode test energy consumption of electric cooking tops as
measured by the DOE test procedure,
EAO_CT_GAS_TP = Annual active mode test energy consumption of gas cooking tops as
measured by the DOE test procedure,

𝐸𝐶𝑂_𝑆𝐶_𝐸𝐿𝐸𝐶
𝐸𝐶𝑂 _ 𝑆𝐶 _ 𝐺𝐴𝑆 = × 𝐸𝐴,𝑇𝑃 = 792 𝑘𝐵𝑡𝑢/𝑦𝑟
𝐸𝐴,𝑇𝑃

Where:

ECO_SC_GAS = Annual cooking energy consumption of gas self-clean ovens,


ECO_SC_ELEC = Annual cooking energy consumption of electric self-clean ovens,
EAO_SC_ELEC_TP = Annual active mode test energy consumption of electric self-clean ovens
as measured by the DOE test procedure,
EAO_SC_GAS_TP = Annual active mode test energy consumption of gas self-clean ovens as
measured by the DOE test procedure,

𝐸𝐶𝑂_𝑆𝑇𝐷_𝐸𝐿𝐸𝐶
𝐸𝐶𝑂 _ 𝑆𝑇𝐷 _ 𝐺𝐴𝑆 = × 𝐸𝐴,𝑇𝑃 = 977 𝑘𝐵𝑡𝑢/𝑦𝑟
𝐸𝐴,𝑇𝑃

Where:
ECO_STD_GAS = Annual cooking energy consumption of gas standard ovens,
ECO_STD_ELEC = Annual cooking energy consumption of electric standard ovens,
EAO_STD_GAS_TP = Annual active mode test energy consumption of gas standard ovens as
measured by the DOE test procedure, and
EAO_STD_ELEC_TP = Annual active mode test energy consumption of electric standard ovens,

7A-4
Table 7A.3.1 summarizes the energy-using components of gas cooking products. Self-
clean, and combined low power mode energy consumption values are described and reported in
Chapter 7, Table 7.2.3 for gas standard ovens and self-clean ovens.

Table 7A.3.1 Gas Cooking Products: Energy-Using Components


Standard Oven Self-clean Oven Cooking Top
Energy-Using
Components Freestanding Built- Built-
Freestanding Gas
In/Slide-In In/Slide-In
Cooking
Energy 977 977 792 792 925
(kBtu/yr)
Self-clean Energy
Gas (kBtu/yr) 234 234
Electric
(kWh/yr)
6 6
Fan Energy
6 6
(kWh/yr)
Combined
Low Power
18 18 18 18 8
Mode Energy
(kWh/yr)*
Total
Gas (kBtu/yr) 1,039 1,058 1,108 1,130 951
*Combined low power mode energy for gas cooktops is in kBtu/yr

7A-5
REFERENCES

1. U.S. Energy Information Administration, Residential Energy Consumption Survey 2020,


Washington, DC. http://www.eia.gov/consumption/residential/data/2020/.

7A-6
APPENDIX 8A. USER INSTRUCTIONS FOR LIFE-CYCLE COST AND PAYBACK
PERIOD SPREADSHEET

TABLE OF CONTENTS

8A.1 DEFINITIONS ........................................................................................................ 8A-1


8A.2 BASIC INSTRUCTIONS ....................................................................................... 8A-2

8A-i
APPENDIX 8A. USER INSTRUCTIONS FOR LIFE-CYCLE COST AND PAYBACK
PERIOD SPREADSHEET

8A.1 DEFINITIONS
The interested reader can examine and reproduce detailed results of the U.S. Department
of Energy’s (DOE’s) life-cycle cost (LCC) and payback period (PBP) analysis for consumer
conventional cooking products by using Microsoft Excel spreadsheets available on DOE’s
website at http://energy.gov/eere/buildings/appliance-and-equipment-standards-program.
To fully execute the spreadsheets requires both Microsoft Excel and Crystal Ball software. Both
applications are commercially available. Crystal Ball is available at www.decisioneering.com.

The latest version of the workbook, which is posted on the DOE website, was tested
using Microsoft Excel 2019. The LCC and PBP workbook for consumer conventional cooking
products comprises the following worksheets.

Summary Presents the results of an analysis in terms of average LCC, LCC


savings, and simple PBP for consumer conventional cooking
products. A table includes, for each efficiency level considered,
installed price; lifetime operating cost; LCC average savings; and the
percentage of customers that would incur a net cost from each
standard level. The user can stipulate three parameters for a
simulation run: whether the AEO energy price trend reflects an
economic case that is reference, low-growth, or high-growth
(reference is default); the number of simulation runs to be performed
within a range of 1,000–10,000 (10,000 is default); and equipment
price trend, i.e., price based on PPI trend, or constant equipment
price.

LCC & Payback The LCC&Payback worksheet shows LCC and PBP calculation
results for different efficiency levels for a single Residential Energy
Consumption Survey (RECS) 2020 household. During a Crystal Ball
simulation, the spreadsheet records the LCC and PBP values for
every sampled household.

Rebuttable Payback The Rebuttable Payback worksheet contains the installation costs,
cooking efficiencies, energy use calculations, and the simple PBP
calculations for each efficiency level.

RECS Sample The RECS Sample worksheet contains the RECS 2020 household
data for each product type. During a Crystal Ball simulation, DOE
uses these household characteristics to determine the analysis
parameters.

8A-1
Energy Use Provides energy use components for all product classes at every
efficiency level.

No-New-Standards Gives the market shares for efficiency levels in the no-new-
Case Efficiency standards case.
Distribution

Equipment Prices Develops total installed cost for equipment in 2022$. This sheet
provides baseline and incremental manufacturer costs, retail price,
sales tax, and installation cost for all product classes and each
efficiency level. Includes the assumptions used about markups and
sales tax.

Energy Prices Contains the regional prices for electricity and natural gas used in the
LCC and PBP analysis.

Energy Price Trends Contains the electricity and natural gas price trends for the reference,
high, and low economic growth scenarios based on Annual Energy
Outlook (AEO) 2023.

Discount Rate Contains data from which an average discount rate and a distribution
of discount rates are determined.

Lifetime Presents the average lifetime, in years, for all product classes, the
Weibull parameters used for the survival function, and a graph of the
Weibull retirement function for consumer conventional cooking
products.

Forecast Cells Gives details regarding base-case efficiency distributions for all
cooking tops. Median, minimum, maximum, and average values are
given, along with 5th, 25th, 50th, 75th, and 95th percentile values.
Included are product prices and details of the LCC and PBP (LCC
savings in terms of money, energy, and the percentages of customers
that would experience a net cost, no impact, or net savings from each
efficiency level).

8A.2 BASIC INSTRUCTIONS


Basic instructions for operating the LCC spreadsheet are provided below.

1. After downloading the LCC file from DOE’s website, use Microsoft Excel to open
it. At the bottom of the workbook, click on the tab for the sheet labeled Summary.

2. Use Excel’s “View/Zoom” command in the top menu bar to change the size of the
display so that it fits your monitor.

8A-2
3. Use the graphical interface in the spreadsheet to choose parameters or enter data.
You can change the default choices for the three inputs listed under “User Input”
(energy price trend, start year, and number of simulation runs). To change a default
input, select the desired value from the drop-down choices by the input box.

4. After selecting the desired parameters, click the “Run” button. The spreadsheet will
minimize until the simulation is complete, and will then re-open with the updated
results.

8A-3
UNCERTAINTY AND VARIABILITY IN LCC ANALYSIS FOR
CONSUMER CONVENTIONAL COOKING PRODUCTS

TABLE OF CONTENTS

8B.1 INTRODUCTION ........................................................................................................ 8B-1


8B.2 UNCERTAINTY .......................................................................................................... 8B-1
8B.3 VARIABILITY ............................................................................................................. 8B-1
8B.4 APPROACHES TO UNCERTAINTY AND VARIABILITY .................................... 8B-2
8B.5 USING CRYSTAL BALL TO PERFORM PROBABILITY ANALYSES ................ 8B-2

LIST OF FIGURES

Figure 8B.5.1 Normal, Triangular, Uniform, Weibull, and Custom Probability


Distributions .................................................................................................8B-3

8B-i
APPENDIX 8B. UNCERTAINTY AND VARIABILITY IN LCC ANALYSIS FOR
CONSUMER CONVENTIONAL COOKING PRODUCTS

8B.1 INTRODUCTION

Analysis of energy conservation standards involves calculations of impacts, for example,


the impact of a standard on consumer life-cycle cost (LCC). In order to perform the calculation,
the analyst must first: 1) specify the equation or model that will be used; 2) define the quantities
in the equation; and 3) provide numerical values for each quantity. In the simplest case, the
equation is unambiguous (contains all relevant quantities and no others), each quantity has a
single numerical value, and the calculation results in a single value. However, unambiguity and
precision are rarely the case. In almost all cases, the model and/or the numerical values for each
quantity in the model are not completely known (i.e., there is uncertainty) or the model and/or
the numerical values for each quantity in the model depend upon other conditions (i.e., there is
variability).

Thorough analysis involves accounting for uncertainty and variability. While the simplest
analysis involves a single numerical value for each quantity in a calculation, arguments can arise
about what the appropriate value is for each quantity. Explicit analysis of uncertainty and
variability is intended to provide more complete information to the decision-making process.

8B.2 UNCERTAINTY

When drawing conclusions of past events or speculating about the future, imperfect
knowledge is the rule rather than the exception. For example, the energy actually consumed by a
particular appliance type (such as the average U.S. water heater, direct heating equipment, or
pool heater) is not directly recorded, but rather estimated based upon available information. Even
direct laboratory measurements have some margin of error. When estimating numerical values
expected for quantities at some future date, the exact outcome is rarely known in advance.

8B.3 VARIABILITY

Variability means that different applications or situations produce different numerical


values when calculating a quantity. Specifying an exact value for a quantity may be difficult
because the value depends on something else. For example, water heater energy consumption
depends upon the specific circumstances and behaviors of the occupants (e.g., number of
persons, length and temperature of showers, etc.). Variability makes specifying an appropriate
population value more difficult in as much as any one value may not be representative of the
entire population. Surveys can be helpful here, and analysis of surveys can relate the variable of
interest (e.g., hours of use) to other variables that are better known or easier to forecast (e.g.,
persons per household).

8B-1
8B.4 APPROACHES TO UNCERTAINTY AND VARIABILITY

This section describes two approaches to uncertainty and variability:

• scenario analysis, and


• probability analysis.

Scenario analysis uses a single numerical value for each quantity in a calculation, then
changes one (or more) of the numerical values and repeats the calculation. A number of
calculations are done, which provide some indication of the extent to which the result depends
upon the assumptions. For example, the life-cycle cost of an appliance could be calculated for
energy rates of 2, 8, and 14¢ per kWh.

The advantages of scenario analysis are that each calculation is simple; a range of
estimates is used and crossover points can be identified. (An example of a crossover point is the
energy rate above which the life-cycle cost is reduced, holding all other inputs constant. That is,
the crossover point is the energy rate at which the consumer achieves savings in operating
expense that more than compensate for the increased purchase expense.) The disadvantage of
scenario analysis is that there is no information about the likelihood of each scenario.

Probability analysis considers the probabilities within a range of values. For quantities
with variability (e.g., electricity rates in different households), surveys can be used to generate a
frequency distribution of numerical values (e.g., the number of households with electricity rates
at particular levels) to estimate the probability of each value. For quantities with uncertainty,
statistical or subjective measures can be used to provide probabilities (e.g., manufacturing cost to
improve energy efficiency to some level may be estimated to be $10 ± $3).

The major disadvantage of the probability approach is that it requires more information,
namely information about the shapes and magnitudes of the variability and uncertainty of each
quantity. The advantage of the probability approach is that it provides greater information about
the outcome of the calculations, that is, it provides the probability that the outcome will be in a
particular range.

Scenario and probability analysis provide some indication of the robustness of the policy
given the uncertainties and variability. A policy is robust when the impacts are acceptable over a
wide range of possible conditions.

8B.5 USING CRYSTAL BALL TO PERFORM PROBABILITY ANALYSES

To quantify the uncertainty and variability that exist in inputs to the engineering, LCC,
and payback period (PBP) analyses, DOE used Microsoft Excel spreadsheets combined with
Crystal Ball, a commercially available add-in, to conduct probability analyses. The probability
analyses used Monte Carlo simulation and probability distributions.

Simulation refers to any analytical method meant to imitate a real-life system, especially
when other analyses are too mathematically complex or too difficult to reproduce. Without the

8B-2
aid of simulation, a spreadsheet model will only reveal a single outcome, generally the most
likely or average scenario. Spreadsheet risk analysis uses both a spreadsheet model and
simulation to automatically analyze the effect of varying inputs on outputs of the modeled
system. One type of spreadsheet simulation is Monte Carlo simulation, which randomly
generates values for uncertain variables again and again to simulate a model. Monte Carlo
simulation was named for Monte Carlo, Monaco, where the primary attractions are casinos
containing games of chance. Games of chance such as roulette wheels, dice, and slot machines,
exhibit random behavior. The random behavior in games of chance is similar to how Monte
Carlo simulation selects variable values at random to simulate a model. When you roll a die, you
know that either a 1, 2, 3, 4, 5, or 6 will come up, but you do not know which for any particular
roll. It's the same with the variables that have a known range of values but an uncertain value for
any particular time or event (e.g., equipment lifetime, discount rate, and installation cost).

For each uncertain variable (one that has a range of possible values), possible values are
defined with a probability distribution. The type of distribution selected is based on the
conditions surrounding that variable. Types of probability distributions include those in Figure
8B.5.1.

NORMAL TRIANGULAR UNIFORM

WEIBULL CUSTOM

Figure 8B.5.1 Normal, Triangular, Uniform, Weibull, and Custom Probability


Distributions

During a simulation, multiple scenarios of a model are calculated by repeatedly sampling


values from the probability distributions for the uncertain variables and using those values for the
cell. Crystal Ball simulations can consist of as many trials (or scenarios) as desired—hundreds or
even thousands. During a single trial, Crystal Ball randomly selects a value from the defined
possibilities (the range and shape of the probability distribution) for each uncertain variable and
then recalculates the spreadsheet.

8B-3
APPENDIX 8C. LIFETIME DISTRIBUTIONS

TABLE OF CONTENTS

8C.1 INTRODUCTION .................................................................................................... 8C-1


8C.2 DERIVATION OF WEIBULL DISTRIBUTION PARAMETERS ......................... 8C-1
REFERENCES ..................................................................................................................... 8C-5

LIST OF TABLES

Table 8C.2.1 Consumer Conventional Cooking Products .....................................................8C-2

LIST OF FIGURES

Figure 8C.2.1 Surviving Probability of Electric Consumer Conventional Cooking


Products...........................................................................................................8C-3
Figure 8C.2.2 Cumulative Lifetime Length of Electric Consumer Conventional
Cooking ...........................................................................................................8C-3
Figure 8C.2.3 Surviving Probability of Gas Consumer Conventional Cooking Products....8C-4
Figure 8C.2.4 Cumulative Lifetime Length of Gas Consumer Conventional Cooking
Products...........................................................................................................8C-4

8C-i
APPENDIX 8C. LIFETIME DISTRIBUTIONS

8C.1 INTRODUCTION
The U.S. Department of Energy (DOE) characterized the lifetime of both fuel types of
consumer conventional cooking products being considered for new energy efficiency standards
(electric and gas consumer conventional cooking products). DOE characterized consumer
conventional cooking products lifetimes using a Weibull probability distribution that ranged
from the minimum to maximum lifetime estimates, as described in chapter 8, section 8.2.3. The
Weibull distribution is recommended for evaluating lifetime data, because it can be shaped to
match low, most likely (or average), and high values. The probability of exceeding the high
value is contained in the long tail of the Weibull distribution.1,2

8C.2 DERIVATION OF WEIBULL DISTRIBUTION PARAMETERS


Weibull distributions utilize available data to assign low, average, and high values to a
random variable that has unknown distribution parameters. DOE applied Weibull distributions to
product lifetime data to derive low, average, and high lifetime values, along with a percentile
containing a high value. A similar approach is described in a technical note to the software
Crystal Ball, which uses a most likely value in place of an average value.3 The Weibull
distribution can be defined as:

Where:

L= location,
α= scale, and
β= shape.

The cumulative distribution therefore is:

Based on available data, Weibull distribution parameters are specified as follows.

1. The output deviates must be greater than the expert opinion of low value.
2. The average, Xavg, must be equal to the average value from the available data.
3. The high value, xb, must correspond to some particular percentile point (e.g., 95
percent or 90 percent).

8C-1
The values for the parameters in the equations were determined using the approach
outlined in Crystal Ball’s technical note.3

Crystal Ball can be used to check a solution by specifying a Weibull distribution that has
the calculated parameters (location, scale, and shape) in an assumption cell, then generating a
forecast that equals that assumption. The forecast histogram and statistics will confirm whether
the Weibull distribution matches the desired shape.

This solution can be checked using Crystal Ball by specifying a Weibull distribution with
the calculated parameters (location, scale, and shape) in an assumption cell and generate a
forecast that equals the assumption. Forecast histogram and statistics verify that the Weibull
distribution matches the desired shape.

Table 8C.2.1 shows the average values used to determine the Weibull distribution
parameters alpha and beta. For consumer conventional cooking products, DOE developed two
lifetime estimates based on product fuel type—one for electricity and another for natural gas.
DOE estimated that product lifetimes did not vary based on whether the product was a consumer
conventional cooking top or an oven. DOE estimated that the maximum lifetime percentile for
both fuel types was 99 percent.

Table 8C.2.1 Consumer Conventional Cooking Products


Expert Opinion Values Weibull Parameters
Product Fuel Maximum
Type Average Alpha
percentile Beta (shape)
year (scale)
%
Electric 16.8 99 16.88 6.99
Gas 14.5 99 14.56 5.73

Figure 8C.2.1 through Figure 8C.2.4 show the Weibull distribution as well as the
cumulative Weibull distribution for each fuel type of consumer conventional cooking products.

8C-2
Lifetime Distribution - Electric
18%
Probability of Failure (%)

15%

12%

9%

6%

3%

0%

Age of Equipment (Years)

Figure 8C.2.1 Surviving Probability of Electric Consumer Conventional Cooking


Products

Cumulative Lifetime - Electric


100%
90%
80%
70%
Probability (%)

60%
50%
40%
30%
20%
10%
0%

Age of Equipment (Years)

Figure 8C.2.2 Cumulative Lifetime Length of Electric Consumer Conventional Cooking

8C-3
Lifetime Distribution - Gas

14%
Probability of Failure (%)

12%

10%

8%

6%

4%

2%

0%

Age of Equipment (Years)

Figure 8C.2.3 Surviving Probability of Gas Consumer Conventional Cooking Products

Cumulative Lifetime - Gas


100%
90%
80%
70%
Probability (%)

60%
50%
40%
30%
20%
10%
0%

Age of Equipment (Years)

Figure 8C.2.4 Cumulative Lifetime Length of Gas Consumer Conventional Cooking


Products

8C-4
REFERENCES

1. Barnes, P. R., J. W. Van Dyke, B. W. McConnell, S. M. Cohn, and S. L. Purucker, The


Feasibility of Replacing or Upgrading Utility Distribution Transformers During Routine
Maintenance, 1995. Oak Ridge National Laboratory. Oak Ridge, TN. Report No. Report
No. ORNL-6804/R1. http://www.ornl.gov/~webworks/cpr/v823/rpt/78562.pdf.

2. Karr, T., Making the Most of Life Test Data. Appliance Magazine, 2003.
http://www.appliancemagazine.com/print.php?article=197&zone=1&first=1.

3. Crystal Ball, Technote: Derivation of Weibull Distribution Parameters When the


Minimum, Most Likely Value, and a Percentile are Known, 2007. (Last accessed
November, 2013.) http://www.crystalball.com/support/simulation/cbl_gen_021A.html.

8C-5
APPENDIX 8D. DISTRIBUTIONS USED FOR DISCOUNT RATES

TABLE OF CONTENTS

8D.1 INTRODUCTION: DISTRIBUTIONS USED FOR RESIDENTIAL


CONSUMER DISCOUNT RATES ....................................................................... 8D-1
8D.1.1 Distribution of Rates for Equity Classes ................................................................. 8D-1
8D.2 DISTRIBUTION OF REAL EFFECTIVE DISCOUNT RATES BY INCOME
GROUP ................................................................................................................... 8D-6
REFERENCES ......................................................................................................................... 8D-8

LIST OF TABLES

Table 8D.1.1 30-Year Average Nominal Interest Rates for Household Equity Type ...... 8D-2
Table 8D.2.1 Distribution of Real Discount Rates by Income Group .............................. 8D-7

LIST OF FIGURES

Figure 8D.1.1 Distribution of Annual Rate of Money Market Accounts .......................... 8D-2
Figure 8D.1.2 Distribution of Annual Rate of Return on CDs .......................................... 8D-3
Figure 8D.1.3 Distribution of Annual Rate of Return on Savings Bonds (30 Year
Treasury Bills) ............................................................................................ 8D-3
Figure 8D.1.4 Distribution of Annual Rate of State and Local Bonds .............................. 8D-4
Figure 8D.1.5 Distribution of Annual Rate of Return on Corporate AAA Bonds............. 8D-4
Figure 8D.1.6 Distribution of Annual Rate of Return on S&P 500 ................................... 8D-5
Figure 8D.1.7 Annual Consumer Price Index (CPI) Rate .................................................. 8D-5
Figure 8D.2.1 Distribution of Real Discount Rates by Income Group .............................. 8D-6

8D-i
APPENDIX 8D. DISTRIBUTIONS USED FOR DISCOUNT RATES

8D.1 INTRODUCTION: DISTRIBUTIONS USED FOR RESIDENTIAL


CONSUMER DISCOUNT RATES

The Department of Energy (DOE) derived consumer discount rates for the life-cycle cost
(LCC) analysis using data on interest or return rates for various types of debt and equity to
calculate a real effective discount rate for each household in the Federal Reserve Board’s Survey
of Consumer Finances (SCF) in 1995, 1998, 2001, 2004, 2007, 2010, 2013, 2016, and 2019.1 To
account for variation among households in rates for each of the types, DOE sampled a rate for
each household in its building sample from a distribution of discount rates for each of six income
groups. This appendix describes the distributions used.

8D.1.1 Distribution of Rates for Equity Classes


Figure 8D.1.1 through Figure 8D.1.6 show the distribution of real interest rates for
different types of equity. Data for equity classes are not available from the Federal Reserve
Board’s SCF, so DOE derived data for these classes from national-level historical data (1991-
2020). The rates for stocks are the annual returns on the Standard and Poor’s 500 for 1991-2020.2
The interest rates associated with AAA corporate bonds were collected from Moody’s time-
series data for 1991-2020.3 Rates on Certificates of Deposit (CDs) accounts came from Cost of
Savings Index (COSI) data covering 1991-2020.4,a The interest rates associated with state and
local bonds (20-bond municipal bonds) were collected from Federal Reserve Board economic
data time-series for 1991-2020.10,b The interest rates associated with treasury bills (30-Year
treasury constant maturity rate) were collected from Federal Reserve Board economic data time-
series for 1991–2020.11,c Rates for money market accounts are based on three-month money
market account rates reported by Organization for Economic Cooperation and Development
(OECD) from 1991–2020.13 Rates for savings accounts are assumed to be half the average real
money market rate. Rates for mutual funds are a weighted average of the stock rates and the
bond rates.d The 30-year average nominal interest rates are shown in Table 8D.1.1. DOE
adjusted the nominal rates to real rates using the annual inflation rate in each year (see Figure
8D.1.7). In addition, DOE adjusted the nominal rates to real effective rates by accounting for the
fact that interest on such equity types is taxable. The capital gains marginal tax rate varies for
each household based on income as shown in chapter 8 (the impact of this is not shown in Figure
8D.1.1 through Figure 8D.1.6, which are only adjusted for inflation).

a
The Wells COSI is based on the interest rates that the depository subsidiaries of Wells Fargo & Company pay to
individuals on certificates of deposit (CDs), also known as personal time deposits. Wells Fargo COSI started in
November 2009.5,6 From July 2007 to October 2009 the index was known as Wachovia COSI7 and from January
1984 to July 2007 the index was known as GDW (or World Savings) COSI.8,9
b
This index was discontinued in 2016. To calculate the 2017 and after values, DOE compared 1981-2020 data for
30-Year Treasury Constant Maturity Rate and Moody’s AAA Corporate Bond Yield to the 20-Bond Municipal
Bond Index data.3,10,11
c
From 2003-2005 there are no data. For 2003-2005, DOE used 20-Year Treasury Constant Maturity Rate.12
d
SCF reports what type of mutual funds the household has (e.g., stock mutual fund, savings bond mutual fund, etc.).
For mutual funds with a mixture of stocks and bonds, the mutual fund interest rate is a weighted average of the stock
rates (two-thirds weight) and the savings bond rates (one-third weight).

8D-1
Table 8D.1.1 30-Year Average Nominal Interest Rates for Household Equity Type
30 Year Average
Type of Equity
Nominal Rate (%)
Savings accounts 2.54
Money market accounts 2.60
Certificate of deposit 2.76
Treasury Bills (T-bills) 4.47
State/Local bonds 4.46
AAA Corporate Bonds 5.34
Stocks (S&P 500) 11.13
Mutual funds 8.91

Figure 8D.1.1 Distribution of Annual Rate of Money Market Accounts

8D-2
Figure 8D.1.2 Distribution of Annual Rate of Return on CDs

Figure 8D.1.3 Distribution of Annual Rate of Return on Savings Bonds (30 Year Treasury
Bills)

8D-3
Figure 8D.1.4 Distribution of Annual Rate of State and Local Bonds

6%

4%
Real Annual Rate of Return

2%

0%

-2%

-4%

Figure 8D.1.5 Distribution of Annual Rate of Return on Corporate AAA Bonds

8D-4
Figure 8D.1.6 Distribution of Annual Rate of Return on S&P 500

Figure 8D.1.7 Annual Consumer Price Index (CPI) Rate

8D-5
8D.2 DISTRIBUTION OF REAL EFFECTIVE DISCOUNT RATES BY INCOME
GROUP

Real effective discount rates were calculated for each household of the SCF using the
method described in Chapter 8. Interest rates for asset types were as described in 8D.1.1. The
data source for the interest rates for mortgages, home equity loans, credit cards, installment
loans, other residence loans, and other lines of credit is the Federal Reserve Board’s SCF in
1995, 1998, 2001, 2004, 2007, 2010, 2013, 2016, and 2019. DOE adjusted the nominal rates to
real rates using the annual inflation rate in each year.

Using the appropriate SCF data for each year, DOE adjusted the nominal mortgage
interest rate and the nominal home equity loan interest rate for each relevant household in the
SCF for mortgage tax deduction and inflation. In cases where the effective interest rate is equal
to or below the inflation rate (resulting in a negative real interest rate), DOE set the real effective
interest rate to zero. Figure 8D.2.1 provides a graphical representation of the real effective
discount rate distributions by income group, while Table 8D.2.1 provides the full distributions as
used in the LCC analysis.

Figure 8D.2.1 Distribution of Real Discount Rates by Income Group

8D-6
Table 8D.2.1 Distribution of Real Discount Rates by Income Group
Income Group 1 Income Group 2 Income Group 3 Income Group 4 Income Group 5 Income Group 6
DR (20-39.9 (40-59.9 (60-79.9 (80-89.9 (90-100
(0-19.9 percentile)
Bin percentile) percentile) percentile) percentile) percentile)
(%) Rate Weight Rate Weight Rate Weight Rate Weight Rate Weight Rate Weight
% % % % % % % % % % % %
0-1 0.14 34.80 0.20 25.09 0.25 16.13 0.32 10.88 0.39 8.43 0.44 10.04
1-2 1.55 7.25 1.52 8.17 1.56 9.65 1.55 14.81 1.55 17.35 1.57 20.96
2-3 2.48 6.97 2.51 9.73 2.52 13.86 2.52 21.01 2.50 24.12 2.51 23.72
3-4 3.51 7.62 3.49 11.09 3.48 14.61 3.49 18.02 3.48 19.92 3.48 19.61
4-5 4.47 8.92 4.48 9.82 4.48 13.20 4.46 13.13 4.47 14.56 4.47 13.66
5-6 5.47 6.63 5.45 8.69 5.47 9.57 5.46 8.57 5.44 7.55 5.44 8.16
6-7 6.48 5.59 6.47 5.95 6.48 6.81 6.47 5.61 6.51 4.31 6.31 2.22
7-8 7.48 3.89 7.48 5.33 7.43 4.72 7.49 2.11 7.40 1.12 7.51 0.49
8-9 8.44 2.89 8.45 2.71 8.47 2.63 8.49 1.29 8.44 0.59 8.40 0.28
9-10 9.53 2.15 9.49 1.99 9.49 1.58 9.48 0.99 9.58 0.62 9.62 0.22
10-11 10.51 1.64 10.45 1.69 10.44 1.29 10.43 0.68 10.44 0.22 10.47 0.28
11-12 11.49 1.17 11.52 1.38 11.52 1.03 11.56 0.51 11.40 0.28 11.56 0.11
12-13 12.52 1.12 12.47 1.18 12.54 0.75 12.47 0.35 12.47 0.16 12.34 0.06
13-14 13.54 1.13 13.53 0.90 13.50 0.66 13.52 0.44 13.48 0.12 13.50 0.02
14-15 14.51 1.23 14.56 1.13 14.59 0.73 14.50 0.31 14.54 0.18 14.44 0.06
15-16 15.55 1.29 15.55 0.98 15.53 0.56 15.47 0.31 15.42 0.13 15.52 0.02
16-17 16.49 1.22 16.41 0.95 16.46 0.51 16.43 0.30 16.17 0.06 16.39 0.01
17-18 17.58 0.95 17.51 0.70 17.52 0.44 17.48 0.21 17.53 0.06 17.93 0.03
18-19 18.42 0.70 18.47 0.56 18.41 0.33 18.35 0.09 18.47 0.06 18.49 0.01
19-20 19.45 0.51 19.40 0.50 19.45 0.22 19.60 0.09 19.39 0.05 19.16 0.01
20-21 20.56 0.44 20.41 0.26 20.38 0.18 20.45 0.09 20.47 0.04 20.13 0.02
21-22 21.43 0.54 21.43 0.34 21.34 0.16 21.47 0.07 21.38 0.06 0.00 0.00
22-23 22.49 0.39 22.48 0.23 22.58 0.08 22.72 0.03 0.00 0.00 0.00 0.00
23-24 23.41 0.17 23.52 0.13 23.40 0.10 23.44 0.02 0.00 0.00 23.89 0.03
24-25 24.65 0.18 24.46 0.10 24.55 0.04 24.07 0.01 0.00 0.00 0.00 0.00
25-26 25.35 0.16 25.40 0.10 25.47 0.06 25.33 0.03 25.79 0.00 0.00 0.00
26-27 26.52 0.13 26.46 0.03 26.50 0.05 0.00 0.00 0.00 0.00 0.00 0.00
27-28 27.49 0.07 27.40 0.02 27.41 0.03 27.27 0.03 27.14 0.00 0.00 0.00
28-29 28.14 0.09 28.29 0.05 28.38 0.01 0.00 0.00 0.00 0.00 0.00 0.00
29-30 29.87 0.01 29.37 0.01 29.31 0.00 0.00 0.00 0.00 0.00 0.00 0.00
>30 68.17 0.14 125.34 0.19 135.27 0.02 53.80 0.00 0.00 0.00 0.00 0.00
Total 4.63 100.00 4.86 100.00 4.41 100.00 3.71 100.00 3.34 100.00 3.01 100.00

8D-7
REFERENCES

1. U.S. Board of Governors of the Federal Reserve System. Survey of Consumer Finances.
1995, 1998, 2001, 2004, 2007, 2010, 2013, 2016, and 2019. (Last accessed June 1, 2023.)
http://www.federalreserve.gov/econresdata/scf/scfindex.htm.

2. Damodaran, A. Data Page: Historical Returns on Stocks, Bonds and Bills-United States.
2021. (Last accessed June 1, 2023.) http://pages.stern.nyu.edu/~adamodar/.

3. Moody’s. Moody’s Seasoned Aaa Corporate Bond Yield [AAA], retrieved from FRED,
Federal Reserve Bank of St. Louis. (Last accessed June 1, 2023.)
https://fred.stlouisfed.org/series/AAA.

4. Wells Fargo. Wells Fargo Cost of Savings Index (COSI). (Last accessed June 1, 2023.)
https://www.wellsfargo.com/mortgage/manage-account/cost-of-savings-index/.

5. Wells Fargo. Wells Fargo Cost of Savings Index (COSI): Historical Data (2009-2015)
retrieved from Mortgage-X - Mortgage Information Service. (Last accessed June 1,
2023.) http://mortgage-x.com/general/indexes/wells_fargo_cosi.asp.

6. Wells Fargo. Wells Fargo Cost of Savings Index (COSI): Historical Data (2015-2020)
retrieved from MoneyCafe.com. (Last accessed June 1, 2023.)
https://www.moneycafe.com/cosi-rate-wells-fargo-cost-of-savings-index/.

7. Wachovia. Wachovia Cost of Savings Index (COSI): Historical Data (2007-2009)


retrieved from Mortgage-X - Mortgage Information Service. (Last accessed June 1,
2023.) http://mortgage-x.com/general/indexes/wachovia_cosi.asp.

8. Golden West Financial Corporation. GDW (World Savings) Cost of Savings Index
(COSI): Historical Data (1984-1990) retrieved from Mortgage-X - Mortgage Information
Service. (Last accessed June 1, 2023.) http://mortgage-
x.com/general/indexes/cosi_history.asp.

9. Golden West Financial Corporation. GDW (World Savings) Cost of Savings Index
(COSI): Historical Data (1991-2007) retrieved from Mortgage-X - Mortgage Information
Service. (Last accessed June 1, 2023.) http://mortgage-x.com/general/indexes/default.asp.

10. U.S. Board of Governors of the Federal Reserve System. State and Local Bonds - Bond
Buyer Go 20-Bond Municipal Bond Index (DISCONTINUED) [WSLB20], retrieved from
FRED, Federal Reserve Bank of St. Louis. (Last accessed June 1, 2023.)
https://fred.stlouisfed.org/series/WSLB20.

11. U.S. Board of Governors of the Federal Reserve System. 30-Year Treasury Constant
Maturity Rate [DGS30], retrieved from FRED, Federal Reserve Bank of St. Louis. (Last
accessed June 1, 2023.) https://fred.stlouisfed.org/series/DGS30.

8D-8
12. U.S. Board of Governors of the Federal Reserve System. 20-Year Treasury Constant
Maturity Rate [DGS20], retrieved from FRED, Federal Reserve Bank of St. Louis. (Last
accessed June 1, 2023.) https://fred.stlouisfed.org/series/DGS20.

13. Organization for Economic Co-operation and Development (OECD). Short-term interest
rates (indicator). (Last accessed June 1, 2023.) https://data.oecd.org/interest/short-term-
interest-rates.htm.

8D-9
APPENDIX 8E. LIFE-CYCLE COST AND PAYBACK PERIOD RESULTS FOR
ALTERNATE SCENARIOS

TABLE OF CONTENTS

8E.1 ALTERNATIVE SCENARIOS CONSIDERED IN THIS RULEMAKING ............... 8E-1


8E.2 LCC AND PBP ALTERNATIVE SCENARIO RESULTS .......................................... 8E-1
8E.2.1 Low Energy Price Scenario ........................................................................................... 8E-1
8E.2.2 High Energy Price Scenario ......................................................................................... 8E-12
REFERENCES ........................................................................................................................ 8E-22

LIST OF TABLES

Table 8E.2.1 Low Energy Prices: Average LCC and PBP Results for Electric
Smooth Element Standalone Cooking Tops ................................................ 8E-2
Table 8E.2.2 Low Energy Prices: Average LCC Savings Results for Electric
Smooth Element Standalone Cooking Tops ................................................ 8E-2
Table 8E.2.3 Low Energy Prices: Average LCC and PBP Results for Electric
Smooth Element Cooking Top Component of a Combined Cooking
Product ......................................................................................................... 8E-2
Table 8E.2.4 Low Energy Prices: Average LCC Savings Results for Electric
Smooth Element Cooking Top Component of a Combined Cooking
Product ......................................................................................................... 8E-3
Table 8E.2.5 Low Energy Prices: Average LCC and PBP Results for Gas
Standalone Cooking Tops ............................................................................ 8E-3
Table 8E.2.6 Low Energy Prices: Average LCC Savings Results for Gas Standalone
Cooking Tops ............................................................................................... 8E-3
Table 8E.2.7 Low Energy Prices: Average LCC and PBP Results for Gas Cooking
Top Component of a Combined Cooking Product ...................................... 8E-4
Table 8E.2.8 Low Energy Prices: Average LCC Savings Results for Gas Cooking
Top Component of a Combined Cooking Product ...................................... 8E-4
Table 8E.2.9 Low Energy Prices: Average LCC and PBP Results for Electric
Standard Ovens, Free-Standing ................................................................... 8E-4
Table 8E.2.10 Low Energy Prices: Average LCC Savings Results for Electric
Standard Ovens, Free-Standing ................................................................... 8E-5
Table 8E.2.11 Low Energy Prices: Average LCC and PBP Results for Electric
Standard Ovens, Built-In/Slide-In ............................................................... 8E-5
Table 8E.2.12 Low Energy Prices: Average LCC Savings Results for Electric
Standard Ovens, Built-In/Slide-In ............................................................... 8E-5
Table 8E.2.13 Low Energy Prices: Average LCC and PBP Results for Electric Self-
Clean Ovens, Free-Standing ........................................................................ 8E-6
Table 8E.2.14 Low Energy Prices: Average LCC Savings Results for Electric Self-
Clean Ovens, Free-Standing ........................................................................ 8E-6

8E-i
Table 8E.2.15 Low Energy Prices: Average LCC and PBP Results for Electric Self-
Clean Ovens, Built-In/Slide-In .................................................................... 8E-6
Table 8E.2.16 Low Energy Prices: Average LCC Savings Results for Electric Self-
Clean Ovens, Built-In/Slide-In .................................................................... 8E-7
Table 8E.2.17 Low Energy Prices: Average LCC and PBP Results for All Electric
Ovens ........................................................................................................... 8E-7
Table 8E.2.18 Low Energy Prices: Average LCC Savings Results for All Electric
Ovens ........................................................................................................... 8E-7
Table 8E.2.19 Low Energy Prices: Average LCC and PBP Results for Gas Standard
Ovens, Free-Standing ................................................................................... 8E-8
Table 8E.2.20 Low Energy Prices: Average LCC Savings Results for Gas Standard
Ovens, Free-Standing ................................................................................... 8E-8
Table 8E.2.21 Low Energy Prices: Average LCC and PBP Results for Gas Standard
Ovens, Built-In/Slide-In ............................................................................... 8E-9
Table 8E.2.22 Low Energy Prices: Average LCC Savings Results for Gas Standard
Ovens, Built-In/Slide-In ............................................................................... 8E-9
Table 8E.2.23 Low Energy Prices: Average LCC and PBP Results for Gas Self-Clean
Ovens, Free-Standing ................................................................................... 8E-9
Table 8E.2.24 Low Energy Prices: Average LCC Savings Results for Gas Self-Clean
Ovens, Free-Standing ................................................................................. 8E-10
Table 8E.2.25 Low Energy Prices: Average LCC and PBP Results for Gas Self-Clean
Ovens, Built-In/Slide-In ............................................................................. 8E-10
Table 8E.2.26 Low Energy Prices: Average LCC Savings Results for Gas Self-Clean
Ovens, Built-In/Slide-In ............................................................................. 8E-10
Table 8E.2.27 Low Energy Prices: Average LCC and PBP Results for All Gas Ovens... 8E-11
Table 8E.2.28 Low Energy Prices: Average LCC Savings Results for All Gas Ovens .... 8E-11
Table 8E.2.29 High Energy Prices: Average LCC and PBP Results for Electric
Smooth Element Standalone Cooking Tops .............................................. 8E-12
Table 8E.2.30 High Energy Prices: Average LCC Savings Results for Electric
Smooth Element Standalone Cooking Tops .............................................. 8E-12
Table 8E.2.31 High Energy Prices: Average LCC and PBP Results for Electric
Smooth Element Cooking Top Component of a Combined Cooking
Product ....................................................................................................... 8E-13
Table 8E.2.32 High Energy Prices: Average LCC Savings Results for Electric
Smooth Element Cooking Top Component of a Combined Cooking
Product ....................................................................................................... 8E-13
Table 8E.2.33 High Energy Prices: Average LCC and PBP Results for Gas
Standalone Cooking Tops .......................................................................... 8E-13
Table 8E.2.34 High Energy Prices: Average LCC Savings Results for Gas Standalone
Cooking Tops ............................................................................................. 8E-14
Table 8E.2.35 High Energy Prices: Average LCC and PBP Results for Gas Cooking
Top Component of a Combined Cooking Product .................................... 8E-14
Table 8E.2.36 High Energy Prices: Average LCC Savings Results for Gas Cooking
Top Component of a Combined Cooking Product .................................... 8E-14
Table 8E.2.37 High Energy Prices: Average LCC and PBP Results for Standard
Electric Ovens, Free-Standing ................................................................... 8E-15

8E-ii
Table 8E.2.38 High Energy Prices: Average LCC Savings Results for Electric
Standard Ovens, Free-Standing ................................................................. 8E-15
Table 8E.2.39 High Energy Prices: Average LCC and PBP Results for Electric
Standard Ovens, Built-In/Slide-In ............................................................. 8E-15
Table 8E.2.40 High Energy Prices: Average LCC Savings Results for Electric
Standard Ovens, Built-In/Slide-In ............................................................. 8E-16
Table 8E.2.41 High Energy Prices: Average LCC and PBP Results for Electric Self-
Clean Ovens, Free-Standing ...................................................................... 8E-16
Table 8E.2.42 High Energy Prices: Average LCC Savings Results for Electric Self-
Clean Ovens, Free-Standing ...................................................................... 8E-16
Table 8E.2.43 High Energy Prices: Average LCC and PBP Results for Electric Self-
Clean Ovens, Built-In/Slide-In .................................................................. 8E-17
Table 8E.2.44 High Energy Prices: Average LCC Savings Results for Electric Self-
Clean Ovens, Built-In/Slide-In .................................................................. 8E-17
Table 8E.2.45 High Energy Prices: Average LCC and PBP Results for All Electric
Ovens ......................................................................................................... 8E-17
Table 8E.2.46 High Energy Prices: Average LCC Savings Results for All Electric
Ovens ......................................................................................................... 8E-18
Table 8E.2.47 High Energy Prices: Average LCC and PBP Results for Gas Standard
Ovens, Free-Standing ................................................................................. 8E-18
Table 8E.2.48 High Energy Prices: Average LCC Savings Results for Gas Standard
Ovens, Free-Standing ................................................................................. 8E-18
Table 8E.2.49 High Energy Prices: Average LCC and PBP Results for Gas Standard
Ovens, Built-In/Slide-In ............................................................................. 8E-19
Table 8E.2.50 High Energy Prices: Average LCC Savings Results for Gas Standard
Ovens, Built-In/Slide-In ............................................................................. 8E-19
Table 8E.2.51 High Energy Prices: Average LCC and PBP Results for Gas Self-
Clean Ovens, Free-Standing ...................................................................... 8E-19
Table 8E.2.52 High Energy Prices: Average LCC Savings Results for Gas Self-Clean
Ovens, Free-Standing ................................................................................. 8E-20
Table 8E.2.53 High Energy Prices: Average LCC and PBP Results for Gas Self-
Clean Ovens, Built-In/Slide-In .................................................................. 8E-20
Table 8E.2.54 High Energy Prices: Average LCC Savings Results for Self-Clean
Ovens, Built-In/Slide-In ............................................................................. 8E-20
Table 8E.2.55 High Energy Prices: Average LCC and PBP Results for All Gas Ovens .. 8E-21
Table 8E.2.56 High Energy Prices: Average LCC Savings Results for All Gas Ovens ... 8E-21

8E-iii
APPENDIX 8E. LIFE-CYCLE COST AND PAYBACK PERIOD RESULTS FOR
ALTERNATIVE SCENARIOS

8E.1 ALTERNATIVE SCENARIOS CONSIDERED IN THIS RULEMAKING


DOE considered alternative scenarios in this rulemaking to account for uncertainty and
variability in key analysis inputs whose probability distribution was not well known. The
alternative scenarios DOE considered are:

• Low energy price scenario: The low energy price scenario uses future energy prices
based on energy price trends for low economic growth projected by the Energy
Information Administration in its Annual Energy Outlook (AEO) 2023.1 This assumption
generally results in less energy cost savings and lower economic benefits from setting a
standard, compared to the reference scenario.
• High energy price scenario: The high-energy price scenario uses future energy prices
based on energy price trends for high economic growth projected by the Energy
Information Administration in its AEO 2023. This assumption generally results in higher
energy cost savings and lower economic benefits from setting a standard, compared to the
reference scenario.

8E.2 LCC AND PBP ALTERNATIVE SCENARIO RESULTS


DOE addressed input uncertainties in its LCC and PBP analysis for this rulemaking in
both its reference case analyses and in its alternative scenario analyses. DOE used the Monte
Carlo approach with 10,000 simulated households per alternative scenario to determine how the
results of the LCC and PBP analysis change under the different scenarios.

This section presents the results of the LCC and PBP for those alternative scenario
analyses. Note that DOE examined each scenario independently, while keeping all other
parameters according to the reference scenario.

8E.2.1 Low Energy Price Scenario


Table 8E.2.1 through Table 8E.2.28 present results for the low energy price scenario for
the trial standard levels (TSLs) described in chapter 10 of this direct final rule technical support
document (TSD).

8E-1
Table 8E.2.1 Low Energy Prices: Average LCC and PBP Results for Electric Smooth
Element Standalone Cooking Tops
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $571 $20 $255 $826 -- 16.8
1 1 $571 $15 $191 $762 0.6 16.8
2 2 $595 $14 $177 $773 4.0 16.8
3 3 $1,212 $16 $206 $1,419 171.1 16.8
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

Table 8E.2.2 Low Energy Prices: Average LCC Savings Results for Electric Smooth
Element Standalone Cooking Tops
Life-Cycle Cost Savings
Efficiency % of Consumers
TSL*, ** Average Savings
Level that Experience
Net Cost 2022$
1 1 0% $61.53
2 2 52% $8.01
3 3 100% ($639.45)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

Table 8E.2.3 Low Energy Prices: Average LCC and PBP Results for Electric Smooth
Element Cooking Top Component of a Combined Cooking Product
Average Costs
2022$ Simple Average
Efficiency
TSL* First Year’s Lifetime LCC Payback Lifetime
Level Installed
Operating Operating years years
Cost
Cost Cost
-- Baseline $571 $20 $255 $826 -- 16.8
1 1 $571 $15 $191 $762 0.6 16.8
2 2 $595 $14 $177 $773 4.0 16.8
3 3 $1,212 $16 $206 $1,419 171.1 16.8
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

8E-2
Table 8E.2.4 Low Energy Prices: Average LCC Savings Results for Electric Smooth
Element Cooking Top Component of a Combined Cooking Product
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 0% $61.53
2 2 52% $8.01
3 3 100% ($639.45)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

Table 8E.2.5 Low Energy Prices: Average LCC and PBP Results for Gas Standalone
Cooking Tops
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $464 $16 $174 $638 -- 14.5
1 1 $465 $15 $167 $633 6.6 14.5
2, 3 2 $492 $13 $144 $636 10.5 14.5
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

Table 8E.2.6 Low Energy Prices: Average LCC Savings Results for Gas Standalone
Cooking Tops
Life-Cycle Cost Savings
Efficiency % of Consumers
TSL*, ** Average Savings
Level that Experience
Net Cost 2022$
1 1 1% $3.05
2, 3 2 39% ($1.15)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

8E-3
Table 8E.2.7 Low Energy Prices: Average LCC and PBP Results for Gas Cooking Top
Component of a Combined Cooking Product
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $464 $16 $174 $638 -- 14.5
1 1 $465 $15 $167 $633 6.6 14.5
2, 3 2 $492 $13s $144 $636 10.5 14.5
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

Table 8E.2.8 Low Energy Prices: Average LCC Savings Results for Gas Cooking Top
Component of a Combined Cooking Product
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 1% $3.05
2, 3 2 39% ($1.15)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

Table 8E.2.9 Low Energy Prices: Average LCC and PBP Results for Electric Standard
Ovens, Free-Standing
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime years years
Installed
Operating Operating LCC
Cost
Cost Cost
-- Baseline $695 $22 $286 $981 -- 16.8
1 1 $694 $21 $268 $962 2.1 16.8
2 2 $752 $20 $257 $1,009 25.3 16.8
3 3 $806 $17 $218 $1,023 20.8 16.8
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

8E-4
Table 8E.2.10 Low Energy Prices: Average LCC Savings Results for Electric Standard
Ovens, Free-Standing
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 0% $16.12
2 2 61% ($42.46)
3 3 86% ($40.70)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

Table 8E.2.11 Low Energy Prices: Average LCC and PBP Results for Electric Standard
Ovens, Built-In/Slide-In
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $727 $23 $297 $1,024 -- 16.8
1 1 $726 $22 $279 $1,005 2.1 16.8
2 2 $784 $21 $269 $1,052 25.8 16.8
3 3 $838 $18 $229 $1,067 20.9 16.8
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

Table 8E.2.12 Low Energy Prices: Average LCC Savings Results for Electric Standard
Ovens, Built-In/Slide-In
Life-Cycle Cost Savings
Efficiency % of Consumers
TSL*, ** Average Savings
Level that Experience
Net Cost 2022$
1 1 0% $14.86
2 2 69% ($42.82)
3 3 87% ($44.29)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

8E-5
Table 8E.2.13 Low Energy Prices: Average LCC and PBP Results for Electric Self-Clean
Ovens, Free-Standing
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $750 $27 $346 $1,096 -- 16.8
1 1 $748 $26 $328 $1,077 2.1 16.8
2 2 $806 $25 $318 $1,124 25.3 16.8
3 3 $860 $22 $279 $1,138 20.8 16.8
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

Table 8E.2.14 Low Energy Prices: Average LCC Savings Results for Electric Self-Clean
Ovens, Free-Standing
Life-Cycle Cost Savings
Efficiency % of Consumers
TSL*, ** Average Savings
Level that Experience
Net Cost 2022$
1 1 0% $15.95
2 2 23% ($40.09)
3 3 81% ($23.83)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

Table 8E.2.15 Low Energy Prices: Average LCC and PBP Results for Electric Self-Clean
Ovens, Built-In/Slide-In
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $782 $28 $356 $1,138 -- 16.8
1 1 $780 $26 $339 $1,119 2.1 16.8
2 2 $838 $26 $329 $1,167 25.8 16.8
3 3 $892 $23 $289 $1,181 20.9 16.8
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

8E-6
Table 8E.2.16 Low Energy Prices: Average LCC Savings Results for Electric Self-Clean
Ovens, Built-In/Slide-In
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 0% $15.66
2 2 11% ($37.51)
3 3 78% ($19.09)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

Table 8E.2.17 Low Energy Prices: Average LCC and PBP Results for All Electric Ovens
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $750 $27 $339 $1,088 -- 16.8
1 1 $749 $25 $321 $1,069 2.1 16.8
2 2 $806 $24 $310 $1,116 25.4 16.8
3 3 $860 $21 $271 $1,131 20.8 16.8
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

Table 8E.2.18 Low Energy Prices: Average LCC Savings Results for All Electric Ovens
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 0% $15.86
2 2 27% ($39.81)
3 3 81% ($25.63)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

8E-7
Table 8E.2.19 Low Energy Prices: Average LCC and PBP Results for Gas Standard
Ovens, Free-Standing
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $799 $21 $233 $1,032 -- 14.5
1 1 $797 $19 $216 $1,012 1.9 14.5
2, 3 2 $839 $19 $208 $1,047 18.0 14.5
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

Table 8E.2.20 Low Energy Prices: Average LCC Savings Results for Gas Standard
Ovens, Free-Standing
Life-Cycle Cost Savings
Efficiency % of Consumers
TSL*, ** Average Savings
Level that Experience
Net Cost 2022$
1 1 0% $14.62
2, 3 2 37% ($28.38)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

8E-8
Table 8E.2.21 Low Energy Prices: Average LCC and PBP Results for Gas Standard
Ovens, Built-In/Slide-In
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $831 $22 $242 $1,073 -- 14.5
1 1 $828 $20 $225 $1,054 2.0 14.5
2, 3 2 $871 $19 $218 $1,088 18.4 14.5
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

Table 8E.2.22 Low Energy Prices: Average LCC Savings Results for Gas Standard
Ovens, Built-In/Slide-In
Life-Cycle Cost Savings
Efficiency % of Consumers
TSL*, ** Average Savings
Level that Experience
Net Cost 2022$
1 1 0% $14.96
2, 3 2 61% ($28.98)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

Table 8E.2.23 Low Energy Prices: Average LCC and PBP Results for Gas Self-Clean
Ovens, Free-Standing
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $967 $22 $249 $1,216 -- 14.5
1 1 $963 $20 $232 $1,195 1.9 14.5
2, 3 2 $1,007 $20 $224 $1,231 18.0 14.5
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

8E-9
Table 8E.2.24 Low Energy Prices: Average LCC Savings Results for Gas Self-Clean
Ovens, Free-Standing
Life-Cycle Cost Savings
Efficiency % of Consumers
TSL*, ** Average Savings
Level that Experience
Net Cost 2022$
1 1 0% $14.95
2, 3 2 7% ($20.78)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

Table 8E.2.25 Low Energy Prices: Average LCC and PBP Results for Gas Self-Clean
Ovens, Built-In/Slide-In
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $998 $23 $259 $1,257 -- 14.5
1 1 $995 $21 $242 $1,236 2.0 14.5
2, 3 2 $1,039 $21 $234 $1,273 18.4 14.5
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

Table 8E.2.26 Low Energy Prices: Average LCC Savings Results for Gas Self-Clean
Ovens, Built-In/Slide-In
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 0% $15.03
2, 3 2 22% ($27.33)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

8E-10
Table 8E.2.27 Low Energy Prices: Average LCC and PBP Results for All Gas Ovens
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $892 $22 $242 $1,134 -- 14.5
1 1 $889 $20 $225 $1,114 1.9 14.5
2, 3 2 $932 $19 $217 $1,149 18.0 14.5
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

Table 8E.2.28 Low Energy Prices: Average LCC Savings Results for All Gas Ovens
Life-Cycle Cost Savings
Efficiency % of Consumers that
TSL*, ** Average Savings
Level Experience
Net Cost 2022$
1 1 0% $14.81
2, 3 2 21% ($24.31)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

8E-11
8E.2.2 High Energy Price Scenario
Table 8E.2.29 through Table 8E.2.56 through present results for the high energy price
scenario for the TSLs described in chapter 10 of this direct final rule TSD.

Table 8E.2.29 High Energy Prices: Average LCC and PBP Results for Electric Smooth
Element Standalone Cooking Tops
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $571 $20 $266 $837 -- 16.8
1 1 $571 $15 $199 $770 0.6 16.8
2 2 $595 $14 $185 $780 3.9 16.8
3 3 $1,212 $17 $213 $1,426 165.6 16.8
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

Table 8E.2.30 High Energy Prices: Average LCC Savings Results for Electric Smooth
Element Standalone Cooking Tops
Life-Cycle Cost Savings
Efficiency % of Consumers
TSL*, ** Average Savings
Level that Experience
Net Cost 2022$
1 1 0% $64.70
2 2 51% $9.39
3 3 100% ($637.94)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

8E-12
Table 8E.2.31 High Energy Prices: Average LCC and PBP Results for Electric Smooth
Element Cooking Top Component of a Combined Cooking Product
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $571 $20 $266 $837 -- 16.8
1 1 $571 $15 $199 $770 0.6 16.8
2 2 $595 $14 $185 $780 3.9 16.8
3 3 $1,212 $17 $213 $1,426 165.6 16.8
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.
Table 8E.2.32 High Energy Prices: Average LCC Savings Results for Electric Smooth
Element Cooking Top Component of a Combined Cooking Product
Life-Cycle Cost Savings
Efficiency % of Consumers
TSL*, ** Average Savings
Level that Experience
Net Cost 2022$
1 1 0% $64.70
2 2 51% $9.39
3 3 100% ($637.94)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

Table 8E.2.33 High Energy Prices: Average LCC and PBP Results for Gas Standalone
Cooking Tops
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $464 $16 $179 $642 -- 14.5
1 1 $465 $15 $172 $638 6.5 14.5
2, 3 2 $492 $13 $147 $640 10.4 14.5
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

8E-13
Table 8E.2.34 High Energy Prices: Average LCC Savings Results for Gas Standalone
Cooking Tops
Life-Cycle Cost Savings
Efficiency % of Consumers
TSL*, ** Average Savings
Level that Experience
Net Cost 2022$
1 1 1% $3.31
2, 3 2 38% ($0.39)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

Table 8E.2.35 High Energy Prices: Average LCC and PBP Results for Gas Cooking Top
Component of a Combined Cooking Product
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $464 $16 $179 $642 -- 14.5
1 1 $465 $15 $172 $638 6.5 14.5
2, 3 2 $492 $13 $147 $640 10.4 14.5
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

Table 8E.2.36 High Energy Prices: Average LCC Savings Results for Gas Cooking Top
Component of a Combined Cooking Product
Life-Cycle Cost Savings
Efficiency % of Consumers
TSL*, ** Average Savings
Level that Experience
Net Cost 2022$
1 1 1% $3.31
2, 3 2 38% ($0.39)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

8E-14
Table 8E.2.37 High Energy Prices: Average LCC and PBP Results for Standard Electric
Ovens, Free-Standing
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $695 $23 $298 $993 -- 16.8
1 1 $694 $21 $280 $974 2.0 16.8
2 2 $752 $21 $268 $1,020 24.8 16.8
3 3 $806 $17 $227 $1,033 20.4 16.8
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

Table 8E.2.38 High Energy Prices: Average LCC Savings Results for Electric Standard
Ovens, Free-Standing
Life-Cycle Cost Savings
Efficiency % of Consumers
TSL*, ** Average Savings
Level that Experience
Net Cost 2022$
1 1 0% $17.07
2 2 61% ($41.95)
3 3 85% ($38.56)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

Table 8E.2.39 High Energy Prices: Average LCC and PBP Results for Electric Standard
Ovens, Built-In/Slide-In
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $727 $24 $310 $1,037 -- 16.8
1 1 $726 $22 $292 $1,018 2.1 16.8
2 2 $784 $21 $280 $1,064 25.4 16.8
3 3 $838 $18 $239 $1,077 20.6 16.8
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

8E-15
Table 8E.2.40 High Energy Prices: Average LCC Savings Results for Electric Standard
Ovens, Built-In/Slide-In
Life-Cycle Cost Savings
Efficiency % of Consumers
TSL*, ** Average Savings
Level that Experience
Net Cost 2022$
1 1 0% $15.74
2 2 69% ($42.33)
3 3 86% ($42.12)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

Table 8E.2.41 High Energy Prices: Average LCC and PBP Results for Electric Self-
Clean Ovens, Free-Standing
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $750 $28 $362 $1,111 -- 16.8
1 1 $748 $26 $344 $1,092 2.0 16.8
2 2 $806 $25 $332 $1,138 24.8 16.8
3 3 $860 $22 $291 $1,151 20.4 16.8
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

Table 8E.2.42 High Energy Prices: Average LCC Savings Results for Electric Self-Clean
Ovens, Free-Standing
Life-Cycle Cost Savings
Efficiency % of Consumers
TSL*, ** Average Savings
Level that Experience
Net Cost 2022$
1 1 0% $16.87
2 2 23% ($39.46)
3 3 80% ($21.86)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

8E-16
Table 8E.2.43 High Energy Prices: Average LCC and PBP Results for Electric Self-
Clean Ovens, Built-In/Slide-In
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $782 $28 $372 $1,154 -- 16.8
1 1 $780 $27 $355 $1,135 2.1 16.8
2 2 $838 $26 $343 $1,181 25.3 16.8
3 3 $892 $23 $302 $1,194 20.6 16.8
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.
Table 8E.2.44 High Energy Prices: Average LCC Savings Results for Electric Self-Clean
Ovens, Built-In/Slide-In
Life-Cycle Cost Savings
Efficiency % of Consumers
TSL*, ** Average Savings
Level that Experience
Net Cost 2022$
1 1 0% $16.60
2 2 11% ($36.71)
3 3 77% ($17.17)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

Table 8E.2.45 High Energy Prices: Average LCC and PBP Results for All Electric Ovens
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $750 $27 $353 $1,103 -- 16.8
1 1 $749 $25 $336 $1,084 2.1 16.8
2 2 $806 $25 $324 $1,130 25.0 16.8
3 3 $860 $22 $283 $1,143 20.4 16.8
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

8E-17
Table 8E.2.46 High Energy Prices: Average LCC Savings Results for All Electric Ovens
Life-Cycle Cost Savings
Efficiency % of Consumers
TSL*, ** Average Savings
Level that Experience
Net Cost 2022$
1 1 0% $16.79
2 2 26% ($39.15)
3 3 80% ($23.64)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

Table 8E.2.47 High Energy Prices: Average LCC and PBP Results for Gas Standard
Ovens, Free-Standing
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $799 $21 $239 $1,037 -- 14.5
1 1 $797 $19 $221 $1,017 1.9 14.5
2, 3 2 $839 $19 $212 $1,051 17.7 14.5
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

Table 8E.2.48 High Energy Prices: Average LCC Savings Results for Gas Standard
Ovens, Free-Standing
Life-Cycle Cost Savings
Efficiency % of Consumers
TSL*, ** Average Savings
Level that Experience
Net Cost 2022$
1 1 0% $15.52
2, 3 2 37% ($28.07)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

8E-18
Table 8E.2.49 High Energy Prices: Average LCC and PBP Results for Gas Standard
Ovens, Built-In/Slide-In
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $831 $22 $248 $1,079 -- 14.5
1 1 $828 $20 $231 $1,059 1.9 14.5
2, 3 2 $871 $20 $223 $1,093 18.1 14.5
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

Table 8E.2.50 High Energy Prices: Average LCC Savings Results for Gas Standard
Ovens, Built-In/Slide-In
Life-Cycle Cost Savings
Efficiency % of Consumers
TSL*, ** Average Savings
Level that Experience
Net Cost 2022$
1 1 0% $15.87
2, 3 2 61% ($28.71)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

Table 8E.2.51 High Energy Prices: Average LCC and PBP Results for Gas Self-Clean
Ovens, Free-Standing
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $967 $22 $255 $1,222 -- 14.5
1 1 $963 $20 $238 $1,201 1.9 14.5
2, 3 2 $1,007 $20 $229 $1,236 17.7 14.5
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

8E-19
Table 8E.2.52 High Energy Prices: Average LCC Savings Results for Gas Self-Clean
Ovens, Free-Standing
Life-Cycle Cost Savings
Efficiency % of Consumers
TSL*, ** Average Savings
Level that Experience
Net Cost 2022$
1 1 0% $15.85
2, 3 2 7% ($20.06)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

Table 8E.2.53 High Energy Prices: Average LCC and PBP Results for Gas Self-Clean
Ovens, Built-In/Slide-In
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $998 $23 $265 $1,264 -- 14.5
1 1 $995 $21 $248 $1,243 1.9 14.5
2, 3 2 $1,039 $21 $240 $1,278 18.1 14.5
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

Table 8E.2.54 High Energy Prices: Average LCC Savings Results for Self-Clean Ovens,
Built-In/Slide-In
Life-Cycle Cost Savings
Efficiency % of Consumers
TSL*, ** Average Savings
Level that Experience
Net Cost 2022$
1 1 0% $15.93
2, 3 2 22% ($26.97)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

8E-20
Table 8E.2.55 High Energy Prices: Average LCC and PBP Results for All Gas Ovens
Average Costs
2022$ Simple Average
Efficiency
TSL* Payback Lifetime
Level First Year’s Lifetime
Installed years years
Operating Operating LCC
Cost
Cost Cost
-- Baseline $892 $22 $248 $1,140 -- 14.5
1 1 $889 $20 $230 $1,119 1.9 14.5
2, 3 2 $932 $20 $222 $1,154 17.7 14.5
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The
PBP is measured relative to the baseline product.
*All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

Table 8E.2.56 High Energy Prices: Average LCC Savings Results for All Gas Ovens
Life-Cycle Cost Savings
Efficiency % of Consumers
TSL*, ** Average Savings
Level that Experience
Net Cost 2022$
1 1 0% $15.71
2, 3 2 21% ($23.78)
*The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.
**All TSLs except TSL 1 have a compliance year of 2027; TSL 1 has a compliance year of 2028.

8E-21
REFERENCES

1. U.S. Department of Energy–Energy Information Administration. Annual Energy Outlook


2023 with Projections to 2050. 2023. (Last accessed August 1, 2023.)
https://www.eia.gov/outlooks/aeo/.

8E-22
APPENDIX 9A. PRICE ELASTICITY OF DEMAND FOR CONSUMER
CONVENTIONAL COOKING PRODUCTS

TABLE OF CONTENTS

9A.1 INTRODUCTION .................................................................................................... 9A-1


9A.2 METHODOLOGY FOR PRICE-ELASTICITY ESTIMATES ............................... 9A-1
9A.3 DATA AND RESULTS ........................................................................................... 9A-2
REFERENCES ........................................................................................................................ 9A-3

9A-i
APPENDIX 9A. PRICE ELASTICITY OF DEMAND FOR CONSUMER
CONVENTIONAL COOKING PRODUCTS

9A.1 INTRODUCTION

DOE estimated a price-elasticity of demand for cooking products to support the


simulation of the repair-or-replace decision making the Department accounted for in its National
Impact Analysis (NIA; see chapter 10 of this direct final rule technical support document). The
price-elasticity is used to estimate the number of households that – as a response to new energy
efficiency standards – would repair a failing unit rather than replace it. DOE developed a semi-
parametric, generalized additive model for the estimation of the price-elasticity of demand for
cooking products. This appendix provides a brief description of the methodology and data DOE
used for that estimation.

9A.2 METHODOLOGY FOR PRICE-ELASTICITY ESTIMATES

Price-elasticity of demand can be measured in several ways depending on data


availability, preference of the analyst and some other factors. One of the most common
approaches applies a constant elasticity model on aggregate time series data, with a log-log
relationship between demand and price. DOE developed on such approach and extended it to
include macroeconomic indicators which the Department believes account for relevant
macroeconomic factors that would affect the purchase of cooking products. The three
macroeconomic indicators DOE used are: (a) the real median household income; (b) the number
of new houses sold; and (c) a measure of near-time consumer attitudes about investments in
durable goods. Similar to the relationship between demand and price, DOE assumed a log-log
relationship between demand and household income. As for the other two macroeconomic
indicators, DOE did not make any assumption on their relationship to demand. Rather, the
Department used a non-parametric approach to estimate their effect on the demand of cooking
products. In a non-parametric regression model the coefficients of the independent variables are
estimated from smoothing functions (curves) that lead to best fittings.

Beyond those three macroeconomic variables, DOE further accounted for unobserved
macroeconomic effects on purchase of cooking products. DOE associated the unobserved
macroeconomic effects to both the shipment year, which is included in the model as a factor
(dummy variable), and to other random effects. Finally, since the data DOE used discriminate
between shipments of electric and gas cooking products, the Department included in its model
the product type – based on the fuel – also as a factor.

The regression model DOE used to estimate the price-elasticity for cooking products is:

ln(𝑆𝑚𝑡 ) = 𝛽0 + 𝛾ln(𝑃𝑚𝑡 ) + 𝛽1 ln(𝐼𝑁𝐶𝑡 ) + s(𝑁𝐻𝑡 ) + s(𝐼𝐶𝑆𝑡 ) + 𝑚 + 𝑡 + 𝜀𝑟 + 𝜀𝑚𝑡

where:
𝑚 Cooking product type (1: electric; 2: gas),
𝑡 Shipment year,

9A-1
𝑆𝑚𝑡 Shipments of 𝑚 in 𝑡,
𝛽0 Constant effect (regression intercept),
𝛾 Price-elasticity estimate,
𝑃𝑚𝑡 Shipments-weighted average price of 𝑚 in 𝑡,
𝛽1 Income-elasticity estimate,
𝐼𝑁𝐶𝑡 Real median household income in 𝑡,
𝑠(𝑥) Smoothing function of variable 𝑥,
𝑁𝐻𝑡 New houses sales in 𝑡,
𝐼𝐶𝑆𝑡 Index of Consumer Sentiment in t,
𝜀𝑟 Unobserved macroeconomic random effects,
𝜀𝑚𝑡 Unobserved stochastic error associated to 𝑚 in 𝑡.

9A.3 DATA AND RESULTS

DOE relied on the US Census Bureau’s Current Industrial Report (CIR)1 as its main
source of data for the elasticity estimation. The CIR reports regular and accurate intercensal
estimates of shipments and value of shipments for cooking ranges and other major household
appliances. DOE used data from 1973 to 2010 in its estimation of a price-elasticity for cooking
products. Annual shipments were obtained directly from CIR; annual appliance prices were
estimated by dividing the annual values of shipments by the number of shipments in each year.

DOE further relied on three additional data sources for the macroeconomic indicators
described above. DOE used the report “Income, Poverty, and Health Insurance Coverage in the
United States: 2012”2 from the US Census Bureau’s Current Population Reports to inform the
real median household income variable in its regression model. In addition, DOE used the “New
One-Family Houses Sold”3 report from the US Census Bureau’s Current Construction Reports to
account for new houses sales in the model above. The report provides statistics for new privately
owned houses sold and for sale in the US. Finally, DOE used the University of Michigan’s Index
of Consumer Sentiment4 (ICS) to inform the corresponding variable in the regression model
above. One of the objectives of the ICS is to allow for incorporating empirical measures of
consumer expectations into models of spending and saving behavior.

DOE used those four data sets in the regression model described above. The model
presented an R-squared value of 0.954. All variables included in the model are statistically
significant, with all p-values equal or lower than 0.001. Further, a Wald test of significance5
performed on the parametric and smooth terms resulted in p-values equal or lower than 0.011.
The resulting price-elasticity DOE estimated for cooking products is -0.367.

9A-2
REFERENCES

1. Current Industrial Report Series. Major Household Appliances MA335F, [Washington,


D.C.]:U.S. Dept. of Commerce, Bureau of the Census, 1973-2010. Available online at
http://catalog.hathitrust.org/Record/007407089 and
https://www.census.gov/manufacturing/cir/historical_data/ma335f/.

2. DeNavas-Walt, Carmen; Bernadette D. Proctor; Jessica C. Smith (2013): “Income,


Poverty, and Health Insurance Coverage in the United States: 2012.” Current Population
Reports P60-245. U.S. Census Bureau. Washington, DC, USA.
http://www.census.gov/prod/2013pubs/p60-245.pdf.

3. US. Bureau of the Census, New One Family Houses Sold: United States [HSN1F],
retrieved from FRED, Federal Reserve Bank of St. Louis
https://research.stlouisfed.org/fred2/series/HSN1F/, October 16, 2015.

4. Thomson Reuters/University of Michigan, University of Michigan: Consumer


Sentiment© [UMCSENT], retrieved from FRED, Federal Reserve Bank of St. Louis
https://research.stlouisfed.org/fred2/series/UMCSENT/, October 16, 2015.

5. Wood, S.N. (2013) “On p-values for smooth components of an extended generalized
additive model.” Biometrika 100:221-228.

9A-3
USER INSTRUCTIONS FOR SHIPMENTS AND NATIONAL
IMPACT ANALYSIS SPREADSHEETS

TABLE OF CONTENTS

10A.1 INTRODUCTION ............................................................................................... 10A-1


10A.2 BASIC INSTRUCTIONS .................................................................................... 10A-2

10A-i
APPENDIX 10A. USER INSTRUCTIONS FOR SHIPMENTS AND NATIONAL
IMPACT ANALYSIS SPREADSHEETS

10A.1 INTRODUCTION
The interested reader can examine and reproduce detailed results of the U.S. Department
of Energy’s (DOE’s) shipments and national impact analysis (NIA) for consumer conventional
cooking products using Microsoft Excel spreadsheets that are available on DOE’s website.
http://www.eere.energy.gov/buildings/appliance_standards/

The latest version of the Microsoft Excel shipments and NIA workbook, which is posted
on the DOE website, was tested using Microsoft Excel 2019. The NIA spreadsheet performs
calculations to forecast the change in national energy use and net present value due to an energy
conservation standard. The energy use and associated costs and savings attributable to a given
standard are determined first by calculating the shipments and then the energy use and costs for
all products shipped under that standard. The differences between results under the standard case
and the base case then can be compared and the nationwide energy savings and net present
values (NPVs) determined.

The shipments and NIA workbook for oven products comprises the following
worksheets.

This sheet contains user input selections under “User Inputs” and
summary tables calculating Cumulative Energy Savings and
NPV for the selected standard level. The sheet contains the
Inputs and Summary efficiency levels being considered for the selected product
classes and the associated incremental prices. This sheet also
contains efficiency weighted average energy use and equipment
price for the no-new-standards and standards cases for the
selected product classes.
LCC Inputs This sheet contains the inputs from the Life-cycle cost analysis.
Efficiency Distribution_ This sheet contains no-new-standards case and standards case
Cooktop efficiency trends for cooking tops.
Efficiency Distribution_ This sheet contains no-new-standards case and standards case
Oven efficiency trends for ovens.
This sheet contains data for historical sales and market share of
Historical Shipment
each cooking product class.
No-New-Standards Case
This sheet calculates the estimation of no-new-standards case
Ship._Electric Cooking
shipments for electric cooking products.
Products
No-New-Standards Case
This sheet calculates the estimation of no-new-standards case
Ship._Gas Cooking
shipments for gas cooking products.
Products

10A-1
No-New-Standards Case
This sheet calculates the estimation of no-new-standards case
Ship. Cooking Top &
shipments for cooking tops and ovens.
Oven
This sheet calculates the estimation of no-new-standards case
and standards case shipments for cooking tops. It also calculates
the energy savings and operating cost savings. The energy and
Cooking Top No-New-
operating cost savings in a single year are the difference between
Stds & Stds Case
the no-new-standards case energy use and operating costs for
that year and the standard case energy use and operating costs in
the same year.
This sheet calculates the estimation of no-new-standards case
and standards case shipments for ovens. It also calculates the
energy savings and operating cost savings. The energy and
Oven No-New-Stds &
operating cost savings in a single year are the difference between
Stds Case
the no-new-standards case energy use and operating costs for
that year and the standard case energy use and operating costs in
the same year.
This sheet provides projected new housing construction starts by
Housing Projections
housing type.
This worksheet contains projected average and marginal
Energy Prices
electricity and gas prices for the three economic scenarios.
The sheet contains the site-to-power plants and full-fuel-cycle
Heat Rates conversion factors that are used in the primary and full-fuel-
cycle energy savings calculations.
This sheet contains the probability of survival of a cooking
Lifetime product at a given age of the unit by its fuel type. The sheet also
provides the average lifetime of a unit by its fuel type.

10A.2 BASIC INSTRUCTIONS


Basic instructions for operating the NIA spreadsheets are as follows:

1. Once the NIA spreadsheets have been downloaded from the Web, open the file using
Excel. At the bottom, click on the tab for the worksheet Inputs and Summary.

2. Use Excel’s View/Zoom commands at the top menu bar to change the size of the display
to make it fit your monitor.

3. The user can change the model parameters listed in the box labelled “User Inputs”. The
parameters are:
a. Discount Rate: To the change value, type in the desired Discount Rate (3% or
7%).
b. Economic Growth: To change the growth scenario, use the drop-down arrow and
select the desired Growth level (Reference, Low, or High).

10A-2
c. Trial Standards Level (TSL): To change level, use the drop-down menu and select
the desired trial standards level (TSL 1, TSL 2 or TSL 3).
d. Relative Price Elasticity: To change the relative price elasticity, use the drop-
down menu and select the desired price elasticity scenario (No impact, or RP
elasticity – 0.367).

4. Once the parameters have been set, the results are automatically updated and are reported
in the “National Impact Summary” table for each product category to the right of the
“User Inputs” box.

10A-3
APPENDIX 10B. FULL-FUEL-CYCLE ANALYSIS

TABLE OF CONTENTS

10B.1 INTRODUCTION .......................................................................................................10B-1


10B.2 SITE-TO-PRIMARY ENERGY FACTORS ...............................................................10B-2
10B.3 FFC METHODOLOGY ..............................................................................................10B-3
10B.4 ENERGY MULTIPLIERS FOR THE FULL FUEL CYCLE .....................................10B-5
REFERENCES ........................................................................................................................10B-6

LIST OF TABLES

Table 10B.2.1 Electric Power Heat Rates (MMBtu/MWh) by Sector and End-Use ........10B-3
Table 10B.3.1 Dependence of FFC Parameters on AEO Inputs ........................................10B-5
Table 10B.4.1 Energy Multipliers for the Full Fuel Cycle (Based on AEO 2023)............10B-5

10B-i
APPENDIX 10B. FULL-FUEL-CYCLE ANALYSIS

10B.1 INTRODUCTION
This appendix summarizes the methods the U.S. Department of Energy (DOE) used to
calculate the estimated full-fuel-cycle (FFC) energy savings from potential energy conservation
standards. The FFC measure includes point-of-use (site) energy; the energy losses associated
with generation, transmission, and distribution of electricity; and the energy consumed in
extracting, processing, and transporting or distributing primary fuels. DOE’s method of analysis
previously encompassed only site energy and the energy lost through generation, transmission,
and distribution of electricity. In 2011 DOE announced its intention, based on recommendations
from the National Academy of Sciences, to use FFC measures of energy use and emissions when
analyzing proposed energy conservation standards.1 This appendix summarizes the methods
DOE used to incorporate impacts of the full fuel cycle into the analysis.

In the national energy savings calculation, DOE estimates the site, primary and full-fuel-
cycle (FFC) energy consumption for each standard level, for each year in the analysis period.
DOE defines these quantities as follows:

• Site energy consumption is the physical quantity of fossil fuels or electricity consumed at
the site where the end-use service is provided. a The site energy consumption is used to
calculate the energy cost input to the net present value (NPV) calculation.
• Primary energy consumption is defined by converting the site fuel use from physical
units, for example cubic feet for natural gas, or kWh for electricity, to common energy
units (million Btu or MMBtu). For electricity the conversion factor is a marginal heat rate
that incorporates losses in generation, transmission and distribution, and depends on the
sector, end use and year.
• The full-fuel-cycle (FFC) energy use is equal to the primary energy use plus the energy
consumed "upstream" of the site in the extraction, processing and distribution of fuels.
The FFC energy use was calculated by applying a fuel-specific FFC energy multiplier to
the primary energy use.

For electricity from the grid, site energy is measured in terawatt-hours (TWh). The
primary energy of a unit of grid electricity is equal to the heat content of the fuels used to
generate that electricity, including transmission and distribution losses.b DOE typically measures
the primary energy associated with the power sector in quads (quadrillion Btu). Both primary
fuels and electricity are used in upstream activities. The treatment of electricity in full-fuel-cycle
analysis must distinguish between electricity generated by fossil fuels and electricity generated
from renewable sources (wind, solar, and hydro). For the former, the upstream fuel cycle relates

a
For fossil fuels, this is the site of combustion of the fuel.
b
For electricity sources like nuclear energy and renewable energy, the primary energy is calculated using the EIA
convention as described below.

10B-1
to the fuel consumed at the power plant. There is no upstream component for the latter, because
no fuel per se is used.

10B.2 SITE-TO-PRIMARY ENERGY FACTORS


DOE uses heat rates to convert site electricity savings in TWh to primary energy savings
in quads. The heat rates are developed as a function of the sector, end-use and year of the
analysis period. For this analysis DOE uses output of the DOE/Energy Information
Administration (EIA)’s National Energy Modeling System (NEMS).2 EIA uses the NEMS model
to produce the Annual Energy Outlook (AEO). DOE’s approach uses the most recently available
edition, in this case AEO 2023.3 The AEO publication includes a reference case and a series of
side cases incorporating different economic and policy scenarios. DOE calculates marginal heat
rates as the ratio of the change in fuel consumption to the change in generation for each fossil
fuel type, where the change is defined as the difference between the reference case and the side
case. DOE calculates a marginal heat rate for each of the principal fuel types: coal, natural gas
and oil. DOE uses the EIA convention of assigning a heat rate of 10.5 Btu/Wh to nuclear power
and 9.5 Btu/Wh to electricity from renewable sources.

DOE multiplied the fuel share weights for sector and end-use, described in appendix 15A
of this TSD, by the fuel specific marginal heat rates, and summed over all fuel types, to define a
heat rate for each sector/end-use. This step incorporates the transmission and distribution losses.
In equation form:

h(u,y) = (1 + TDLoss)*∑r,f g(r,f,y) H(f,y)

Where:

TDLoss = the fraction of total generation that is lost in transmission and distribution,
equal to 0.07037
u = an index representing the sector/end-use (e.g. commercial cooling)
y = the analysis year
f = the fuel type
H(f,y) = the fuel-specific heat rate
g(r,f,y) = the fraction of generation provided by fuel type f for end-use u in year y
h(u,y) = the end-use specific marginal heat rate

The sector/end-use specific heat rates are shown in Table 10B.2.1. These heat rates
convert site electricity to primary energy in quads; i.e., the units used in the table are quads per
TWh.

10B-2
Table 10B.2.1 Electric Power Heat Rates (MMBtu/MWh) by Sector and End-Use
2025 2030 2035 2040 2045 2050+
Residential
Clothes Dryers 9.640 9.309 9.455 9.451 9.449 9.443
Cooking 9.623 9.298 9.444 9.440 9.440 9.433
Freezers 9.660 9.311 9.456 9.451 9.449 9.441
Lighting 9.675 9.346 9.495 9.489 9.486 9.480
Refrigeration 9.659 9.312 9.457 9.452 9.450 9.443
Space Cooling 9.529 9.162 9.292 9.295 9.300 9.289
Space Heating 9.696 9.365 9.516 9.509 9.504 9.498
Water Heating 9.650 9.327 9.476 9.471 9.469 9.463
Other Uses 9.639 9.311 9.457 9.453 9.452 9.445
Commercial
Cooking 9.528 9.244 9.390 9.391 9.395 9.390
Lighting 9.553 9.257 9.403 9.403 9.406 9.400
Office Equipment (Non-Pc) 9.478 9.203 9.347 9.350 9.357 9.352
Office Equipment (Pc) 9.478 9.203 9.347 9.350 9.357 9.352
Refrigeration 9.626 9.303 9.449 9.446 9.445 9.439
Space Cooling 9.502 9.140 9.269 9.273 9.279 9.268
Space Heating 9.706 9.370 9.521 9.513 9.508 9.502
Ventilation 9.629 9.306 9.453 9.449 9.448 9.442
Water Heating 9.526 9.246 9.393 9.394 9.398 9.394
Other Uses 9.499 9.219 9.364 9.366 9.372 9.367
Industrial
All Uses 9.499 9.219 9.364 9.366 9.372 9.367

10B.3 FFC METHODOLOGY


The methods used to calculate FFC energy use are summarized here. The mathematical
approach to determining FCC is discussed in Coughlin (2012).4 Details related to the modeling
of the fuel production chain are presented in Coughlin (2013).5

When all energy quantities are normalized to the same units, FFC energy use can be
represented as the product of the primary energy use and an FFC multiplier. Mathematically the
FFC multiplier is a function of a set of parameters that represent the energy intensity and
material losses at each stage of energy production. Those parameters depend only on physical
data, so the calculations require no assumptions about prices or other economic factors. Although
the parameter values may differ by geographic region, this analysis utilizes national averages.

The fuel cycle parameters are defined as follows.

10B-3
• ax is the quantity of fuel x burned per unit of electricity produced for grid electricity. The
calculation of ax includes a factor to account for losses incurred through the transmission
and distribution systems.
• by is the amount of grid electricity used in producing fuel y, in MWh per physical unit of
fuel y.
• cxy is the amount of fuel x consumed in producing one unit of fuel y.
• qx is the heat content of fuel x (MBtu/physical unit).
All the parameters are calculated as functions of an annual time step; hence, when
evaluating the effects of potential new standards, a time series of annual values is used to
estimate the FFC energy and emissions savings in each year of the analysis period and
cumulatively.

The FFC multiplier is denoted µ (mu). A separate multiplier is calculated for each fuel
used on site. Also calculated is a multiplier for electricity that reflects the fuel mix used in its
generation. The multipliers are dimensionless numbers applied to primary energy savings to
obtain the FFC energy savings. The upstream component of the energy savings is proportional to
(µ-1). The fuel type is denoted by a subscript on the multiplier µ.

The method for performing the full-fuel-cycle analysis utilizes data and projections
published in the AEO 2023. Table 10B.3.1 summarizes the data used as inputs to the calculation
of various parameters. The column titled "AEO Table" gives the name of the table that provided
the reference data.

10B-4
Table 10B.3.1 Dependence of FFC Parameters on AEO Inputs
Parameter(s) Fuel(s) AEO Table Variables
qx All Conversion factors MMBtu per physical unit
Electricity supply, disposition,
Generation by fuel type
prices, and emissions
ax All
Energy consumption by sector Electric energy consumption
and source by the power sector
Coal production by region and Coal production by type and
bc, cnc, cpc Coal
type sulfur content
Refining industry energy
Refining-only energy use
consumption
Liquid fuels supply and
Crude supply by source
disposition
bp, cnp, cpp Petroleum
International liquids supply
Crude oil imports
and disposition
Domestic crude oil
Oil and gas supply
production
Oil and gas supply U.S. dry gas production
cnn Natural gas Natural gas supply, disposition,
Pipeline, lease, and plant fuel
and prices
Electricity supply, disposition,
zx All Power sector emissions
prices, and emissions

AEO 2023 does not provide all the information needed to estimate total energy use in the
fuel production chain. Coughlin (2013) describes the additional data sources used to complete
the analysis. The time dependence in the FFC multipliers, however, arises exclusively from
variables taken from the AEO.

10B.4 ENERGY MULTIPLIERS FOR THE FULL FUEL CYCLE


FFC energy multipliers for selected years are presented in Table 10B.4.1. The 2050 value
was held constant for the analysis period beyond 2050, which is the last year in the AEO 2023
projection. The multiplier for electricity reflects the shares of various primary fuels in total
electricity generation throughout the forecast period.

Table 10B.4.1 Energy Multipliers for the Full Fuel Cycle (Based on AEO 2023)
2025 2030 2035 2040 2045 2050+
Electricity (grid) 1.045 1.032 1.028 1.028 1.027 1.027
Natural Gas 1.115 1.112 1.114 1.114 1.115 1.117
Fuel Oil 1.194 1.198 1.204 1.208 1.212 1.211

10B-5
REFERENCES

1. U.S. Department of Energy. Federal Register. August 18, 2011. vol. 76, no. 160: pp.
51281–51289. (Last accessed May 1, 2023.) http://www.gpo.gov/fdsys/pkg/FR-2011-08-
18/pdf/FR-2011-08-18.pdf.

2. Energy Information Administration. The National Energy Modeling System (NEMS).


U.S. Department of Energy: Washington DC. (Last accessed May 1, 2023.)
https://www.eia.gov/outlooks/aeo/nems/documentation/.

3. U.S. Department of Energy–Energy Information Administration. Annual Energy Outlook


2023 with Projections to 2050. 2023. (Last accessed May 1, 2023.)
https://www.eia.gov/outlooks/aeo/.

4. Coughlin, K. A Mathematical Analysis of Full Fuel Cycle Energy Use. Energy. 2012.
37(1): pp. 698–708.

5. Coughlin, K. Projections of Full-Fuel-Cycle Energy and Emissions Metrics. 2013.


Lawrence Berkeley National Laboratory: Berkeley, CA. Report No. LBNL-6025E. (Last
accessed May 1, 2023.) https://eta-
publications.lbl.gov/sites/default/files/lbnl6025e_ffc.pdf.

10B-6
APPENDIX 10C. NATIONAL IMPACT ANALYSIS RESULTS FOR ALTERNATIVE
SCENARIOS

TABLE OF CONTENTS

10C.1 INTRODUCTION .................................................................................................10C-1


10C.2 ALTERNATIVE PRICE LEARNING SCENARIOS ...........................................10C-1
10C.2.1 Alternative Price Scenarios for Consumer Conventional Gas Cooking Products .10C-1
10C.2.2 Alternative Price Scenarios for Consumer Conventional Electric Cooking Products
................................................................................................................................10C-4
10C.2.3 Summary of Alternative Price Learning Scenarios ...............................................10C-6
10C.2.4 Results Using Alternative Learning Rates .............................................................10C-7
10C.3 ALTERNATIVE AEO GROWTH SCENARIOS ...............................................10C-11
10C.3.1 AEO Growth Scenario Projections ......................................................................10C-11
10C.3.2 Results Using Alternative AEO Growth Scenarios .............................................10C-12

LIST OF TABLES

Table 10C.2.1 Full-Fuel Cycle National Energy Savings of Consumer Impacts Under
Alternative Product Price Forecasts (quads); 30 Years of Shipments* .....10C-8
Table 10C.2.2 Net Present Value of Consumer Impacts Under Alternative Product
Price Forecasts (3 Percent Discount Rate, billion 2022$); 30 Years of
Shipments* .................................................................................................10C-9
Table 10C.2.3 Net Present Value of Consumer Impacts Under Alternative Product
Price Forecasts (7 Percent Discount Rate, billion 2022$); 30 Years of
Shipments* ...............................................................................................10C-10
Table 10C.3.1 Full-Fuel Cycle National Energy Savings of Consumer Impacts Under
Alternative Growth Scenarios (quads); 30 Years of Shipments* ............10C-13
Table 10C.3.2 Net Present Value of Consumer Impacts Under Alternative Growth
Scenarios (3 Percent Discount Rate, billion 2022$); 30 Years of
Shipments* ...............................................................................................10C-14
Table 10C.3.3 Net Present Value of Consumer Impacts Under Alternative Growth
Scenarios (7 Percent Discount Rate, billion 2022$); 30 Years of
Shipments* ...............................................................................................10C-15

LIST OF FIGURES

Figure 10C.2.1 Low Price Decline Scenario: Relative Price versus Cumulative
Shipments of Consumer Conventional Gas Cooking Products from
2005 to 2022 ..............................................................................................10C-2
Figure 10C.2.2 High Price Decline Scenario: Relative Price versus Cumulative
Shipments of Consumer Conventional Gas Cooking Products from
1981 to 2004 ..............................................................................................10C-3

10C-i
Figure 10C.2.3 Low Price Decline Scenario: Relative Price versus Cumulative
Shipments of Consumer Conventional Electric Cooking Products from
1967 to 1992 ..............................................................................................10C-4
Figure 10C.2.4 High Price Decline Scenario: Relative Price versus Cumulative
Shipments of Consumer Conventional Electric Cooking Products from
1993 to 2022 ..............................................................................................10C-5
Figure 10C.2.5 Conventional Gas Cooking Product Price Factor Indexes for the
Default Case and Sensitivity Cases............................................................10C-6
Figure 10C.2.6 Conventional Electric Cooking Product Price Factor Indexes for the
Default Case and Sensitivity Cases............................................................10C-7
Figure 10C.3.1 New Housing Starts Projections Under Alternative AEO 2023
Economic Growth Scenarios....................................................................10C-11
Figure 10C.3.2 Average Residential Electricity Price Trend Projections Under
Alternative AEO 2023 Economic Growth Scenarios ..............................10C-12
Figure 10C.3.3 Average Residential Natural Gas Price Trend Projections Under
Alternative AEO 2023 Economic Growth Scenarios ..............................10C-12

10C-ii
APPENDIX 10C. NATIONAL NET PRESENT VALUE OF CONSUMER BENEFITS
FROM ALTERNATIVE SCENARIOS

10C.1 INTRODUCTION

The NPV results presented in chapter 10 are based on future price projection derived
from historical PPI data from the Bureau of Labor Statistics (BLS) and the Reference Growth
Scenario from the Energy Information Administration Annual Energy Outlook 2023 (AEO
2023). This appendix provides results for alternate price and growth scenarios.

For alternative price learning scenarios, DOE collected PPI data of “gas household
ranges, ovens, surface cooking units and equipment” from 1981 to 2022 to project future price
for conventional gas cooking products, and PPI data of “electric household ranges, ovens,
surface cooking units and equipment” from 1967 to 2022 to project future price for conventional
electric cooking products. DOE also investigated the impact of different product price forecasts
on the consumer net present value (NPV) for the trial standard levels of both electric and gas
cooking products. The two price sensitivity scenarios DOE considered for both types of
conventional consumer cooking products are based on the same PPI series used in their default
case but covering different periods of time to estimate a low-price decline scenario and a high-
price decline scenario, respectively.

For alternative growth scenarios, DOE used energy price and housing starts forecasts
from the High Economic Growth case and the Low Economic Growth case AEO 2023.

10C.2 ALTERNATIVE PRICE LEARNING SCENARIOS

10C.2.1 Alternative Price Scenarios for Consumer Conventional Gas Cooking Products
For the price sensitivity analysis for conventional gas cooking products, DOE used the
same experience curve approach as the default case to forecast their future price. The low price
decline scenario is based on the “gas household ranges, ovens, surface cooking units and
equipment” PPI series from 2005 to 2022 and the high price decline scenario is based on the “gas
household ranges, ovens, surface cooking units and equipment” PPI series from 1981 to 2004. In
the experience curve method, the real cost of production is related to the cumulative production,
or experience, with a manufactured product. DOE modeled the experience curve by fitting the
inflation –adjusted PPI series to the corresponding cumulative shipments, a proxy of cumulative
production, of conventional gas cooking products. The percentage reduction in cost that occurs
with each doubling of cumulative production is known as the learning rate.

To estimate an experience rate parameter, a least-squares power-law fit was performed on


the unified price index versus cumulative shipments. The form of the fitting equation is:

Pt = Po Xt (-b),

10C-1
where, the two parameters, b (the learning rate parameter) and Po (the price or cost of the first
unit of production), are obtained by fitting the model to the data. The variable Xt, is the
cumulative shipments from period zero to period t and Pt is the average deflated price of
shipments in period t. DOE notes that the cumulative shipments on the right hand side of the
equation can have a dependence on price, so there is an issue with simultaneity where the
independent variable Xt is not truly independent. DOE’s use of a simple least squares fit is
equivalent to an assumption of no significant effect of the price elasticity of supply.

Figure 10C.2.1 and Figure 10C.2.2 present the fit of experience curve for conventional
gas cooking products under low price decline and high price decline scenarios, respectively.

Figure 10C.2.1 Low Price Decline Scenario: Relative Price versus Cumulative Shipments
of Consumer Conventional Gas Cooking Products from 2005 to 2022

10C-2
Price Index (2022=1) 2.0

1.5

1.0

0.5

0.0
0.0 20.0 40.0 60.0 80.0 100.0
Cumulative Shipments (million)

Gas Cooktop and Oven (1981-2004) Power (Gas Cooktop and Oven (1981-2004))

Figure 10C.2.2 High Price Decline Scenario: Relative Price versus Cumulative Shipments
of Consumer Conventional Gas Cooking Products from 1981 to 2004

For the low price decline scenario, the parameter values obtained are:

Po = 1.281+0.744
−0.471 (95% confidence), and
b = −0.0528+0.458
−0.096 (95% confidence)

The estimated experience rate for the low price decline scenario (defined as the fractional
reduction in price expected from each doubling of cumulative production) is 3.6+6.2
−36.0 % (95%
confidence).

For the high price decline scenario, the parameter values obtained are:

Po = 9.726+1.718
−1.460 (95% confidence), and
b = −0.4906+0.041
−0.041 (95% confidence)

The estimated experience rate for the high price decline scenario (defined as the
fractional reduction in price expected from each doubling of cumulative production) is
28.8+2.0
−2.0 % (95% confidence).

DOE then derived two price factor indices for consumer conventional gas cooking
products, and the price index value in a given year is a function of the experience rate and the
cumulative production projection through that year, which is based on the shipments forecast
described in chapter 9 of this direct final rule technical support document.

10C-3
10C.2.2 Alternative Price Scenarios for Consumer Conventional Electric Cooking
Products
For the price sensitivity analysis, DOE used the same experience curve approach as the
default case to forecast future prices of consumer conventional electric cooking products. The
low price decline scenario is based on the “electric household ranges, ovens, surface cooking
units and equipment” PPI series from 1967 to 1992, and the high price decline scenario is based
on the “electric household ranges, ovens, surface cooking units and equipment” PPI series from
1993 to 2022 Similar to the approach described above, DOE modeled the experience curve by
fitting the inflation –adjusted PPI series to the corresponding cumulative shipments, a proxy of
cumulative production, of conventional electric cooking products with power-law functional
form.

Figure 10C.2.3 and Figure 10C.2.4 present the fit of experience curve for consumer
conventional electric cooking products under low price decline and high price decline scenarios,
respectively.

3.5

3.0
Price Index (2022=1)

2.5

2.0

1.5

1.0

0.5

0.0
0.0 10.0 20.0 30.0 40.0 50.0 60.0 70.0 80.0 90.0
Cumulative Shipments (million)

Electric Cooktop and Oven (1967-1992) Power (Electric Cooktop and Oven (1967-1992))

Figure 10C.2.3 Low Price Decline Scenario: Relative Price versus Cumulative Shipments
of Consumer Conventional Electric Cooking Products from 1967 to 1992

10C-4
1.6

1.4

1.2
Price Index (2022=1)

1.0

0.8

0.6

0.4

0.2

0.0
0.0 50.0 100.0 150.0 200.0 250.0
Cumulative Shipments (million)

Electric Cooktop and Oven (1993-2022) Power (Electric Cooktop and Oven (1993-2022))

Figure 10C.2.4 High Price Decline Scenario: Relative Price versus Cumulative Shipments
of Consumer Conventional Electric Cooking Products from 1993 to 2022

For the low-price decline scenario, the parameter values obtained are:

Po = 3.299+0.533
−0.459 (95% confidence), and
b = -0.1583±0.042 (95% confidence)

The estimated experience rate for the low price decline scenario (defined as the fractional
reduction in price expected from each doubling of cumulative production) is 10.4+2.6
−2.7 % (95%
confidence).

For the high price decline scenario, the parameter values obtained are:

Po = 10.625+4.550
−3.152 (95% confidence), and
b = -0.4625±0.073 (95% confidence)

The estimated experience rate for the high price decline scenario (defined as the
fractional reduction in price expected from each doubling of cumulative production) is
27.4+3.6
−3.8 % (95% confidence).

DOE then derived two price factor indices for conventional electric cooking products,
and the price index value in a given year is a function of the experience rate and the cumulative
production projection through that year, which is based on the shipments forecast described in
chapter 9.

10C-5
10C.2.3 Summary of Alternative Price Learning Scenarios
Figure 10C.2.5 and Figure 10C.2.6 shows the resulting price trends for conventional gas
and electric cooking products, respectively.

1.2

1.0
Price Index Factor (2022=1)

0.8

Gas Cooktop and Oven -


0.6 Default
Gas Cooktop and Oven_High
Price Decline
0.4
Gas Cooktop and Oven_Low
Price Decline
0.2

0.0

Year

Figure 10C.2.5 Conventional Gas Cooking Product Price Factor Indexes for the
Default Case and Sensitivity Cases

10C-6
1.2

1.0
Price Index Factor (2022=1)

0.8

Electric Cooktop and Oven -


0.6 Default
Electric Cooktop and
Oven_High Price Decline
0.4
Electric Cooktop and
Oven_Low Price Decline
0.2

0.0

Year

Figure 10C.2.6 Conventional Electric Cooking Product Price Factor Indexes for
the Default Case and Sensitivity Cases

10C.2.4 Results Using Alternative Learning Rates


Table 10C.2.1 through Table 10C.2.3 present results for alternative learning rates as well
as reference NIA results.

10C-7
Table 10C.2.1 Full-Fuel Cycle National Energy Savings of Consumer Impacts Under
Alternative Product Price Forecasts (quads); 30 Years of Shipments*
Scenario Product Class TSL 1 TSL 2 TSL 3

Electric Smooth Element Standalone Cooking


0.02 0.04 0.04
Tops
Electric Smooth Element Cooking Top
0.16 0.28 0.30
Component of a Combined Cooking Product
Gas Standalone Cooking Tops 0.00 0.04 0.04
Reference Gas Cooking Top Component of a Combined
0.00 0.20 0.20
Cooking Product
Electric Ovens 0.02 0.07 0.91
Gas Ovens 0.01 0.03 0.03
All 0.22 0.66 1.52
Electric Smooth Element Standalone Cooking
0.02 0.04 0.04
Tops
Electric Smooth Element Cooking Top
0.16 0.28 0.30
Component of a Combined Cooking Product
High Gas Standalone Cooking Tops 0.00 0.04 0.04
Price
Gas Cooking Top Component of a Combined
Decline 0.00 0.20 0.20
Cooking Product
Electric Ovens 0.02 0.07 0.91
Gas Ovens 0.01 0.03 0.03
All 0.22 0.66 1.52
Electric Open (Coil) Element Cooking Tops 0.02 0.04 0.04
Electric Smooth Element Cooking Tops 0.16 0.28 0.30
Gas Standalone Cooking Tops 0.00 0.04 0.04
Low Gas Cooking Top Component of a Combined
Price 0.00 0.20 0.20
Decline
Cooking Product
Electric Ovens 0.02 0.07 0.91
Gas Ovens 0.01 0.03 0.03
All 0.22 0.66 1.52
*2027–2056 for all TSLs except TSL 1 (the Recommended TSL); 2028–2057 for TSL 1

10C-8
Table 10C.2.2 Net Present Value of Consumer Impacts Under Alternative Product Price
Forecasts (3 Percent Discount Rate, billion 2022$); 30 Years of Shipments*
Scenario Product Class TSL 1 TSL 2** TSL 3**

Electric Smooth Element Standalone Cooking


0.17 0.17 (5.67)
Tops
Electric Smooth Element Cooking Top
1.20 1.19 (38.14)
Component of a Combined Cooking Product
Gas Standalone Cooking Tops 0.00 0.05 0.05
Reference Gas Cooking Top Component of a Combined
0.01 0.18 0.18
Cooking Product
Electric Ovens 0.14 (0.96) (0.02)
Gas Ovens 0.05 (0.28) (0.28)
All 1.56 0.34 (43.89)
Electric Smooth Element Standalone Cooking
0.17 0.18 (5.52)
Tops
Electric Smooth Element Cooking Top
1.20 1.25 (37.11)
Component of a Combined Cooking Product
High Gas Standalone Cooking Tops 0.00 0.05 0.05
Price
Gas Cooking Top Component of a Combined
Decline 0.01 0.20 0.20
Cooking Product
Electric Ovens 0.14 (0.94) 0.11
Gas Ovens 0.05 (0.27) (0.27)
All 1.56 0.46 (42.54)
Electric Smooth Element Standalone Cooking
0.17 0.16 (5.84)
Tops
Electric Smooth Element Cooking Top
1.19 1.13 (39.35)
Component of a Combined Cooking Product
Low Gas Standalone Cooking Tops 0.00 0.03 0.03
Price Gas Cooking Top Component of a Combined
Decline 0.01 0.08 0.08
Cooking Product
Electric Ovens 0.14 (0.99) (0.16)
Gas Ovens 0.05 (0.34) (0.34)
All 1.55 0.06 (45.59)
*2027–2056 for all TSLs except TSL 1 (the Recommended TSL); 2028–2057 for TSL 1
**Negative values denoted in parenthesis.

10C-9
Table 10C.2.3 Net Present Value of Consumer Impacts Under Alternative Product Price
Forecasts (7 Percent Discount Rate, billion 2022$); 30 Years of Shipments*
Scenario Product Class TSL 1 TSL 2** TSL 3**

Electric Smooth Element Standalone Cooking


0.07 0.05 (3.31)
Tops
Electric Smooth Element Cooking Top
0.50 0.38 (21.82)
Component of a Combined Cooking Product
Gas Standalone Cooking Tops 0.00 0.00 0.00
Reference Gas Cooking Top Component of a Combined
0.00 (0.02) (0.02)
Cooking Product
Electric Ovens 0.06 (0.64) (1.01)
Gas Ovens 0.02 (0.19) (0.19)
All 0.65 (0.40) (26.34)
Electric Smooth Element Standalone Cooking
0.07 0.06 (3.23)
Tops
Electric Smooth Element Cooking Top
0.50 0.41 (21.30)
Component of a Combined Cooking Product
High Gas Standalone Cooking Tops 0.00 0.00 0.00
Price Gas Cooking Top Component of a Combined
Decline 0.00 (0.01) (0.01)
Cooking Product
Electric Ovens 0.06 (0.62) (0.94)
Gas Ovens 0.02 (0.18) (0.18)
All 0.65 (0.34) (25.66)
Electric Smooth Element Standalone Cooking
0.07 0.05 (3.40)
Tops
Electric Smooth Element Cooking Top
0.50 0.35 (22.42)
Component of a Combined Cooking Product
Low Price Gas Standalone Cooking Tops 0.00 (0.01) (0.01)
Decline Gas Cooking Top Component of a Combined
0.00 (0.07) (0.07)
Cooking Product
Electric Ovens 0.06 (0.66) (1.09)
Gas Ovens 0.02 (0.22) (0.22)
All 0.65 (0.55) (27.20)
*2027–2056 for all TSLs except TSL 1 (the Recommended TSL); 2028–2057 for TSL 1
**Negative values denoted in parenthesis.

10C-10
10C.3 ALTERNATIVE AEO GROWTH SCENARIOS

10C.3.1 AEO Growth Scenario Projections


This section presents NIA results using inputs from alternative economic growth
scenarios. The scenarios use the energy price and housing starts forecasts in the Low Economic
Growth case and the High Economic Growth case from EIA’s AEO 2023.

Figure 10C.3.1 shows the projection for new housing starts for the Reference, Low, and
High AEO Growth scenarios. Figure 10C.3.2 and Figure 10C.3.3 show residential electricity prices
and natural gas prices under the different economic growth scenarios, respectively.

1.80
1.70
1.60
Housing Starts (million)

1.50
1.40
1.30
1.20
1.10
1.00
0.90
0.80

Reference Low High

Figure 10C.3.1 New Housing Starts Projections Under Alternative AEO 2023
Economic Growth Scenarios

10C-11
Electricity Price Trend (2022=100) Residential Electricity Price Projection
1.02
1.00
0.98
0.96
0.94
0.92
0.90
0.88
0.86
0.84
0.82
0.80

Reference Low High

Figure 10C.3.2 Average Residential Electricity Price Trend Projections Under


Alternative AEO 2023 Economic Growth Scenarios

Residential Natural Gas Price Projection


1.05
Gas Price Trend (2022=100)

1.00
0.95
0.90
0.85
0.80
0.75
0.70
0.65
0.60

Reference Low High

Figure 10C.3.3 Average Residential Natural Gas Price Trend Projections Under
Alternative AEO 2023 Economic Growth Scenarios

10C.3.2 Results Using Alternative AEO Growth Scenarios


Table 10C.3.1 through Table 10C.3.3 results for alternative learning rates as well as
reference NIA results.

10C-12
Table 10C.3.1 Full-Fuel Cycle National Energy Savings of Consumer Impacts Under
Alternative Growth Scenarios (quads); 30 Years of Shipments*
Scenario Product Class TSL 1 TSL 2 TSL 3

Electric Smooth Element Standalone Cooking


0.02 0.04 0.04
Tops
Electric Smooth Element Cooking Top
0.16 0.28 0.30
Component of a Combined Cooking Product
Gas Standalone Cooking Tops 0.00 0.04 0.04
Reference Gas Cooking Top Component of a Combined
0.00 0.20 0.20
Cooking Product
Electric Ovens 0.02 0.07 0.91
Gas Ovens 0.01 0.03 0.03
All 0.22 0.66 1.52
Electric Smooth Element Standalone Cooking
0.02 0.04 0.04
Tops
Electric Smooth Element Cooking Top
0.16 0.27 0.29
Component of a Combined Cooking Product
Low Gas Standalone Cooking Tops 0.00 0.04 0.04
Growth Gas Cooking Top Component of a Combined
0.00 0.19 0.19
Cooking Product
Electric Ovens 0.02 0.07 0.87
Gas Ovens 0.01 0.03 0.03
All 0.21 0.63 1.45
Electric Smooth Element Standalone Cooking
0.02 0.04 0.04
Tops
Electric Smooth Element Cooking Top
0.17 0.28 0.31
Component of a Combined Cooking Product
High Gas Standalone Cooking Tops 0.00 0.04 0.04
Growth Gas Cooking Top Component of a Combined
0.00 0.20 0.20
Cooking Product
Electric Ovens 0.02 0.07 0.92
Gas Ovens 0.01 0.03 0.03
All 0.22 0.67 1.54
*2027–2056 for all TSLs except TSL 1 (the Recommended TSL); 2028–2057 for TSL 1

10C-13
Table 10C.3.2 Net Present Value of Consumer Impacts Under Alternative Growth
Scenarios (3 Percent Discount Rate, billion 2022$); 30 Years of Shipments*
Scenario Product Class TSL 1 TSL 2** TSL 3**

Electric Smooth Element Standalone Cooking


0.17 0.17 (5.67)
Tops
Electric Smooth Element Cooking Top
1.20 1.19 (38.14)
Component of a Combined Cooking Product
Gas Standalone Cooking Tops 0.00 0.05 0.05
Reference Gas Cooking Top Component of a Combined
0.01 0.18 0.18
Cooking Product
Electric Ovens 0.14 (0.96) (0.02)
Gas Ovens 0.05 (0.28) (0.28)
All 1.56 0.34 (43.89)
Electric Smooth Element Standalone Cooking
0.15 0.15 (5.48)
Tops
Electric Smooth Element Cooking Top
1.10 1.07 (36.81)
Component of a Combined Cooking Product
Low Gas Standalone Cooking Tops 0.00 0.04 0.04
Growth Gas Cooking Top Component of a Combined
0.01 0.15 0.15
Cooking Product
Electric Ovens 0.13 (1.01) (0.55)
Gas Ovens 0.05 (0.28) (0.28)
All 1.44 0.12 (42.94)
Electric Smooth Element Standalone Cooking
0.18 0.18 (5.73)
Tops
Electric Smooth Element Cooking Top
1.26 1.29 (38.56)
Component of a Combined Cooking Product
High Gas Standalone Cooking Tops 0.00 0.05 0.05
Growth Gas Cooking Top Component of a Combined 0.01 0.21 0.21
Cooking Product
Electric Ovens 0.15 (0.90) 0.51
Gas Ovens 0.05 (0.28) (0.28)
All 1.64 0.56 (43.80)
*2027–2056 for all TSLs except TSL 1 (the Recommended TSL); 2028–2057 for TSL 1
**Negative values denoted in parenthesis.

10C-14
Table 10C.3.3 Net Present Value of Consumer Impacts Under Alternative Growth
Scenarios (7 Percent Discount Rate, billion 2022$); 30 Years of Shipments*
Scenario Product Class TSL 1 TSL 2** TSL 3**

Electric Smooth Element Standalone Cooking


0.07 0.05 (3.31)
Tops
Electric Smooth Element Cooking Top
0.50 0.38 (21.82)
Component of a Combined Cooking Product
Reference Gas Standalone Cooking Tops 0.00 0.00 0.00
Gas Cooking Top Component of a Combined
0.00 (0.02) (0.02)
Cooking Product
Electric Ovens 0.06 (0.64) (1.01)
Gas Ovens 0.02 (0.19) (0.19)
All 0.65 (0.40) (26.34)
Electric Smooth Element Standalone Cooking
0.07 0.05 (3.20)
Tops
Electric Smooth Element Cooking Top
0.46 0.34 (21.11)
Component of a Combined Cooking Product
Low Gas Standalone Cooking Tops 0.00 (0.00) (0.00)
Growth Gas Cooking Top Component of a Combined
0.00 (0.03) (0.03)
Cooking Product
Electric Ovens 0.05 (0.65) (1.21)
Gas Ovens 0.02 (0.18) (0.18)
All 0.60 (0.48) (25.73)
Electric Smooth Element Standalone Cooking
0.07 0.06 (3.34)
Tops
Electric Smooth Element Cooking Top
0.52 0.42 (22.05)
Component of a Combined Cooking Product
High Gas Standalone Cooking Tops 0.00 0.00 0.00
Growth Gas Cooking Top Component of a Combined
0.00 (0.00) (0.00)
Cooking Product
Electric Ovens 0.06 (0.61) (0.79)
Gas Ovens 0.02 (0.19) (0.19)
All 0.68 (0.31) (26.37)
*2027–2056 for all TSLs except TSL 1 (the Recommended TSL); 2028–2057 for TSL 1
**Negative values denoted in parenthesis.

10C-15
APPENDIX 12A. GOVERNMENT REGULATORY IMPACT MODEL OVERVIEW

TABLE OF CONTENTS

12A.1 INTRODUCTION AND PURPOSE .......................................................................... 12A-1


12A.2 COOKING PRODUCTS GRIM DESCRIPTION ...................................................... 12A-1

LIST OF FIGURES

Figure 12A.2.1 Detailed Income Statement and Cash Flow Statement Example .................. 12A-4

12A-i
APPENDIX 12A. GOVERNMENT REGULATORY IMPACT MODEL OVERVIEW

12A.1 INTRODUCTION AND PURPOSE

The purpose of the Government Regulatory Impact Model (GRIM) is to help quantify the
impacts of energy conservation standards on manufacturers of external power supplies. The basic
mode of analysis is to estimate the change in the value of the industry or manufacturers
following a regulation or a series of regulations. The model structure also allows an analysis of
multiple products or equipment with regulations taking effect over a period of time, and of
multiple regulations on the same item.

Industry net present value is defined, for the purpose of this analysis, as the discounted
sum of industry free cash flows plus a discounted terminal value. The model calculates the actual
cash flows by year and then determines the present value of those cash flows both without an
energy conservation standard (i.e., the no-new-standards case) and under different trial standard
levels (TSLs) (i.e., the standards cases).

Output from the model consists of summary financial metrics, graphs of major variables,
and, when appropriate, access to the complete cash flow calculation.

12A.2 COOKING PRODUCTS GRIM DESCRIPTION

In this rulemaking, DOE analyzed the impacts of standards on battery charger and battery
charger application manufacturers. The basic structure of the GRIM is a standard annual cash
flow analysis that uses manufacturer selling prices, manufacturing costs, a shipments forecast,
and financial parameters as inputs and accepts a set of regulatory conditions as changes in costs
and investments. The cash flow analysis is separated into two major blocks: income and cash
flow. The income calculation determines net operating profit after taxes. The cash flow
calculation converts net operating profit after taxes into an annual cash flow by including
investment and non-cash items. The line items below relate to the battery charger manufacturers
and are definitions of listed items on the printout of the output sheet. Please refer to Figure
12A.2.1.

1) Revenues: Annual revenues - computed by multiplying products’ unit prices at each


efficiency level by the appropriate manufacturer markup;

2) Total Shipments: The total covered units shipped;

3) Materials: The portion of cost of goods sold (COGS) that includes materials;

4) Labor: The portion of COGS that includes direct labor, commissions, dismissal pay,
bonuses, vacation, sick leave, social security contributions, fringe, and assembly
labor up-time;

12A-1
5) Depreciation: The portion of COGS that includes an allowance for the total amount
of fixed assets used to produce that one unit;

6) Overhead: The portion of COGS that includes indirect labor, indirect material,
energy use, maintenance, property taxes, and insurance related to assets;

7) Standard SG&A: Selling, general, and administrative costs are computed as a


percentage of Revenues (1);

8) R&D: GRIM separately accounts for ordinary research and development (R&D) as a
percentage of Revenues (1);

9) Product Conversion Costs: Product conversion costs are investments in research,


development, testing, marketing, and other costs focused on making product designs
comply with amended energy conservation standards. The GRIM allocates these
costs over the period between the standards’ announcement and compliance dates;

10) Stranded Assets: In the year the standard becomes effective, a one-time write-off of
stranded assets is accounted for;

11) Earnings before Interest and Taxes (EBIT): Includes profits before deductions for
interest paid and taxes;

12) Per Unit EBIT: The average amount of EBIT (11) per covered unit shipped;

13) EBIT/Revenues: EBIT (11) as a percentage of sales to compare with the industry’s
average reported in financial statements;

14) Taxes: Taxes on EBIT (11) are calculated by multiplying the tax rate contained in
the Discounted Cash Flow tab by EBIT (11);

15) Net Operating Profits after Taxes (NOPAT): Computed by subtracting Taxes (14)
from EBIT (11);

16) NOPAT repeated: NOPAT (15) is repeated in the Statement of Cash Flows;

17) Depreciation repeated: Depreciation (5) is added back in the Statement of Cash
Flows because it is a non-cash expense;

18) Stranded Assets repeated: Stranded Assets (10) is added back in the Statement of
Cash Flows because it is a non-cash expense;

19) Change in Working Capital: Change in cash tied up in accounts receivable,


inventory, and other cash investments necessary to support operations is calculated
by multiplying working capital (as a percentage of revenues) by the change in annual
revenues;

12A-2
20) Cash Flow from Operations: Calculated by taking NOPAT (16), adding back non-
cash items such as Depreciation (17) and Stranded Assets (18), and subtracting the
Change in Working Capital (19);

21) Ordinary Capital Expenditures: Ordinary investments in property, plant, and


equipment to maintain and replace existing production assets, computed as a
percentage of Revenues (1);

22) Capital Conversion Costs: Capital conversion costs are one-time investments in
property, plant, and equipment to adapt or change existing production facilities so
that new product designs can be fabricated and assembled under amended
regulations; the GRIM allocates these costs over the period between the standards’
announcement and compliance dates;

23) Free Cash Flow: Calculated by taking annual Cash Flow from Operations (20) and
subtracting Ordinary Capital Expenditures (21) and Capital Conversion Costs (22);

24) Free Cash Flow repeated: Free Cash Flow (23) is repeated in the Discounted Cash
Flow section;

25) Terminal Value: Estimate of the continuing value of the industry after the analysis
period. Computed by growing the Free Cash Flow (24) at the beginning of 2024 at a
constant rate in perpetuity;

26) Present Value Factor: Factor used to calculate an estimate of the present value of an
amount to be received in the future;

27) Discounted Cash Flow: Free Cash Flow (23) multiplied by the Present Value
Factor (26). For the end of the analysis period, the discounted cash flow includes the
discounted Terminal Value (25); and

28) Industry Value through the end of the analysis period: The sum of Discounted
Cash Flows (27).

12A-3
Figure 12A.2.1 Detailed Income Statement and Cash Flow Statement Example

12A-4
APPENDIX 13A. EMISSIONS ANALYSIS METHODOLOGY

TABLE OF CONTENTS

13A.1 INTRODUCTION ...................................................................................................... 13A-1


13A.2 POWER SECTOR AND SITE EMISSIONS FACTORS .......................................... 13A-1
13A.3 UPSTREAM FACTORS ............................................................................................ 13A-2
13A.4 DATA TABLES ......................................................................................................... 13A-3
REFERENCES ..................................................................................................................... 13A-11

LIST OF TABLES

Table 13A.4.1 Site Combustion Emissions Factors.......................................................... 13A-3


Table 13A.4.2 Power Sector Emissions Factors for CO2 (Short Tons per GWh of Site
Electricity Use) ......................................................................................... 13A-4
Table 13A.4.3 Power Sector Emissions Factors for CH4 (Short Tons per GWh of Site
Electricity Use) ......................................................................................... 13A-5
Table 13A.4.4 Power Sector Emissions Factors for Hg (Short Tons per TWh of Site
Electricity Use) ......................................................................................... 13A-6
Table 13A.4.5 Power Sector Emissions Factors for N2O (Short Tons per GWh of Site
Electricity Use) ......................................................................................... 13A-7
Table 13A.4.6 Power Sector Emissions Factors for NOx (Short Tons per GWh of Site
Electricity Use) ......................................................................................... 13A-8
Table 13A.4.7 Power Sector Emissions Factors for SO2 (Short Tons per GWh of Site
Electricity Use) ......................................................................................... 13A-9
Table 13A.4.8 Electricity Upstream Emissions Factors ................................................... 13A-9
Table 13A.4.9 Natural Gas Upstream Emissions Factors............................................... 13A-10
Table 13A.4.10 Petroleum Fuels Upstream Emission Factors ......................................... 13A-10

13A-i
APPENDIX 13A. EMISSIONS ANALYSIS METHODOLOGY

13A.1 INTRODUCTION
The emissions analysis consists of two components. The first component estimates the
effect of potential energy conservation standards on power sector and site combustion emissions
of carbon dioxide (CO2), nitrogen oxides (NOX), sulfur dioxide (SO2), and mercury (Hg). The
second component estimates the impacts of a potential standard on emissions of two additional
greenhouse gases, methane (CH4) and nitrous oxide (N2O), as well as the reductions to emissions
of all species due to “upstream” activities in the fuel production chain. These upstream activities
comprise extraction, processing, and transporting fuels to the site of combustion. The associated
emissions are referred to as upstream emissions. Together, these emissions account for the full-
fuel-cycle (FFC), in accordance with DOE’s FFC Statement of Policy. 76 FR 51282 (Aug. 18,
2011).

The analysis of power sector emissions uses marginal emissions intensity factors
calculated by DOE. DOE’s methodology is based on results published with the most recent
edition of the Annual Energy Outlook (AEO) which is published by the Energy Information
Agency (EIA). For this analysis DOE used AEO 2023.1 DOE developed end-use specific
emissions intensity coefficients, in units of mass of pollutant per kWh of site (grid) electricity,
for each pollutant. The methodology is based on the more general approach used for all the
utility sector impacts calculations, which is described in appendix 15A of this TSD and in the
report “Utility Sector Impacts of Reduced Electricity Demand” (Coughlin, 2014; Coughlin,
2019).2,3 This appendix describes the methodology used to estimate the upstream emissions
factors, and presents the values used for all emissions factors.

13A.2 POWER SECTOR AND SITE EMISSIONS FACTORS


Power sector marginal emissions factors are calculated by looking at the difference, over
the full analysis period, in fuel consumption and emissions across a variety of cases published
with the AEO. The analysis produces a set of emissions intensity factors that quantify the
reduction in emissions of a given pollutant per unit reduction of fuel used in (grid) electricity
generation for each of the primary fossil fuel types (coal, natural gas and oil). These factors are
combined with estimates of the fraction of generation allocated to each fuel type, also calculated
from AEO 2023 data, for each sector and end-use. The result is a set of end-use specific marginal
emissions intensity factors, summarized in the tables below. Total emissions reductions are
estimated by multiplying the intensity factors times the energy savings calculated in the national
impact analysis (chapter 10). Power sector emissions factors are presented in Table 13A.4.2
through Table 13A.4.7

Site combustion of fossil fuels in buildings (for example in water-heating, space-heating


or cooking applications) also produces emissions of CO2 and other pollutants. To quantify the
reduction in these emissions from a considered standard level, DOE used emissions intensity
factors from Environmental Protection Agency (EPA) publications.4 These factors, presented in
Table 13A.4.1, are constant in time. The EPA defines SO2 emissions in terms of a formula that
depends on the sulfur content of the fuel. The typical use of petroleum-based fuels in buildings if

13A-1
for heating, and a typical sulfur content for heating oils is a few hundred parts-per-million (ppm).
The value provided in Table 13A.4.1 corresponds to a sulfur content of approximately 100 ppm.

13A.3 UPSTREAM FACTORS


The FFC upstream emissions are estimated based on the methodology developed by
Coughlin (2013).5 The upstream emissions include both emissions from fuel combustion during
extraction, processing and transportation of fuel, and “fugitive” emissions (direct leakage to the
atmosphere) of CH4 and CO2.

The FFC accounting approach is described briefly in appendix 10B and in Coughlin
(2013).5 When demand for a particular fuel is reduced, there is a corresponding reduction in the
upstream activities associated with production of that fuel (mining, refining etc.) These upstream
activities also consume energy and therefore produce combustion emissions. The FFC
accounting estimates the total consumption of electricity, natural gas and petroleum-based fuels
in these upstream activities. The relevant combustion emissions factors are then applied to this
fuel use to determine the total upstream emissions intensities from combustion, per unit of fuel
delivered to the consumer.

In addition to combustion emissions, extraction and processing of fossil fuels also


produces fugitive emissions of CO2 and CH4. Fugitive emissions of CO2 are small relative to
combustion emissions, comprising about 2-3 percent of total CO2 emissions for natural gas and
1-2 percent for petroleum fuels. In contrast, the fugitive emissions of methane from fossil fuel
production are relatively large compared to combustion emissions of CH4. Hence, fugitive
emissions make up over 99 percent of total methane emissions for natural gas, about 95 percent
for coal, and 93 percent for petroleum fuels.

Fugitive emissions factors for CO2 and methane from coal mining and natural gas
production were estimated based on a review of recent studies compiled by Burnham (2011). 6
This review includes estimates of the difference between fugitive emissions factors for
conventional production of natural vs. unconventional (shale or tight gas). These estimates rely
in turn on data gathered by EPA under new GHG reporting requirements for the petroleum and
natural gas industries.7,8 The value for methane, if it were translated to a leakage rate, would be
equivalent to 1.3%. Actual leakage rates of methane at various stages of the production process
are highly variable and the subject of ongoing research. In a comprehensive review of the
literature, Brandt et al. (2014)8 find that, while regional studies with very high emissions rates
may not be representative of typical natural gas systems, it is also true that official inventories
have most likely underestimated methane emissions. As more data are made available, DOE will
continue to update these estimated emissions factors.

Upstream emissions factors account for both fugitive emissions and combustion
emissions in extraction, processing, and transport of primary fuels. For ease of application in its
analysis, DOE developed all of the emissions factors using site (point of use) energy savings in
the denominator. Table 13A.4.1 presents the electricity upstream emissions factors for selected
years. The caps that apply to power sector NOX emissions do not apply to upstream combustion
sources, so some components of the upstream fuel cycle (particularly off-road mobile engines)
can contribute significantly to the upstream NOx emissions factors.

13A-2
13A.4 DATA TABLES
Summary tables of all the emissions factor data used by DOE for rules using AEO 2023
are presented in the tables below. Table 13A.4.1 provides combustion emissions factors for fuels
commonly used in buildings. Table 13A.4.2 to Table 13A.4.7 present the marginal power sector
emissions factors as a function of sector and end use for a selected set of years. Table 13A.4.8 to
Table 13A.4.10 provide the upstream emissions factors for all pollutants, for site electricity,
natural gas and petroleum fuels. In all cases, the emissions factors are defined relative to the site
electricity supplied from the grid and site use of the fuel.

Table 13A.4.1 Site Combustion Emissions Factors


Natural Gas Distillate Oil
Species
g/mcf g/bbl
CH4 1.03E+00 1.33E+01
CO2 5.47E+04 4.46E+05
N 2O 1.03E-01 8.65E+00
NOx 4.36E+01 3.62E+02
SO2 2.73E-01 2.20E+02

13A-3
Table 13A.4.2 Power Sector Emissions Factors for CO2 (Short Tons per GWh of Site
Electricity Use)
2025 2030 2035 2040 2045 2050+
Residential Sector
Clothes Dryers 487 243 208 190 178 162
Cooking 481 241 207 189 178 161
Freezers 497 248 213 194 182 165
Lighting 497 243 207 188 176 158
Refrigeration 496 248 213 194 182 165
Space Cooling 464 251 221 206 197 183
Space Heating 503 244 207 187 175 157
Water Heating 488 241 205 187 175 158
Other Uses 487 243 207 189 178 161
Commercial Sector
Cooking 445 228 196 181 171 157
Lighting 455 232 199 183 174 159
Office Equipment (Non-Pc) 428 225 194 180 172 159
Office Equipment (Pc) 428 225 194 180 172 159
Refrigeration 482 241 206 188 177 161
Space Cooling 455 249 220 206 197 183
Space Heating 507 246 208 188 175 157
Ventilation 483 241 206 188 177 160
Water Heating 443 227 194 180 170 156
Other Uses 435 227 195 181 172 158
Industrial Sector
All Uses 435 227 195 181 172 158

13A-4
Table 13A.4.3 Power Sector Emissions Factors for CH4 (Short Tons per GWh of Site
Electricity Use)
2025 2030 2035 2040 2045 2050+
Residential Sector
Clothes Dryers 0.0401 0.0175 0.0160 0.0137 0.0122 0.0103
Cooking 0.0391 0.0171 0.0157 0.0134 0.0119 0.0101
Freezers 0.0413 0.0181 0.0166 0.0142 0.0126 0.0107
Lighting 0.0418 0.0181 0.0166 0.0142 0.0126 0.0106
Refrigeration 0.0413 0.0180 0.0165 0.0141 0.0126 0.0106
Space Cooling 0.0352 0.0158 0.0145 0.0125 0.0112 0.0096
Space Heating 0.0428 0.0186 0.0170 0.0145 0.0128 0.0108
Water Heating 0.0404 0.0176 0.0161 0.0138 0.0122 0.0103
Other Uses 0.0400 0.0175 0.0160 0.0137 0.0122 0.0103
Commercial Sector
Cooking 0.0338 0.0149 0.0136 0.0117 0.0104 0.0089
Lighting 0.0353 0.0155 0.0142 0.0122 0.0109 0.0092
Office Equipment (Non-Pc) 0.0313 0.0139 0.0127 0.0109 0.0098 0.0084
Office Equipment (Pc) 0.0313 0.0139 0.0127 0.0109 0.0098 0.0084
Refrigeration 0.0393 0.0172 0.0157 0.0134 0.0120 0.0101
Space Cooling 0.0338 0.0153 0.0140 0.0121 0.0109 0.0094
Space Heating 0.0434 0.0188 0.0172 0.0147 0.0130 0.0110
Ventilation 0.0394 0.0172 0.0158 0.0135 0.0120 0.0102
Water Heating 0.0337 0.0149 0.0135 0.0116 0.0104 0.0089
Other Uses 0.0324 0.0144 0.0131 0.0113 0.0101 0.0086
Industrial Sector
All Uses 0.0324 0.0144 0.0131 0.0113 0.0101 0.0086

13A-5
Table 13A.4.4 Power Sector Emissions Factors for Hg (Short Tons per TWh of Site
Electricity Use)
2025 2030 2035 2040 2045 2050+
Residential Sector
Clothes Dryers 0.00140 0.00052 0.00047 0.00038 0.00035 0.00035
Cooking 0.00137 0.00051 0.00046 0.00037 0.00034 0.00034
Freezers 0.00145 0.00054 0.00049 0.00039 0.00037 0.00036
Lighting 0.00147 0.00055 0.00049 0.00040 0.00037 0.00036
Refrigeration 0.00145 0.00054 0.00049 0.00039 0.00037 0.00036
Space Cooling 0.00120 0.00044 0.00040 0.00032 0.00030 0.00029
Space Heating 0.00152 0.00056 0.00051 0.00041 0.00038 0.00038
Water Heating 0.00142 0.00053 0.00048 0.00038 0.00036 0.00035
Other Uses 0.00140 0.00052 0.00047 0.00038 0.00035 0.00035
Commercial Sector
Cooking 0.00115 0.00043 0.00038 0.00031 0.00029 0.00028
Lighting 0.00121 0.00045 0.00040 0.00033 0.00030 0.00030
Office Equipment (Non-Pc) 0.00105 0.00039 0.00035 0.00028 0.00026 0.00026
Office Equipment (Pc) 0.00105 0.00039 0.00035 0.00028 0.00026 0.00026
Refrigeration 0.00137 0.00051 0.00046 0.00037 0.00035 0.00034
Space Cooling 0.00114 0.00042 0.00038 0.00031 0.00029 0.00028
Space Heating 0.00154 0.00057 0.00052 0.00042 0.00039 0.00038
Ventilation 0.00138 0.00051 0.00046 0.00037 0.00035 0.00034
Water Heating 0.00115 0.00042 0.00038 0.00031 0.00029 0.00028
Other Uses 0.00109 0.00040 0.00036 0.00029 0.00027 0.00027
Industrial Sector
All Uses 0.00109 0.00040 0.00036 0.00029 0.00027 0.00027

13A-6
Table 13A.4.5 Power Sector Emissions Factors for N2O (Short Tons per GWh of Site
Electricity Use)
2025 2030 2035 2040 2045 2050+
Residential Sector
Clothes Dryers 0.00569 0.00245 0.00226 0.00192 0.00169 0.00143
Cooking 0.00555 0.00240 0.00220 0.00187 0.00166 0.00140
Freezers 0.00587 0.00253 0.00233 0.00198 0.00175 0.00147
Lighting 0.00594 0.00255 0.00235 0.00199 0.00176 0.00148
Refrigeration 0.00586 0.00253 0.00233 0.00198 0.00175 0.00147
Space Cooling 0.00497 0.00219 0.00202 0.00173 0.00153 0.00130
Space Heating 0.00609 0.00261 0.00240 0.00204 0.00180 0.00151
Water Heating 0.00573 0.00247 0.00227 0.00193 0.00170 0.00143
Other Uses 0.00568 0.00245 0.00225 0.00191 0.00169 0.00142
Commercial Sector
Cooking 0.00477 0.00207 0.00190 0.00162 0.00143 0.00121
Lighting 0.00498 0.00216 0.00198 0.00169 0.00150 0.00126
Office Equipment (Non-Pc) 0.00439 0.00192 0.00176 0.00150 0.00133 0.00113
Office Equipment (Pc) 0.00439 0.00192 0.00176 0.00150 0.00133 0.00113
Refrigeration 0.00557 0.00240 0.00221 0.00188 0.00166 0.00140
Space Cooling 0.00477 0.00211 0.00194 0.00166 0.00148 0.00126
Space Heating 0.00617 0.00264 0.00243 0.00206 0.00182 0.00153
Ventilation 0.00559 0.00241 0.00222 0.00189 0.00167 0.00140
Water Heating 0.00475 0.00206 0.00189 0.00161 0.00143 0.00121
Other Uses 0.00455 0.00199 0.00182 0.00155 0.00138 0.00117
Industrial Sector
All Uses 0.00455 0.00199 0.00182 0.00155 0.00138 0.00117

13A-7
Table 13A.4.6 Power Sector Emissions Factors for NOx (Short Tons per GWh of Site
Electricity Use)
2025 2030 2035 2040 2045 2050+
Residential Sector
Clothes Dryers 0.255 0.115 0.103 0.096 0.085 0.060
Cooking 0.251 0.114 0.102 0.095 0.084 0.059
Freezers 0.261 0.118 0.106 0.099 0.087 0.062
Lighting 0.262 0.117 0.104 0.097 0.085 0.060
Refrigeration 0.261 0.118 0.106 0.099 0.087 0.061
Space Cooling 0.236 0.114 0.103 0.098 0.088 0.063
Space Heating 0.267 0.118 0.105 0.098 0.086 0.060
Water Heating 0.256 0.115 0.102 0.095 0.084 0.059
Other Uses 0.255 0.115 0.103 0.096 0.085 0.060
Commercial Sector
Cooking 0.225 0.104 0.093 0.088 0.078 0.056
Lighting 0.232 0.107 0.095 0.090 0.080 0.057
Office Equipment (Non-Pc) 0.214 0.101 0.090 0.085 0.076 0.055
Office Equipment (Pc) 0.214 0.101 0.090 0.085 0.076 0.055
Refrigeration 0.251 0.114 0.102 0.095 0.084 0.059
Space Cooling 0.230 0.112 0.102 0.097 0.087 0.063
Space Heating 0.269 0.119 0.106 0.098 0.086 0.060
Ventilation 0.252 0.114 0.102 0.095 0.084 0.059
Water Heating 0.225 0.104 0.092 0.087 0.077 0.055
Other Uses 0.219 0.102 0.091 0.086 0.077 0.055
Industrial Sector
All Uses 0.219 0.102 0.091 0.086 0.077 0.055

13A-8
Table 13A.4.7 Power Sector Emissions Factors for SO2 (Short Tons per GWh of Site
Electricity Use)
2025 2030 2035 2040 2045 2050+
Residential Sector
Clothes Dryers 0.149 0.074 0.070 0.057 0.051 0.049
Cooking 0.145 0.072 0.068 0.056 0.050 0.048
Freezers 0.154 0.077 0.073 0.059 0.053 0.051
Lighting 0.156 0.077 0.073 0.060 0.054 0.051
Refrigeration 0.154 0.077 0.072 0.059 0.053 0.051
Space Cooling 0.130 0.065 0.061 0.050 0.045 0.043
Space Heating 0.160 0.079 0.075 0.061 0.055 0.053
Water Heating 0.150 0.075 0.071 0.058 0.052 0.049
Other Uses 0.149 0.074 0.070 0.057 0.051 0.049
Commercial Sector
Cooking 0.124 0.062 0.058 0.047 0.042 0.040
Lighting 0.130 0.064 0.061 0.050 0.044 0.042
Office Equipment (Non-Pc) 0.113 0.056 0.053 0.043 0.039 0.037
Office Equipment (Pc) 0.113 0.056 0.053 0.043 0.039 0.037
Refrigeration 0.146 0.073 0.068 0.056 0.050 0.048
Space Cooling 0.124 0.063 0.059 0.048 0.043 0.041
Space Heating 0.163 0.081 0.076 0.062 0.056 0.053
Ventilation 0.147 0.073 0.069 0.056 0.051 0.048
Water Heating 0.123 0.061 0.058 0.047 0.042 0.040
Other Uses 0.118 0.059 0.055 0.045 0.040 0.038
Industrial Sector
All Uses 0.118 0.059 0.055 0.045 0.040 0.038

Table 13A.4.8 Electricity Upstream Emissions Factors


Species Unit 2025 2030 2035 2040 2045 2050+
CO2 kg/MWh 27.7 19.1 16.6 16.3 16.2 15.7
CH4 g/MWh 2172.0 1554.8 1328.7 1349.8 1343.9 1302.1
Hg g/MWh 5.3E-06 2.2E-06 1.8E-06 1.4E-06 1.2E-06 9.7E-07
N 2O g/MWh 0.159 0.088 0.081 0.070 0.066 0.060
NOx g/MWh 372.5 265.6 231.3 229.3 228.9 223.2
SO2 g/MWh 2.5 1.3 1.2 1.0 0.9 0.8

13A-9
Table 13A.4.9 Natural Gas Upstream Emissions Factors
Species Unit 2025 2030 2035 2040 2045 2050+
CO2 kg/MMcf 7.6 7.4 7.5 7.5 7.6 7.7
CH4 g/MMcf 701.6 698.8 703.8 704.1 705.9 707.0
Hg g/MMcf 0.0E+00 0.0E+00 0.0E+00 0.0E+00 0.0E+00 0.0E+00
N 2O g/MMcf 0.012 0.012 0.012 0.012 0.012 0.012
NOx g/MMcf 108.5 105.4 107.6 107.4 108.8 110.2
SO2 g/MMcf 0.033 0.032 0.032 0.032 0.033 0.033

Table 13A.4.10 Petroleum Fuels Upstream Emission Factors


Species Unit 2025 2030 2035 2040 2045 2050+
CO2 kg/bbl 76.3 76.6 78.6 80.0 81.2 80.9
CH4 g/bbl 1085.7 1094.0 1127.2 1147.7 1166.8 1164.8
Hg g/bbl 4.3E-06 2.1E-06 1.8E-06 1.6E-06 1.5E-06 1.3E-06
N 2O g/bbl 0.578 0.573 0.583 0.591 0.597 0.592
NOx g/bbl 764.0 769.1 784.9 796.8 807.3 802.4
SO2 g/bbl 13.3 12.9 13.1 13.3 13.4 13.2

13A-10
REFERENCES

1. U.S. Department of Energy–Energy Information Administration. Annual Energy Outlook


2023 with Projections to 2050. 2023. (Last accessed May 1, 2023.)
https://www.eia.gov/outlooks/aeo/.

2. Coughlin, K. Utility Sector Impacts of Reduced Electricity Demand. 2014. Lawrence


Berkeley National Laboratory: Berkeley, CA. Report No. LBNL-6864E. (Last accessed
May 1, 2023.) https://www.osti.gov/biblio/1165372.

3. Coughlin, K. Utility Sector Impacts of Reduced Electricity Demand: Updates to


Methodology and Results. 2019. Lawrence Berkeley National Laboratory: Berkeley, CA.
Report No. LBNL-2001256. (Last accessed May 1, 2023.)
https://www.osti.gov/biblio/1580427.

4. U.S. Environmental Protection Agency. Emission Factors for Greenhouse Gas


Inventories. 2014. (Last accessed May 1, 2023.)
https://www.epa.gov/sites/default/files/2015-07/documents/emission-factors_2014.pdf.

5. Coughlin, K. Projections of Full-Fuel-Cycle Energy and Emissions Metrics. 2013.


Lawrence Berkeley National Laboratory: Berkeley, CA. Report No. LBNL-6025E. (Last
accessed May 1, 2023.) https://eta-
publications.lbl.gov/sites/default/files/lbnl6025e_ffc.pdf.

6. Burnham, A., J. Han, C. E. Clark, M. Wang, J. B. Dunn, and I. Palou-Rivera. Life-Cycle


Greenhouse Gas Emissions of Shale Gas, Natural Gas, Coal, and Petroleum.
Environmental Science & Technology. 2011. 46(2): pp. 619–627.

7. U.S. Environmental Protection Agency. Greenhouse Gas Emissions Reporting from the
Petroleum and Natural Gas Industry: Background Technical Support Document. 2009.
Washington, D.C. (Last accessed May 1, 2023.)
https://www.epa.gov/sites/default/files/2015-05/documents/subpart-w_tsd.pdf.

8. U.S. Environmental Protection Agency. Oil and Natural Gas Sector: Standards of
Performance for Crude Oil and Natural Gas Production, Transmission, and Distribution,
Background Supplemental Technical Support Document for the Final New Source
Performance Standards. 2012. Washington, D.C. (Last accessed May 1, 2023.)
https://www.regulations.gov/document/EPA-HQ-OAR-2010-0505-4550.

13A-11
APPENDIX 14A. SOCIAL COST OF GREENHOUSE GAS VALUES, 2020-2070

TABLE OF CONTENTS

14A.1 VALUES FOR SOCIAL COST OF GREENHOUSE GASES ............................ 14A-1


REFERENCES ....................................................................................................................... 14A-6

LIST OF TABLES

Table 14A.1.1 Interim Social Cost of CO2 Values Based on 2021 Interagency Update
and 2021 EPA Light-Duty Vehicle Regulatory Impact Analysis, 2020–
2070 (converted to 2020$ per Metric Ton of CO2)* ................................. 14A-1
Table 14A.1.2 Interim Social Cost of CH4 Values from 2021 Interagency Update and
Interagency Update, 2021 EPA Light-Duty Vehicle Regulatory Impact
Analysis, 2020–2070 (converted to 2020$ per Metric Ton of CH4)* ....... 14A-3
Table 14A.1.3 Interim Social Cost of N2O Values from 2021 Interagency Update and
2021 EPA Light-Duty Vehicle Regulatory Impact Analysis, 2020–
2070 (converted to 2020$ per Metric Ton of N2O)* ................................. 14A-4

14A-i
APPENDIX 14A. SOCIAL COST OF GREENHOUSE GAS VALUES, 2020-2070

14A.1 VALUES FOR SOCIAL COST OF GREENHOUSE GASES


The values in this appendix are taken from the model input files supporting the “Revised
2023 and Later Model Year Light-Duty Vehicle GHG Emissions Standards: Regulatory Impact
Analysis” published by EPA in December 2021.1,a These values are themselves based on the
2020-2050 values in “Technical Support Document: Social Cost of Carbon, Methane, and
Nitrous Oxide; Interim Estimates under Executive Order 13990”, published by the Interagency
Working Group on Social Cost of Greenhouse Gases in February 2021.2 To derive values for
2051-2070, EPA extrapolated based on methods, assumptions, and parameters identical to the
2020-2050 estimates developed by the Interagency Working Group. The values in the EPA files
are in 2018$. DOE converted these to 2020$ using the GDP deflator. b Due to a lack of available
SC-CO2 estimates for emissions years beyond 2070, DOE did not monetize the climate benefits
of GHG emissions reductions occurring after 2070.

Table 14A.1.1 Interim Social Cost of CO2 Values Based on 2021 Interagency Update and
2021 EPA Light-Duty Vehicle Regulatory Impact Analysis, 2020–2070
(converted to 2020$ per Metric Ton of CO2)*
Discount Rate and Statistics
Emissions Year 5%, Average 3%, Average 2.5%, Average 3%, 95th
2020 14 51 76 Percentile
151
2021 15 52 77 155
2022 15 53 79 158
2023 16 54 80 162
2024 16 55 81 165
2025 17 56 83 169
2026 17 57 84 172
2027 18 58 85 176
2028 18 59 87 179
2029 19 60 88 183
2030 19 62 89 186
2031 20 63 91 190
2032 20 64 92 194
2033 21 65 93 198
2034 22 66 95 201
2035 22 67 96 205
2036 23 68 97 209
2037 23 70 99 213

a
Model files available at: www3.epa.gov/otaq/ld/EPA-CCEMS-PostProcessingTool-Project-FRM.zip (last accessed
January 18, 2022).
b
For 2020-2050, there are slight differences from the IWG report in a few cases that are likely due to the GDP
deflator used.

14A-1
Discount Rate and Statistics
Emissions Year 5%, Average 3%, Average 2.5%, Average 3%, 95th
2038 24 71 100 Percentile
217
2039 25 72 101 220
2040 25 73 103 224
2041 26 74 104 228
2042 26 75 105 231
2043 27 76 107 235
2044 28 78 108 238
2045 28 79 109 242
2046 29 80 111 245
2047 30 81 112 249
2048 30 82 113 252
2049 31 83 115 256
2050 32 84 116 259
2051 32 85 118 260
2052 33 86 119 261
2053 34 87 120 262
2054 34 88 121 263
2055 35 89 122 265
2056 35 90 123 267
2057 36 91 124 269
2058 37 92 125 271
2059 37 92 127 273
2060 38 93 128 275
2061 39 95 129 280
2062 40 96 131 285
2063 41 98 132 290
2064 42 99 134 295
2065 44 100 135 300
2066 45 102 137 305
2067 46 103 138 311
2068 47 105 140 316
2069 48 106 141 321
2070 49 108 143 326
* Values are rounded off to the nearest dollar.

14A-2
Table 14A.1.2 Interim Social Cost of CH4 Values from 2021 Interagency Update and
Interagency Update, 2021 EPA Light-Duty Vehicle Regulatory Impact
Analysis, 2020–2070 (converted to 2020$ per Metric Ton of CH4)*
Discount Rate and Statistics
Emissions Year 5%, Average 3%, Average 2.5%, Average 3%, 95th
2020 663 1,480 1,946 Percentile
3,893
2021 691 1,527 2,002 4,021
2022 718 1,574 2,057 4,149
2023 745 1,620 2,112 4,277
2024 772 1,667 2,167 4,405
2025 799 1,714 2,223 4,533
2026 826 1,761 2,278 4,661
2027 853 1,807 2,333 4,789
2028 880 1,854 2,388 4,917
2029 908 1,901 2,444 5,045
2030 935 1,948 2,499 5,173
2031 969 2,003 2,563 5,326
2032 1,003 2,058 2,626 5,479
2033 1,038 2,113 2,690 5,632
2034 1,072 2,168 2,754 5,786
2035 1,106 2,224 2,817 5,939
2036 1,140 2,279 2,881 6,092
2037 1,175 2,334 2,945 6,245
2038 1,209 2,389 3,008 6,399
2039 1,243 2,444 3,072 6,552
2040 1,277 2,500 3,136 6,705
2041 1,315 2,555 3,199 6,849
2042 1,352 2,611 3,261 6,993
2043 1,389 2,667 3,324 7,138
2044 1,427 2,722 3,387 7,282
2045 1,464 2,778 3,450 7,426
2046 1,502 2,834 3,512 7,570
2047 1,539 2,890 3,575 7,714
2048 1,576 2,945 3,638 7,859
2049 1,614 3,001 3,701 8,003
2050 1,651 3,057 3,763 8,147
2051 1,680 3,096 3,807 8,193
2052 1,703 3,128 3,841 8,228
2053 1,726 3,159 3,874 8,263
2054 1,749 3,190 3,908 8,297
2055 1,772 3,221 3,942 8,332

14A-3
Discount Rate and Statistics
Emissions Year 5%, Average 3%, Average 2.5%, Average 3%, 95th
2056 1,797 3,256 3,979 Percentile
8,373
2057 1,823 3,291 4,017 8,415
2058 1,848 3,326 4,055 8,456
2059 1,873 3,360 4,092 8,497
2060 1,899 3,395 4,130 8,539
2061 2,021 3,548 4,296 9,067
2062 2,143 3,702 4,462 9,594
2063 2,264 3,856 4,628 10,122
2064 2,386 4,009 4,794 10,650
2065 2,508 4,163 4,960 11,177
2066 2,632 4,325 5,141 11,758
2067 2,757 4,488 5,323 12,338
2068 2,881 4,651 5,504 12,919
2069 3,006 4,814 5,686 13,499
2070 3,130 4,976 5,867 14,079
* Values are rounded off to the nearest dollar.

Table 14A.1.3 Interim Social Cost of N2O Values from 2021 Interagency Update and 2021
EPA Light-Duty Vehicle Regulatory Impact Analysis, 2020–2070
(converted to 2020$ per Metric Ton of N2O)*
Discount Rate and Statistics
Emissions Year 5%, Average 3%, Average 2.5%, Average 3%, 95th
2020 5,760 18,342 27,037 Percentile
48,090
2021 5,961 18,777 27,592 49,293
2022 6,162 19,213 28,147 50,497
2023 6,363 19,649 28,702 51,700
2024 6,565 20,084 29,257 52,904
2025 6,766 20,520 29,811 54,108
2026 6,967 20,955 30,366 55,311
2027 7,168 21,391 30,921 56,515
2028 7,370 21,827 31,476 57,718
2029 7,571 22,262 32,031 58,922
2030 7,772 22,698 32,585 60,125
2031 8,019 23,188 33,195 61,480
2032 8,266 23,678 33,804 62,834
2033 8,513 24,168 34,413 64,189
2034 8,760 24,659 35,023 65,543
2035 9,007 25,149 35,632 66,898

14A-4
Discount Rate and Statistics
Emissions Year 5%, Average 3%, Average 2.5%, Average 3%, 95th
2036 9,253 25,639 36,241 Percentile
68,252
2037 9,500 26,129 36,850 69,606
2038 9,747 26,619 37,460 70,961
2039 9,994 27,110 38,069 72,315
2040 10,241 27,600 38,678 73,670
2041 10,530 28,127 39,320 75,089
2042 10,819 28,655 39,962 76,508
2043 11,109 29,183 40,604 77,928
2044 11,398 29,710 41,246 79,347
2045 11,687 30,238 41,888 80,766
2046 11,976 30,765 42,530 82,186
2047 12,265 31,293 43,172 83,605
2048 12,555 31,820 43,814 85,024
2049 12,844 32,348 44,456 86,443
2050 13,133 32,875 45,098 87,863
2051 13,479 33,426 45,727 88,606
2052 13,798 33,954 46,354 89,984
2053 14,118 34,483 46,981 91,362
2054 14,438 35,011 47,609 92,739
2055 14,758 35,539 48,236 94,117
2056 15,091 36,092 48,890 95,463
2057 15,425 36,644 49,544 96,808
2058 15,758 37,196 50,199 98,154
2059 16,091 37,748 50,853 99,499
2060 16,424 38,300 51,507 100,845
2061 17,077 39,165 52,485 103,794
2062 17,730 40,030 53,463 106,743
2063 18,382 40,895 54,441 109,692
2064 19,035 41,760 55,419 112,641
2065 19,687 42,625 56,397 115,590
2066 20,354 43,515 57,403 118,657
2067 21,020 44,404 58,409 121,725
2068 21,686 45,293 59,416 124,793
2069 22,352 46,183 60,422 127,860
2070 23,018 47,072 61,428 130,928
* Values are rounded off to the nearest dollar.

14A-5
REFERENCES

1. U.S. Environmental Protection Agency. Revised 2023 and Later Model Year Light-Duty
Vehicle GHG Emissions Standards: Regulatory Impact Analysis. EPA-420-R-21-028.
December 2021. (Last accessed January 18, 2022.)
https://nepis.epa.gov/Exe/ZyPDF.cgi?Dockey=P1013ORN.pdf.

2. Interagency Working Group on Social Cost of Greenhouse Gasses, United States


Government. Technical Support Document: Social Cost of Carbon, Methane, and Nitrous
Oxide Interim Estimates under Executive Order 13990. February 2021. (Last accessed
January 18, 2022.) https://www.whitehouse.gov/wp-
content/uploads/2021/02/TechnicalSupportDocument_SocialCostofCarbonMethaneNitro
usOxide.pdf.

14A-6
APPENDIX 14B. BENEFIT-PER-TON VALUES FOR NOX AND SO2 EMISSIONS
FROM ELECTRICITY GENERATION

TABLE OF CONTENTS

14B.1 INTRODUCTION ...................................................................................................14B-1


14B.2 METHODOLOGY ..................................................................................................14B-1
14B.2.1 EPA Data.................................................................................................................14B-1
14B.2.2 AEO Data ................................................................................................................14B-2
14B.2.3 Equations and Results .............................................................................................14B-2
REFERENCES ........................................................................................................................14B-4

LIST OF TABLES

Table 14B.2.1 NOX Benefit-per-ton Values (2019$/ Short Ton) ......................................14B-3


Table 14B.2.2 SO2 Benefit-per-ton Values (2019$/ Short Ton) .......................................14B-3

14B-i
APPENDIX 14B. BENEFIT-PER-TON VALUES FOR NOX AND SO2 EMISSIONS
FROM ELECTRICITY GENERATION

14B.1 INTRODUCTION
This appendix describes the analytical methodology DOE uses to incorporate regional
variability in NOX and SO2 valuations into the emissions monetization. The regional values
assigned to these emissions are based on benefit-per-ton estimates published by EPA for a
variety of sectors, including electricity generation. EPA provides high and low estimates of
benefit-per-ton of NOX and SO2 emissions reductions in 40 regions of the continental USA. DOE
combined these data with regional information on electricity consumption and emissions from
the most recent edition of the Annual Energy Outlook (AEO) to define weighted-average national
benefit-per-ton values for NOX and SO2.

14B.2 METHODOLOGY

14B.2.1 EPA Data


In 2023 EPA published an updated Technical Support Document (TSD) describing an
approach for estimating the average avoided human health impacts and monetized benefits
related to reducing emissions of PM2.5 and ozone precursors including NOX and SO2 from 21
sectors.a The EPA TSD includes estimates of the present value of the benefits of NOX and SO2
emissions reductions (benefit-per-ton estimates or BPT) for 2025, 2030, 2035 and 2040. For
NOX, EPA provides values for PM2.5 –related benefits and for ozone-related benefits. Because the
pollutants associated with NOX as PM2.5 and SO2 emissions persist in the atmosphere over a
period of years, reductions in any given year will have benefits in subsequent years. These future
benefits are discounted and summed to provide a single value for the reduction of one ton of
emissions in the emissions year.

For Electricity generating units, EPA estimated regional BPT values for regions
consisting of states or combinations of contiguous continental states. BPT values for NOx and
SO2 as precursors to PM2.5 include high and low impact scenarios; BPT values for NO x as a
precursor to ozone include short and long-term impacts. For all data two rates of discounting (3%
and 7%) are provided.

DOE used linear interpolation to define values for the years between 2025 and 2030,
2030 and 2035, and 2035 and 2040; for years beyond 2040 the value is held constant. DOE
defined the total value of NOx emissions reductions as the sum of the BPT value for PM 2.5 plus
one half of the BPT value for ozone; the factor of one half accounts for the fact that ozone is
primarily produced during the May-September period, so approximately half of NOx emissions
will produce ozone emissions.

a
U.S. Environmental Protection Agency. Estimating the Benefit per Ton of Reducing Directly-Emitted PM2.5, PM2.5
Precursors and Ozone Precursors from 21 Sectors. April 2023. https://www.epa.gov/system/files/documents/2021-
10/source-apportionment-tsd-oct-2021_0.pdf
14B-1
14B.2.2 AEO Data
The AEO provides data on the distribution of electricity sales by region, and the
magnitude of NOX and SO2 emissions by region. For this analysis DOE used the Reference case
from AEO2023.1 DOE used the total annual emissions of NOx and SO2 for each of the AEO’s 25
Electricity Market Module (EMM) regions,2 and data tables published with the NEMS code
package that allocate electricity sales within each EMM region to individual states.b The latter
are used to map EMM regions to EPA regions, and to determine the relative fraction of
emissions allocated to each EPA region. The data are then combined to create time series of
national average BPT values.

14B.2.3 Equations and Results


Consistent with its treatment of other utility and environmental impacts, DOE defines a
times series of national average estimates of NOx and SO2 values.

The same methodology is applied to each pollutant type and EPA scenario (low-7%, low-
3%, etc.). The notation is:

• y is the analysis year,

• m is a label for the EMM region,

• z is a label for the EPA region,

• w(z,m) is a matrix that maps EPA regions to EMM regions; it is defined as the
fraction of total electricity sales within m to region z; ∑z w(z,m) = 1 for all m,

• p(z,y) is the BPT estimate in EPA region z and year y,

• M(m,y) is total pollutant emissions in EMM region m and year y.

The calculation proceeds in three steps:

1. Pollutant emissions are mapped from EMM regions to EPA regions:

M1(z, y) = ∑m M(m, y) * w(z, m)

2. A weight is defined for EPA region z, based on pollutant emissions:

u(z, y) = M1(z, y)/[ ∑z M1(z, y) ]

3. The regional weights are used to define a national average BPT value:

P(y) = ∑z u(z, y) * p(z, y)

b
The NEMS package can be downloaded at https://www.eia.gov/outlooks/aeo/info_nems_archive.php. Once
installed, the file path to the data files is aeo2021\reference\input\emm_db.zip. The data files are
EMMCNTL_RDB.xlsx and LDSMSTR_RDB.xlsx.
14B-2
The results of this calculation are provided in Table 14B.2.1 for NOX and in Table 14B.2.2 for
SO2. DOE’s prices are not significantly different than the EPA estimate of the US average.
Although the EPA prices are held constant after 2040, the DOE prices may vary slightly in the
period 2040-2050 due to the projected changes in regional emissions.

Table 14B.2.1 NOX Benefit-per-ton Values (2019$/ Short Ton)


Scenario 2025 2030 2035 2040 2045 2050
High, 3% Discount Rate 56,936 77,757 84,832 96,284 96,398 96,050
Low, 3% Discount Rate 50,652 70,516 76,799 87,889 88,002 87,782
High, 7% Discount Rate 50,976 69,705 76,145 86,359 86,459 86,146
Low, 7% Discount Rate 45,325 63,187 68,906 78,799 78,899 78,703

Table 14B.2.2 SO2 Benefit-per-ton Values (2019$/ Short Ton)


Scenario 2025 2030 2035 2040 2045 2050
High, 3% Discount Rate 160,483 189,092 210,625 239,287 244,462 247,500
Low, 3% Discount Rate 74,849 91,454 104,488 120,693 123,281 124,822
High, 7% Discount Rate 144,312 170,084 189,573 215,359 220,016 222,755
Low, 7% Discount Rate 67,319 82,162 93,932 108,579 110,911 112,300

14B-3
REFERENCES

1. U.S. Department of Energy–Energy Information Administration. Annual Energy Outlook


2023 with Projections to 2050. 2023. (Last accessed May 1, 2023.)
https://www.eia.gov/outlooks/aeo/.

2. U.S. Energy Information Administration. Assumptions to the Annual Energy Outlook


2021: Electricity Market Module. 2021. (Last accessed September 1, 2022.)
https://www.eia.gov/outlooks/aeo/assumptions/pdf/electricity.pdf.

14B-4
APPENDIX 15A. UTILITY IMPACT ANALYSIS METHODOLOGY

TABLE OF CONTENTS

15A.1 INTRODUCTION .................................................................................................. 15A-1


15A.2 METHODOLOGY ................................................................................................. 15A-1
15A.3 MODEL RESULTS ................................................................................................ 15A-3
15A.3.1 Electricity Generation ............................................................................................ 15A-3
15A.3.2 Installed Capacity ................................................................................................... 15A-5
REFERENCES ....................................................................................................................... 15A-8

LIST OF TABLES

Table 15A.3.1 Fuel-Share Weights by Sector and End-Use (Values for 2025) ............... 15A-4
Table 15A.3.2 Fuel-Share Weights by Sector and End-Use (Values for 2050) ............... 15A-5
Table 15A.3.3 Capacity Impact Factors in GW per TWh Reduced Site Electricity
Demand (Values for 2025)........................................................................ 15A-6
Table 15A.3.4 Capacity Impact Factors in GW per TWh Reduced Site Electricity
Demand (Values for 2050)........................................................................ 15A-7

15A-i
APPENDIX 15A. UTILITY IMPACT ANALYSIS METHODOLOGY

15A.1 INTRODUCTION
In the utility impact analysis, the U.S. Department of Energy (DOE) analyzes the changes
in electric installed capacity and power generation that result for each trial standard level (TSL).
These changes are estimated by multiplying the site savings of electricity by a set of impact
factors which measure the corresponding change in generation by fuel type, installed capacity,
and power sector emissions. This Appendix describes the methods that DOE used to calculate
these impact factors. The methodology is more fully described in Coughlin (2014; 2019).1,2

DOE’s analysis uses output of the DOE/Energy Information Administration (EIA)’s most
recent Annual Energy Outlook (AEO).3 The AEO includes a reference case and a set of side cases
that implement a variety of economic and policy scenarios. In 2015 EIA announced the adoption
of a two-year release cycle for the AEO, alternating between a full set of scenarios and a shorter
edition containing only five scenarios. DOE has adapted its calculation methodology to be
independent of the type of scenarios available with each AEO publication.

15A.2 METHODOLOGY
Marginal reductions in electricity demand lead to marginal reductions in power sector
generation, emissions, and installed capacity. Generally, DOE quantifies these reductions using
marginal impact factors, which are time series defining the change in some power sector quantity
that results from a unit change in site electricity demand. Because load shapes affect the mix of
generation types on the margin, these impact factors depend on end-use and sector.

DOE’s approach examines a series of AEO side cases to estimate the relationship
between changes to power sector generation (TWh) by fuel type and changes to other supply-
side power sector variables, including fuel consumption (quads) by fuel type, and installed
capacity (GW) by fuel and technology type. DOE also calculates changes to power sector
emissions; the methodology for computing these impacts is described in appendix 13A.

DOE uses load shape information from the NEMS code to relate marginal generation
reductions by fuel type to marginal demand reductions by sector and end use. Because AEO side
cases with electricity demand reductions are not always available, DOE defines the relationship
between sector/end-use and generation fuel type using Reference case data. Specifically, DOE
defines, for each sector and end-use, fuel-share weights equal to the percentage of each MWh
used to serve that end-use load that is provided by each generation fuel type.

The load shape data provide an hourly profile defining total consumption of electricity
for each sector/end-use. For each load DOE allocates consumption to one of 3 periods: on-peak,
shoulder, and off-peak. These categories are used in the utility sector to correlate end-use
consumption with supply types. On-peak hours are defined as 12pm to 5pm Monday through
Saturday, June through September. Off-peak hours are 9pm to 6am daily and all day Sunday. All
other hours are allocated to the shoulder period. This leads to a set of weights w(p,u,y) where:

15A-1
y = the analysis year
u = an index representing the sector/end-use (e.g. commercial cooling)
p = the time-of-day period
w(p,u,y) = the fraction of load u that is served in period p

By definition the sum of w(p,u,y) over periods p is equal to one. On the supply-side, DOE
allocates generation by each fuel type to one of the time-of-day periods. The allocation is based
on the following rules:
1.1. The data are normalized so that total annual generation equals total annual
consumption by sector and end-use;
1.2. The demand-side data are summed over sector/end-use to define a total demand
for generation in each time-of-day period;
1.3. All petroleum-based generation is allocated to peak periods;
1.4. Base-load generation (nuclear and coal) is assumed to be equally likely to be on in
all hours; hence, it is allocated to each period in proportion to the number of hours
in that period;
1.5. Any unmet peak period demand is allocated to natural gas;
1.6. The remaining generation of all types is allocated to the remaining periods
proportionally.
This leads to a second set of weights z(p,f,y) where:

f = the fuel type


z(p,f,y) = the fraction of load in period p that is served by fuel f
These weights are used to allocate a MWh of demand reduction for a given end-use to
each fuel type. In defining the fuel-share weights for demand reductions, DOE makes one
adjustment to the factors calculated from the Reference case data. An examination of all
available AEO scenarios shows that both generation and installed capacity for nuclear power are
unchanged across the projection period. This implies that the use of nuclear power is not affected
by small changes in the supply/demand balance; hence, DOE assumes that the factor z(p,f,y) is
zero for nuclear power. The values of z(p,f,y) for the other fuels are renormalized so that the sum
of z(p,f,y) across the remaining fuel types is equal to one.
DOE defines the generation fuel share weights g(u,f,y) as the product

g(u,f,y) = ∑p w(p,u,y) z(p,f,y).


Eq. 15A.1
For the sector/end-use defined by u, the product of the total annual site electricity savings
times the factor g(u,f,y) defines the marginal generation reductions by fuel type. These marginal
generation reductions can be related to marginal fuel use reductions (see appendix 10.B of this
TSD) and to the marginal emissions reductions (see appendix 13A of this TSD). They are also
related to the marginal installed capacity reductions through the capacity factor.

15A-2
DOE uses a capacity factor to relate reductions in generation by fuel type to reductions in
installed capacity by technology type. The capacity factor is defined as the magnitude of change
in capacity given a unit change in generation. The technology types are coal, natural gas
combined-cycle (NGCC), oil and gas steam (OGS), combustion turbine-diesel (CTD), and
renewable sources. For NGCC the capacity factor is defined as the ratio of NGCC capacity to
natural gas generation. DOE combines CTD and OGS DOE into a single peak capacity type,
with capacity factor equal to the ratio of the sum of CTD plus OGS capacity to oil-fired
generation. Each fuel type is then related to a unique capacity type. While marginal capacity
factors can be calculated from AEO data, this approach produces results that are dominated by
computational noise. Hence, DOE uses data for the AEO Reference Case to calculate grid-
average capacity factors for each year of the analysis period, defined as c(f,y). The capacity
change for fuel/technology type f induced by a unit reduction in demand for sector/end-use u is
given by the product g(u,f,y)*c(f,y).

15A.3 MODEL RESULTS


Representative values of the impact factors for fuel share by fuel type, and capacity by
technology type are provided in the tables below. The tables show the factors for two years, 2025
and 2050. The marginal heat rates are presented in appendix 10B and emissions factors are
presented in in appendix 13A.

15A.3.1 Electricity Generation


Table 15A.3.1 and Table 15A.3.2 show the distribution across fuel types of a unit
reduction in electricity demand by sector and end-use, referred to above as fuel-share weights.
The fuel types are coal, natural gas, petroleum, and renewables. The values for cooling are
representative of peaking loads, while the values for refrigeration are representative of flat loads.
The data are shown for 2025 and 2050.

15A-3
Table 15A.3.1 Fuel-Share Weights by Sector and End-Use (Values for 2025)
Coal Natural Gas Oil Renewables
Residential Sector
Clothes Dryers 26.9% 35.5% 0.2% 37.4%
Cooking 26.2% 36.0% 0.2% 37.6%
Freezers 27.8% 35.2% 0.2% 36.8%
Lighting 28.3% 34.4% 0.1% 37.3%
Refrigeration 27.8% 35.2% 0.2% 36.9%
Space Cooling 23.0% 39.5% 0.6% 36.9%
Space Heating 29.1% 33.8% 0.0% 37.1%
Water Heating 27.2% 35.1% 0.1% 37.6%
Other Uses 26.8% 35.5% 0.2% 37.5%
Commercial Sector
Cooking 22.1% 38.4% 0.3% 39.3%
Lighting 23.2% 37.7% 0.3% 38.8%
Office Equipment (Non-Pc) 20.1% 39.8% 0.4% 39.7%
Office Equipment (Pc) 20.1% 39.8% 0.4% 39.7%
Refrigeration 26.3% 35.9% 0.2% 37.7%
Space Cooling 21.8% 40.3% 0.7% 37.2%
Space Heating 29.5% 33.6% 0.0% 37.0%
Ventilation 26.4% 35.8% 0.2% 37.7%
Water Heating 22.0% 38.3% 0.3% 39.4%
Other Uses 21.0% 39.2% 0.3% 39.5%
Industrial Sector
All Uses 21.0% 39.2% 0.3% 39.5%

15A-4
Table 15A.3.2 Fuel-Share Weights by Sector and End-Use (Values for 2050)
Coal Natural Gas Oil Renewables
Residential Sector
Clothes Dryers 6.5% 19.7% 0.0% 73.7%
Cooking 6.4% 20.1% 0.1% 73.5%
Freezers 6.8% 19.9% 0.1% 73.2%
Lighting 6.9% 18.1% 0.0% 75.0%
Refrigeration 6.8% 19.9% 0.1% 73.3%
Space Cooling 5.5% 26.6% 0.2% 67.7%
Space Heating 7.1% 17.3% 0.0% 75.6%
Water Heating 6.6% 18.8% 0.0% 74.6%
Other Uses 6.5% 19.6% 0.0% 73.8%
Commercial Sector
Cooking 5.3% 21.6% 0.1% 73.0%
Lighting 5.6% 21.3% 0.1% 73.0%
Office Equipment (Non-Pc) 4.8% 23.2% 0.1% 71.9%
Office Equipment (Pc) 4.8% 23.2% 0.1% 71.9%
Refrigeration 6.4% 19.8% 0.0% 73.7%
Space Cooling 5.3% 27.5% 0.2% 67.1%
Space Heating 7.2% 17.2% 0.0% 75.6%
Ventilation 6.4% 19.7% 0.0% 73.8%
Water Heating 5.3% 21.4% 0.1% 73.2%
Other Uses 5.0% 22.6% 0.1% 72.3%
Industrial Sector
All Uses 5.0% 22.6% 0.1% 72.3%

15A.3.2 Installed Capacity


Table 15A.3.3 and Table 15A.3.4 show the total change in installed capacity (GW) per
unit of site electricity demand reduction for the five principal capacity types: coal, natural gas,
peaking, renewables, and nuclear. The peaking category is the sum of the two NEMS categories
oil and gas steam and combustion turbine/diesel. Data are shown for 2025 and 2050.

15A-5
Table 15A.3.3 Capacity Impact Factors in GW per TWh Reduced Site Electricity
Demand (Values for 2025)
Coal Natural Gas Oil Renewables
Residential Sector
Clothes Dryers 0.063 0.089 0.044 0.146
Cooking 0.062 0.090 0.050 0.147
Freezers 0.066 0.088 0.048 0.143
Lighting 0.067 0.086 0.016 0.145
Refrigeration 0.065 0.088 0.047 0.144
Space Cooling 0.054 0.099 0.166 0.144
Space Heating 0.069 0.085 0.002 0.145
Water Heating 0.064 0.088 0.027 0.147
Other Uses 0.063 0.089 0.041 0.146
Commercial Sector
Cooking 0.052 0.096 0.074 0.153
Lighting 0.055 0.095 0.069 0.151
Office Equipment (Non-Pc) 0.047 0.100 0.101 0.155
Office Equipment (Pc) 0.047 0.100 0.101 0.155
Refrigeration 0.062 0.090 0.045 0.147
Space Cooling 0.051 0.101 0.180 0.145
Space Heating 0.069 0.084 0.000 0.144
Ventilation 0.062 0.090 0.043 0.147
Water Heating 0.052 0.096 0.071 0.153
Other Uses 0.049 0.098 0.091 0.154
Industrial Sector
All Uses 0.049 0.098 0.091 0.154

15A-6
Table 15A.3.4 Capacity Impact Factors in GW per TWh Reduced Site Electricity
Demand (Values for 2050)
Coal Natural Gas Oil Renewables
Residential Sector
Clothes Dryers 0.021 0.069 0.052 0.299
Cooking 0.020 0.070 0.059 0.298
Freezers 0.021 0.069 0.057 0.297
Lighting 0.022 0.063 0.019 0.304
Refrigeration 0.021 0.069 0.055 0.298
Space Cooling 0.017 0.093 0.196 0.275
Space Heating 0.022 0.060 0.002 0.307
Water Heating 0.021 0.065 0.032 0.303
Other Uses 0.021 0.068 0.049 0.300
Commercial Sector
Cooking 0.017 0.075 0.088 0.296
Lighting 0.018 0.074 0.081 0.296
Office Equipment (Non-Pc) 0.015 0.081 0.119 0.292
Office Equipment (Pc) 0.015 0.081 0.119 0.292
Refrigeration 0.020 0.069 0.053 0.299
Space Cooling 0.017 0.095 0.212 0.272
Space Heating 0.023 0.060 0.000 0.307
Ventilation 0.020 0.068 0.051 0.300
Water Heating 0.017 0.075 0.083 0.297
Other Uses 0.016 0.079 0.107 0.293
Industrial Sector
All Uses 0.016 0.079 0.107 0.293

15A-7
REFERENCES

1. Coughlin, K. Utility Sector Impacts of Reduced Electricity Demand. 2014. Lawrence


Berkeley National Laboratory: Berkeley, CA. Report No. LBNL-6864E. (Last accessed
May 1, 2023.) https://www.osti.gov/biblio/1165372.

2. Coughlin, K. Utility Sector Impacts of Reduced Electricity Demand: Updates to


Methodology and Results. 2019. Lawrence Berkeley National Laboratory: Berkeley, CA.
Report No. LBNL-2001256. (Last accessed May 1, 2023.)
https://www.osti.gov/biblio/1580427.

3. U.S. Department of Energy–Energy Information Administration. Annual Energy Outlook


2023 with Projections to 2050. 2023. (Last accessed May 1, 2023.)
https://www.eia.gov/outlooks/aeo/.

15A-8
APPENDIX 17A. REGULATORY IMPACT ANALYSIS: SUPPORTING MATERIALS

TABLE OF CONTENTS

17A.1 INTRODUCTION .................................................................................................. 17A-1


17A.2 MARKET SHARE ANNUAL INCREASES BY POLICY .................................. 17A-1
17A.3 NIA-RIA INTEGRATED MODEL ....................................................................... 17A-6
17A.4 MARKET PENETRATION CURVES .................................................................. 17A-6
17A.4.1 Introduction ............................................................................................................ 17A-6
17A.4.2 Adjustment of XENERGY Penetration Curves ..................................................... 17A-8
17A.4.3 Interpolation of Penetration Curves........................................................................ 17A-9
17A.5 CONSUMER REBATE PROGRAMS ................................................................ 17A-10
17A.6 FEDERAL AND STATE TAX CREDITS .......................................................... 17A-10
17A.6.1 Federal Tax Credits for Consumers ...................................................................... 17A-10
17A.6.2 Federal Tax Credits for Manufacturers ................................................................ 17A-12
17A.6.3 State Tax Credits .................................................................................................. 17A-12
REFERENCES ..................................................................................................................... 17A-14

LIST OF TABLES

Table 17A.2.1 Annual Increases in Market Shares Attributable to Alternative Policy


Measures for Electric Smooth Element Standalone Cooking Tops
(TSL 1) ...................................................................................................... 17A-2
Table 17A.2.2 Annual Increases in Market Shares Attributable to Alternative Policy
Measures for Electric Smooth Element Cooking Top Component of
Combined Cooking Products (TSL 1) ...................................................... 17A-3
Table 17A.2.3 Annual Increases in Market Shares Attributable to Alternative Policy
Measures for Gas Element Standalone Cooking Tops (TSL 1) ................ 17A-4
Table 17A.2.4 Annual Increases in Market Shares Attributable to Alternative Policy
Gas Cooking Top Component of Combined Cooking Products (TSL 1) . 17A-5
Table 17A.5.1 Rebates Amounts for Consumer Conventional Cooking Products* ....... 17A-10

LIST OF FIGURES

Figure 17A.4.1 S-Curves Showing Effects of External and Internal Sources on


Adoption of New Technologies ................................................................ 17A-8

17A-i
APPENDIX 17A. REGULATORY IMPACT ANALYSIS: SUPPORTING MATERIALS

17A.1 INTRODUCTION

This appendix contains sections discussing the following topics:

• Projections of annual market share increases for the alternative policies;


• NIA-RIA Integrated Model;
• Market penetration curves used to analyze consumer rebates and voluntary energy
efficiency targets, including:
o Background material on XENERGY’s approach,
o DOE’s adjustment of these curves for this analysis, and
o The method DOE used to derive interpolated, customized curves;
• Detailed table of rebates offered for the considered product, as well as DOE’s approach
to estimate a market representative rebate value for this RIA; and
• Background material on Federal and State tax credits for appliances.

17A.2 MARKET SHARE ANNUAL INCREASES BY POLICY

Table 17A.2.1 through Table 17A.2.4 show the annual increases in market shares of
consumer conventional cooking products meeting the target efficiency levels for the selected
TSL (TSL 1). DOE used these market share increases as inputs to the NIA-RIA spreadsheet
model.

17A-1
Table 17A.2.1 Annual Increases in Market Shares Attributable to Alternative Policy
Measures for Electric Smooth Element Standalone Cooking Tops (TSL 1)
Consumer Consumer Manufacturer Vol Energy Bulk Govt
Year
Rebates Tax Credits Tax Credits Eff Targets Purchases
2028 10.0% 6.0% 3.0% 1.5% 0.02%
2029 10.0% 6.0% 3.0% 2.9% 0.04%
2030 10.0% 6.0% 3.0% 4.3% 0.1%
2031 10.0% 6.0% 3.0% 5.5% 0.1%
2032 10.0% 6.0% 3.0% 6.7% 0.1%
2033 10.0% 6.0% 3.0% 7.9% 0.1%
2034 10.0% 6.0% 3.0% 9.0% 0.1%
2035 10.0% 6.0% 3.0% 10.1% 0.2%
2036 10.0% 6.0% 3.0% 11.2% 0.2%
2037 10.0% 6.0% 3.0% 12.2% 0.2%
2038 10.0% 6.0% 3.0% 12.3% 0.2%
2039 10.0% 6.0% 3.0% 12.4% 0.2%
2040 10.0% 6.0% 3.0% 12.4% 0.2%
2041 10.0% 6.0% 3.0% 12.4% 0.2%
2042 10.0% 6.0% 3.0% 12.5% 0.2%
2043 10.0% 6.0% 3.0% 12.5% 0.2%
2044 10.0% 6.0% 3.0% 12.6% 0.2%
2045 10.0% 6.0% 3.0% 12.6% 0.2%
2046 10.0% 6.0% 3.0% 12.6% 0.2%
2047 10.0% 6.0% 3.0% 12.7% 0.2%
2048 10.0% 6.0% 3.0% 12.7% 0.2%
2049 10.0% 6.0% 3.0% 12.7% 0.2%
2050 10.0% 6.0% 3.0% 12.7% 0.2%
2051 10.0% 6.0% 3.0% 12.8% 0.2%
2052 10.0% 6.0% 3.0% 12.8% 0.2%
2053 10.0% 6.0% 3.0% 12.8% 0.2%
2054 10.0% 6.0% 3.0% 12.8% 0.2%
2055 10.0% 6.0% 3.0% 12.9% 0.2%
2056 10.0% 6.0% 3.0% 12.9% 0.2%
2057 10.0% 6.0% 3.0% 12.9% 0.2%

17A-2
Table 17A.2.2 Annual Increases in Market Shares Attributable to Alternative Policy
Measures for Electric Smooth Element Cooking Top Component of
Combined Cooking Products (TSL 1)
Consumer Consumer Manufacturer Vol Energy Bulk Govt
Year
Rebates Tax Credits Tax Credits Eff Targets Purchases
2028 10.0% 6.0% 3.0% 1.5% 0.02%
2029 10.0% 6.0% 3.0% 2.9% 0.04%
2030 10.0% 6.0% 3.0% 4.3% 0.1%
2031 10.0% 6.0% 3.0% 5.5% 0.1%
2032 10.0% 6.0% 3.0% 6.7% 0.1%
2033 10.0% 6.0% 3.0% 7.9% 0.1%
2034 10.0% 6.0% 3.0% 9.0% 0.1%
2035 10.0% 6.0% 3.0% 10.1% 0.2%
2036 10.0% 6.0% 3.0% 11.2% 0.2%
2037 10.0% 6.0% 3.0% 12.2% 0.2%
2038 10.0% 6.0% 3.0% 12.3% 0.2%
2039 10.0% 6.0% 3.0% 12.4% 0.2%
2040 10.0% 6.0% 3.0% 12.4% 0.2%
2041 10.0% 6.0% 3.0% 12.4% 0.2%
2042 10.0% 6.0% 3.0% 12.5% 0.2%
2043 10.0% 6.0% 3.0% 12.5% 0.2%
2044 10.0% 6.0% 3.0% 12.6% 0.2%
2045 10.0% 6.0% 3.0% 12.6% 0.2%
2046 10.0% 6.0% 3.0% 12.6% 0.2%
2047 10.0% 6.0% 3.0% 12.7% 0.2%
2048 10.0% 6.0% 3.0% 12.7% 0.2%
2049 10.0% 6.0% 3.0% 12.7% 0.2%
2050 10.0% 6.0% 3.0% 12.7% 0.2%
2051 10.0% 6.0% 3.0% 12.8% 0.2%
2052 10.0% 6.0% 3.0% 12.8% 0.2%
2053 10.0% 6.0% 3.0% 12.8% 0.2%
2054 10.0% 6.0% 3.0% 12.8% 0.2%
2055 10.0% 6.0% 3.0% 12.9% 0.2%
2056 10.0% 6.0% 3.0% 12.9% 0.2%
2057 10.0% 6.0% 3.0% 12.9% 0.2%

17A-3
Table 17A.2.3 Annual Increases in Market Shares Attributable to Alternative Policy
Measures for Gas Element Standalone Cooking Tops (TSL 1)
Consumer Consumer Manufacturer Vol Energy Bulk Govt
Year
Rebates Tax Credits Tax Credits Eff Targets Purchases
2028 3.0% 1.8% 0.9% 0.3% 0.003%
2029 3.0% 1.8% 0.9% 0.8% 0.01%
2030 3.0% 1.8% 0.9% 1.3% 0.01%
2031 3.0% 1.8% 0.9% 1.8% 0.01%
2032 3.0% 1.8% 0.9% 2.4% 0.02%
2033 3.0% 1.8% 0.9% 2.9% 0.02%
2034 3.0% 1.8% 0.9% 3.0% 0.02%
2035 3.0% 1.8% 0.9% 3.0% 0.03%
2036 3.0% 1.8% 0.9% 3.0% 0.03%
2037 3.0% 1.8% 0.9% 3.0% 0.03%
2038 3.0% 1.8% 0.9% 3.0% 0.03%
2039 3.0% 1.8% 0.9% 3.0% 0.03%
2040 3.0% 1.8% 0.9% 3.0% 0.03%
2041 3.0% 1.8% 0.9% 3.0% 0.03%
2042 3.0% 1.8% 0.9% 3.0% 0.03%
2043 3.0% 1.8% 0.9% 3.0% 0.03%
2044 3.0% 1.8% 0.9% 3.0% 0.03%
2045 3.0% 1.8% 0.9% 3.0% 0.03%
2046 3.0% 1.8% 0.9% 3.0% 0.03%
2047 3.0% 1.8% 0.9% 3.0% 0.03%
2048 3.0% 1.8% 0.9% 3.0% 0.03%
2049 3.0% 1.8% 0.9% 3.0% 0.03%
2050 3.0% 1.8% 0.9% 3.0% 0.03%
2051 3.0% 1.8% 0.9% 3.0% 0.03%
2052 3.0% 1.8% 0.9% 3.0% 0.03%
2053 3.0% 1.8% 0.9% 3.0% 0.03%
2054 3.0% 1.8% 0.9% 3.0% 0.03%
2055 3.0% 1.8% 0.9% 3.0% 0.03%
2056 3.0% 1.8% 0.9% 3.0% 0.03%
2057 3.0% 1.8% 0.9% 3.0% 0.03%

17A-4
Table 17A.2.4 Annual Increases in Market Shares Attributable to Alternative Policy Gas
Cooking Top Component of Combined Cooking Products (TSL 1)
Consumer Consumer Manufacturer Vol Energy Bulk Govt
Year
Rebates Tax Credits Tax Credits Eff Targets Purchases
2028 3.0% 1.8% 0.9% 0.3% 0.003%
2029 3.0% 1.8% 0.9% 0.8% 0.01%
2030 3.0% 1.8% 0.9% 1.3% 0.01%
2031 3.0% 1.8% 0.9% 1.8% 0.01%
2032 3.0% 1.8% 0.9% 2.4% 0.02%
2033 3.0% 1.8% 0.9% 2.9% 0.02%
2034 3.0% 1.8% 0.9% 3.0% 0.02%
2035 3.0% 1.8% 0.9% 3.0% 0.03%
2036 3.0% 1.8% 0.9% 3.0% 0.03%
2037 3.0% 1.8% 0.9% 3.0% 0.03%
2038 3.0% 1.8% 0.9% 3.0% 0.03%
2039 3.0% 1.8% 0.9% 3.0% 0.03%
2040 3.0% 1.8% 0.9% 3.0% 0.03%
2041 3.0% 1.8% 0.9% 3.0% 0.03%
2042 3.0% 1.8% 0.9% 3.0% 0.03%
2043 3.0% 1.8% 0.9% 3.0% 0.03%
2044 3.0% 1.8% 0.9% 3.0% 0.03%
2045 3.0% 1.8% 0.9% 3.0% 0.03%
2046 3.0% 1.8% 0.9% 3.0% 0.03%
2047 3.0% 1.8% 0.9% 3.0% 0.03%
2048 3.0% 1.8% 0.9% 3.0% 0.03%
2049 3.0% 1.8% 0.9% 3.0% 0.03%
2050 3.0% 1.8% 0.9% 3.0% 0.03%
2051 3.0% 1.8% 0.9% 3.0% 0.03%
2052 3.0% 1.8% 0.9% 3.0% 0.03%
2053 3.0% 1.8% 0.9% 3.0% 0.03%
2054 3.0% 1.8% 0.9% 3.0% 0.03%
2055 3.0% 1.8% 0.9% 3.0% 0.03%
2056 3.0% 1.8% 0.9% 3.0% 0.03%
2057 3.0% 1.8% 0.9% 3.0% 0.03%

17A-5
17A.3 NIA-RIA INTEGRATED MODEL

For this analysis, DOE used its integrated NIA-RIAa model approach that the Department
built on the NIA model discussed in chapter 10 and documented in appendix 10A. The resulting
integrated NIA-RIA model features both the NIA and RIA inputs, analyses and results. It has the
capability to generate results, by product class and TSL, for the mandatory standards and each of
the RIA policies. Separate modules estimate increases in market penetration of more efficient
equipment for consumer rebates, voluntary energy efficiency targets and bulk government
purchases.b The consumer rebates module calculates benefit-cost (B/C) ratios and market
barriers, and generates customized market penetration curves for each product class; the
voluntary energy efficiency targets module relies on the market barriers calculated in the
consumer rebates module to project a reduction in those barriers over the first ten years of the
analysis period and estimate the market effects of such a reduction; and the bulk government
purchases module scales down the market for consumer conventional cooking products to
housing units in a public housing authority. A separate module summarizes the market impacts
from mandatory standards, calculated under the same market conditions as the alternative
policies, and all policy alternatives. An additional module produces all tables and figures
presented in chapter 17 as well as the tables of market share increases for each policy reported in
Section 17A.2 of this appendix.

17A.4 MARKET PENETRATION CURVES

This section first discusses the theoretical basis for the market penetration curves that
DOE used to analyze the Consumer Rebates and Voluntary Energy Efficiency Targets policies.
Next it discusses the adjustments it made to the maximum penetration rates. It then refers to the
method it used to develop interpolated penetration curves for consumer conventional cooking
products that meet the target efficiency levels at each TSL. The resulting curves are presented in
chapter 17.

17A.4.1 Introduction

XENERGY, Inc.c, developed a re-parameterized, mixed-source information diffusion


model to estimate market impacts induced by financial incentives for purchasing energy efficient
appliances.1 The basic premise of the mixed-source model is that information diffusion drives the
adoption of technology.

a
NIA = National Impact Analysis; RIA = Regulatory Impact Analysis
b
As mentioned in chapter 17, the increase in market penetrations for consumer tax credits and manufacturer tax
credits are estimated as a fraction of the increase in market penetration of consumer rebates.
c
XENERGY is now owned by KEMA, Inc. (www.kema.com)

17A-6
Extensive economic literature describes the diffusion of new products as technologies
evolve. Some research focuses primarily on developing analytical models of diffusion patterns
applicable to individual consumers or to technologies from competing firms.2, 3, 4 One study
records researchers’ attempts to investigate the factors that drive diffusion processes.5 Because a
new product generally has its own distinct characteristics, few studies have been able to
conclusively develop a universally applicable model. Some key findings, however, generally are
accepted in academia and industry.

One accepted finding is that, regardless of their economic benefits and technological
merits, new technologies are unlikely to be adopted by all potential users. For many products, a
ceiling must be placed on the adoption rate. A second conclusion is that not all adopters purchase
new products at the same time: some act quickly after a new product is introduced; others wait
for the product to mature. Third, diffusion processes can be characterized approximately by
asymmetric S-curves that depict three stages of diffusion: starting, accelerating, and decreasing
(as the adoption ceiling is approached).

A so-called epidemic model of diffusion is used widely in marketing and social studies.
The epidemic model assumes that (1) all consumers place identical value on the benefits of a
new product, and (2) the cost of a new product is constant or declines monotonically over time.
What induces a consumer to purchase a new product is information about the availability and
benefits of the product. In other words, information diffusion drives consumers’ adoption of a
new product.3 The model incorporates information diffusion from both internal sources (spread
by word of mouth from early adopters to prospective adopters) and external sources (the
“announcement effect” produced by government agencies, institutions, or commercial
advertising). The model incorporates both internal and external sources by combining a logistic
function with an exponential function.4, 5

The relative degree of influence from the internal and external sources determines the
general shape of the diffusion curve for a specific product.4, 5 If adoption of a product is
influenced primarily by external sources of information (the announcement effect), for instance,
a high rate of diffusion occurs at the beginning of the process. In this scenario, external sources
provide immediate information exposure to a significant number of prospective adopters. In
contrast, internal sources (such as a network of prospective adopters) are relatively small in size
and reach, producing a more gradual exposure to prospective adopters. Graphically speaking,
information diffusion dominated by external sources is represented by a concave curve (the
exponential curve in Figure 17A.4.1). If adoption of a new product is influenced most strongly
by internal sources of information, the number of adopters increases gradually, forming a convex
curve (the logistic curve in Figure 17A.4.1).

17A-7
Figure 17A.4.1 S-Curves Showing Effects of External and Internal Sources on Adoption of
New Technologies

17A.4.2 Adjustment of XENERGY Penetration Curves

In consultation with the primary authors of the 2002 XENERGY study who later
conducted similar California studies, DOE made some adjustments to XENERGY’s original
implementation (penetration) curves.6, 7 The experiences with utility programs since the
XENERGY study indicate that incentive programs have difficulty achieving penetration rates as
high as 80 percent. Consumer response is limited by barriers created by consumer utility issues
and other non-economic factors. DOE therefore adjusted the maximum penetration parameters
for some of the curves from 80 percent to the following levels:

Moderate Barriers: 70%


High Barriers: 60%
Extremely High Barriers: 50%

The low barriers and no barriers curves (the latter used only when a product has a very
high base-case-market share) remained, respectively, with 80 percent and 100 percent as their
maximum penetration rates. For the interpolated penetration curves (discussed below), DOE set
the no barriers and extremely high barriers curves as the upper and lower bounds, respectively,
for any benefit/cost ratio points higher or lower than the curves. It set another constraint such
that the policy case market share cannot be great than 100 percent, as might occur for products
with high no-new-standards case market shares of the target-level technology.

17A-8
17A.4.3 Interpolation of Penetration Curves

As discussed above, the XENERGY penetration (implementation) curves followed a


functional form to estimate the market implementation rate caused by energy efficiency
measures such as consumer rebates. d The XENERGY report presents five reference market
implementation curves that vary according to the level of market barriers to technology
penetration.1 Such curves have been used by DOE in the Regulatory Impact Analyses for
rulemakings for appliance energy efficiency standards to estimate market share increases in
response to rebate programs. e They provide a framework for evaluating technology penetration,
yet require matching the studied market to the curve that best represents it. This approximate
matching can introduce some inaccuracy to the analysis.

Blum et al (2011, appendix A)8 presents an alternative approach to such evaluation: a


method to estimate market implementation rates more accurately by performing interpolations of
the reference curves. The referred report describes the market implementation rate function and
the reference curves, the method to calibrate the function to a given market, and the limitations
of the method.

DOE used the above referred method to interpolate market implementation curves, to
generate customized curves that were used to estimate the effects of consumer rebates and
voluntary energy efficiency targets for each product class covered by this RIA. For consumer
rebates, DOE derived such curves based on an algorithm that finds the market implementation
curve that best fits, for the first year of the analysis period, the B/C ratio of the target efficiency
level and the market penetration of equipment with that level of energy efficiency in the no-new-
standards case. For the analysis of voluntary energy efficiency targets, DOE departs from the
market barriers level corresponding to the market implementation curve it derived for consumer
rebates, to linearly decrease it over the ten initial years of the analysis period. For each year, as
market barriers decline, the corresponding market implementation curve leads – for the same
B/C ratio – to higher market penetrations.

d
The RIA chapter refers to these curves as penetration curves. This section, in references to the original source, uses
the term implementation curve.
e
DOE has also used this method to estimate market share increases resulting from consumer tax credit and
manufacturer tax credit programs, since the effects of tax credits on markets are considered in this RIA proportional
to the impacts from rebates.

17A-9
17A.5 CONSUMER REBATE PROGRAMS

DOE performed a nationwide internet search for rebate programs that offered incentives
for consumer conventional cooking products in July, 2022. DOE could not find rebate programs
for this product, and therefore assumed that a rebate program would pay for all or part of the
increased installed cost. For gas cooking tops, DOE assumed that a rebate would cover all of the
increased installed costs, given that the increased installed costs are less than 5% of the total
installed costs. For electric cooking tops, DOE assumed that a rebate would cover all of the
increased installed cost at TSL 1 and 2, given that for these two TSLs, the increased installed
costs are less than 3% of the total installed costs; at TSL 3, DOE assumed a $100 rebate, which
would cover approximately 15% of the increased installed cost. Table 17A.5.1 shows the rebate
amounts DOE estimated for the selected efficiency levels of the product classes covered by this
RIA.

Table 17A.5.1 Rebates Amounts for Consumer Conventional Cooking Products*


TSL 1 TSL 2 TSL 3
Electric Smooth Element Standalone Cooking Tops $2.84 $22.63 $100.00
Electric Smooth Element Cooking Top Component
$2.84 $22.63 $100.00
of Combined Cooking Products
Gas Element Standalone Cooking Tops $3.77 $26.64 $26.64
Gas Cooking Top Component of Combined
$3.77 $26.64 $26.64
Cooking Products
* In 2022$.

17A.6 FEDERAL AND STATE TAX CREDITS

This section summarizes the Federal and State tax credits available to consumers who
purchase energy efficient appliances. This section also describes tax credits available to
manufacturers who produce certain energy efficient appliances.

17A.6.1 Federal Tax Credits for Consumers

EPACT 2005 included Federal tax credits for consumers who installed efficient air
conditioners or heat pumps; gas, oil and propane furnaces and boilers; furnace fans; and/or gas,
oil, or electric heat pump water heaters in new or existing homes.9 These tax credits were in
effect in 2006 and 2007, expired in 2008, and were reinstated for 2009–2010 by the American
Recovery and Reinvestment Act (ARRA).10 There was a $1,500 cap on the credit per home,
including the amount received for insulation, windows, and air and duct sealing. Congress
extended this provision for 2011, with some modifications to eligibility requirements, and
reductions in the cap to $500 per home. The American Taxpayer Relief Act of 2012 extended,
with some modifications, residential tax credits for air conditioners, heat pumps, furnaces, and
water heaters placed in service between January 1, 2012 and December 31, 2013.11
The tax credit for furnace fans was $50 in 2011, after which it expired.

17A-10
The importance of the Federal tax credits has been emphasized in research in the
residential heating industry on the impacts of the relatively large credits that were available for
HVAC (heating, ventilating, and air conditioning) equipment. In a survey of HVAC distributors
conducted by Vermont Energy Investment Corporation, respondents indicated that the ample
credit had had a notable impact on sales of higher-efficiency heating and cooling equipment.
Some distributors combined the Federal tax credits with manufacturer rebates and utility
program rebates for a greater consumer incentive. However, when the amount of the Federal tax
credit was reduced, smaller utility rebate incentives had not induced the same levels of
equipment sales increases. The decrease in incentive size from a $1,500 cap in 2009-2010 to a
$500 cap in 2011, during a period when the economy continued to be sluggish, resulted in a
decline in total sales of residential HVAC products. Distributors stated that an incentive needed
to cover 25 to 75 percent of the incremental cost of the efficient equipment to influence
consumer choice. The industry publication “2011 HVAC Review and Outlook” noted a decline
in sales of air conditioning units with >14 SEER in 2011 and a return in sales of units with >16
SEER to 2009 levels (after an increase in 2010). The large majority of distributors observed no
impacts from the utility programs with their lower rebate amounts available in 2011. Distributors
also commented on the advantages of the Federal tax credit being nationwide in contrast to
utility rebate programs that target regional markets.12, 13

In an effort to evaluate the potential impact of a Federal appliance tax credit program,
DOE reviewed Internal Revenue Service (IRS) data on the numbers of taxpayers who claimed
the tax credits during tax years 2006 and 2007. It estimated the percentage of taxpayers who filed
Form 5695, Residential Energy Credits.14 It also estimated the percentage of taxpayers with
entries under Form 5695’s section 3, Residential energy property costs, line 3b, qualified natural
gas, propane, or oil furnace or hot water boiler. DOE reasoned that the percentage of taxpayers
with an entry on Line 3b could serve as a rough indication of the potential of taxpayer
participation in a Federal tax credit program for furnaces during the initial program years. DOE
found that of all residential taxpayers filing tax returns, 0.8 percent in 2006 and 0.6 percent in
2007, claimed a credit for a furnace or boiler. DOE further found that the percentages of those
filing Form 5695 for any qualifying energy property expenditure (which also included
installation of efficient windows, doors and roofs) were 3.1 and 3.2 percent in 2006 and 2007
respectively.

DOE also reviewed data from an earlier Federal energy conservation tax credit program
in place in the 1980s. While this tax credit was available from 1979 through 1985, DOE located
data for only the first three years of the program.15, 16, 17 For those three years - 1979, 1980, and
1981 - the percentages of taxpayers filing Form 5695 were 6.4 percent, 5.2 percent, and 4.9
percent. Given that the data from this earlier tax credit program were not disaggregated by type
of energy property, this data series served only to indicate a possible trend of greater
participation in the initial program year, followed by slightly smaller participation in subsequent
years. However, DOE did not find detailed analysis of this program to indicate the possible
reasons for such a trend. Also, this trend varies from the more stable trend shown in the EPAct
2005 energy tax credit program data for its first two program years.

As discussed in chapter 17, DOE analyzed the percentage of participation in consumer


tax credit programs using its estimates of consumer participation in rebate programs that was

17A-11
based on benefit/cost data specific to each product class of consumer conventional cooking
products covered by this RIA. Hence it was difficult to compare these detailed estimates to the
more general data analysis described above from the existing Federal tax credit program, or to
use the IRS data analysis in its consumer tax credit analysis.

17A.6.2 Federal Tax Credits for Manufacturers

EPACT 2005 provided Federal Energy Efficient Appliance Credits to manufacturers that
produced high-efficiency refrigerators, clothes washers, and dishwashers in 2006 and 2007. 18
The Emergency Economic Stabilization Act of 2008 19 amended the credits and extended them
through 2010. The credits were extended again to 2011 with modifications in the eligibility
requirements. Manufacturer tax credits were extended again, by the American Taxpayer Relief
Act of 2012, for clothes washers, refrigerators, and dishwashers manufactured between January
1, 2012 and December 31, 2013.

Manufacturers who produce these appliances receive the credits for increasing their
production of qualifying appliances. These credits had several efficiency tiers in 2011. For 2012-
2013, credits for the higher tiers remain but were eliminated for the lowest (least efficient) tiers
for clothes washers and dishwashers. The credit amounts applied to each unit manufactured. The
credit to manufacturers of qualifying clothes washers, refrigerators and dishwashers was capped
at $75 million for the period of 2008-2010. However, the most efficient refrigerator (30%) and
clothes washer (2.2 MEF/4.5 wcf) models was not subject to the cap. The credit to manufacturers
was capped at $25 million for 2011, with the most efficient refrigerators (35%) and clothes
washers (2.8 MEF/3.5 WCF) exempted from this cap.f

17A.6.3 State Tax Credits

The States of Oregon and Montana have offered consumer tax credits for efficient
appliances for several years, and the States of Kentucky, Michigan and Indiana began offering
such credits in 2009. The Oregon Department of Energy (ODOE) has disaggregated data on
taxpayer participation in credits for eligible products. (See the discussion in chapter 17, Section
17.3.3, on tax credit data for clothes washers.) Montana’s Department of Revenue does not
disaggregate participation data by appliance, although DOE reviewed Montana's overall
participation trends and found them congruent with its analysis of Oregon's clothes washer tax
credits.

Oregon’s Residential Energy Tax Credit (RETC) was created in 1977. The Oregon
legislature expanded the RETC program in 1997 to include residential refrigerators, clothes
washers, and dishwashers, which significantly increased participation in the program. The
program subsequently added credits for high-efficiency heat pump systems, air conditioners, and
water heaters (2001); furnaces and boilers (2002); and duct/air sealing, fuel cells, heat recovery,
and renewable energy equipment. Beginning in 2012 a Tax Credit Extension Bill (HB3672)
eliminated refrigerators, clothes washers, dishwashers, air conditioners, and boilers from the

f
For more information on federal tax credits for manufacturers see the following websites:
https://programs.dsireusa.org/system/program/detail/1273/energy-efficient-appliance-manufacturing-tax-credit,
https://energytaxincentives.org/

17A-12
RETC program, leaving credits for water heaters, furnaces, heat pumps, tankless water heaters,
and heat pump water heaters.20, 21 The technologies recognized by the Oregon Department of
Energy as “premium efficiency” were eligible for a tax credit of $0.60 per kWh saved in the first
year (up to $1,500).20

Montana had an Energy Conservation Tax Credit for residential measures starting in
1998.22 The tax credit covered various residential energy and water efficient products, including
split system central air conditioning; package system central air conditioning; split system air
source heat pumps; package system heat pumps; natural gas, propane, or oil furnaces; hot water
boilers; advanced main air circulating fans; heat recovery ventilators; gas, oil, or propane water
heaters; electric heat pump water heaters; low-flow showerheads and faucets; light fixtures; and
controls. In 2002 the amount of the credit was increased from 5 percent of product costs (up to
$150) to 25 percent (up to $500) per taxpayer. The credit could be used for products installed in
new construction or remodeling projects. The tax credit covered only the part of the cost and
materials that exceeded established standards of construction.

17A-13
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Estimates. October 29, 2013. (Last accessed August 1, 2023.)
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15. Commissioner of Internal Revenue. 1979 Annual Report. 1979. U.S. Internal Revenue
Service: Washington, D.C. (Last accessed August 1, 2023.) http://www.irs.gov/pub/irs-
soi/79dbfullar.pdf.

16. Commissioner of Internal Revenue. 1980 Annual Report. 1980. U.S. Internal Revenue
Service: Washington, D.C. http://www.irs.gov/pub/irs-soi/80dbfullar.pdf.

17. Commissioner of Internal Revenue and Chief Counsel for the Internal Revenue Service.
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19. Emergency Economic Stabilization Act of 2008. Public Law 110–343. 2008. (Last
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20. Database of State Incentives for Renewables and Efficiency (DSIRE). Oregon
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