[Federal Register Volume 78, Number 161 (Tuesday, August 20, 2013)]
[Proposed Rules]
[Pages 51463-51557]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-20006]



[[Page 51463]]

Vol. 78

Tuesday,

No. 161

August 20, 2013

Part V





Department of Energy





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10 CFR Part 431





Energy Conservation Program: Energy Conservation Standards for Metal 
Halide Lamp Fixtures; Proposed Rule

Federal Register / Vol. 78 , No. 161 / Tuesday, August 20, 2013 / 
Proposed Rules

[[Page 51464]]


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DEPARTMENT OF ENERGY

10 CFR Part 431

[Docket Number EERE-2009-BT-STD-0018]
RIN 1904-AC00


Energy Conservation Program: Energy Conservation Standards for 
Metal Halide Lamp Fixtures

AGENCY: Office of Energy Efficiency and Renewable Energy, Department of 
Energy.

ACTION: Notice of proposed rulemaking (NOPR) and public meeting.

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SUMMARY: The Energy Policy and Conservation Act of 1975 (EPCA), as 
amended, prescribes energy conservation standards for various consumer 
products and certain commercial and industrial equipment, including 
metal halide lamp fixtures. EPCA also requires the U.S. Department of 
Energy (DOE) to determine whether more-stringent, amended standards 
would be technologically feasible and economically justified, and would 
save a significant amount of energy. In this notice, DOE proposes 
amended energy conservation standards for metal halide lamp fixtures. 
The notice also announces a public meeting to receive comments on these 
proposed standards and associated analyses and results.

DATES: DOE will hold a public meeting on Friday, September 27, 2013, 
from 9 a.m. to 4 p.m., in Washington, DC. The meeting will also be 
broadcast as a webinar. See section VIII, ``Public Participation,'' for 
webinar registration information, participant instructions, and 
information about the capabilities available to webinar participants.
    DOE will accept comments, data, and information regarding this 
notice of proposed rulemaking (NOPR) before and after the public 
meeting, but no later than October 21, 2013. See section, ``VIII Public 
Participation,'' for details.

ADDRESSES: The public meeting will be held at the U.S. Department of 
Energy, Forrestal Building, Room 8E-089 1000 Independence Avenue SW., 
Washington, DC 20585. To attend, please notify Ms. Brenda Edwards at 
(202) 586-2945. Please note that foreign nationals visiting DOE 
Headquarters are subject to advance security screening procedures. Any 
foreign national wishing to participate in the meeting should advise 
DOE as soon as possible by contacting Ms. Edwards to initiate the 
necessary procedures. Please also note that those wishing to bring 
laptops into the Forrestal Building will be required to obtain a 
property pass. Visitors should avoid bringing laptops, or allow an 
extra 45 minutes. Persons can attend the public meeting via webinar. 
For more information, refer to the Public Participation section near 
the end of this notice.
    Any comments submitted must identify the NOPR for Energy 
Conservation Standards for metal halide lamp fixtures, and provide 
docket number EE-2009-BT-STD-0018 and/or regulatory information number 
(RIN) 1904-AC00. Comments may be submitted using any of the following 
methods:
    1. Federal eRulemaking Portal: www.regulations.gov. Follow the 
instructions for submitting comments.
    2. Email: MHLF-2009-STD-0018@ee.doe.gov. Include the docket number 
and/or RIN in the subject line of the message.
    3. Mail: Ms. Brenda Edwards, U.S. Department of Energy, Building 
Technologies Program, Mailstop EE-2J, 1000 Independence Avenue SW., 
Washington, DC 20585-0121. If possible, please submit all items on a 
CD. It is not necessary to include printed copies.
    4. Hand Delivery/Courier: Ms. Brenda Edwards, U.S. Department of 
Energy, Building Technologies Program, 950 L'Enfant Plaza SW., Suite 
600, Washington, DC 20024. Telephone: (202) 586-2945. If possible, 
please submit all items on a CD, in which case it is not necessary to 
include printed copies.
    Written comments regarding the burden-hour estimates or other 
aspects of the collection-of-information requirements contained in this 
proposed rule may be submitted to Office of Energy Efficiency and 
Renewable Energy through the methods listed above and by email to 
Chad_S_Whiteman@omb.eop.gov.
    For detailed instructions on submitting comments and additional 
information on the rulemaking process, see section VIII of this 
document (``Public Participation'').
    Docket: The docket is available for review at www.regulations.gov, 
including Federal Register notices, framework documents, public meeting 
attendee lists and transcripts, comments, and other supporting 
documents/materials. All documents in the docket are listed in the 
www.regulations.gov index. However, not all documents listed in the 
index may be publicly available, such as information that is exempt 
from public disclosure.
    A link to the docket Web page can be found at: 
www1.eere.energy.gov/buildings/appliance_standards/product.aspx/productid/49. This Web page will contain a link to the docket for this 
notice on the regulations.gov site. The regulations.gov Web page will 
contain simple instructions on how to access all documents, including 
public comments, in the docket. See section VIII for further 
information on how to submit comments through www.regulations.gov.
    For further information on how to submit a comment, review other 
public comments and the docket, or participate in the public meeting, 
contact Ms. Brenda Edwards at (202) 586-2945 or by email: 
brenda.edwards@ee.doe.gov.

FOR FURTHER INFORMATION CONTACT:
Ms. Lucy deButts, U.S. Department of Energy, Office of Energy 
Efficiency and Renewable Energy, Building Technologies Program, EE-2J, 
1000 Independence Avenue SW., Washington, DC 20585-0121. Telephone: 
(202) 287-1604. Email: metal_halide_lamp_fixtures@ee.doe.gov.
Mr. Ari Altman, U.S. Department of Energy, Office of the General 
Counsel, GC-71, 1000 Independence Avenue SW., Washington, DC 20585-
0121. Telephone: (202) 287-6307. Email: ari.altman@hq.doe.gov.

SUPPLEMENTARY INFORMATION: 

Table of Contents

I. Summary of the Proposed Rule
    A. Benefits and Costs to Customers
    B. Impact on Manufacturers
    C. National Benefits
II. Introduction
    A. Authority
    B. Background
    1. Current Standards
    2. History of Standards Rulemaking for Metal Halide Lamp 
Fixtures
    3. Compliance Date
III. Issues Affecting the Scope of This Rulemaking
    A. Additional Metal Halide Lamp Fixtures for Which DOE Is 
Proposing Standards
    1. EISA 2007 Exempted Metal Halide Lamp Fixtures
    a. Fixtures With Regulated-Lag Ballasts
    b. Fixtures With 480 V Electronic Ballasts
    c. Exempted 150 W Fixtures
    2. Additional Rated Lamp Wattages
    3. General Lighting
    4. Summary
    B. Alternative Approaches to Energy Conservation Standards: 
System Approaches
    1. Lamp-Ballast System
    2. Fixtures Systems--Lamp, Ballast, Optics, and Enclosure
    3. California Title 20 Approach
    C. Combined Rulemakings
    D. Standby Mode and Off Mode Energy Consumption Standards
IV. General Discussion
    A. Test Procedures
    1. Current Test Procedures
    2. Test Input Voltage

[[Page 51465]]

    a. Average of Tested Efficiency at all Possible Voltages
    b. Posting the Highest and Lowest Efficiencies
    c. Test at Single Manufacturer-Declared Voltage
    d. Test at Highest-Rated Voltage
    e. Test on Input Voltage Based on Wattage and Available Voltages
    3. Testing Electronic Ballasts
    4. Rounding Requirements
    B. Technological Feasibility
    1. General
    2. Maximum Technologically Feasible Levels
    C. Energy Savings
    1. Determination of Savings
    2. Significance of Savings
    D. Economic Justification
    1. Specific Criteria
    a. Economic Impact on Manufacturers and Customers
    b. Life-Cycle Costs
    c. Energy Savings
    d. Lessening of Utility or Performance of Products
    e. Impact of Any Lessening of Competition
    f. Need for National Energy Conservation
    g. Other Factors
    2. Rebuttable Presumption
V. Methodology and Discussion
    A. Market and Technology Assessment
    1. General
    2. Equipment Classes
    a. Input Voltage
    b. Fixture Application
    c. Electronic Configuration and Circuit Type
    d. Lamp Wattage
    e. Number of Lamps
    f. Starting Method
    g. Conclusions
    B. Screening Analysis
    C. Engineering Analysis
    1. Approach
    2. Representative Equipment Classes
    3. Representative Wattages
    4. Representative Fixture Types
    5. Ballast Efficiency Testing
    6. Input Power Representations
    7. Baseline Ballast Models
    a. 70 W Baseline Ballast
    b. 150 W Baseline Ballast
    c. 1000 W Baseline Ballast
    8. Selection of More Efficient Units
    a. Higher-Efficiency Magnetic Ballasts
    b. Electronic Ballasts
    9. Efficiency Levels
    10. Design Standard
    11. Scaling to Equipment Classes Not Analyzed
    12. Manufacturer Selling Prices
    a. Manufacturer Production Costs
    b. Incremental Costs for Electronically Ballasted Fixtures
    c. Manufacturer Markups
    D. Markups to Determine Equipment Price
    1. Distribution Channels
    2. Estimation of Markups
    3. Summary of Markups
    E. Energy Use Analysis
    F. Life-Cycle Cost and Payback Period Analysis
    1. Equipment Cost
    2. Installation Cost
    3. Annual Energy Use
    4. Energy Prices
    5. Energy Price Projections
    6. Replacement Costs
    7. Equipment Lifetime
    8. Discount Rates
    9. Analysis Period
    10. Fixture Purchasing Events
    G. National Impact Analysis--National Energy Savings and Net 
Present Value Analysis
    1. Shipments
    a. Historical Shipments
    b. Fixture Stock Projections
    c. Base Case Shipment Scenarios
    d. Standards Case Efficiency Scenarios
    2. Site-to-Source Energy Conversion
    H. Customer Subgroup Analysis
    I. Manufacturer Impact Analysis
    1. Overview
    2. GRIM Analysis and Key Inputs
    a. Manufacturer Production Costs
    b. Base Case Shipment Projections
    c. Standards Case Shipment Projections
    d. Markup Scenarios
    e. Product and Capital Conversion Costs
    3. Discussion of Comments
    a. Compliance Period
    b. Opportunity Cost of Investments
    c. Impact on Competition
    4. Manufacturer Interviews
    a. Ability To Recoup Investments
    b. Efficiency Metric Used
    c. Maintenance of 150 W Exemption
    J. Employment Impact Analysis
    K. Utility Impact Analysis
    L. Emissions Analysis
    M. Monetizing Carbon Dioxide and Other Emissions Impacts
    1. Social Cost of Carbon
    a. Monetizing Carbon Dioxide Emissions
    b. Social Cost of Carbon Values Used in Past Regulatory Analyses
    c. Current Approach and Key Assumptions
    2. Valuation of Other Emissions Reductions
VI. Analytical Results
    A. Trial Standard Levels
    B. Economic Justification and Energy Savings
    1. Economic Impacts on Individual Customers
    a. Life-Cycle Cost and Payback Period
    b. Customer Subgroup Analysis
    c. Rebuttable Presumption Payback
    2. Economic Impacts on Manufacturers
    a. Industry Cash-Flow Analysis Results
    b. Impacts on Employment
    c. Impacts on Manufacturing Capacity
    d. Impacts on Subgroups of Manufacturers
    e. Cumulative Regulatory Burden
    3. National Impact Analysis
    a. Significance of Energy Savings
    b. Net Present Value of Customer Costs and Benefits
    c. Impacts on Employment
    4. Impact on Utility or Performance of Equipment
    5. Impact of Any Lessening of Competition
    6. Need of the Nation To Conserve Energy
    C. Proposed Standards
    1. Trial Standard Level 5
    2. Trial Standard Level 4
    3. Trial Standard Level 3
    D. Backsliding
VII. Procedural Issues and Regulatory Review
    A. Review Under Executive Orders 12866 and 13563
    B. Review Under the Regulatory Flexibility Act
    1. Description and Estimated Number of Small Entities Regulated
    a. Methodology for Estimating the Number of Small Entities
    b. Manufacturer Participation
    c. Metal Halide Ballast and Fixture Industry Structure
    d. Comparison Between Large and Small Entities
    2. Description and Estimate of Compliance Requirements
    3. Duplication, Overlap, and Conflict with Other Rules and 
Regulations
    4. Significant Alternatives to the Proposed Rule
    C. Review Under the Paperwork Reduction Act
    D. Review Under the National Environmental Policy Act of 1969
    E. Review Under Executive Order 13132
    F. Review Under Executive Order 12988
    G. Review Under the Unfunded Mandates Reform Act of 1995
    H. Review Under the Treasury and General Government 
Appropriations Act, 1999
    I. Review Under Executive Order 12630
    J. Review Under the Treasury and General Government 
Appropriations Act, 2001
    K. Review Under Executive Order 13211
    L. Review Under the Information Quality Bulletin for Peer Review
VIII. Public Participation
    A. Attendance at the Public Meeting
    B. Procedure for Submitting Prepared General Statements For 
Distribution
    C. Conduct of the Public Meeting
    D. Submission of Comments
    E. Issues on Which DOE Seeks Comment
IX. Approval of the Office of the Secretary

I. Summary of the Proposed Rule

    Title III, Part B \1\ of the Energy Policy and Conservation Act of 
1975 (EPCA or the Act), Public Law 94-163 (42 U.S.C. 6291-6309, as 
codified), established the Energy Conservation Program for Consumer 
Products Other Than Automobiles. Pursuant to EPCA, any new or amended 
energy conservation standard that the U.S. Department of Energy (DOE) 
prescribes for certain products, such as metal halide lamp fixtures 
(MHLFs or ``fixtures''), shall be designed to achieve the maximum 
improvement in energy efficiency that is technologically feasible and 
economically justified. (42 U.S.C. 6295(o)(2)(A)) Furthermore, the new 
or amended standard must result in a significant conservation of 
energy. (42 U.S.C. 6295(o)(3)(B)) In accordance with these and other 
statutory provisions discussed in this notice, DOE proposes amended 
energy conservation standards for metal halide lamp fixtures. The 
proposed standards, which are the

[[Page 51466]]

minimum allowable ballast efficiencies \2\ based on fixture location, 
ballast type, and rated lamp wattage, are shown in Table I.1.
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    \1\ For editorial reasons, upon codification in the U.S. Code, 
Part B was redesignated Part A.
    \2\ DOE is proposing to continue using a ballast efficiency 
metric for regulation of metal halide lamp fixtures, rather than a 
system or other approach. See section III.B for further discussion.

                Table I.1--Proposed Energy Conservation Standards for Metal Halide Lamp Fixtures
----------------------------------------------------------------------------------------------------------------
                       Rated lamp       Indoor/outdoor      Test input
Equipment classes       wattage              ***         voltage [dagger]       Minimum standard equation %
----------------------------------------------------------------------------------------------------------------
1................  >=50 W and <=100   Indoor...........  480 V...........  99.4/(1 + 2.5 * P[caret](-0.55))
                    W.                                                      [Dagger].
2................  >=50 W and <=100   Indoor...........  All others......  100/(1 + 2.5 * P[caret](-0.55)).
                    W.
3................  >=50 W and <=100   Outdoor..........  480 V...........  99.4/(1 + 2.5 * P[caret](-0.55)).
                    W.
4................  >=50 W and <=100   Outdoor..........  All others......  100/(1 + 2.5 * P[caret](-0.55)).
                    W.
5................  >100 W and <150 W  Indoor...........  480 V...........  99.4/(1 + 0.36 * P[caret](-0.30)).
                    *.
6................  >100 W and <150 W  Indoor...........  All others......  100/(1 + 0.36 * P[caret](-0.30)).
                    *.
7................  >100 W and <150 W  Outdoor..........  480 V...........  99.4/(1 + 0.36 * P[caret](-0.30)).
                    *.
8................  >100 W and <150 W  Outdoor..........  All others......  100/(1 + 0.36 * P[caret](-0.30)).
                    *.
9................  >=150 W ** and     Indoor...........  480 V...........  For >=150 W and <=200 W: 88.0.
                    <=250 W.                                               For >200 W and <=250 W: 6.0 *
                                                                            10[caret](-2) * P + 76.0.
10...............  >=150 W ** and     Indoor...........  All others......  For >=150 W and <=200 W: 88.0.
                    <=250 W.                                               For >200 W and <=250 W: 7.0 *
                                                                            10[caret](-2) * P + 74.0.
11...............  >=150 W ** and     Outdoor..........  480 V...........  For >=150 W and <=200 W: 88.0.
                    <=250 W.                                               For >200 W and <=250 W: 6.0 *
                                                                            10[caret](-2) * P + 76.0.
12...............  >=150 W ** and     Outdoor..........  All others......  For >=150 W and <=200 W: 88.0.
                    <=250 W.                                               For >200 W and <=250 W: 7.0 *
                                                                            10[caret](-2) * P + 74.0.
13...............  >250 W and <=500   Indoor...........  480 V...........  91.0.
                    W.
14...............  >250 W and <=500   Indoor...........  All others......  91.5.
                    W.
15...............  >250 W and <=500   Outdoor..........  480 V...........  91.0.
                    W.
16...............  >250 W and <=500   Outdoor..........  All others......  91.5.
                    W.
17...............  >500 W and <=2000  Indoor...........  480 V...........  For >500 W to <1000 W: 0.994 * (3.2 *
                    W.                                                      10[caret](-3) * P + 89.9).
                                                                           For >=1000 W to <=2000 W: 92.5 and
                                                                            may not utilize a probe-start
                                                                            ballast.
18...............  >500 W and <=2000  Indoor...........  All others......  For >500 W to <1000 W: 3.2 *
                    W.                                                      10[caret](-3) * P + 89.9.
                                                                           For >=1000 W to <=2000 W: 93.1 and
                                                                            may not utilize a probe-start
                                                                            ballast.
19...............  >500 W and <=2000  Outdoor..........  480 V...........  For >500 W to <1000 W: 0.994 * (3.2 *
                    W.                                                      10[caret](-3) * P + 89.9).
                                                                           For >=1000 W to <=2000 W: 92.5 and
                                                                            may not utilize a probe-start
                                                                            ballast.
20...............  >500 W and <=2000  Outdoor..........  All others......  For >500 W to <1000 W: 3.2 *
                    W.                                                      10[caret](-3) * P + 89.9.
                                                                           For >=1000 W to <=2000 W: 93.1 and
                                                                            may not utilize a probe-start
                                                                            ballast.
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* Includes 150 W fixtures exempted by EISA 2007, which are fixtures rated only for 150 watt lamps; rated for use
  in wet locations, as specified by the National Electrical Code 2002, section 410.4(A); and containing a
  ballast that is rated to operate at ambient air temperatures above 50 [deg]C, as specified by Underwriters
  Laboratories (UL) 1029-2001.
** Excludes 150 W fixtures exempted by EISA 2007, which are fixtures rated only for 150 watt lamps; rated for
  use in wet locations, as specified by the National Electrical Code 2002, section 410.4(A); and containing a
  ballast that is rated to operate at ambient air temperatures above 50 [deg]C, as specified by UL 1029-2001.
*** DOE's proposed definitions for ``indoor'' and ``outdoor'' metal halide lamp fixtures are described in
  section V.A.2.
[dagger] Input voltage for testing would be specified by the test procedures. Ballasts rated to operate lamps
  less than 150 W would be tested at 120 V, and ballasts rated to operate lamps >=150 W would be tested at 277
  V. Ballasts not designed to operate at either of these voltages would be tested at the highest voltage for
  which the ballast is designed to operate.
[Dagger] P is defined as the rated wattage of the lamp that the fixture is designed to operate.


[[Page 51467]]

A. Benefits and Costs to Customers

    Table I.2 presents DOE's evaluation of the economic effects of the 
proposed standards on customers of metal halide lamp fixtures, as 
measured by the average life-cycle cost (LCC) savings and the median 
payback period (PBP). The average LCC savings are positive for a 
majority of users for all equipment classes. For example, the estimated 
average LCC savings are approximately $30 for fixtures operating a 400 
W metal halide (MH) lamp in indoor and outdoor applications.

  Table I.2--Impacts of Proposed Standards on Metal Halide Lamp Fixture
                                Customers
------------------------------------------------------------------------
                                         Average LCC     Median payback
           Equipment class              savings 2012$     period years
------------------------------------------------------------------------
70 W (indoor, magnetic baseline)....             38.41               4.2
70 W (outdoor, magnetic baseline)...             46.44               4.4
150 W (indoor)......................             10.14               4.7
150 W (outdoor).....................            112.51              10.5
250 W (indoor)......................             13.12              11.8
250 W (outdoor).....................             13.75              14.0
400 W (indoor)......................             28.23              10.5
400 W (outdoor).....................             30.47              12.3
1000 W (indoor).....................            502.21               2.0
1000 W (outdoor)....................            409.02               3.0
------------------------------------------------------------------------

B. Impact on Manufacturers

    The industry net present value (INPV) is the sum of the discounted 
cash flows to the industry from the base year through the end of the 
analysis period (2013 to 2045). Using a real discount rate of 8.9 
percent, DOE estimates that the INPV for manufacturers of metal halide 
ballasts ranges from $77 million in the low shipment-preservation of 
operating profit markup scenario to $127 million in the high shipment-
flat markup scenario in 2012$. Under the proposed standards, DOE 
expects ballast manufacturers to lose up to 25.0 percent of their INPV, 
which is approximately $25.9 million, in the low shipment,-preservation 
of operating profit markup scenario. In the high shipment-flat markup 
scenario, DOE expects manufacturers to increase their INPV up to 3.7 
percent, which is approximately $4.5 million. Using a real discount 
rate of 9.5 percent, DOE estimates that the INPV for manufacturers of 
metal halide lamp fixtures ranges from $523 million in the low 
shipment-preservation of operating profit markup scenario to $695 
million in the high shipment-flat markup scenario in 2012$. Under the 
proposed standards, DOE expects fixture manufacturers to lose up to 3.2 
percent of their INPV, which is approximately $17.3 million, in the low 
shipment-preservation of operating profit markup scenario. In the high 
shipment-flat markup scenario, DOE expects manufacturers to increase 
their INPV up to 10.3 percent, which is approximately $64.8 million. 
Additionally, based on DOE's interviews with the manufacturers of metal 
halide lamp fixtures, DOE does not expect any plant closings or 
significant loss of employment.

C. National Benefits

    DOE's analyses indicate that the proposed standards would save a 
significant amount of energy. The lifetime savings for metal halide 
lamp fixtures purchased in a 30-year period (2016-2045) amount to 0.80-
1.1 quads.
    The cumulative national net present value (NPV) of total customer 
costs and savings of the proposed standards in 2012$ ranges from $0.95 
billion (at a 7-percent discount rate) to $3.2 billion (at a 3-percent 
discount rate) for metal halide lamp fixtures. This NPV expresses the 
estimated total value of future operating-cost savings minus the 
estimated increased equipment costs for equipment purchased in 2016-
2045, discounted to 2013.
    In addition, the proposed standards would have significant 
environmental benefits. The energy savings would result in cumulative 
emission reductions of 49-65 million metric tons (Mt) \3\ of carbon 
dioxide (CO2), 214-289 thousand tons of methane 
(CH4), 0.89-3.0 thousand tons of nitrous oxide 
(N2O), 65-87 thousand tons of sulfur dioxide 
(SO2), 66-90 thousand tons of nitrogen oxides 
(NOX), and 0.11-0.15 tons of mercury (Hg).4 5
---------------------------------------------------------------------------

    \3\ A metric ton is equivalent to 1.1 short tons. Results for 
CH4, SO2, NOX and Hg are presented 
in short tons.
    \4\ DOE calculates emissions reductions relative to the Annual 
Energy Outlook (AEO) 2013 Reference case, which generally represents 
current legislation and environmental regulations for which 
implementing regulations were available as of December 31, 2012.
    \5\ DOE also estimated CO2 and CO2 
equivalent (CO2eq) emissions that occur by 2030 
(CO2eq includes greenhouse gases such as CH4 
and N2O). The estimated emissions reductions by 2030 are 
15-17 million metric tons CO2, 1,471-1,627 thousand tons 
CO2eq for CH4, and 63-70 thousand tons 
CO2eq for N2O.
---------------------------------------------------------------------------

    The value of the CO2 emissions reductions is calculated 
using a range of values per metric ton of CO2 (otherwise 
known as the Social Cost of Carbon, or SCC) developed by a recent 
interagency process. The derivation of the SCC values is discussed in 
section V.M.1. DOE estimates the net present monetary value of the 
CO2 emissions reduction is between $0.33 and $4.7 billion, 
expressed in 2012$ and discounted to 2013. DOE also estimates the net 
present monetary value of the NOX emissions reduction, 
expressed in 2012$ and discounted to 2013, is $45 million at a 7-
percent discount rate, and $91 million at a 3-percent discount rate.\6\
---------------------------------------------------------------------------

    \6\ DOE has decided to await further guidance regarding 
consistent valuation and reporting of Hg emissions before it 
monetizes Hg in its rulemakings.
---------------------------------------------------------------------------

    Table I.3 summarizes the national economic costs and benefits 
expected to result from today's proposed standards for metal halide 
lamp fixtures.

[[Page 51468]]



   Table I.3--Summary of National Economic Benefits and Costs of Metal
     Halide Lamp Fixture Energy Conservation Standards (Primary (Low
                          Shipments) Estimate)
------------------------------------------------------------------------
                                        Present value     Discount rate
              Category                  million 2012$       (percent)
------------------------------------------------------------------------
                                Benefits
------------------------------------------------------------------------
Operating Cost Savings..............             1,848                 7
                                                 3,748                 3
CO2 Reduction Monetized Value ($12.9/              333                 5
 t case) *..........................
CO2 Reduction Monetized Value ($40.8/            1,532                 3
 t case) *..........................
CO2 Reduction Monetized Value ($62.2/            2,436               2.5
 t case) *..........................
CO2 Reduction Monetized Value (at                4,689                 3
 $117/t case) *.....................
NOX Reduction Monetized Value (at                   45                 7
 $2,639/ton) **.....................
                                                    91                 3
    Total Benefits[dagger]..........             3,424                 7
                                                 5,371                 3
------------------------------------------------------------------------
                                  Costs
------------------------------------------------------------------------
Incremental Installed Costs.........               897                 7
                                                 1,294                 3
------------------------------------------------------------------------
                              Net Benefits
------------------------------------------------------------------------
Including CO2 and NOX Reduction                  2,528                 7
 Monetized Value....................
                                                 4,076                 3
------------------------------------------------------------------------
* The interagency group selected four sets of SCC values for use in
  regulatory analyses. Three sets of values are based on the average SCC
  from the integrated assessment models, at discount rates of 2.5, 3,
  and 5 percent. The fourth set, which represents the 95th percentile
  SCC estimate across all three models at a 3-percent discount rate, is
  included to represent higher-than-expected impacts from temperature
  change further out in the tails of the SCC distribution. The values in
  parentheses represent the SCC in 2015. The SCC time series used by DOE
  incorporate an escalation factor.
** The value represents the average of the low and high NOX values used
  in DOE's analysis.
[dagger] Total Benefits for both the 3% and 7% cases are derived using
  the series corresponding to average SCC value with 3-percent discount
  rate.

    The benefits and costs of today's proposed standards, for equipment 
sold between 2016 and 2045, can also be expressed in terms of 
annualized values. The annualized monetary values are the sum of (1) 
the annualized national economic value of the benefits from customer 
operation of equipment that meets the proposed standards (consisting 
primarily of operating cost savings from using less energy, minus 
increases in equipment purchase and installation costs, which is 
another way of representing customer NPV), and (2) the annualized 
monetary value of the benefits of emissions reductions, including 
CO2 emissions reductions.\7\
---------------------------------------------------------------------------

    \7\ DOE used a two-step calculation process to convert the time-
series of costs and benefits into annualized values. First, DOE 
calculated a present value in 2013, the year used for discounting 
the NPV of total customer costs and savings, for the time-series of 
costs and benefits using discount rates of 3 and 7 percent for all 
costs and benefits except for the value of CO2 emissions 
reductions. For the latter, DOE used a range of discount rates, as 
shown in Table I.4. From the present value, DOE then calculated the 
fixed annual payment over a 30-year period (2016 through 2045) that 
yields the same present value. The fixed annual payment is the 
annualized value. Although DOE calculated annualized values, this 
does not imply that the time-series of costs and benefits from which 
the annualized values were determined is a steady stream of 
payments.
---------------------------------------------------------------------------

    Although combining the values of operating savings and 
CO2 emissions reductions provides a useful perspective, two 
issues should be considered. First, the national operating savings are 
domestic U.S. customer monetary savings that occur as a result of 
market transactions, while the value of CO2 emissions 
reductions is a global value. Second, the assessments of operating cost 
savings and CO2 emissions savings are performed with 
different methods that use different time frames for analysis. The 
national operating cost savings is measured for the lifetime of metal 
halide lamp fixtures shipped between 2016 and 2045. The SCC values, on 
the other hand, reflect the present value of some future climate-
related impacts resulting from the emission of 1 ton of CO2 
in each year. These impacts will continue well beyond 2045.
    Estimates of annualized benefits and costs of the proposed 
standards are shown in Table I.4. The results under the primary 
estimate are as follows. (All monetary values below are expressed in 
2012$.) Using a 7-percent discount rate for benefits and costs other 
than CO2 emissions reductions, for which DOE used a 3-
percent discount rate along with the SCC series corresponding to a 
value of $40.8/ton in 2012$, the cost of the standards proposed in 
today's rule is $68.0 million per year in increased equipment costs, 
while the annualized benefits are $139 million per year in reduced 
equipment operating costs, $76 million in CO2 emissions 
reductions, and $3.4 million in reduced NOX emissions. In 
this case, the net benefit amounts to $151 million per year. Using a 3-
percent discount rate for all benefits and costs and the SCC series 
corresponding to a value of $40.8/ton in 2012$, the cost of the 
standards proposed in today's rule is $64 million per year in increased 
equipment costs, while the benefits are $186 million per year in 
reduced operating costs, $76 million in CO2 emissions 
reductions, and $4.5 million in reduced NOX emissions. In 
this case, the net benefit amounts to $202 million per year.

[[Page 51469]]



          Table I.4--Annualized Benefits and Costs of Proposed Standards for Metal Halide Lamp Fixtures
----------------------------------------------------------------------------------------------------------------
                                                                      Monetized Values  [million 2012$/year]
                                                                 -----------------------------------------------
                                              Discount rate            Primary (low
                                                                   shipments) estimate *     High  estimate *
----------------------------------------------------------------------------------------------------------------
Benefits
----------------------------------------------------------------------------------------------------------------
Operating Cost Savings................  7%......................  139...................  169
                                        3%......................  186...................  240
CO2 Reduction Monetized Value ($12.9/t  5%......................  21....................  26
 case) **.
CO2 Reduction Monetized Value ($40.8/t  3%......................  76....................  99
 case) **.
CO2 Reduction Monetized Value ($62.2/t  2.5%....................  114...................  149
 case) **.
CO2 Reduction Monetized Value $117/t    3%......................  232...................  303
 case) **.
NOX Reduction Monetized Value (at       7%......................  3.36..................  4.06
 $2,639/ton) **.
                                        3%......................  4.49..................  5.76
    Total Benefits[dagger]............  7% plus CO2 range.......  163 to 375............  200 to 476
                                        7%......................  218...................  272
                                        3%......................  266...................  344
                                        3% plus CO2 range.......  211 to 422............  272 to 548
----------------------------------------------------------------------------------------------------------------
Costs
----------------------------------------------------------------------------------------------------------------
Incremental Equipment Costs...........  7%......................  68....................  81
                                        3%......................  64....................  80
----------------------------------------------------------------------------------------------------------------
Net Benefits/Costs
----------------------------------------------------------------------------------------------------------------
Total [dagger]........................  7% plus CO2 range.......  96 to 307.............  119 to 396
                                        7%......................  151...................  192
                                        3%......................  202...................  264
                                        3% plus CO2 range.......  147 to 358............  192 to 468
----------------------------------------------------------------------------------------------------------------
* This table presents the annualized costs and benefits associated with fixtures shipped in 2016 and 2045. These
  results include benefits to customers which accrue after 2045 from the fixtures purchased in 2016 to 2045.
  Costs incurred by manufacturers, some of which may be incurred prior to 2016 in preparation for the rule, are
  not directly included, but are indirectly included as part of incremental equipment costs. The Low (Primary)
  and High Estimates utilize forecasts of energy prices from the Energy Information Administration's 2012 Annual
  Energy Outlook (AEO2013) from the AEO2013 Reference case, with the Low and High Estimates based on projected
  fixture shipments in the Low Shipments, Roll-up and High Shipments, Roll-up scenarios, respectively. In
  addition, all estimates use incremental equipment costs that reflect a declining trend for equipment prices,
  using AEO price trends (deflators). The derivation and application of price trends for equipment prices is
  explained in section V.F.
** The interagency group selected four sets of SCC values for use in regulatory analyses. Three sets of values
  are based on the average SCC from the three integrated assessment models, at discount rates of 2.5, 3, and 5
  percent. The fourth set, which represents the 95th percentile SCC estimate across all three models at a 3-
  percent discount rate, is included to represent higher-than-expected impacts from temperature change further
  out in the tails of the SCC distribution. The values in parentheses represent the SCC in 2015. The SCC time
  series incorporate an escalation factor. The value for NOX is the average of the low and high values used in
  DOE's analysis.
[dagger] Total Benefits for both the 3-percent and 7-percent cases are derived using the series corresponding to
  average SCC with 3-percent discount rate. In the rows labeled as ``7% plus CO2 range'' and ``3% plus CO2
  range,'' the operating cost and NOX benefits are calculated using the labeled discount rate, and those values
  are added to the full range of CO2 values.

    DOE has tentatively concluded that the proposed standards represent 
the maximum improvement in energy efficiency that is technologically 
feasible and economically justified, and would result in the 
significant conservation of energy. DOE further notes that equipment 
achieving these standard levels are already commercially available for 
at least some, if not most, equipment classes covered by today's 
proposal. Based on the analyses described above, DOE has tentatively 
concluded that the benefits of the proposed standards to the nation 
(energy savings, positive NPV of customer benefits, customer LCC 
savings, and emissions reductions) would outweigh the burdens (loss of 
INPV for manufacturers and LCC increases for some customers).
    DOE also considered more-stringent fixture energy-use levels as 
trial standard levels (TSLs), and is still considering them in this 
rulemaking. DOE has tentatively concluded, however, that the potential 
burdens of the more-stringent energy-use levels would outweigh the 
projected benefits. Based on its consideration of the public comments 
DOE receives in response to this notice and related information 
collected and analyzed during the course of this rulemaking effort, DOE 
may adopt energy-use levels that are either higher or lower than the 
proposed standards, or some combination of level(s) that incorporate 
the proposed standards in part.

II. Introduction

    The following section discusses the statutory authority underlying 
today's proposal, as well as some of the historical background related 
to the establishment of standards for metal halide lamp fixtures.

A. Authority

    Title III, Part B of EPCA established the Energy Conservation 
Program for Consumer Products Other Than Automobiles,\8\ a program 
covering most major household appliances (collectively referred to as 
``covered products''). Amendments to EPCA have given DOE the authority 
to regulate the energy efficiency of several additional kinds of 
equipment, including certain metal halide lamp fixtures, which are the 
subject of this rulemaking. (42 U.S.C. 6292(a)(19)) EPCA, as amended by 
the Energy Independence and Security Act of 2007 (EISA 2007) prescribes 
energy conservation

[[Page 51470]]

standards for these products (42 U.S.C. 6295(hh)(1)), and directs DOE 
to conduct a rulemaking to determine whether to amend these standards. 
(42 U.S.C. 6295(hh)(2)(A)) (DOE notes that under 42 U.S.C. 
6295(hh)(3)(A), the agency must review its already established energy 
conservation standards for metal halide lamp fixtures. Under this 
requirement, the next review that DOE would need to conduct must occur 
no later than January 1, 2019.)
---------------------------------------------------------------------------

    \8\ For editorial reasons, upon codification in the U.S. Code, 
Part B was redesignated Part A.
---------------------------------------------------------------------------

    Pursuant to EPCA, DOE's energy conservation program for covered 
products consists of four parts: (1) Testing; (2) labeling; (3) the 
establishment of Federal energy conservation standards; and (4) 
certification and enforcement procedures. The Federal Trade Commission 
(FTC) is primarily responsible for labeling, and DOE implements the 
remainder of the program. Subject to certain criteria and conditions, 
DOE is required to develop test procedures to measure the energy 
efficiency, energy use, or estimated annual operating cost of each 
covered product. (42 U.S.C. 6293) Manufacturers of covered products 
must use the prescribed DOE test procedures as the basis for certifying 
to DOE that their products comply with the applicable energy 
conservation standards adopted under EPCA and when making 
representations to the public regarding the energy use or efficiency of 
those products. (42 U.S.C. 6293(c) and 6295(s)) Similarly, DOE must use 
these test procedures to determine whether the products comply with 
standards adopted pursuant to EPCA. The DOE test procedures for metal 
halide lamp fixtures currently appear at title 10 of the Code of 
Federal Regulations (CFR) Sec. Sec.  431.323 and 431.324.
    DOE must follow specific statutory criteria for prescribing amended 
standards for covered products. As indicated above, any amended 
standard for a covered product must be designed to achieve the maximum 
improvement in energy efficiency that is technologically feasible and 
economically justified. (42 U.S.C. 6295(o)(2)(A)) Furthermore, DOE may 
not adopt any standard that would not result in the significant 
conservation of energy. (42 U.S.C. 6295(o)(3)) Moreover, DOE may not 
prescribe a standard: (1) For certain products, including metal halide 
lamp fixtures, if no test procedures have been established for the 
product, or (2) if DOE determines by rule that the proposed standard is 
not technologically feasible or economically justified. (42 U.S.C. 
6295(o)(3)(A)-(B)) In deciding whether a proposed standard is 
economically justified, DOE must determine whether the benefits of the 
standard exceed its burdens. (42 U.S.C. 6295(o)(2)(B)(i)) DOE must make 
this determination after receiving comments on the proposed standard, 
and by considering, to the greatest extent practicable, the following 
seven factors:

    1. The economic impact of the standard on manufacturers and 
consumers of the products subject to the standard;
    2. The savings in operating costs throughout the estimated 
average life of the covered products in the type (or class) compared 
to any increase in the price, initial charges, or maintenance 
expenses for the covered products that are likely to result from the 
imposition of the standard;
    3. The total projected amount of energy, or as applicable, 
water, savings likely to result directly from the imposition of the 
standard;
    4. Any lessening of the utility or the performance of the 
covered products likely to result from the imposition of the 
standard;
    5. The impact of any lessening of competition, as determined in 
writing by the Attorney General, that is likely to result from the 
imposition of the standard;
    6. The need for national energy and water conservation; and
    7. Other factors the Secretary of Energy (Secretary) considers 
relevant. (42 U.S.C. 6295(o)(2)(B)(i)(I)-(VII))

    EPCA, as codified, also contains what is known as an ``anti-
backsliding'' provision, which prevents the Secretary from prescribing 
any amended standard that either increases the maximum allowable energy 
use or decreases the minimum required energy efficiency of a covered 
product. (42 U.S.C. 6295(o)(1)) Also, the Secretary may not prescribe 
an amended or new standard if interested persons have established by a 
preponderance of evidence that the standard is likely to result in the 
unavailability in the United States of any covered product type (or 
class) of performance characteristics (including reliability), 
features, sizes, capacities, and volumes that are substantially the 
same as those generally available in the United States. (42 U.S.C. 
6295(o)(4))
    Further, EPCA, as codified, establishes a rebuttable presumption 
that a standard is economically justified if the Secretary finds that 
the additional cost to the consumer of purchasing a product complying 
with an energy conservation standard level will be less than three 
times the value of the energy savings during the first year that the 
consumer will receive as a result of the standard, as calculated under 
the applicable test procedures. See 42 U.S.C. 6295(o)(2)(B)(iii).
    Additionally, 42 U.S.C. 6295(q)(1) specifies requirements when 
promulgating a standard for a type or class of covered product that has 
two or more subcategories. DOE must specify a different standard level 
than that which applies generally to such type or class of products for 
any group of covered products that have the same function or intended 
use if DOE determines that products within such group (A) consume a 
different kind of energy from that consumed by other covered products 
within such type (or class); or (B) have a capacity or other 
performance-related feature which other products within such type (or 
class) do not have and such feature justifies a higher or lower 
standard. In determining whether a performance-related feature 
justifies a different standard for a group of products, DOE must 
consider such factors as the utility to the consumer of the feature and 
other factors DOE deems appropriate. (42 U.S.C. 6294(q)(1)) Any rule 
prescribing such a standard must include an explanation of the basis on 
which such a higher or lower level was established. (42 U.S.C. 
6295(q)(2))
    Federal energy conservation requirements generally supersede state 
laws or regulations concerning energy conservation testing, labeling, 
standards, and enforcement. (42 U.S.C. 6297(a)-(c)) DOE may, however, 
grant waivers of Federal preemption for particular state laws or 
regulations, in accordance with the procedures and other provisions set 
forth under 42 U.S.C. 6297(d)).
    Finally, pursuant to the amendments contained in section 310(3) of 
EISA 2007, any final rule for new or amended energy conservation 
standards promulgated after July 1, 2010, is required to address 
standby mode and off mode energy use. (42 U.S.C. 6295(gg)(3)) When DOE 
adopts a standard for a covered product after that date, it must, if 
justified by the criteria for adoption of standards under EPCA (42 
U.S.C. 6295(o)), incorporate standby mode and off mode energy use into 
the standard, or, if that is not feasible, adopt a separate standard 
for such energy use for that product. (42 U.S.C. 6295(gg)(3)(A)-(B)) 
DOE's current test procedures and standards for metal halide lamp 
fixtures address standby mode and off mode energy use. However, in this 
rulemaking, DOE only addresses active mode energy consumption as 
standby and off mode energy use are not applicable to the proposed 
scope of coverage.
    DOE has also reviewed this regulation pursuant to Executive Order 
(E.O.) 13563, issued on January 18, 2011. 76 FR 3281, (Jan. 21, 2011). 
E.O. 13563 is supplemental to and explicitly reaffirms the principles, 
structures, and definitions governing regulatory review

[[Page 51471]]

established in E.O. 12866. To the extent permitted by law, agencies are 
required by E.O. 13563 to: (1) Propose or adopt a regulation only upon 
a reasoned determination that its benefits justify its costs 
(recognizing that some benefits and costs are difficult to quantify); 
(2) tailor regulations to impose the least burden on society, 
consistent with obtaining regulatory objectives, taking into account, 
among other things, and to the extent practicable, the costs of 
cumulative regulations; (3) select, in choosing among alternative 
regulatory approaches, those approaches that maximize net benefits 
(including potential economic, environmental, public health and safety, 
and other advantages; distributive impacts; and equity); (4) to the 
extent feasible, specify performance objectives, rather than specifying 
the behavior or manner of compliance that regulated entities must 
adopt; and (5) identify and assess available alternatives to direct 
regulation, including providing economic incentives to encourage the 
desired behavior, such as user fees or marketable permits, or providing 
information upon which choices can be made by the public.
    DOE emphasizes as well that E.O. 13563 requires agencies ``to use 
the best available techniques to quantify anticipated present and 
future benefits and costs as accurately as possible.'' In its guidance, 
the Office of Information and Regulatory Affairs has emphasized that 
such techniques may include ``identifying changing future compliance 
costs that might result from technological innovation or anticipated 
behavioral changes.'' For the reasons stated in the preamble, DOE 
believes that today's NOPR is consistent with these principles, 
including the requirement that, to the extent permitted by law, 
benefits justify costs and that net benefits are maximized. Consistent 
with EO 13563, and the range of impacts analyzed in this rulemaking, 
the energy efficiency standard proposed herein by DOE achieves maximum 
net benefits.

B. Background

1. Current Standards
    EISA 2007 prescribed the current energy conservation standards for 
metal halide lamp fixtures manufactured on or after January 1, 2009. 
(42 U.S.C. 6295(hh)(1)) The current standards are set forth in Table 
II.1. EISA 2007 excludes from the standards: fixtures with regulated-
lag ballasts, fixtures with electronic ballasts that operate at 480 
volts (V); and fixtures that (1) are rated only for 150 W lamps; (2) 
are rated for use in wet locations; and (3) contain a ballast that is 
rated to operate at ambient air temperatures higher than 50 [deg]C.

  Table II.1--Federal Energy Efficiency Standards for Metal Halide Lamp
                               Fixtures *
------------------------------------------------------------------------
                                                              Minimum
                                     Operated lamp rated      ballast
           Ballast type                 wattage range       efficiency
                                                             (percent)
------------------------------------------------------------------------
Pulse-start.......................  >=150 and <=500 W...              88
Magnetic Probe-start..............  >=150 and <=500 W...              94
Nonpulse-start Electronic.........  >=150 and <=250 W...              90
Nonpulse-start Electronic.........  >=250 and <=500 W...              92
------------------------------------------------------------------------
* (42 U.S.C. 6295(hh)(1)).

2. History of Standards Rulemaking for Metal Halide Lamp Fixtures
    DOE is conducting this rulemaking to review and consider amendments 
to the energy conservation standards in effect for metal halide lamp 
fixtures, as required under 42 U.S.C. 6295(hh)(2) and (4). On December 
30, 2009, DOE published a notice announcing the availability of the 
framework document, ``Energy Conservation Standards Rulemaking 
Framework Document for Metal Halide Lamp Fixtures,'' and a public 
meeting to discuss the proposed analytical framework for the 
rulemaking. 74 FR 69036. DOE also posted the framework document on its 
Web site; this document is available at www1.eere.energy.gov/buildings/appliance_standards/product.aspx/productid/49. The framework document 
described the procedural and analytical approaches that DOE anticipated 
using to evaluate energy conservation standards for metal halide lamp 
fixtures, and identified various issues to be resolved in conducting 
this rulemaking.
    DOE held a public meeting on January 26, 2010, during which it 
presented the contents of the framework document, described the 
analyses it planned to conduct during the rulemaking, sought comments 
from interested parties on these subjects, and in general, sought to 
inform interested parties about, and facilitate their involvement in, 
the rulemaking. At the meeting and during the period for commenting on 
the framework document, DOE received comments that helped identify and 
resolve issues involved in this rulemaking.
    DOE then gathered additional information and performed preliminary 
analyses to help develop potential energy conservation standards for 
metal halide lamp fixtures. On April 1, 2011, DOE published in the 
Federal Register an announcement (the April 2011 notice) of the 
availability of the preliminary technical support document (the 
preliminary TSD) and of another public meeting to discuss and receive 
comments on the following matters: (1) The equipment classes DOE 
planned to analyze; (2) the analytical framework, models, and tools 
that DOE was using to evaluate standards; (3) the results of the 
preliminary analyses performed by DOE; and (4) potential standard 
levels that DOE could consider. 76 FR 1812 (April 1, 2011). In the 
April 2011 notice, DOE requested comment on issues that would affect 
energy conservation standards for metal halide lamp fixtures or that 
DOE should address in this notice of proposed rulemaking (NOPR). The 
preliminary TSD is available at www1.eere.energy.gov/buildings/appliance_standards/product.aspx/productid/49.
    The preliminary TSD summarized the activities DOE undertook in 
developing standards for metal halide lamp fixtures, and discussed the 
comments DOE received in response to the framework document. It also 
described the analytical framework that DOE uses in this rulemaking, 
including a description of the methodology, the analytical tools, and 
the relationships among the various analyses that are part of the 
rulemaking. The preliminary TSD presented and described in detail each 
analysis DOE performed up to that point, including descriptions of 
inputs, sources, methodologies, and results. These analyses were as 
follows:
     A market and technology assessment set the scope of this 
rulemaking, identified the potential equipment classes for metal halide 
lamp

[[Page 51472]]

fixtures, characterized the markets for this equipment, and reviewed 
techniques and approaches for improving their efficiency;
     A screening analysis reviewed technology options to 
improve the efficiency of metal halide lamp fixtures, and weighed these 
options against DOE's four prescribed screening criteria;
     An engineering analysis estimated the manufacturer selling 
prices (MSPs) associated with more energy-efficient metal halide lamp 
fixtures;
     An energy-use analysis estimated the annual energy use of 
metal halide lamp fixtures;
     A markups analysis converted estimated MSPs derived from 
the engineering analysis to customer prices;
     A life-cycle cost (LCC) analysis calculated, for 
individual customers, the discounted savings in operating costs 
throughout the estimated average life of the equipment compared to any 
increase in installed costs likely to result directly from the 
imposition of a given standard;
     A payback period (PBP) analysis estimated the amount of 
time it would take individual customers to recover the higher purchase 
expense of more energy-efficient products through lower operating 
costs;
     A shipments analysis estimated shipments of metal halide 
lamp fixtures over the time period examined in the analysis. This was 
then used in the national impact analysis (NIA);
     A national impact analysis assessed the national energy 
savings, and the national net present value of total customer costs and 
savings, expected to result from specific, potential energy 
conservation standards for metal halide lamp fixtures; and
     A preliminary manufacturer impact analysis (MIA) began 
evaluating the effects on manufacturers of amended efficiency 
standards.
    The public meeting announced in the April 2011 notice took place on 
April 18, 2011 (April 2011 public meeting). At this meeting, DOE 
presented the methodologies and results of the analyses set forth in 
the preliminary TSD. Interested parties discussed the following major 
issues at the public meeting: (1) Alternative approaches to performance 
requirements and the various related efficiency metrics; (2) the 
possibility of including design standards; (3) amendments to the test 
procedures for metal halide ballasts to account for multiple input 
voltages; (4) the cost and feasibility of utilizing electronic ballasts 
in metal halide lamp fixtures; (5) equipment class divisions; (6) 
overall pricing methodology; (7) lamp lifetimes; (8) cumulative 
regulatory burden; (9) shipments; and (10) the possibility of merging 
the metal halide lamp fixture and the high-intensity discharge (HID) 
lamp rulemakings. This NOPR responds to the issues raised in the 
comments received since publication of the April 2011 notice, including 
those received at the April 2011 public meeting.
3. Compliance Date
    EPCA, as amended by EISA 2007, contains guidelines for the 
compliance date of the standards amended by this rulemaking. EPCA 
requires DOE to determine whether to amend the standards in effect for 
metal halide lamp fixtures and whether any amended standards should 
apply to additional metal halide lamp fixtures. The Secretary was 
directed to publish a final rule no later than January 1, 2012 to 
determine whether the energy conservation standards established by EISA 
2007 for metal halide lamp fixtures should be amended, with any 
amendment applicable to products manufactured after January 1, 2015. 
(42 U.S.C. 6295(hh)(2)(B))

III. Issues Affecting the Scope of This Rulemaking

A. Additional Metal Halide Lamp Fixtures for Which DOE Is Proposing 
Standards

    As noted in section II.B.1, the existing energy conservation 
standards for metal halide lamp fixtures are established in EPCA 
through amendments made by EISA 2007. (42 U.S.C. 6295(hh)(1)(A)) EISA 
2007 prescribed energy conservation standards for metal halide lamp 
fixtures by setting minimum ballast efficiency requirements for 
fixtures manufactured after January 1, 2009. Currently, coverage is 
limited to certain rated wattages of lamps used in metal halide lamp 
fixtures (150 W to 500 W). Such fixtures must be equipped with a 
ballast that has a designated starting method (pulse-start or probe-
start) and electronic configuration (magnetic or electronic). However, 
the statute excludes from coverage metal halide lamp fixtures with 
regulated-lag ballasts,\9\ electronic ballasts that operate at 480 V, 
and fixtures that: (1) Are rated only for 150 W lamps, (2) are rated 
for use in wet locations,\10\ and (3) contain a ballast that is rated 
to operate at ambient air temperatures greater than 50 [deg]C.\11\ (42 
U.S.C. 6295(hh)(1)(A)).
---------------------------------------------------------------------------

    \9\ `Regulated lag ballast' means ballasts designed to withstand 
significant line voltage variation with minimum wattage variation to 
the lamp.
    \10\ Specifications for ``wet locations'' are from the National 
Electrical Code 2002, section 410.4(A).
    \11\ Specifications for ballasts that operate at ambient air 
temperatures above 50 [deg]C are found in UL 1029-2001.
---------------------------------------------------------------------------

    In the preliminary TSD, DOE requested comment from interested 
parties on the scope of energy conservation standards rulemaking for 
metal halide lamp fixtures. DOE received several comments related to 
expanding the scope to include fixtures exempted by EISA 2007, fixtures 
designed to be operated with additional rated lamp wattages, and the 
definition of a general lighting application.
1. EISA 2007 Exempted Metal Halide Lamp Fixtures
    DOE considered expanding its energy conservation standards to cover 
metal halide lamp fixtures exempted by EISA 2007, including fixtures 
with regulated-lag ballasts; electronic ballasts that operate at 480 V; 
and ballasts that are rated only for (1) use with 150 W lamps, (2) use 
in wet locations, and (3) operation in ambient air temperatures higher 
than 50 [deg]C. (42 U.S.C. 6295(hh)(1)(B))
Fixtures With Regulated-Lag Ballasts
    In the preliminary analysis, DOE tentatively decided to continue 
the exemption for regulated-lag ballasts. Through information gathered 
in manufacturer interviews and market research, DOE determined that 
regulated-lag ballasts are mainly used for specialty applications where 
line voltage variation is large. Regulated-lag ballasts are designed to 
withstand significant line voltage variation with minimum wattage 
variation to the lamp, which results in an efficiency penalty compared 
to ballasts whose output changes more significantly with line voltage 
variation. To be able to withstand large variations, regulated-lag 
ballasts are currently designed to be significantly larger than 
standard ballasts, and as a result exhibit poor efficiency. According 
to manufacturers and market research, EISA 2007's exemption did not 
lead to a significant market shift to regulated-lag ballasts.
    The Appliance Standard Awareness Project (ASAP) encouraged DOE to 
consider coverage for regulated-lag ballasts. While ASAP stated that 
they understood that regulated-lag ballasts may be inherently less 
efficient, they suggested a separate equipment class with a lower 
standard might be more appropriate than no standard. They also stated 
that little information about the market for regulated-lag ballasts is 
available. (ASAP, Public Meeting Transcript, No. 33 at p. 24) \12\ DOE

[[Page 51473]]

conducted additional research on regulated-lag ballasts and found none 
of these products available in major manufacturers' catalogs. DOE 
assumed that absence from catalogs indicates a very small market share, 
and concluded that there was no potential for significant energy 
savings through inclusion of these products in the scope of coverage. 
In addition, DOE continues to agree with the preliminary analysis that 
the size and weight of regulated-lag ballasts prohibit their use as 
substitutes in traditional applications. For the NOPR, DOE proposes to 
continue exempting from energy conservation standards fixtures that 
include regulated-lag ballasts and requests comment on this proposal.
---------------------------------------------------------------------------

    \12\ A notation in the form ``ASAP, Public Meeting Transcript, 
No. 33 at p. 24'' identifies a comment that DOE has received and 
included in the docket of this rulemaking. This particular notation 
refers to a comment: (1) Submitted by ASAP during the public meeting 
on April 18, 2011; (2) in the transcript of that public meeting, 
document number 33 in the docket of this rulemaking; and (3) 
appearing on page 24 of the transcript.
---------------------------------------------------------------------------

Fixtures With 480 V Electronic Ballasts
    In the preliminary analysis, DOE also considered continuing the 
exemption of 480 V electronic ballasts based on their unavailability in 
the market. In its comments, Empower Electronics disagreed with the 
exemption, stating that 347 V and 480 V electronic ballasts for metal 
halide lamps are now feasible, and suggested that regulations could 
help the maturation of these technologies. (Empower Electronics, No. 36 
at pp. 3-4) \13\ Following additional research for the NOPR, DOE did 
identify one manufacturer of 480 V electronic ballasts, but determined 
that these ballasts have a very small market share based on their 
limited availability from distributors and only being manufactured by 
one company. Therefore, DOE concluded that there is no potential for 
significant energy savings and proposes to continue exempting fixtures 
that use 480 V electronic ballasts until DOE has an opportunity to 
analyze commercially available products. DOE requests comment on this 
proposal.
---------------------------------------------------------------------------

    \13\ A notation in the form ``Empower Electronics, No. 36 at pp. 
3-4'' identifies a written comment that DOE has received and 
included in the docket of this rulemaking. This particular notation 
refers to a comment: (1) Submitted by Empower Electronics; (2) in 
document number 36 of the docket; and (3) on pages 3 to 4 of that 
document.
---------------------------------------------------------------------------

Exempted 150 W Fixtures
    In the preliminary analysis, DOE considered eliminating the current 
exemption for 150 W outdoor fixtures rated for wet and hot locations 
because these products could be made more efficient and have the 
potential for significant energy savings. Shipments for these exempted 
150 W fixtures increased in response to the EISA 2007 regulations (a 
shift from 175 W fixtures), further increasing the potential energy 
savings for regulations targeted at this product type. In addition, DOE 
found that many fixtures commonly used indoors (high- and low-bay 
fixtures for high-ceiling buildings) meet the high-temperature 
requirements and have the option of being rated for wet locations. DOE 
preliminarily concluded that some fixtures used indoors were using the 
exemption designed for outdoor fixtures, negating possible energy 
savings for indoor 150 W fixtures. DOE requested comment on the impact 
of eliminating the exemption for 150 W outdoor fixtures rated for wet 
and high-temperature locations.
    The National Electrical Manufacturers Association (NEMA), Philips 
Lighting Electronics (Philips), and Georgia Power commented that the 
wet-location and high-temperature outdoor 150 W fixture exemption was 
created in part to move the market from the popular 175 W ballast to 
the 150 W ballast, and lead to energy savings through a wattage 
reduction, and therefore does not constitute a loophole. (NEMA, No. 34 
at p. 4; Philips, Public Meeting Transcript, No. 33 at pp. 24-25; 
Georgia Power, No. 28 at p. 1) NEMA stated that this exemption is 
critical for outdoor lighting ballasts because 150 W magnetic ballasts 
cannot meet the 88 percent EISA 2007 requirement. NEMA contended that 
the power savings realized by shifting from 175 W lamps to 150 W lamps, 
and the risk that the market would migrate back to 175 W without the 
exemption, far outweigh any additional savings generated by requiring 
that 150 W ballasts meet a ballast efficiency requirement. (NEMA, No. 
34 at p. 4) DOE disagrees with NEMA that the removal of the exemption 
will result in a shift to 175 W fixtures. DOE is not required to set 
the standard for 150 W fixtures at or above the 88 percent minimum set 
by EISA 2007. Because these fixtures were not previously covered, 
setting a less stringent standard than 88 percent would not constitute 
backsliding and has the potential to save significant energy. DOE would 
analyze efficiency levels for 150 W fixtures according to the same 
criteria it uses for all other wattages. Section V.C.9 describes the 
efficiency levels under consideration in the NOPR for 150 W fixtures.
    Northwest Energy Efficiency Alliance (NEEA) commented that there is 
no reason to continue the exclusion for fixtures rated for wet 
locations and ambient temperatures higher than 50 [deg]C. If electronic 
ballasts with their higher efficiencies cannot be utilized in these 
fixtures, NEEA suggested placing them in a separate class for standards 
purposes rather than excluding them from coverage. (NEEA, No. 31 at pp. 
1, 3) ASAP and, in a joint comment, Pacific Gas and Electric Company, 
San Diego Gas & Electric, Southern California Gas Company, and Southern 
California Edison (hereafter the ``California Investor-Owned 
Utilities'' [CA IOUs]) also supported the coverage of 150 W fixtures 
because the exemption may have become a loophole. (ASAP, Public Meeting 
Transcript, No. 33 at p. 23; CA IOUs, No. 32 at p. 1)
    DOE agrees that these 150 W ballasts should be covered by this 
rulemaking and notes that the criteria for the scope of coverage for 
this rulemaking is defined as technology which is technologically 
feasible, economically justified, and has the potential for significant 
energy savings. Because a range of ballast efficiencies exist or are 
achievable in commercially available ballasts, DOE believes that 
improving the efficiencies of ballasts in 150 W fixtures in wet 
locations and high ambient temperatures is technologically feasible. 
DOE's analysis indicates that removing the wet-location and high-
ambient-temperature 150 W fixture exemption has the potential for 
energy savings and is economically justified. Therefore, in this NOPR, 
DOE proposes to remove the exemption for fixtures that are rated only 
for use with 150 W lamps, wet environments, and in ambient temperatures 
greater than 50 [deg]C and include these fixtures in the scope of 
coverage. DOE requests comment on this proposal.
2. Additional Rated Lamp Wattages
    During the preliminary analysis, DOE considered expanding its 
coverage of energy conservation standards to include metal halide lamp 
fixtures that operate lamps rated from 50 W to 150 W and fixtures that 
operate lamps rated greater than 500 W. DOE's review of ballast 
manufacturer catalogs (an indication of product availability) showed 
many types of metal halide ballasts for fixtures operating lamps rated 
outside the currently regulated wattage range. The catalogs showed that 
approximately 30 percent (by number of products, not by market share) 
of available metal halide ballasts are designed for lamps rated less 
than 150 W and approximately 13 percent of available metal halide 
ballasts are designed for lamps rated greater than 500 W. Due to the 
number of ballasts outside of the existing scope of coverage, DOE 
believed that there was potential for significant energy savings and 
considered including fixtures designed to operate lamps with rated

[[Page 51474]]

wattage >=50 W in the analysis. DOE received comment on expanding the 
scope to fixtures that operate lamps rated from 50 W to 150 W and 
fixtures that operate lamps rated greater than 500 W.
    In response to request for comment in the preliminary TSD, NEMA 
suggested that there is little energy savings to be realized by 
regulating fixtures for the 50 W to 150 W range due to their low energy 
usage and the movement of the market to the greater than 150 W power 
range. (NEMA, Public Meeting Transcript, No. 34 at p. 13) ASAP, NEEA, 
the CA IOUs, Empower Electronics, and Progress Energy Carolinas 
supported the expansion of scope to the greater than 50 W and less than 
150 W range discussed in the preliminary TSD. (ASAP, Public Meeting 
Transcript, No. 33 at p. 23; NEEA, No. 31 at p. 1; CA IOUs, No. 32 at 
p. 1; Empower Electronics, No. 36 at p. 3; Progress Energy Carolinas, 
No. 24 at p. 2) DOE conducted testing within the 50 W to 150 W range 
and identified varying efficiencies within a single wattage, which 
suggests that standards to improve the least-efficient ballasts are 
technologically feasible. Furthermore, as discussed in section VI.B.3, 
DOE determined that standards for this wattage range have the potential 
for significant energy savings. Therefore, DOE proposes to include 
fixtures designed to operate lamps rated >=50 W and <150 W.
    DOE also received comment on the greater than 500 W equipment 
class. Georgia Power stated that regulating high wattages (such as 1000 
W and 1500 W) would save little energy at significant cost. (Georgia 
Power, No. 28 at p. 2) ASAP, NEEA, the CA IOUs, Empower Electronics, 
and Progress Energy Carolinas, however, agreed with DOE's preliminary 
findings and supported the expansion of scope to the >500 W range 
discussed in the preliminary TSD. (ASAP, Public Meeting Transcript, No. 
33 at p. 23; NEEA, No. 31 at p. 1; CA IOUs, No. 32 at p. 1; Empower 
Electronics, No. 36 at p. 3; Progress Energy Carolinas, No. 24 at p. 2) 
In terms of technological feasibility, NEMA stated that the ballasts 
included in high-wattage fixtures are already up to 92 percent 
efficient. NEMA took the position that because this efficiency is 
comparable to the efficiencies of lower-wattage equipment with the 
highest-grade components, it would be difficult, if not impossible, to 
define energy efficiency requirements that would result in appreciable 
savings. Still, NEMA supported DOE's determination that ballasts 
greater than 500 W were within the scope of DOE's authority for 
preclusion of ``state-by-state'' rulemaking through preemption (NEMA, 
No. 34 at p. 3) In terms of potential for significant energy savings, 
NEMA noted that market estimates for greater-than-500-W ballasts are on 
the order of 15 percent, while the total energy use for equipment in 
this power range is estimated to be as high as 40 percent of the total 
of installed metal halide lamp fixtures. Id.
    DOE agrees that the greater-than-500-W ballasts have higher 
efficiencies than the lower-wattage equipment. However, based on test 
data, DOE still found a range of efficiencies present in commercially 
available ballasts, indicating technological feasibility. DOE also 
verified NEMA's comment that these high-wattage products have fewer 
shipments than the lower-wattage products included in this rulemaking, 
but they consume more energy per installation. DOE's analysis indicates 
that regulation of these higher wattages could be economically 
justified and has the potential for significant energy savings. 
Finally, based on review of product catalogs, DOE determined that 
fixtures rated for use with lamps rated for wattages greater than 2000 
W served small-market-share applications like graphic arts, ultraviolet 
curing, and scanners. Therefore, DOE proposes not to include fixtures 
rated for wattages greater than 2000 W in this rulemaking. In summary, 
because DOE finds economic justification and potential energy savings 
in regulating ballasts greater than 500 W and less than or equal to 
2000 W, DOE proposes that these fixtures be included in the scope of 
this rulemaking. DOE requests comment on this proposal.
3. General Lighting
    EISA 2007 defines the scope of this rulemaking as applying to 
fixtures used in general lighting applications. (42 U.S.C. 6291(64)) In 
section 2 of 10 CFR Part 430, Subpart A, a general lighting application 
is defined as lighting that provides an interior or exterior area with 
overall illumination. DOE is proposing to add this definition to 10 CFR 
431.2,\14\ the section of the CFR that relates to commercial and 
industrial equipment. DOE applies this definition to determine which 
lighting applications DOE has the authority to cover.
---------------------------------------------------------------------------

    \14\ The general lighting application definition prescribed by 
EISA 2007 was previously incorporated into the consumer products 
section (10 CFR Part 430), but has not yet been added to the 
commercial and industrial equipment section (10 CFR Part 431).
---------------------------------------------------------------------------

    NEMA and OSRAM SYLVANIA (OSI) recommended capping the greater-than-
500 W class at 1000 W because 1000 W is the highest wattage used for 
general lighting applications, arguing that DOE does not have authority 
to consider higher wattages. (NEMA, No. 34 at pp. 13-14; OSI, No. 27 at 
p. 4) OSI also commented that metal halide systems are also used in 
specialty applications such as stage, theater, television, film, solar 
simulation, airfield, medical/surgical, microscope, endoscope, video 
projection, display, treatment of skin disorders, sports, and 
automotive. OSI recommended that these specialized applications be 
excluded from this rulemaking. (OSI, No. 27 at p. 7)
    DOE's research indicated that there are a number of fixtures 
available for general lighting applications above 1000 W. The primary 
application of such fixtures is outdoor sports lighting, which commonly 
uses metal halide ballasts of 1000 W to 2000 W. Because sports lighting 
provides overall illumination to an exterior area (playing field and 
stadium), DOE believes sports lighting does meet the definition of a 
general lighting application. While DOE agrees that some special 
applications listed by OSI do not fit under the covered general 
illumination definition, others, such as sports and airfield lighting, 
do provide general illumination to an exterior area and are covered by 
this rulemaking. DOE requests comment on this proposal.
4. Summary
    DOE proposes to include metal halide lamp fixtures designed to 
operate ballasts rated from 50 W to 2000 W and for use in general 
lighting applications in the scope of coverage. EISA 2007 exempted 
specific metal halide lamp fixtures from regulation. These included (a) 
fixtures that include regulated-lag ballasts, (b) fixtures that include 
480 V electronic metal halide ballasts, and (c) fixtures that include 
lamps rated at 150 W with ballasts that (1) are rated for use in wet 
locations and (2) contain a ballast that is rated to operate at ambient 
air temperatures greater than 50 [deg]C. In this rulemaking, DOE 
proposes to continue the exemption for the first two categories 
(regulated-lag ballasts and 480 V electronic ballasts) but not for the 
third, certain 150 W fixtures. DOE finds that regulating these 150 W 
ballasts could provide considerable potential energy savings and would 
be economically justifiable. As such, DOE proposes that the 150 W 
ballasts rated for use in wet locations and containing a ballast that 
is rated to operate at ambient air temperatures greater than 50 [deg]C 
be covered in this rulemaking.

[[Page 51475]]

B. Alternative Approaches to Energy Conservation Standards: System 
Approaches

    EISA 2007 requires DOE to set standards for metal halide lamp 
fixtures. (42 U.S.C. 6295(hh)(2)) As previously stated, although metal 
halide lamp fixtures usually comprise a metal halide lamp, a metal 
halide ballast, and other fixture components, EPCA established MHLF 
energy conservation standards by setting minimum efficiency 
requirements for only the ballast. For the preliminary analysis, DOE 
considered three system approaches as alternatives to regulating only 
ballast efficiency. The first was a lamp and ballast system approach in 
which the lamp and ballast would be rated together in terms of lumens 
per lamp-ballast system watts. The second was a whole fixture system 
approach in which the ballast, lamp, and optics/enclosure would all be 
rated together in terms of a fixture-level metric such as Fitted Target 
Efficacy (FTE) or Target Efficacy Rating (TER). The third was an 
approach similar to California Title 20, which allowed for multiple 
compliance pathways utilizing a combination of design standards, 
ballast efficiency standards, and lamp wattage requirements. DOE 
received several comments on these three system approaches.
    In general, interested parties recognized the potential value for 
system approaches over a ballast efficiency approach, but also noted 
several limitations related to each possible approach. NEEA supported 
systems approaches to rating equipment, but did not find any of the 
three specific approaches discussed in the preliminary analysis to be 
practicable to implement. (NEEA, No. 31 at p. 2) Philips stated that, 
generally, NEMA considers the system approach to be the preferred 
approach for any rulemaking. (Philips, Public Meeting Transcript, No. 
33 at p. 32) Philips noted that a system approach is an extremely 
complex issue and pointed out that there are other metrics beyond those 
that DOE listed as under consideration. (Philips, Public Meeting 
Transcript, No. 33 at pp. 36-37) DOE found that the three system 
approaches considered in the preliminary TSD have the theoretical 
potential of saving more energy than the current ballast-only approach, 
but also have many practical limitations. DOE weighed the benefits and 
drawbacks of each system approach, but for this rulemaking, DOE 
proposes a ballast-efficiency approach consistent with the current EISA 
2007 regulations. DOE discusses each of the system approaches in the 
following sections. DOE also discusses the possibility of a coordinated 
metal halide lamp fixture and high-intensity discharge lamp rulemaking 
in section III.C as an additional approach to considering all aspects 
of the metal halide lighting system when considering energy 
conservation standards.
1. Lamp-Ballast System
    In the lamp-ballast system approach, metal halide lamp fixtures 
would be regulated on the basis of a lumens-per-watt metric that 
assesses the performance of the lamp and ballast included in the 
fixture. Fixture manufacturers would be required to report the system 
lumens per watt (lm/W) of every lamp and ballast pair included in their 
fixtures. This approach has the potential to save more energy and allow 
more design flexibility for manufacturers. However, this approach is 
somewhat at odds with current fixture sales practices. Fixture 
manufacturers commonly ship fixtures with the ballast installed to 
ensure that the fixture is compliant with fire safety requirements and 
meets energy conservation standards. There are currently no 
requirements for fixtures to be shipped with certain lamps, and in 
general, fixture manufacturers noted that few fixtures are sold with 
lamps, giving customers flexibility to choose lamps from a variety of 
manufacturers. In a lamp-ballast system approach, fixture manufacturers 
would be required to provide fixtures with installed lamps and 
ballasts, and customers would be limited to predetermined lamp and 
ballast combinations.
    During preliminary interviews, DOE found that there are several 
metal halide ballast manufacturers that do not manufacture metal halide 
lamps. In a lamp-ballast system approach, these manufacturers could 
have a competitive disadvantage compared with manufacturers that 
manufacture both lamps and ballasts. Manufacturers said that for 
fixture manufacturers that are not vertically integrated (i.e., fixture 
manufacturers that do not also produce lamps and ballasts), sourcing 
lamp and ballast systems is problematic as only a few manufacturers 
have the capability to provide them. Non-vertically-integrated 
manufacturers also said that they would not have the same ability to 
optimize the fixtures as their lamp and ballast-manufacturer 
competitors. Based on the concern that some manufacturers would be at a 
disadvantage to their vertically integrated competitors and that 
fixtures are typically not shipped with lamps, DOE preliminarily 
determined that ballast efficiency was a better approach than lamp-
ballast systems.
    NEMA described the pros and cons of a simple lumens-per-watt 
standard based on a lamp-ballast system. NEMA stated that this 
methodology provides more technological flexibility and can yield 
overall higher performance by including the effect of lamp efficacy. On 
the other hand, NEMA stated that there are compatibility issues with 
operation of certain lamp and ballast pairs. While some of these 
compatibility issues would be resolved through use of a database, that 
database would require management by the industry, which represents 
additional cost and a reporting burden if manufacturers are required to 
report on various lamp and ballast combinations. It also might require 
manufacturers to transport mercury (if DOE mandates that a fixture be 
sold with a lamp). (NEMA, No. 34 at p. 5)
    Georgia Power and NEEA commented on the practical limitations of a 
lamp-ballast system approach. Georgia Power pointed out that utilities 
buy lamps and fixtures separately and strive to minimize the number of 
lamp types that they must stock to use in new and existing fixtures. 
Georgia Power said that matching different lamps to different ballasts 
of the same wattage would be costly and very confusing. Additionally, 
Georgia Power noted that training the installers and relampers would be 
costly and impractical for the utilities. (Georgia Power, No. 28 at p. 
1) NEEA commented that because there is no way to control which 
replacement lamps are used after the initial lamp fails, real system 
energy savings may be smaller than forecasts that assume an equivalent 
lamp is used as a replacement. (NEEA, No. 31 at p. 2)
    With regards to lamp-ballast compatibility concerns with a lamp-
ballast approach to setting standards, OSI commented that lamp and 
electronic ballast manufacturers already maintain lists of compatible 
products, indicating a lamp-ballast approach would not create 
additional burden. OSI stated that NEMA's main concern is with high-
frequency electronic ballasts operating high-wattage lamps. As noted in 
section V.C.8, these ballasts can create acoustic resonance problems 
with lamps. The issue is further complicated by the fact that different 
lamps have different acoustic resonance points. OSI noted that NEMA has 
assembled a task force on lamp and electronic ballast compatibility 
issues, and the task force is close to finalizing compatibility test 
procedures. Once finalized, each manufacturer will conduct testing 
based on the procedure to determine

[[Page 51476]]

compatibility with other products. OSI recommended that all electronic 
metal halide ballasts be designed to meet existing American National 
Standards Institute (ANSI) standards based on magnetic operation. This 
redesign will help assure lamp and ballast compatibility. (OSI, No. 27 
at p. 7)
    In the preliminary TSD, DOE also considered a `table of standard 
lamps' for use in a lamp-ballast system standard approach. The use of a 
table of standard lamps would allow for fixture performance to be 
assigned to all fixtures, including those not shipped with lamps. This 
table of standard lamps would allow for conversion of tested ballast 
efficiency to lumens per watt for determination of compliance with a 
lamp-ballast system standard, mitigating the potential for lost 
competitive advantage for ballast-only manufacturers. NEEA commented 
that they did not agree that a table of standard lamps (and a lamp-
ballast system approach without a table of standard lamps) would 
adequately control which replacement lamps are used in fixtures. (NEEA, 
No. 31 at p. 2)
    DOE recognizes these positive and negative aspects of the lamp and 
ballast approach (both with and without the table of standard lamps) 
and has weighed them carefully and tentatively decided not to propose 
this approach. DOE found that a lamp and ballast system approach might 
be burdensome due to unresolved compatibility and compliance issues 
related to specifying performance of every lamp and ballast combination 
sold. DOE tentatively agrees with Georgia Power's concern that some 
users could need to stock multiple lamps for pairing with different 
manufacturers' ballasts of the same wattage, unless they were willing 
to place all of their lamp and ballast orders from a single supplier. 
Additionally, once the original lamp fails, customers may replace it 
with a lower-efficacy alternative. A lamp-ballast system approach could 
also complicate defining categories and classes. In regards to a lamp-
ballast system approach with a table of standard lamps, DOE agrees with 
NEEA that such a table would not address customers using less-
efficacious replacement lamps and does not provide an adequate 
improvement over a traditional lamp-ballast system approach or a simple 
ballast efficiency approach. Though inclusion of the table could be 
more equitable for ballast-only manufacturers, it is still hindered by 
compliance and compatibility issues, and would likely result in less 
energy savings than a pure lamp-ballast system approach.
2. Fixtures Systems--Lamp, Ballast, Optics, and Enclosure
    For the preliminary TSD, DOE analyzed fixture-level metrics by 
conducting independent research and interviewing manufacturers. DOE 
found that fixture energy use depends on four variables: (1) Lamp 
efficacy; (2) ballast efficiency; (3) light absorption by the fixture; 
and (4) usefulness of light emitted by the fixture (direction or light 
distribution pattern). DOE considered two alternative metrics to 
quantify these areas of importance, namely FTE and TER. DOE drafted the 
FTE metric for the solid-state lighting (SSL) ENERGY STAR[supreg] 
program. NEMA, along with its luminaire division, developed TER. FTE 
and TER metrics treat each fixture-energy-use area of importance more 
effectively in some ways than others.
    The FTE metric measures the fixture performance by fitting a 
rectangle to a uniform ``pool'' of light for each fixture, then 
multiplying the lumens delivered to this pool by the percent coverage 
of the rectangular target, and dividing the result by input watts to 
the fixture. Because FTE was developed for roadway and parking lot 
applications, separate algorithms for each respective application would 
need to be calculated and verified. As FTE is calculated using a 
rectangular area, a fixture that is designed to (1) light a non-
rectangular area, (2) produce a large amount of unlighted area within 
the rectangle, or (3) produce specific light patterns that light both a 
horizontal plane and a vertical plane, or even above the fixture, will 
be at a disadvantage.
    TER involves calculating fixture efficacy by multiplying the light 
leaving the fixture by the Coefficient of Utilization (CU), which 
factors in the distribution of light, room geometry, and room surface 
reflectances. CU represents the percentage of rated lamp lumens 
reaching the workplane. The calculation of efficacy for TER also takes 
into account lamp and ballast efficiency. TER has 22 different types of 
luminaire classifications, each with a different TER calculation method 
and value,\15\ though every classification is not applicable to metal 
halide lamp fixtures.
---------------------------------------------------------------------------

    \15\ There are two main calculation methods--one for indoor and 
one for outdoor applications. The methods are then customized to 
each classification.
---------------------------------------------------------------------------

    For the preliminary TSD, DOE tentatively decided not to implement 
either FTE or TER. DOE found that FTE only accounts for light hitting 
the specified test area and does not take into account other surfaces 
that the fixture is designed to light. This methodology disadvantages 
fixture types not designed to light a uniform, flat, rectangular space. 
DOE tentatively decided not to use TER out of concern that certain 
fixtures could fall within multiple categories of fixture due to their 
designs. Because of the need for uniformity and more simplicity, DOE 
preliminarily found TER unsuitable this rulemaking. The following 
discussion describes the comments DOE received about the use of these 
metrics.
    Georgia Power and Progress Energy Carolinas suggested that TER and 
FTE were better metrics than the current ballast-efficiency metric 
because they address the optical performance of the entire fixture, 
accounting for light directionality and losses. (Georgia Power, No. 28 
at p. 1; Progress Energy Carolinas, No. 24 at p. 1) However, NEEA 
commented that it did not believe that FTE or TER is appropriate as the 
basis for energy efficiency standards at this time. NEEA stated that 
either approach could be used as a design optimization framework, but 
both have sufficient drawbacks and lack of field implementation 
experience that render them unusable as the basis for a minimum 
efficiency standard. (NEEA, No. 31 at p. 2) NEMA agreed with the 
preliminary TSD, stating that because this rulemaking covers all types 
of products (e.g., downlights, track lighting, industrial highbay/
lowbay, streetlighting, roadway lighting, floodlights, parking lots, 
parking garages), it is challenging to define a metric that effectively 
covers all applications without flawed assumptions. Specifically, NEMA 
pointed out that none of the metrics considered covers equipment that 
is designed to be aimed or tilted. (NEMA, No. 34 at p. 6) Both NEEA and 
Empower Electronics also supported DOE's determination from the 
preliminary TSD not to use either FTE or TER. (NEEA, No. 31 at p. 2; 
Empower Electronics, No. 36 at p. 4)
    Though a fixture-level metric has the potential to save the most 
energy, DOE does not believe an approach currently exists that 
adequately assesses the types of metal halide lamp fixtures included in 
this rulemaking. Because FTE is focused on applications that deliver 
light to a horizontal space and a TER standard would require fixture 
classifications that have not yet been developed, DOE has determined 
that ballast efficiency is a better approach at this time. Therefore, 
DOE does not find fixture-level metrics practicable for setting 
standards for this equipment at this time, and proposes not to use a 
system-approach metric in this rulemaking.

[[Page 51477]]

3. California Title 20 Approach
    California's Title 20 \16\ includes regulations that aim to reduce 
energy consumption in appliances, including metal halide lamp 
fixtures.\17\ For metal halide lamp fixtures, Title 20 requires 
compliance through one of four primary paths: (1) The use of lamps from 
reduced-wattage bins with a minimum 88 percent efficient ballast; (2) 
an integrated motion sensor and high-low control with a minimum 88 
percent efficient ballast; (3) an integrated daylight sensor and high-
low control (for indoor only) with a minimum 88 percent efficient 
ballast; and (4) high-efficiency ballasts with a minimum efficiency of 
90 percent for 150 W to 250 W lamps or 92 percent for 251 W to 500 W 
lamps. In the preliminary TSD, DOE requested comment on the 
implementation of a similar approach, with multiple options for 
compliance, including the integration of controls.
---------------------------------------------------------------------------

    \16\ www.energy.ca.gov/regs/title20/index.html.
    \17\ California's term `metal halide luminaire' refers to the 
same item as DOE's `metal halide lamp fixture.'
---------------------------------------------------------------------------

    Several commenters gave direct feedback on the Title 20 approach. 
Energy Solutions supported DOE's consideration of a Title 20 or Title-
20-like approach. (Energy Solutions, Public Meeting Transcript, No. 33 
at p. 39) NEMA and Acuity Brands Lighting (Acuity) stated that although 
it also adds complexity to the associated enforcement and reporting, 
the Title 20 approach provides flexibility for manufacturers and 
designers. Additionally, NEMA and Acuity noted that the Title 20 
requirement for 336 W to 500 W reduced-wattage lamps to produce 80 lm/W 
is not currently achievable. Acuity requested that DOE not consider 
these lamp specifications, and stated that they have been working with 
the California Energy Commission (CEC) to correct that efficacy level. 
(NEMA, No. 34 at p. 6; Acuity, Public Meeting Transcript, No. 33 at p. 
41)
    NEMA and Philips then addressed regulations that consider lamps and 
ballasts simultaneously for analysis, but assign performance metrics to 
each component individually. NEMA commented that they would support 
regulation that allows for lower ballast efficiency requirements in 
conjunction with higher lamp efficacy requirements. However, NEMA noted 
that a requirement to ship high-efficacy lamps in new fixtures would 
not prevent future replacement of these lamps with lower-efficacy 
alternatives. (NEMA, No. 34 at p. 5) Philips noted that it is possible 
to specify certain lamps for particular fixtures through an 
Underwriters Laboratories (UL) listing. Philips explained that if a 
ballast and a fixture are labeled for a particular lamp, then that 
fixture would only keep its UL listing when that lamp is used. This 
could mitigate the risk that the type of lamp originally packaged with 
the fixture would be replaced with a less-efficacious alternative. 
Additionally, Philips pointed out that for ENERGY STAR and fluorescent 
lamps, NEMA has maintained a table of corresponding lamp and ballast 
efficacies so that fixture manufacturers can easily select compliant 
products. Philips suggested that DOE could create a similar database 
for this rulemaking. (Philips, Public Meeting Transcript, No. 33 at pp. 
33-34)
    DOE also received many comments on the controls and dimming 
compliance pathways of the Title 20 approach. The CA IOUs noted that 
dimming and occupancy controls can greatly reduce the overall 
electricity consumption of a lighting system. The CA IOUs stated that 
many electronic ballasts in the 150 W to 575 W range include dimming 
circuitry. (CA IOUs, No. 32 at p. 5) OSI agreed that the use of dimming 
as an energy-saving tool is growing. OSI clarified that it is actually 
easier to develop an electronic metal halide dimming ballast than a 
magnetic one; and the electronic ballast will provide more utility for 
the end user. (OSI, No. 27 at p. 3) The CA IOUs specifically noted that 
for outdoor fixtures, from a public safety standpoint, dimming can be 
prohibitively slow in magnetic ballasts. However, there are 
commercially available electronically ballasted systems with 
appropriate response times that are much better suited for the 
transition towards fully controllable and dimmable fixtures. (CA IOUs, 
No. 32 at p. 5)
    Several commenters provided feedback on the relative merits of 
electronic metal halide lamp dimming, magnetic metal halide lamp 
dimming, and other lighting technologies like fluorescent lighting. OSI 
explained that magnetic ballasts (by using a split capacitor) can only 
provide two light levels (bi-level dimming). An electronic ballast has 
a microprocessor to provide stepped dimming at programmed levels or 
continuous dimming using a 0 to 10 V signal. A continuously dimming 
ballast is compatible with daylight harvesting, scheduling, building 
management, demand response systems, and other processes where dimming 
is desirable. OSI stated that dimming can be provided in various 
applications, including outdoor lighting, by replacing a magnetic 
ballast with an electronic one with no rewiring needed. (OSI, No. 27 at 
p. 3) Progress Energy Carolinas stated that bi-level dimming in 
magnetic ballasts has been around for years and has a proven track 
record. Although there is an efficacy decrease associated with dimming 
to 50 percent, Progress Energy Carolinas concluded that bi-level 
dimming is cost effective. (Progress Energy Carolinas, No. 24. at pp. 
1-2) NEMA stated, however, that the incremental cost associated with an 
integrated bi-level dimming control in a metal halide lamp fixture can 
almost double the overall fixture cost. By contrast, the cost of 
integrated controls for a fluorescent lamp fixture designed for the 
same application requirements are about 30 to 40 percent higher than 
without controls, and the controls have more functionality due to the 
instant on and continuous dimming capability of the fluorescent system. 
For these reasons, NEMA argued that bi-level dimming with metal halide 
lamp fixtures is more costly and has less functionality than 
alternative technologies. (NEMA, No. 34 at p. 9)
    Next, DOE received several comments relating to the applications 
that commonly use dimming, and the potential for difficulty in 
distinguishing some of these categories based on technical features. 
NEMA pointed out that although dimming metal halide lamp fixtures in 
certain applications where there is sporadic or limited occupancy 
(e.g., high-bay and low-bay applications for warehousing) can result in 
significant energy reduction, many MHLF applications are not well 
suited for bi-level control capabilities, such as operations and 
roadway lighting that operates 24 hours per day, 7 days per week. 
(NEMA, No. 34 at p. 9) Progress Energy Carolinas also noted that apart 
from dusk-to-dawn photocontrol, occupancy sensors will not work for 
street lighting. Progress Energy Carolinas stated that street lighting 
would need to be controlled with a smart-box type of control. (Progress 
Energy Carolinas, No. 24 at p. 2) Cooper Lighting suggested that DOE 
analyze dimming in roadway lighting separately from other applications. 
(Cooper, Public Meeting Transcript, No. 33 at p. 40) Georgia Power 
recognized that the specifics of which applications can and cannot be 
dimmed, and how to measure energy reduction in unmetered applications 
(e.g., roadway lighting provided by a utility), will be complex. 
(Georgia Power, No. 28 at p. 1) NEMA noted that because DOE cannot 
distinguish products based on application type, it is unclear how DOE 
would describe regulatory requirements without specifying the use of 
controls based on application characteristics.

[[Page 51478]]

(NEMA, No. 34 at p. 9) Specifically, NEMA also observed that the Title 
20 approach requires differentiation between indoor and outdoor 
products, which DOE would have to define based on product attributes. 
(NEMA, No. 34 at p. 6)
    Several commenters reported on the low percentage of fixtures using 
the controls pathways to compliance for California Title 20. Energy 
Solutions and the CA IOUs reported that of the chosen compliance 
pathways recorded in the CEC Appliance Database, most are either the 
reduced lamp wattage or the ballast efficiency requirement; not many 
report the controls compliance pathway. (Energy Solutions, Public 
Meeting Transcript, No. 33 at pp. 39-40; CA IOUs, No. 32 at p. 2) 
Philips explained that the controls compliance pathway has not been 
embraced because Title 20 requires all pieces of a control system to be 
integral to the fixture. Philips urged DOE to consider that a 
simplified approach to controllable fixtures would encourage more 
dimming systems and, therefore, more energy savings. (Philips Lighting 
Electronics, Public Meeting Transcript, No. 33 at p. 40) Similarly, 
NEMA supported the concept of controllable fixtures and also suggested 
that controls be separate from the fixture for any regulations. NEMA 
stated that any incorporation of controls should be technology-neutral, 
allowing various control technologies without requiring the control to 
be integral to the fixture. (NEMA, No. 34 at p. 6)
    NEEA expressed concern over any forecasted energy savings resulting 
from the implementation of dimming ballasts, commenting that the 
presence of controls and the capability of dimming are no guarantee of 
use, and therefore, no guarantee of the promised energy savings. 
Consequently, NEEA did not agree with a Title 20 approach as part of a 
federal minimum efficiency standard. Furthermore, NEEA opposed DOE's 
adoption of the Title 20 approach because California's regulatory 
approach depends heavily on the existence of its Title 24 regulations 
(which have no DOE analog) for compliance and enforcement, including 
verifying the installation of the qualifying components that would meet 
the system requirements. For these reasons, NEEA felt that the Title 20 
approach is unworkable at the federal level. (NEEA, No. 31 at p. 3)
    In response to the various approaches in California Title 20, DOE 
is concerned that adopting these methods would risk reducing energy 
savings and complicating compliance and enforcement relative to 
ballast-efficiency-only regulations. With regards to the controls/
dimming approach, DOE tentatively agrees that a standard requiring the 
presence of controls or dimming does not ensure energy savings. DOE 
believes that the use of such technologies is much less popular for 
metal halide systems relative to other lighting technologies. Metal 
halide lamp fixtures typically take 5 to 10 minutes to re-strike and 
turn on again after being turned off, so controls that would turn metal 
halide lamp fixtures on and off more frequently have less utility 
relative to lighting with instant restarting capability. Additionally, 
a majority of metal halide lamp fixtures installed today use magnetic 
ballasts. Magnetic ballasts are typically only capable of bi-level 
dimming, giving them less functionality compared to other lighting 
technologies. Regarding the approach to allow less-efficient ballasts 
when sold in fixtures with more efficacious lamps, DOE is concerned 
that some energy savings could be lost if the lamp is replaced with a 
less efficacious lamp after the first failure, similar to its 
conclusions with lamp and ballast systems. Given the uncertainty of 
resulting energy savings, DOE has tentatively decided not to propose 
Title-20-like standards in this rulemaking.

C. Combined Rulemakings

    In addition to system approaches, another method for maximizing 
energy savings and simplifying compliance would be to combine the metal 
halide lamp fixture and high-intensity discharge (HID) lamp rulemakings 
(Docket EERE-2010-BT-STD-0043). These rulemakings are related because 
the MH lamps used in metal halide lamp fixtures are a subset of HID 
lamps. During the comment period and the public meeting for the metal 
halide lamp fixture preliminary TSD, and also in subsequent 
manufacturer interviews, DOE received requests that DOE consider metal 
halide lamp fixtures and HID lamps in a combined manner. The stated 
benefits of this approach include maximizing potential energy savings, 
avoiding conflicting rules for related technologies, avoiding 
duplicative efforts, improving consistency and ease of review, saving 
taxpayer dollars, and simplifying compliance. Based on the outcome of 
this NOPR, DOE will consider how to best combine the rulemakings.
    OSI, NEMA, and Philips commented that the metal halide lamp fixture 
rulemaking should be conducted in conjunction with metal halide lamp 
rulemakings. (OSI, No. 27 at p. 6; NEMA, Public Meeting Transcript, No. 
33 at p. 15; NEMA, No. 34 at p. 5; Philips, Public Meeting Transcript, 
No. 33 at p. 32) NEMA expressed concern that potential energy savings 
could be missed by keeping the metal halide lamp fixtures and HID lamps 
rulemakings separate. (NEMA, Public Meeting Transcript, No. 33 at p. 
15) OSI and NEMA recommended that the ballast efficiency and lamp 
efficacy regulations be completed in conjunction so that overall system 
efficacy can be recognized in resulting regulations. (OSI, No. 27 at p. 
6; NEMA, No. 34 at p. 21) Additionally, Philips stated that keeping the 
lamp and ballast rulemakings separate will add complexity to 
maintaining lamp and ballast compatibility. (Philips, Public Meeting 
Transcript, No. 33 at p. 32) Philips noted that if ballast regulations 
eliminate certain ballast types, they may also take certain lamps out 
of the market, losing all energy savings that were meant to be 
generated by the lamps' standards. (Philips, Public Meeting Transcript, 
No. 33 at p. 132)
    In its work to date on the HID lamp and MHLF energy conservation 
standards, DOE has identified and is using a number of shared data 
sources and analytical processes in the two rulemakings. The following 
is an initial inventory of rulemaking data and processes either fully 
or partially shared between HID lamps and metal halide lamp fixtures:
     market and technology assessments;
     distribution channels and price markups;
     annual operating hours;
     lamp, fixture, and ballast lifetimes;
     lamp lumen maintenance;
     installation times and costs;
     electricity prices;
     discount rates;
     lamp and fixture shipments;
     life-cycle cost (LCC) subgroup analysis; and
     Regulatory impact analysis.
    DOE is currently evaluating the data and analytical processes that 
are shared between the two rulemakings.

D. Standby Mode and Off Mode Energy Consumption Standards

    EPCA requires energy conservation standards adopted for covered 
equipment after July 1, 2010 to address standby mode and off mode 
energy use. (42 U.S.C. 6295(gg)(3)) The requirement to incorporate 
standby mode and off mode energy use into the energy conservation 
standards analysis is therefore applicable in this rulemaking. 10 CFR 
431.322 defines the terms ``active mode,'' ``standby mode,'' and ``off 
mode'' as follows:
     ``Active mode'' is the condition in which an energy-using 
piece of

[[Page 51479]]

equipment is connected to a main power source, has been activated, and 
provides one or more main functions.
     ``Off mode'' is the condition in which an energy-using 
piece of equipment is connected to a main power source, and is not 
providing any standby or active mode function.
     ``Standby mode'' is the condition in which an energy-using 
piece of equipment is connected to a main power source and offers one 
or more of the following user-oriented or protective functions: 
facilitating the activation or deactivation of other functions 
(including active mode) by remote switch (including remote control), 
internal sensor, or timer; or providing continuous functions, including 
information or status displays (including clocks) or sensor-based 
functions.
    For the preliminary TSD, DOE analyzed these definitions to 
determine their applicability to metal halide lamp fixtures. DOE 
tentatively found that it is possible for metal halide fixtures to 
operate in active mode and standby mode. The off mode condition does 
not apply because metal halide lamp fixtures do not operate in off 
mode. 74 FR 33171, 33175 (July 10, 2009).\18\ Therefore, for this 
energy conservation standard rulemaking, DOE only considered the active 
mode and standby mode energy use provisions from EISA 2007 applicable 
to metal halide lamp fixtures that are (or could be) covered by this 
rulemaking.
---------------------------------------------------------------------------

    \18\ The definition of ``off mode'' requires that ballasts be 
connected to a main power source and not provide any standby mode or 
active mode function. (42 U.S.C. 6295(gg)(1)(A)(ii)) As discussed in 
the metal halide ballast test procedures, DOE does not believe that 
there is any condition in which the ballast is connected to the main 
power source and is not already accounted for in either active mode 
or standby mode.
---------------------------------------------------------------------------

    DOE recognizes that metal halide lamp fixtures can be designed with 
auxiliary control devices, which could consume energy in standby mode. 
One example of this fixture design involves Digitally Addressable Light 
Interface (DALI) enabled ballasts. These ballasts may draw power in 
standby mode, as the internal circuitry remains on and active even when 
the ballast is not driving any lamps. DOE has yet to encounter such a 
ballast that it could purchase. DOE has continued to search for and 
consider DALI-enabled fixtures, as well as other types of metal halide 
lamp fixtures, to evaluate the issue of standby mode energy use in 
metal halide lamp fixtures. In the preliminary TSD, DOE tentatively 
concluded that it cannot establish a separate standard that 
incorporates standby mode energy use and invited comments on the issue 
of standby mode and ballast designs that incorporate it.
    Philips and NEMA both expressed NEMA's view, agreeing that a 
standard cannot be established for standby mode energy consumption. 
(Philips, Public Meeting Transcript, No. 33 at p. 29, NEMA, No. 34 at 
p. 3) Empower Electronics also commented that a standby mode energy 
standard cannot be established. (Empower Electronics, No. 36 at p. 2) 
NEEA agreed with DOE's findings and proposals for standby mode and off 
mode. (NEEA, No. 31 at p. 2)
    With no new findings with regard to ballasts drawing power in 
standby and off modes and comments supporting DOE's preliminary 
proposal, DOE continues to conclude in this NOPR that it cannot 
establish a separate standard that incorporates standby mode or off 
mode energy consumption.

IV. General Discussion

A. Test Procedures

1. Current Test Procedures
    The current test procedures for metal halide ballasts and fixtures 
are outlined in Subpart S of 10 CFR Part 431. The test conditions, 
setup, and methodology generally follow the guidance of ANSI C82.6-
2005. Testing requires the use of a reference lamp, which is to be 
driven by the ballast under test conditions until the ballast reaches 
operational stability. Ballast efficiency for the fixture is then 
calculated as the measured ballast output power divided by the ballast 
input power. In this NOPR, DOE proposes changes to test input voltage, 
testing electronic ballasts, and rounding requirements.
2. Test Input Voltage
    Metal halide ballasts can be operated at a variety of voltages, 
with different voltages chosen based on the application and use of the 
fixture. The most common voltages are 120 V, 208 V, 240 V, 277 V, and 
480 V. Ballasts will also commonly be rated for more than one, such as 
dual-input-voltage ballasts that can be operated on 120 V or 277 V, or 
quad-input-voltage ballasts that can be operated on 120 V, 208 V, 240 
V, or 277 V. DOE received manufacturer feedback that the specific 
design of a ballast and the voltage of the lamp operated by the ballast 
can affect the trend between input voltage and efficiency. DOE likewise 
observed that changes in efficiency (on the level of several percent) 
were possible in individual ballasts based on its own testing of 
multiple-input-voltage ballasts.
    The existing test procedures do not specify the voltage at which a 
ballast is to be tested. Therefore, to ensure consistency among testing 
and reported efficiencies, the input voltage should be specified in the 
test procedures. To set an energy conservation standard based on test 
data, DOE needed to determine which input voltage to use for its data. 
In addition, manufacturers would need to their equipment at the same 
input voltage that DOE used when developing energy conservation 
standards for the regulations to have the intended effect. Because the 
majority of ballasts sold are capable of operating at multiple input 
voltages, DOE is considering standardizing this aspect of testing. In 
the preliminary TSD, DOE requested comment on this issue, specifically 
on the possibility of testing at all input voltages and reporting the 
average of the efficiencies. DOE discusses several input voltage 
specification options in the following paragraphs.
a. Average of Tested Efficiency at All Possible Voltages
    In the preliminary TSD, DOE asked for comment on the possibility of 
testing ballasts at each input voltage at which they are able to 
operate, then having a standard for the average of these efficiencies. 
NEEA commented that they saw the positive aspects of this method of 
testing. NEEA said that even though it would increase testing burden, 
it would also reduce efficiency bias associated with input voltage. 
(NEEA, No. 31 at p. 2) Philips commented that adapting a magnetic 
ballast for use with multiple input voltages lowers the efficiencies on 
one or more of the voltages, but the market has demanded the use of 
multi-tap ballasts, especially because the manufacturers desire to 
reduce inventory in an effort to lower cost. (Philips, Public Meeting 
Transcript, No. 33 at p. 28) NEMA said it disagreed with measuring at 
multiple voltages and then averaging due to the increased testing 
burden and associated costs. (NEMA, No. 34 at p. 2) Although DOE found 
little difference in ballast efficiency at different input voltages, 
DOE recognizes the possibility for efficiencies associated with rarely 
used input voltages to skew the overall efficiency of ballasts under 
this averaged-efficiencies approach. For example, a ballast might have 
the capability to operate on 120 V and 277 V at approximately 90 
percent efficiency, but at 208 V (an uncommon input voltage for metal 
halide lighting) it operated at only 88 percent efficiency. Averaging 
these three efficiencies would lead to a reported value of about 89 
percent, when the ballast will in all

[[Page 51480]]

likelihood only operate at 120 V or 277 V (at 90 percent efficiency). 
In this instance, averaging the efficiencies misrepresents the 
performance of the ballast in its most common uses. Additionally, DOE 
recognizes that testing at each input voltage could increase the burden 
relative to a requirement of testing ballasts at only a single voltage. 
For these reasons, in this NOPR, DOE is not proposing to test at all 
available input voltages and average the resulting efficiencies.
b. Posting the Highest and Lowest Efficiencies
    Another approach, suggested by Empower Electronics, would require 
testing at each input voltage and listing the best and worst 
efficiencies on the product label. (Empower Electronics, No. 36 at p. 
2) DOE acknowledges that, as with voltage averaging, this method could 
help address the concern that a manufacturer could optimize their 
ballasts on a voltage that could easily increase in efficiency, while 
most customers would be using a non-optimized voltage. Also similar to 
voltage averaging, however, DOE finds that this approach would lead to 
a compliance burden for manufacturers and would increase the required 
tests compared to a requirement to test ballasts only at a single 
voltage.
c. Test at Single Manufacturer-Declared Voltage
    In response to the preliminary TSD, NEMA suggested that the test 
procedures should allow testing at a single voltage determined by the 
manufacturer and declared in the test report. (NEMA, No. 34 at p. 2) In 
manufacturer interviews, DOE received feedback that manufacturers 
optimize ballasts at a specific voltage and prefer to test their 
products at that voltage. DOE is concerned, however, that manufacturers 
might optimize efficiency at a voltage that is most convenient or least 
expensive rather than the voltage most used by customers. Were 
manufacturers to optimize efficiency at a less commonly used voltage, 
the efficiency claimed at this voltage would not be representative of 
typical efficiency in the more common uses. Because the efficiency at 
the manufacturer-declared voltage and the efficiency at the more 
commonly used voltages may not have direct correlation, such test 
procedures could potentially reduce the energy savings of this 
rulemaking.
d. Test at Highest-Rated Voltage
    Another input voltage specification could be that the ballast 
should be tested at the highest voltage possible. OSI commented, and 
NEEA agreed, that fluorescent ballast test procedures set the precedent 
for having to test only at the highest rated voltage. They also said 
that this would reduce costs associated with additional testing for 
metal halide ballasts. (OSI, Public Meeting Transcript, No. 33 at p. 
29; NEEA, No. 31 at p. 2) DOE understands the concern regarding 
increased burdens and costs associated with being required to test 
ballasts at multiple input voltages. DOE's research, however, found 
that a ballast's highest-rated voltage is not always its most common 
input voltage. For example, DOE found a significant number of 70 W 
ballasts that were capable of operating on 120 V, 208 V, 240 V, and 277 
V. Testing at the highest-rated voltage would mean these ballasts are 
tested at 277 V, but manufacturer feedback indicated that 70 W ballasts 
are much more likely to be actually used in 120 V applications. One 
possible reaction to energy conservation standards based on this test 
procedure specification could be for manufacturers to optimize 70 W 
ballasts at 277 V (the tested voltage) as opposed to 120 V (the more 
commonly used voltage). Because of this possibility, DOE finds that 
testing and enforcing standards at the highest voltage could reduce the 
potential energy savings of this rulemaking.
e. Test on Input Voltage Based on Wattage and Available Voltages
    In this NOPR, DOE is proposing that the most common input voltages 
for each wattage range be used in testing. Progress Energy Carolinas 
commented that an amendment to the current test procedures that would 
specify the required input voltage for testing would not provide enough 
energy savings for the additional expense. (Progress Energy Carolinas, 
No. 24 at p. 2) DOE disagrees with Progress Energy Carolinas' assertion 
that an added expense is inherent in specification of the input voltage 
for testing. DOE's proposal only requires testing at one input voltage, 
the minimum number of tests possible. By proposing testing at a single 
voltage, DOE reduces testing burden relative to a requirement for 
testing at multiple input voltages. In addition, because the input 
voltage specification matches the most commonly used voltage, the 
requirement encourages optimization of efficiency around an input 
voltage commonly used in practice. Finally, analysis of the impact of 
energy savings for this rulemaking is made more accurate by assessing 
ballast efficiency at the most commonly used input voltages.
    In manufacturer interviews, DOE received feedback on usage of 
different input voltages. DOE learned that 208 V is the least used and 
least optimized voltage. DOE also received feedback that efficiencies 
at 277 V and 240 V are similar to each other. In general, DOE 
determined that fixtures with wattages less than 150 W were most often 
used at 120 V. Wattages of 150 W and above were most commonly used at 
277 V. Thus, this NOPR proposes that testing of metal halide ballasts 
use the following input voltages:
     For ballasts less than 150 W that have 120 V as an 
available input voltage, ballasts are to be tested at 120 V.
     For ballasts less than 150 W that lack 120 V as an 
available voltage, ballasts should be tested at the highest available 
input voltage.
     For ballasts operated at greater than or equal to 150 W 
and less than or equal to 2000 W that also have 277 V as an available 
input voltage, ballasts are to be tested at 277 V.
     For ballasts greater than or equal to 150 W and less than 
or equal to 2000 W that lack 277 V as an available input voltage, 
ballasts should be tested at the highest available input voltage.
3. Testing Electronic Ballasts
    With regards to testing electronic metal halide ballasts, DOE 
received feedback on several issues in response to the preliminary TSD. 
Some interested parties commented that the test procedures do not apply 
to any electronic ballasts and others commented that high-frequency 
electronic ballast testing is not specified and is more prone to 
measurement variation than low-frequency electronic ballast testing is. 
DOE discusses these comments below.
    In the preliminary TSD, DOE noted that it would continue to use the 
2005 version of ANSI C82.6 for testing both electronic and magnetic 
ballasts. Philips and Venture both commented that there are currently 
no test procedures for electronic ballasts. (Philips, Public Meeting 
Transcript, No. 33 at p. 130; Venture, Public Meeting Transcript, No. 
33 at p. 130) Both Cooper and NEMA noted that an update to ANSI C82.6 
that was to be released by the end of 2011 would include test 
procedures for low-frequency electronic (LFE) ballasts, but not high-
frequency electronic (HFE) ballasts.\19\ (Cooper, Public Meeting 
Transcript, No. 33 at pp. 27-28; NEMA, No. 34 at p. 2) NEEA commented 
that

[[Page 51481]]

this delay should preclude DOE from altering the test procedures for 
electronic metal halide ballasts at this time. (NEEA, No. 31 at p. 2) 
In DOE's reading of ANSI C82.6, the scope dictates testing HID lamp 
ballasts without specifying applicability only to magnetic ballasts. In 
interviews with manufacturers, DOE received feedback confirming that 
ANSI C82.6-2005 does provide a method for testing low-frequency 
ballasts. Additionally, section 4.4.3 of ANSI C82.6-2005 discusses low-
frequency electronic ballasts in the context of alternative 
stabilization methods.
---------------------------------------------------------------------------

    \19\ At the time of development of this NOPR in mid-2012, an 
update to ANSI C82.6-2005 was not yet available.
---------------------------------------------------------------------------

    DOE also received comments that HFE ballasts should be excluded 
from the rulemaking because there are no test procedures for them. 
Philips, OSI, and NEMA noted that the available equipment cannot test 
HFE ballast frequencies above 125 kHz as accurately as other ballasts, 
and Philips noted that HFE ballast testing accuracy can range from plus 
or minus two to five percent. (Philips, Public Meeting Transcript, No. 
33 at p. 130; NEMA, No. 34 at p. 14; OSI, No. 27 at p. 4) NEEA 
commented that manufacturers stated that there are no ANSI or NEMA HFE 
standards, and that no test procedures could accurately assess the 
efficiency of these ballasts to within plus or minus one percent. Based 
on this information, NEEA recommended that DOE should not consider 
these products in this rulemaking. (NEEA, No. 31 at p. 9) Empower 
Electronics commented that the test procedures should be amended to 
include HFE ballast testing. (Empower Electronics, No. 36 at p. 2) DOE 
agrees that the instrumentation in ANSI C82.6-2005 is specified only up 
to 800 Hz for ammeters and voltmeters and to 1 kHz for wattmeters, and 
also that these would be insufficient for measurements of HFE ballasts.
    DOE is proposing to amend the metal halide ballast and fixtures 
test procedures to specify the instrumentation required to test HFE 
ballasts. DOE found that the instrumentation commonly used for high-
frequency electronic metal halide ballast testing is the same 
instrumentation used for fluorescent lamp ballast testing. DOE proposes 
that instrumentation at least as accurate as required by ANSI C82.6-
2005 be used to assess the output frequency of the ballast. Once the 
output frequency is determined to be greater than or equal to 1000 Hz, 
(the frequency at which DOE proposes to define high-frequency 
electronic ballasts), the test procedure instrumentation would be 
required to include a power analyzer that conforms to ANSI C82.6-2005 
with a maximum of 100 picofarads (pF) capacitance to ground and 
frequency response between 40 Hz and 1 MHz. The test procedures would 
also require a current probe compliant with ANSI C82.6-2005 that is 
galvanically isolated and has a frequency response between 40 Hz and 20 
MHz, and lamp current measurement where the full transducer ratio is 
set in the power analyzer to match the current to the analyzer. The 
full transducer ratio would be required to satisfy:
[GRAPHIC] [TIFF OMITTED] TP20AU13.055

Where:
Iin is current through the current transducer;
Vout is the voltage out of the transducer;
Rin is the power analyzer impedance; and
Rs is the current probe output impedance.
4. Rounding Requirements
    DOE also proposes to amend the metal halide ballast test procedure 
requirements for measuring and recording input wattage and output 
wattage to require rounding to the nearest tenth of a watt, and the 
resulting calculation of efficiency to the nearest tenth of a percent. 
Through testing, DOE found that testing multiple samples of the same 
ballast yielded a range of ballast efficiencies typically differing by 
less than one percent. Because this data introduces both test 
measurement and sample to sample variation, the test measurement itself 
should be at least this accurate. Therefore, DOE believes its test 
procedures can resolve differences of less than one percent and 
rounding to the tenths decimal place would be reasonable.

B. Technological Feasibility

1. General
    In each standards rulemaking, DOE conducts a screening analysis 
based on information it has gathered on current technology options and 
prototype designs that could improve the efficiency of the products or 
equipment that are the subject of the rulemaking. As the first step in 
this analysis, DOE develops a list of design options for consideration 
in consultation with manufacturers, design engineers, and other 
interested parties. DOE then determines which of these options for 
improving efficiency is technologically feasible. DOE considers 
technologies incorporated in commercially available products or in 
working prototypes to be technologically feasible. 10 CFR part 430, 
subpart C, appendix A, section 4(a)(4)(i)
    Once DOE has determined that particular design options are 
technologically feasible, it evaluates each of these design options 
according to the following three screening criteria: (1) Practicability 
to manufacture, install, or service; (2) adverse impacts on product 
utility or availability; and (3) adverse impacts on health or safety. 
Section V.B of this notice discusses the results of the screening 
analysis for metal halide lamp fixtures. In particular, it lists the 
designs DOE considered, those it screened out, and those that are the 
basis for the TSLs in this rulemaking. For further details on the 
screening analysis for this rulemaking, see chapter 4 of the NOPR TSD.
2. Maximum Technologically Feasible Levels
    Section 325(o) of EPCA requires that when DOE amends standards for 
a type or class of covered equipment, it must determine the maximum 
improvement in energy efficiency or maximum reduction in energy use 
that is technologically feasible for that product. (42 U.S.C. 6295(o)) 
Accordingly, DOE determined the maximum technologically feasible (``max 
tech'') ballast efficiency in this NOPR's engineering analysis, using 
the design options identified in the screening analysis (see chapter 4 
of the NOPR TSD).
    To determine the max tech level, DOE conducted a survey of the MHLF 
market and the research fields that support the market. DOE's view 
based on test data is that within a given equipment class, no working 
prototypes exist that have a distinguishably higher ballast efficiency 
than currently available equipment. Therefore, the highest efficiency 
level presented, which represents the most efficient tier of 
commercially available equipment, is the max tech level for this 
rulemaking. This highest efficiency level requires electronic ballasts 
using the best components and circuit topologies commercially available 
for fixtures rated >=50 W to <=500 W. The max tech efficiency level 
requires the highest grades of core steel and copper windings for the 
fixtures rated >500 W and <=2000 W.
    DOE did not screen out any technology options in the preliminary 
analysis. DOE received several comments regarding its determination of 
max tech ballast efficiency in the preliminary TSD. These comments are 
discussed in section V.C.8. For this NOPR, DOE conducted additional 
analysis to determine the appropriate max tech levels for metal halide 
ballasts. As discussed in section V.C.3, DOE added 150 W as a 
representative wattage, and tested ballasts to establish an appropriate 
max tech level for this wattage. DOE also conducted additional

[[Page 51482]]

testing of the 70 W, 250 W, 400 W, and 1000 W ballasts on the market, 
and determined the highest efficiency levels that are technologically 
feasible within each equipment class. As discussed in section V.C.9, 
data for each equipment class has been fit with a wattage-efficiency 
equation to determine the minimum efficiency levels. Table IV.1 
presents the max tech efficiencies for each wattage range analyzed in 
the NOPR.

                                           Table IV.1--Max Tech Levels
----------------------------------------------------------------------------------------------------------------
   Equipment class wattage range        Efficiency level*                 Efficiency level equation %
----------------------------------------------------------------------------------------------------------------
>=50 and <=100.....................  EL4....................  100/(1+0.36*P[caret](-0.3))[dagger].
>100 and <150*.....................  EL4....................  100/(1+0.36*P[caret](-0.3)).
>=150** and <=250..................  EL4....................  100/(1+0.36*P[caret](-0.3)).
>250 and <=500.....................  EL4....................  100/(1+0.36*P[caret](-0.3)).
>500 and <=2000....................  EL2....................  For >500 W to <1000 W:
                                                              3.2*10[caret](-3)*P + 89.9
                                                              For >=1000 W to <=2000 W: 93.1.
----------------------------------------------------------------------------------------------------------------
* Includes 150 W fixtures exempted by EISA 2007, which are fixtures rated only for 150 watt lamps; rated for use
  in wet locations, as specified by the National Electrical Code 2002, section 410.4(A); and containing a
  ballast that is rated to operate at ambient air temperatures above 50 [deg]C, as specified by UL 1029-2001.
** Excludes 150 W fixtures exempted by EISA 2007, which are fixtures rated only for 150 watt lamps; rated for
  use in wet locations, as specified by the National Electrical Code 2002, section 410.4(A); and containing a
  ballast that is rated to operate at ambient air temperatures above 50 [deg]C, as specified by UL 1029-2001.
[dagger] P is defined as the rated wattage of the lamp that the fixture is designed to operate.

    DOE requests comment on its selection of the max tech levels and 
whether it is technologically feasible to attain these high 
efficiencies. Specifically, DOE seeks data on the potential change in 
efficiency, the design options employed, and the associated change in 
cost. Any design option that DOE considers to improve efficiency must 
meet the four criteria outlined in the screening analysis: 
technological feasibility; practicability to manufacture, install, and 
service; adverse impacts on product or equipment utility to customers 
or availability; and adverse impacts on health or safety. DOE also 
requests comment on any technological barriers to an improvement in 
efficiency above the max tech efficiency levels for all or certain 
types of ballasts.

C. Energy Savings

1. Determination of Savings
    For each TSL, DOE projected energy savings from the equipment that 
are the subject of this rulemaking purchased in the 30-year period that 
begins in the year of compliance with new or amended standards (2016-
2045). The savings are measured over the entire lifetime of products 
purchased in the 30-year period.\20\ DOE quantified the energy savings 
attributable to each TSL as the difference in energy consumption 
between each standards case and the base case. The base case represents 
a projection of energy consumption in the absence of amended mandatory 
efficiency standards, and considers market forces and policies that 
affect demand for more efficient equipment. For example, in the base 
case, DOE models a migration from covered metal halide lamp fixtures to 
higher-efficiency technologies such as high-intensity fluorescent 
(HIF), induction lights, and light-emitting diodes (LEDs). DOE also 
models a move to other HID fixtures such as high-pressure sodium, based 
on data given by manufacturers during the 2010 framework public 
meeting. (Philips, Public Meeting Transcript, No.8 at p. 91)
---------------------------------------------------------------------------

    \20\ In the past DOE presented energy savings results for only 
the 30-year period that begins in the year of compliance. In the 
calculation of economic impacts, however, DOE considered operating 
cost savings measured over the entire lifetime of equipment 
purchased in the 30-year period. DOE has chosen to modify its 
presentation of national energy savings to be consistent with the 
approach used for its national economic analysis.
---------------------------------------------------------------------------

    DOE used its NIA spreadsheet to estimate energy savings from new or 
amended-standards for the metal halide lamp fixtures that are the 
subject of this rulemaking. The NIA spreadsheet model (described in 
section V.G of this notice and in chapter 11 of the NOPR TSD) 
calculates energy savings in site energy, which is the energy directly 
consumed by products at the locations where they are used. DOE reports 
national energy savings on an annual basis in terms of the source 
(primary) energy savings, which is the savings in the energy that is 
used to generate and transmit the site energy. To convert site energy 
to source energy, DOE derived annual conversion factors from the model 
used to prepare the Energy Information Administration's (EIA) Annual 
Energy Outlook 2013 (AEO2013).
    DOE has begun to also estimate energy savings using full-fuel-cycle 
metrics. The full-fuel-cycle (FFC) metric includes the energy consumed 
in extracting, processing, and transporting primary fuels, and, thus, 
presents a more complete picture of the impacts of efficiency 
standards. DOE's approach is based on application of FFC multipliers 
for each fuel type used by covered products and equipment, as discussed 
in DOE's statement of policy published in the Federal Register on 
August 18, 2011 (76 FR 51281), and in the notice of policy amendment. 
77 FR 49701 (August 17, 2012).
2. Significance of Savings
    As noted above, 42 U.S.C. 6295(o)(3)(B) prevents DOE from adopting 
a standard for a covered product unless such standard would result in 
``significant'' energy savings. Although the term ``significant'' is 
not defined in the Act, the U.S. Court of Appeals, in Natural Resources 
Defense Council v. Herrington, 768 F.2d 1355, 1373 (D.C. Cir. 1985), 
indicated that Congress intended ``significant'' energy savings in this 
context to be savings that were not ``genuinely trivial.'' The energy 
savings for all of the TSLs considered in this rulemaking (presented in 
section VI.B.3) are nontrivial, and, therefore, DOE considers them 
``significant'' within the meaning of section 325 of EPCA.

D. Economic Justification

1. Specific Criteria
    As noted in section II.A, EPCA provides seven factors to be 
evaluated in determining whether a potential energy conservation 
standard is economically justified. (42 U.S.C. 6295(o)(2)(B)) The 
following sections discuss how DOE addresses each of those seven 
factors in this rulemaking.

[[Page 51483]]

a. Economic Impact on Manufacturers and Customers
    In determining the impacts of a new or amended standard on 
manufacturers, DOE first determines quantitative impacts using an 
annual-cash-flow approach. This approach includes both a short-term 
assessment--based on the cost and capital requirements during the 
period between the announcement of a regulation and when the regulation 
comes into effect--and a long-term (30-year) assessment. The 
quantitative impacts analyzed include INPV (which values the industry 
based on expected future cash flows), annual cash flows, and changes in 
revenue and income. Second, DOE analyzes and reports the impacts on 
different types of manufacturers, including an analysis of impacts on 
small manufacturers. Third, DOE considers the impact of standards on 
overall and technology-specific domestic manufacturer employment and 
manufacturing capacity, as well as the potential for standards to 
result in plant closures and loss of capital investment for technology-
specific manufacturers. DOE also takes into account cumulative impacts 
of different DOE regulations and other regulatory requirements on 
manufacturers.
    For individual customers, measures of economic impact include the 
changes in LCC and PBP associated with new or amended standards. LCC is 
separately specified as one of the seven factors to consider when 
determining the economic justification for a new or amended standard 
(42 U.S.C. 6295(o)(2)(B)(i)(II)), and is discussed in the following 
section. For customers viewed from a national perspective, DOE 
calculates the net present value of the economic impacts on them over 
the 30-year equipment shipments period used in this rulemaking.
b. Life-Cycle Costs
    The LCC is the sum of the purchase price of a fixture (including 
its installation) and its operating expenses (including energy, 
maintenance, and repair expenditures) discounted over the lifetime of 
the fixture. The LCC savings for the considered efficiency levels are 
calculated relative to a base case that reflects likely trends in the 
absence of new or amended standards. The LCC analysis required a 
variety of inputs, such as equipment prices, equipment energy 
consumption, energy prices, maintenance and repair costs, equipment 
lifetimes, and customer discount rates. DOE assumed in its analysis 
that customers purchase the equipment in 2016.
    To account for uncertainty and variability in specific inputs, such 
as equipment lifetime and discount rate, DOE uses a distribution of 
values, with probabilities attached to each value. DOE identifies the 
percentage of customers estimated to receive LCC savings or experience 
an LCC increase, in addition to the average LCC savings associated with 
a particular standard level. DOE also evaluates the LCC impacts of 
potential standards on identifiable subgroups of customers that may be 
affected disproportionately by a national standard.
c. Energy Savings
    Although significant conservation of energy is a separate statutory 
requirement for imposing an energy conservation standard, EPCA requires 
DOE, in determining the economic justification of a standard, to 
consider the total projected energy savings that are expected to result 
directly from the standard. (42 U.S.C. 6295(o)(2)(B)(i)(III)) As 
discussed in section V.G, DOE uses the NIA spreadsheet to project 
national energy savings.
d. Lessening of Utility or Performance of Products
    In establishing classes of equipment and evaluating design options 
and the impact of potential standard levels, DOE seeks to develop 
standards that would not lessen the utility or performance of the 
equipment under consideration. The efficiency levels considered in 
today's NOPR will not affect features valued by customers, such as 
input voltage and light output. Therefore, DOE believes that none of 
the TSLs presented in section VI.A would reduce the utility or 
performance of the ballasts considered in the rulemaking. (42 U.S.C. 
6295(o)(2)(B)(i)(IV))
e. Impact of Any Lessening of Competition
    EPCA directs DOE to consider any lessening of competition likely to 
result from standards. It directs the Attorney General to determine the 
impact, if any, of any lessening of competition likely to result from a 
proposed standard and to transmit this determination to the Secretary, 
not later than 60 days after the publication of a proposed rule, 
together with an analysis of the nature and extent of such impact. (42 
U.S.C. 6295(o)(2)(B)(i)(V) and (B)(ii)) DOE has transmitted a copy of 
today's proposed rule to the Attorney General and has requested that 
the Department of Justice (DOJ) provide its determination on this 
issue. DOE will address the Attorney General's determination in any 
final rule.
f. Need for National Energy Conservation
    The energy savings from the proposed standards are likely to 
provide improvements to the security and reliability of the nation's 
energy system. Reductions in the demand for electricity also may result 
in reduced costs for maintaining the reliability of the nation's 
electricity system. DOE conducts a utility impact analysis to estimate 
how standards may affect the nation's needed power generation capacity.
    The proposed standards also are likely to result in environmental 
benefits in the form of reduced emissions of air pollutants and 
greenhouse gases associated with energy production. DOE reports the 
emissions impacts from today's proposed standards, and from each TSL it 
considered, in section VI.B.6 of this notice. DOE also reports 
estimates of the economic value of emissions reductions resulting from 
the considered TSLs.
g. Other Factors
    EPCA allows the Secretary to consider any other relevant factors in 
determining whether a standard is economically justified. (42 U.S.C. 
6295(o)(2)(B)(i)(VII)) Under this provision, DOE considered subgroups 
of customers that may experience disproportionately adverse effects 
under the standards proposed in this rule. DOE specifically assessed 
the effect of standards on utilities, transportation facility owners, 
and warehouse owners. In considering these subgroups, DOE analyzed 
differences in electricity prices, operating hours, discount rates, and 
baseline ballasts. See section V.H for further detail.
2. Rebuttable Presumption
    As set forth in 42 U.S.C. 6295(o)(2)(B)(iii), EPCA creates a 
rebuttable presumption that an energy conservation standard is 
economically justified if the additional cost to the customer of 
equipment that meets the standard is less than three times the value of 
the first year's energy savings resulting from the standard, as 
calculated under the applicable DOE test procedure. DOE's LCC and PBP 
analyses generate values used to calculate the effects that proposed 
energy conservation standards would have on the payback period for 
customers. These analyses include, but are not limited to, the 3-year 
payback period contemplated under the rebuttable-presumption test. In 
addition, DOE routinely conducts an economic analysis that considers 
the full range of

[[Page 51484]]

impacts to customers, manufacturers, the nation, and the environment, 
as required under 42 U.S.C. 6295(o)(2)(B)(i). The results of this 
analysis serve as the basis for DOE's evaluation of the economic 
justification for a potential standard level (thereby supporting or 
rebutting the results of any preliminary determination of economic 
justification). The rebuttable presumption payback calculation is 
discussed in section VI.B.1 of this NOPR.

V. Methodology and Discussion

    DOE used two spreadsheet tools to estimate the impact of today's 
proposed standards. The first spreadsheet tool calculates LCCs and PBPs 
of potential new energy conservation standards. The second spreadsheet 
tool provides shipment projections and then calculates national energy 
savings and net present value impacts of potential new energy 
conservation standards. The Department also assessed manufacturer 
impacts, largely through use of the Government Regulatory Impact Model 
(GRIM).
    Additionally, DOE estimated the impacts of energy efficiency 
standards on utilities and the environment. DOE used a version of EIA's 
National Energy Modeling System (NEMS) for the utility and 
environmental analyses. The NEMS model simulates the energy sector of 
the U.S. economy. EIA uses NEMS to prepare its Annual Energy Outlook, a 
widely known reference energy forecast for the United States. The NEMS-
based model used for appliance standards analysis is called NEMS-BT (BT 
stands for DOE's Building Technologies Program), and is based on the 
current AEO (AEO2013) NEMS with minor modifications.\21\ The NEMS-BT 
accounts for the interactions between the various energy supply and 
demand sectors and the economy as a whole. For more information on 
NEMS, refer to The National Energy Modeling System: An Overview, DOE/
EIA-0581 (98) (Feb. 1998), available at: tonto.eia.doe.gov/FTPROOT/forecasting/058198.pdf.
---------------------------------------------------------------------------

    \21\ The EIA does not approve use of the name ``NEMS'' unless it 
describes an AEO version of the model without any modification to 
code or data. Because the present analysis entails some minor code 
modifications and runs the model under various policy scenarios that 
deviate from AEO assumptions, the name ``NEMS-BT'' refers to the 
model as used here.
---------------------------------------------------------------------------

A. Market and Technology Assessment

1. General
    When beginning an energy conservation standards rulemaking, DOE 
develops information that provides an overall picture of the market for 
the equipment concerned, including the purpose of the products, the 
industry structure, and the market characteristics. This activity 
includes both quantitative and qualitative assessments based on 
publicly available information. The subjects addressed in the market 
and technology assessment for this rulemaking include: Equipment 
classes and manufacturers; historical shipments; market trends; 
regulatory and non-regulatory programs; and technologies or design 
options that could improve the energy efficiency of the product(s) 
under examination. See chapter 3 of the NOPR TSD for further discussion 
of the market and technology assessment.
2. Equipment Classes
    In establishing energy conservation standards, DOE divides covered 
equipment into classes by: (a) The type of energy used, (b) the 
capacity of the equipment, or (c) any other performance-related feature 
that justifies different standard levels, such as features affecting 
consumer utility. (42 U.S.C. 6295(q)) DOE then considers establishing 
separate standard levels for each equipment class based on the criteria 
set forth in 42 U.S.C. 6295(o).
    In the preliminary analysis, DOE considered several potential 
class-setting factors for fixtures, including rated lamp wattage, input 
voltage, number of lamps operated, starting method, electronic 
configuration, circuit type, and fixture application. DOE preliminarily 
determined that rated lamp wattage was the only factor affecting both 
consumer utility and efficiency. DOE, therefore, analyzed four 
equipment classes for fixtures with rated lamp wattages: (1) Greater 
than or equal to 50 W and less than 150 W; (2) greater than or equal to 
150 W and less than or equal to 250 W; (3) greater than 250 W and less 
than or equal to 500 W; and (4) greater than 500 W. As discussed in the 
following sections, several interested parties commented on the 
preliminary equipment classes and the other class-setting factors that 
DOE considered.
a. Input Voltage
    Metal halide lamp fixtures are available in a variety of input 
voltages (such as 120 V, 208 V, 240 V, 277 V, and 480 V), and the 
majority of fixtures are equipped with ballasts that are capable of 
operating at multiple input voltages (for example quad-input-voltage 
ballasts are able to operate at 120 V, 208 V, 240 V, and 277 V). DOE 
determined that input voltage represents a feature affecting consumer 
utility as certain applications demand specific input voltages. 
Although input voltage can affect ballast resistive losses and thus, 
efficiency, for the preliminary analysis, DOE's ballast testing did not 
indicate a prevailing relationship (e.g., higher voltages are not 
always more efficient) between discrete input voltages and ballast 
efficiencies. Therefore, in the preliminary analysis, DOE did not 
establish separate equipment classes for metal halide lamp fixtures 
based on input voltage. In the preliminary analysis, DOE suggested that 
efficiency be represented by the average of tested efficiencies at each 
of the input voltages at which the ballast is rated for operation.
    In response to the preliminary analysis, DOE received several 
comments supporting and opposing input voltage as a class-setting 
criterion. NEMA noted that multiple-input-voltage ballasts are often 
optimized for the most popular voltage application. For example, a 
quint-input-voltage ballast (able to operate at five different input 
voltages) will often have a lower efficiency at 480 V than at 277 V 
because the ballast is optimized for 277 V operation. NEMA suggested 
that 480 V-capable ballasts be given an efficiency allowance, or that 
all ballasts be allowed to be tested at the optimal operating voltage 
as specified by the manufacturer. (NEMA, No. 34 at p. 10) Georgia Power 
also commented that due to their increased costs relative to non-480 V 
ballasts, dedicated 480 V and quint-input-voltage ballasts should be in 
a separate equipment class. (Georgia Power, No. 28 at p. 1) Progress 
Energy Carolinas agreed that separate equipment classes should be 
established for ballasts above 300 V. (Progress Energy Carolinas, No. 
24 at p. 2) NEEA found that voltage does not appear to be a significant 
factor in energy efficiency performance or system utility. However, 
NEEA had no objection to treating 480 V systems as a separate class, 
should DOE choose to do so. (NEEA, No. 31 at p. 3) Empower Electronics 
commented that a separate classification based on input voltage is not 
needed. (Empower Electronics, No. 36 at p. 5)
    As discussed in section IV.A of this NOPR, DOE is proposing that 
metal halide ballasts be tested at a single input voltage, based on the 
lamp wattage operated by the ballast. Ballasts that operate lamps 150 W 
or less would be tested at 120 V, and all others would be tested at 277 
V, unless the ballast is incapable of operating at the specified input 
voltage; in that case, the ballast would be tested at the highest input 
voltage possible. DOE's view is that this proposal would reduce the 
testing burden and better characterize the

[[Page 51485]]

energy consumption of metal halide lamp fixtures for the majority of 
applications in which they are installed. Based on the proposed test 
procedures, DOE evaluated efficiency differences between dedicated 480 
V, quint-input-voltage, and quad-input-voltage ballasts (which 
represent the vast majority of ballasts on the market). DOE found that 
the quint-input-voltage ballasts had similar efficiencies as the quad-
input-voltage ballasts when both were tested at 120 V or 277 V. In 
contrast, DOE found that the dedicated 480 V ballasts (tested at 480 V) 
were, on average, 1.4 percent less efficient than quad-input-voltage 
ballasts (tested at 120 V or 277 V).
    Because dedicated 480 V ballasts have a distinct utility and a 
difference in efficiency relative to ballasts tested at 120 V and 277 
V, DOE proposes separate equipment classes for ballasts tested at 480 V 
(in accordance with the test procedures). These would include dedicated 
480 V ballasts and any ballasts that are capable of being operated at 
480 V, but incapable of being operated at the input voltage specified 
by the test procedures (either 120 V or 277 V, depending on lamp 
wattage). DOE requests comment on this proposal.
Fixture Application
    Metal halide lamp fixtures are used in a variety of applications 
such as parking lots, roadways, warehouses, big-box retail, and flood 
lighting. Although the fixture size, shape, and optics are often 
tailored to the application, generally the same types of ballasts are 
currently utilized for most of the applications. DOE did not expect 
fixture-application-related attributes to affect ballast efficiency for 
a given lamp wattage, and in the preliminary analysis DOE did not 
analyze separate equipment classes based on such attributes.
    In response to the preliminary analysis, DOE received several 
comments regarding the problems of utilizing electronic ballasts in 
outdoor applications and recommending that DOE establish separate 
equipment classes for outdoor fixtures and indoor fixtures. Energy 
Solutions noted that there are significant fixture design 
considerations necessitated by outdoor use. (Energy Solutions, Public 
Meeting Transcript, No. 33 at pp. 46-47) Progress Energy Carolinas 
clarified that ballasts used in outdoor fixtures need to be able to 
withstand high temperatures, voltage variations, and lightning and 
other voltage surges. Progress Energy Carolinas also indicated that the 
same concerns existed with LED fixtures (utilizing electronic drivers) 
and that they were successfully addressed by adding heat sinks to 
dissipate excess heat; building regulation into the drivers to deal 
with voltage variations; and adding metal oxide varistor (MOV) 
protection (typically 10 kilo volt [kV] ANSI C62.41.1-2002 \22\ Class C 
protection) to protect against lightning and other voltage surges. LED 
fixtures also underwent field testing through all four seasons to prove 
overall reliability. Progress Energy Carolinas explained that until 
some of these issues are similarly addressed and their solutions 
proven, end users will be reluctant to use electronic metal halide 
ballasts in outdoor fixtures. (Progress Energy Carolinas, No. 24 at p. 
1) Georgia Power and Progress Energy Carolinas stated that outdoor 
electronic metal halide ballasts have not been widely adopted by 
utilities, largely due to these reliability concerns. NEMA urged DOE to 
establish MHLF standards for outdoor applications (which have higher 
transient requirements and wider operating temperature ranges) such 
that magnetic ballasts would be compliant. (NEMA, No. 34 at p. 9) If 
electronic ballasts are mandated for outdoor fixtures, Progress Energy 
Carolinas recommended that utilities be exempt until reliability 
concerns decrease. (Georgia Power, No. 28 at p. 2; Progress Energy 
Carolinas, No. 24 at p. 2)
---------------------------------------------------------------------------

    \22\ ``Institute of Electrical and Electronics Engineers Guide 
on the Surge Environment in Low-Voltage (V and Less) AC Power 
Circuits,'' Approved April 4, 2003.
---------------------------------------------------------------------------

    The CA IOUs, however, stated that electronic ballasts have been 
successfully applied in outdoor applications and are readily available 
on the market today, citing examples of commercially available 
electronic metal halide products rated for outdoor use and 
municipalities that have adopted electronically ballasted metal halide 
streetlights. The CA IOUs expressed their belief that the application 
environment does not affect the utility or the achievable efficiency of 
a ballast. The CA IOUs also stated that should DOE decide that the use 
of electronic ballasts in outdoor environments requires additional 
fixture modifications, DOE would need to conduct separate cost and 
savings analyses for indoor versus outdoor applications. If DOE decides 
to set different equipment classes for indoor and outdoor metal halide 
lamp fixtures, the CA IOUs suggested that DOE adopt California's 
approach for differentiation of these types by specifying fixtures that 
are ``UL 1598 Wet Location Listed and labeled `Suitable for Wet 
Locations' as specified by the National Electrical Code [NEC] 2005, 
Section 410.4(A).'' (CA IOUs, No. 32 at pp. 2-3)
    Although electronic ballasts are being successfully used in certain 
outdoor applications, DOE acknowledges that there is currently a market 
reluctance to use electronic metal halide ballasts in outdoor 
applications, particularly due to concerns with the electronic 
ballast's ability to withstand voltage transients. However, DOE 
disagrees with NEMA that an efficiency level that requires electronic 
ballasts should not be analyzed or proposed on the basis of the 
features of transient suppression and operating temperature ranges. 
DOE's view is that addressing these concerns with either (1) an 
external surge protection device or (2) internal transient protection 
of the ballast using MOVs in conjunction with other inductors and 
capacitors is technologically feasible, as shown by the CA IOUs' list 
of examples. DOE understands that this added protection also adds an 
incremental cost to the ballast or fixture (further discussed in 
section V.C.12). As these incremental costs could affect the cost 
effectiveness of fixtures for outdoor applications, DOE proposes 
separate equipment classes for indoor and outdoor fixtures. DOE 
proposes that outdoor fixtures be defined as those that (1) are rated 
for use in wet locations and (2) have 10 kV of voltage transient 
protection. Conversely, fixtures that do not meet these requirements 
will be defined as indoor fixtures.
    DOE proposes to define the wet location rating as specified by the 
National Electrical Code 2011,\23\ section 410.10(A) or Underwriters 
Laboratories (UL) 1598 Wet Location Listed.\24\ DOE believes that 
providing two possible definitions will reduce the compliance burden as 
many manufacturers are already familiar with one or both of these 
ratings (the NEC definition was included in EISA 2007 and both are used 
in California energy efficiency regulations). For 10 kV voltage 
transient protection, DOE proposes to use the 10

[[Page 51486]]

kV voltage pulse withstand requirement from ANSI C136.2-2004 as a 
characteristic unique to outdoor fixtures. As discussed in section 
VI.C, based on weighing the benefits and drawbacks of different 
requirements, DOE is proposing efficiency standards that are the same 
for indoor and outdoor equipment classes. If a different requirement is 
ultimately adopted by DOE in the final rule, the definitions of indoor 
and outdoor will be added to the Code of Federal Regulations for metal 
halide lamp fixtures.
---------------------------------------------------------------------------

    \23\ The NEC 2011 states that fixtures installed in wet or damp 
locations shall be installed such that water cannot enter or 
accumulate in wiring components, lampholders, or other electrical 
parts. All fixtures installed in wet locations shall be marked, 
``Suitable for Wet Locations.'' All fixtures installed in damp 
locations shall be marked ``Suitable for Wet locations'' or 
``Suitable for Damp Locations.''
    \24\ UL Standard Publication 1598 defines a wet location is one 
in which water or other liquid can drip, splash, or flow on or 
against electrical equipment. A wet location fixture shall be 
constructed to prevent the accumulation of water on live parts, 
electrical components, or conductors not identified for use in 
contact with water. A fixture that permits water to enter the 
fixture shall be provided with a drain hole.
---------------------------------------------------------------------------

c. Electronic Configuration and Circuit Type
    Of the two metal halide ballast types (electronic and magnetic), 
magnetic ballasts are currently more common. Magnetic ballasts 
typically use transformer-like copper or aluminum windings on a steel 
or iron core. The newer electronic ballasts, which are more efficient 
but less common, rely on integrated circuits, switches, and capacitors/
inductors to control current and voltage to the lamp. Both electronic 
and magnetic ballasts are capable of producing the same light output 
and, with certain modifications (e.g., thermal management, transient 
protection, 120 V auxiliary power functionality), can be used 
interchangeably in all applications.
    Magnetic metal halide ballasts are available in the market in 
several types of circuit configurations including high-reactance 
autotransformer, constant-wattage isolated transformer, constant-
wattage autotransformer (CWA), linear reactor (reactor), and 
magnetically regulated-lag (reg-lag or mag-reg) ballasts. Each magnetic 
circuit type listed has different characteristics that may be preferred 
in certain applications. These characteristics (discussed further in 
chapter 3 of the NOPR TSD) include size, efficiency, and power 
regulation. For example, magnetically regulated-lag ballasts are 
typically the largest and heaviest circuit type, but provide the 
greatest degree of resistance to input voltage variation (which 
sustains light output). In the preliminary analysis, DOE determined 
that although magnetic ballasts are usually less efficient and have a 
lower initial cost than electronic ballasts, neither configuration 
provides a distinct consumer utility over the other. Because electronic 
ballasts can provide the same utility as any magnetic circuit type, can 
be used as substitutes in all applications, and are generally more 
efficient than magnetic ballasts, DOE determined in the preliminary 
analysis that setting separate equipment classes based on electronic 
configuration (magnetic vs. electronic) or on circuit type was 
unnecessary.
    At wattages greater than 500 W, few electronic ballasts are 
available due to their higher cost and lower expected efficiency 
improvement over magnetic ballasts. Electronic ballasts have two 
primary circuit types that operate the lamp at either ``high'' or 
``low'' frequency. DOE proposes to define a high-frequency ballast to 
be a ballast with output frequency greater than or equal to 1000 Hz. 
For low-frequency electronic ballasts, a square current waveform is 
used to diminish acoustic resonance and maintain lamp life. All lamps 
operate well on low-frequency square waves, so these low-frequency 
ballasts have few compatibility issues with lamps. At higher 
frequencies, however, acoustic resonance issues and electromagnetic 
interference (EMI) effects cause compatibility issues with lamps. At 
these high frequencies, ballasts have to be designed to have the right 
frequency for a desired lamp, but the selected frequency may be 
incompatible with other lamps designed for different frequencies. 
Therefore, high-frequency electronic ballasts are less widely 
compatible with lamps relative to low-frequency electronic ballasts. 
High-frequency ballasts may also have difficulty complying with Federal 
Communications Commission (FCC) standards.\25\
---------------------------------------------------------------------------

    \25\ FCC regulations at 47 CFR part 18, subpart C set forth 
technical standards for industrial, scientific, and medical 
equipment that specify frequency bands and tolerance ranges as well 
as electromagnetic field strength limits. Some metal halide ballasts 
may be covered under these ``industrial, scientific, and medical 
(ISM) equipment'' standards, which list the general operating 
conditions for ISM equipment. Ballasts designed to exceed 9 kHz 
ballast frequency have to be designed so that interference with 
transmitted radio frequencies is eliminated. 47 CFR 18.111, 18.301-
11
---------------------------------------------------------------------------

    In response to DOE's preliminary determination not to use 
electronic configuration or circuit type as a class-setting factor, DOE 
received several comments relating to replacement of magnetic ballasts 
with electronic ballasts, possible reliability issues with electronic 
ballasts, and non-efficiency-related benefits to using electronic 
ballasts. Cooper Lighting stated that electronic ballasts are not 
direct replacements for magnetic ballasts in fixtures. (Cooper 
Lighting, Public Meeting Transcript, No. 33 at p. 64) With regard to 
reliability, Georgia Power said that (1) electronic ballasts are 
unproven in outdoor applications and (2) electronic ballasts are 
vulnerable to failures due to high temperature, moisture, and voltage 
variations and surges caused by lightning and other outdoor events. 
Progress Energy Carolinas did not disagree with including electronic 
and magnetically ballasted fixtures in the same equipment class, but 
commented that the expected energy savings are small. They stated that 
other operating characteristics drive the use of electronic ballasts in 
indoor applications (i.e., correlated color temperature variation, lamp 
lumen depreciation, and dimming). (Progress Energy Carolinas, No. 24 at 
p. 2) The CA IOUs agreed with Georgia Power that electronic ballasts, 
especially in conjunction with pulse-start ceramic metal halide lamps 
that offer higher efficacy and improved color rendering index (CRI), 
have other advantages that can offset their added cost. The CA IOUs 
also stated that electronic ballasts do save energy relative to 
magnetically ballasted systems. (CA IOUs, No. 32 at p. 4) Finally, 
Empower Electronics supported DOE's preliminary determination, stating 
that equipment classes need not be set according to electronic 
configuration and circuit type. (Empower Electronics, No. 36 at p. 6)
    As discussed in section V.C.12, DOE recognizes the technological 
differences between magnetic and electronic ballasts and has 
incorporated the cost of additional devices or modifications necessary 
for certain applications into its analysis. In section V.I.2, DOE 
addresses impacts on manufacturers of a transition to electronic 
ballasts, but does not consider these impacts in development of 
equipment classes. While acknowledging that customers make purchasing 
decisions on electronic versus magnetic ballasts after consideration of 
other parameters in addition to efficiency, DOE has determined that 
significant energy savings can be realized through a transition from 
magnetic to electronic ballasts (see section VI.B.3). For this NOPR, 
DOE maintains that electronic configuration does not affect consumer 
utility because with the necessary design adders, electronic ballasts 
can provide the same utility as magnetic ballasts. Because of this, DOE 
is not proposing to define equipment classes based on electronic 
configuration and requests comment on this matter.
d. Lamp Wattage
    As lamp wattage increases, lamp and ballast systems generally (but 
not always) produce increasing amounts of light (lumens). The goal of 
efficiency standards is to decrease the wattage needed for the same 
lumens--resulting in an increase in energy efficiency. Because certain 
applications require more light than others, wattage often varies by 
application. For example, low-wattage (less than 150 W) lamps are

[[Page 51487]]

used today in commercial applications for general lighting. Medium-
wattage (150-500 W) lamps are the most widely used today and include 
warehouse, street, and general commercial lighting. High-wattage 
(greater than 500 W) lamps are used today in searchlights, stadiums, 
and other applications that require powerful white light. In the 
preliminary analysis, based on its impact on light output, DOE 
determined that lamp wattage affects consumer utility. DOE also 
determined that the wattage of a lamp operated by a ballast is 
correlated with the ballast efficiency, which generally increases for 
higher-wattage loads. For electronic ballasts, this efficiency gain can 
be attributed to the decreasing proportion of fixed losses (e.g., 
switches) to total losses. For low-wattage electronic ballasts, certain 
fixed losses contribute a larger proportion of total losses than they 
do for high-wattage ballasts. Magnetic ballasts--essentially 
transformers (sometimes with capacitors for power correction and 
igniters for pulse-starting)--have proportionally lower overall losses 
with increased wattage. Transformer losses (resistive losses in 
windings, eddy currents, and hysteresis) do not scale linearly with 
wattage, meaning that overall efficiency increases with wattage. 
Because wattage affects consumer utility (lumen output) and has a 
strong correlation to efficiency, DOE determined that separate 
equipment classes based on wattage were warranted. As a result in the 
preliminary analysis, DOE analyzed four lamp wattage class bins: >=50 W 
and <150 W, >=150 W and <=250 W, >250 W and <=500 W, and >500 W.
    NEEA, Empower Electronics, and Progress Energy Carolinas supported 
DOE's determination in the preliminary analysis that wattage should be 
a class-setting factor. (NEEA, No. 31 at p. 3; Empower Electronics, No. 
36 at p. 7; Progress Energy Carolinas, No. 24 at p. 3) Because no 
adverse comments were received on DOE's determination, DOE proposes to 
continue using lamp wattage as a class-setting factor for this NOPR.
    For the NOPR, DOE found that even within a designated wattage range 
(such as between 100 W and 150 W), the potential efficiencies 
manufacturers can reach is not constant, but rather varies with 
wattage. Instead of setting a constant efficiency standard within a 
wattage bin, DOE is proposing the use of an equation-based energy 
conservation standard for certain equipment classes (see section V.C). 
DOE is also continuing to use wattage bins (instead of a single 
equation spanning the entire covered wattage range) to define equipment 
classes, for two reasons. First, the range of ballast efficiencies 
considered can differ significantly by lamp wattage, thus making it 
difficult to construct a single continuous equation for ballast 
efficiency from 50 W to 2000 W. This efficiency difference can be 
attributed to the varying cost of increasing ballast efficiency for 
different wattages and the impact of legislated (EISA 2007) standards 
that affect only some wattage ranges. Second, different wattages often 
serve different applications and have unique cost-efficiency 
relationships. Analyzing each wattage range as a separate equipment 
class allows DOE to establish the energy conservation standards that 
are cost-effective for each wattage bin.
    DOE also received comment that certain wattage ranges used in the 
preliminary analysis should be further divided. Progress Energy 
Carolinas commented that further division of the 50 W to 250 W 
equipment class was warranted on the basis of different levels of 
efficiency being possible for different wattages. (Progress Energy 
Carolinas, No. 24 at p. 1) For this NOPR, DOE determined that the >=50 
W and <150 W range should be further subdivided. DOE's test data 
indicates that efficiency varies more significantly for ballasts that 
operate 50 W to 150 W lamps than for any other wattage range considered 
in the preliminary TSD. Based on catalog information and manufacturer 
interviews, DOE determined that 50 W and 100 W fixtures typically serve 
the same applications, while 150 W products begin to serve applications 
with increased light demand such as area lighting or parking lots. DOE 
used this natural division in wattage based on application to further 
divide the lowest-wattage range from the preliminary analysis.
    With regards to the specification of the boundary between fixtures 
rated to operate at wattages above and below 150 W, Georgia Power 
commented that 150 W fixtures should be included with fixtures less 
than 150 W, not those greater than 150 W. (Georgia Power, No. 2 at p. 
2) DOE agrees that some 150 W fixtures (those exempted by EISA 2007) 
should be included in the >100 to <150 W equipment classes. As 
discussed previously in section III.A.1, there is an existing EISA 2007 
exemption for ballasts rated for only 150 W lamps, used in wet 
locations, and that operate in ambient air temperatures higher than 50 
[deg]C. This exemption has led to a difference in the commercially 
available efficiencies for ballasts that are exempted or not exempted 
from EISA 2007. The exempted ballasts have a range of efficiencies 
similar to wattages less than 150 W. Ballasts not exempted by EISA 2007 
have efficiencies similar to ballasts greater than 150 W. As a result, 
DOE is proposing that 150 W fixtures previously exempted from EISA 2007 
be included in a >100 W and <150 W range, while 150 W fixtures subject 
to EISA 2007 standards would be included in a >=150 W to <=250 W range.
    In the preliminary analysis, DOE included all fixtures rated to 
operate at wattages greater than 500 W in the same equipment class. OSI 
suggested that DOE include 500 W ballasts in the highest-wattage range. 
OSI stated that electronic ballasts that operate lamps greater than or 
equal to 500 W have not been developed yet. (OSI, No. 27 at p. 4) In 
response to the lack of electronic ballasts operating lamps greater 
than or equal to 500 W, DOE agrees that there are not commercially 
available electronic ballasts at these wattages today, but also notes 
that magnetic ballasts are also unavailable at this wattage. Because 
leaving the boundary between these two wattage ranges at 500 W does not 
affect any commercially available products, DOE proposes to maintain 
the >250 W and <=500 W range for consistency with the EISA 2007 covered 
wattage range.
    In summary, DOE is proposing to define metal halide lamp fixture 
equipment classes by rated lamp wattage ranges >=50 W to <=100 W, >100 
W to <150 W, >=150 W to <=250 W, >250 W to <=500 W, and >500 W to 
<=2000 W. DOE proposes that 150 W fixtures previously exempted by EISA 
2007 be included in the >100 W to <150 W range, while 150 W fixtures 
subject to EISA 2007 standards continue to be included in the >=150 W 
to <=250 W range. DOE requests comment on these wattage ranges.
e. Number of Lamps
    Metal halide lamp fixtures are commonly designed to operate with a 
single lamp because of lamp characteristics related to re-striking 
(turning the lamp on again after being turned off, because metal halide 
lamps require time to cool down before being lighted again) and voltage 
regulation. DOE's review of manufacturer catalogs revealed that while a 
majority of available ballasts operate only one lamp, a small fraction 
are designed for two lamps. Based on this review, DOE determined that 
there is little to no change in efficiency between one-lamp and two-
lamp metal halide ballast fixtures. In the preliminary analysis, DOE 
determined it unnecessary to consider multiple-lamp ballasts in

[[Page 51488]]

equipment classes separate from single-lamp ballasts.
    NEMA agreed with DOE on the limited number of two-lamp metal halide 
lamp fixtures. Because two-lamp ballasts represent such a small part of 
the market, NEMA suggested they be excluded from the rulemaking. Given 
the optical size of a metal halide lamp, NEMA found it unlikely that a 
manufacturer would use this exemption as a loophole. Fixtures using 
multiple-lamp ballasts would have to be larger, more expensive, and 
less optically efficient than those with single-lamp ballasts. (NEMA, 
No. 34 at p. 10) Because catalog data shows no difference in 
efficiency, in this NOPR, DOE continues to propose including ballasts 
with differing numbers of lamps in the same equipment class. DOE is not 
proposing to exclude 2-lamp ballasts from the scope of coverage.
f. Starting Method
    Metal halide lamp fixtures currently available in the market are 
designed to operate with either probe-start or pulse-start lamps, but 
not a mixture of both types at the same time.\26\ The main differences 
between these starting methods are: (1) The inclusion of a third probe 
in probe-start lamps, (2) the need for an igniter circuit for pulse-
start lamps, and (3) the different wiring specification for ballasts of 
each starting method. Most new applications in the market are pulse-
start due to its higher efficacy (pulse-start lamps provide more lumens 
per watt than probe-start lamps). In the preliminary analysis, DOE did 
not consider probe versus pulse-starting to be a class-setting factor. 
While pulse-start lamps are more efficacious than probe-start lamps, 
probe and pulse-start ballasts can achieve the same levels of ballast 
efficiency and are used in similar applications. DOE did not receive 
any adverse comment relating to this preliminary determination, so in 
this NOPR, DOE proposes that both probe and pulse-start ballasts be 
included in the same equipment class.
---------------------------------------------------------------------------

    \26\ DOE is aware of some metal halide lamps that can be 
operated by a pulse-start or a probe-start ballast. These lamps are 
much less common than lamps designed to be operated by ballasts of 
only one starting method.
---------------------------------------------------------------------------

    EISA 2007 distinguishes nonpulse-start electronic equipment classes 
by separating them into two rated lamp wattage ranges (>=150 W and 
<=250 W, and >250 W and <=500 W) and applying a more stringent standard 
to them than to other ballast types. According to DOE's review of 
manufacturer catalogs and information provided by manufacturers during 
interviews, nonpulse-start electronic metal halide lamp fixtures are 
not available in the market. While EISA 2007 contemplated the creation 
of additional classes for alternative technologies that could become 
available in the future, DOE has no information that indicates 
differences in efficiency or consumer utility based on pulse-start 
versus nonpulse-start ballast fixtures. Based on this information, in 
the preliminary analysis, DOE determined that a separate equipment 
class for nonpulse-start ballasts was unnecessary. DOE did not receive 
adverse comments relating to this preliminary determination, so in this 
NOPR, DOE is proposing that nonpulse-start electronic ballasts be 
included in the same equipment class as all other starting methods. The 
term nonpulse-start electronic ballast is currently undefined in the 
CFR. To avoid confusion, DOE is proposing to define `nonpulse-start 
electronic ballast' in 10 CFR 431.322 as an electronic ballast with a 
starting method other than pulse-start.
    Due to their apparent interchangeability and lack of unique or 
separate utility that would affect efficiency, DOE proposes not to use 
ballast-starting method as a class-setting feature.
g. Conclusions
    Based on interested party input and additional research, in this 
NOPR, DOE has decided to propose the equipment classes in the following 
table. DOE has revised the wattage bins considered in the preliminary 
analysis to account for a varying number of efficiency levels, 
different cost-efficiency relationships in the lower wattages, and the 
lack of general lighting applications for wattages higher than 2000 W. 
Additionally, each of these wattage bins is further divided into indoor 
and outdoor applications to account for the difference in consumer 
utility and the cost-efficiency relationships for these application 
types (see section V.C.12 for further details about the cost adders 
that effect these relationships). Finally, each of these classes is 
subdivided by input voltage, with one class for ballasts tested at 480 
V (in accordance with the 2009 test procedures, supplemented with the 
testing guidance included in this document), and the non-480 V ballasts 
in a separate class. Ballasts tested at 480 V include dedicated 480 V 
ballasts and any ballast capable of being operated at 480 V, but 
incapable of being operated at the input voltage specified by the 
amendments to the test procedures proposed in this NOPR (either 120 V 
or 277 V, depending on lamp wattage). DOE invites comments on these 
proposed equipment classes.

                           Table V.1--Metal Halide Lamp Fixture NOPR Equipment Classes
----------------------------------------------------------------------------------------------------------------
                                                                Indoor/outdoor
        Equipment classes             Rated lamp wattage           [dagger]         Input voltage type [Dagger]
----------------------------------------------------------------------------------------------------------------
1................................  >=50 W and <=100 W......  Indoor.............  Tested at 480 V.
2................................  >=50 W and <=100 W......  Indoor.............  All others.
3................................  >=50 W and <=100 W......  Outdoor............  Tested at 480 V.
4................................  >=50 W and <=100 W......  Outdoor............  All others.
5................................  >100 W and <150 W *.....  Indoor.............  Tested at 480 V.
6................................  >100 W and <150 W *.....  Indoor.............  All others.
7................................  >100 W and <150 W *.....  Outdoor............  Tested at 480 V.
8................................  >100 W and <150 W *.....  Outdoor............  All others.
9................................  >=150 W ** and <=250 W..  Indoor.............  Tested at 480 V.
10...............................  >=150 W ** and <=250 W..  Indoor.............  All others.
11...............................  >=150 W ** and <=250 W..  Outdoor............  Tested at 480 V.
12...............................  >=150 W ** and <=250 W..  Outdoor............  All others.
13...............................  >250 W and <=500 W......  Indoor.............  Tested at 480 V.
14...............................  >250 W and <=500 W......  Indoor.............  All others.
15...............................  >250 W and <=500 W......  Outdoor............  Tested at 480 V.
16...............................  >250 W and <=500 W......  Outdoor............  All others.
17...............................  >500 W and <=2000 W.....  Indoor.............  Tested at 480 V.
18...............................  >500 W and <=2000 W.....  Indoor.............  All others.

[[Page 51489]]

 
19...............................  >500 W and <=2000 W.....  Outdoor............  Tested at 480 V.
20...............................  >500 W and <=2000 W.....  Outdoor............  All others.
----------------------------------------------------------------------------------------------------------------
* Includes 150 W fixtures exempted by EISA 2007, which are fixtures rated only for 150 watt lamps; rated for use
  in wet locations, as specified by the National Electrical Code 2002, section 410.4(A); and containing a
  ballast that is rated to operate at ambient air temperatures above 50 [deg]C, as specified by UL 1029-2001.
** Excludes 150 W fixtures exempted by EISA 2007, which are fixtures rated only for 150 watt lamps; rated for
  use in wet locations, as specified by the National Electrical Code 2002, section 410.4(A); and containing a
  ballast that is rated to operate at ambient air temperatures above 50 [deg]C, as specified by UL 1029-2001.
[dagger] DOE's proposed definitions for ``indoor'' and ``outdoor'' metal halide lamp fixtures are described in
  section V.A.2.
[Dagger] Input voltage for testing would be specified by the test procedures. Ballasts rated to operate lamps
  less than 150 W would be tested at 120 V, and ballasts rated to operate lamps >=150 W would be tested at 277
  V. Ballasts not designed to operate at either of these voltages would be tested at the highest voltage the
  ballast is designed to operate. See section IV.A for further detail.

    DOE requests comment on the proposed equipment classes.

B. Screening Analysis

    For the screening analysis, DOE consults with industry, technical 
experts, and other interested parties to develop a list of technology 
options for consideration and to determine which technology options to 
consider further and which to screen out.
    Section 325(o)(2) of EPCA requires that any new or revised standard 
achieve the maximum improvement in energy efficiency determined to be 
technologically feasible and economically justified. (42 U.S.C. 
6295(o)(2)) Appendix A to subpart C of 10 CFR part 430, ``Procedures, 
Interpretations, and Policies for Consideration of New or Revised 
Energy Conservation Standards for Consumer Products'' (the Process 
Rule), sets forth procedures to guide DOE in its consideration and 
promulgation of new or revised energy conservation standards. These 
procedures elaborate on the statutory criteria provided in 42 U.S.C. 
6295(o) and, in part, eliminate problematic technologies early in the 
process of prescribing or amending an energy conservation standard. In 
particular, sections 4(b)(4) and 5(b) of the Process Rule provide 
guidance to DOE for determining which design options are unsuitable for 
further consideration:
    Technological feasibility. DOE will consider technologies 
incorporated in commercial products or in working prototypes to be 
technologically feasible.
    Practicability to manufacture, install, and service. If mass 
production and reliable installation and servicing of a technology in 
commercial products could be achieved on the scale necessary to serve 
the relevant market at the time the standard comes into effect, then 
DOE will consider that technology practicable to manufacture, install, 
and service.
    Adverse impacts on product utility or product availability. If DOE 
determines a technology would have significant adverse impacts on the 
utility of the product to significant subgroups of consumers, or would 
result in the unavailability of any covered equipment type with 
performance characteristics (including reliability), features, sizes, 
capacities, and volumes that are substantially the same as equipment 
generally available in the United States at the time, it will not 
consider this technology further.
    Adverse impacts on health or safety. If DOE determines that a 
technology will have significant adverse impacts on health or safety, 
it will not consider this technology further.
    For the preliminary analysis, DOE identified the design options 
listed in Table V.2 as technologies that could improve MHLF ballast 
efficiency and pass the screening criteria discussed above. For further 
details on these design options, see chapter 3 of the NOPR TSD. DOE 
received several comments, discussed below, in response to the design 
options presented in the preliminary analysis, particularly on 
``improved core steel'' for magnetic ballasts and ``improved 
components'' for electronic ballasts.

                    Table V.2--Metal Halide Lamp Fixture Preliminary Analysis Design Options
----------------------------------------------------------------------------------------------------------------
 
----------------------------------------------------------------------------------------------------------------
            Ballast type                              Design option                          Description
----------------------------------------------------------------------------------------------------------------
Magnetic...........................                Improved Core Steel               Use a higher grade of
                                                                                      electrical steel,
                                                                                      including grain-oriented
                                                                                      silicon or amorphous
                                                                                      steel, to lower core
                                                                                      losses.
                                                      Copper Wiring                  Use copper wiring in place
                                                                                      of aluminum wiring to
                                                                                      lower resistive losses.
                                                 Increased Stack Height              Add steel laminations to
                                                                                      lower core losses.
                                            Increased Conductor Cross-Section        Increase conductor cross
                                                                                      section to lower winding
                                                                                      losses.
                                                   Electronic Ballast                Replace magnetic ballasts
                                                                                      with electronic ballasts.
                                    ------------------------------------------------
Electronic.........................  Improved Components...  Magnetics.............  Use grain-oriented or
                                                                                      amorphous electrical steel
                                                                                      to reduce core losses.
                                                                                     Use optimized-gauge copper
                                                                                      or litz wire to reduce
                                                                                      winding losses.
                                                                                     Add steel laminations to
                                                                                      lower core losses.
                                                                                     Increase conductor cross
                                                                                      section to lower winding
                                                                                      losses.
                                                             Diodes................  Use diodes with lower
                                                                                      losses.
                                                             Capacitors............  Use capacitors with a lower
                                                                                      effective series
                                                                                      resistance and output
                                                                                      capacitance.
                                                             Transistors...........  Use transistors with lower
                                                                                      drain-to-source
                                                                                      resistance.

[[Page 51490]]

 
                                     Improved Circuit        Integrated Circuits...  Substitute discrete
                                      Design.                                         components with an
                                                                                      integrated circuit.
----------------------------------------------------------------------------------------------------------------

    DOE received comment on whether improved core steel was a design 
option or if the highest-grade steels are already used in commercially 
available ballasts. NEEA was generally in support of the 13 selected 
design options and DOE's decision to not screen any of them further. 
However, NEEA did comment that if higher-grade electrical steels are 
already being utilized in the baseline efficiency ballasts, this may 
limit DOE's ability to apply ``improved core steel'' as a design option 
for improving efficiency. (NEEA, No. 31 at p. 4) DOE agrees that some 
ballasts available on the market today already use some of the highest 
grades of grain-oriented core steel available. For example, DOE has 
received feedback that 175 W magnetic ballasts typically require M6 
steel, a high-grade, grain-oriented steel, to reach 88 percent, the 
minimum EISA 2007 requirement. (Philips, Public Meeting Transcript, No. 
33 at p. 69-70) However, through manufacturer interviews, DOE has 
learned that there exists significant opportunity for improvement in 
the steels used for other wattage ballasts. Therefore, DOE continues to 
consider higher-grade, grain-oriented silicon steel as a design option 
to improve magnetic ballast efficiency.
    ASAP commented that DOE should evaluate the efficiency potential of 
using amorphous steel in cores for the highest efficiency levels 
analyzed. (ASAP, Public Meeting Transcript, No. 33 at pp. 68-69) 
Conversely, NEMA stated that amorphous steel is neither technologically 
feasible nor practicable to manufacture for any HID ballast, including 
metal halide ballasts. NEMA commented that distribution transformers 
are linear devices that have relatively simpler core configurations. In 
contrast, metal halide ballasts are non-linear devices that require 
specific flux leakages and wave shaping. These unique characteristics 
are achieved through reconfiguring flux pathways within the metal 
halide ballast by using flux choke points and leakage paths between the 
primary and secondary circuits. NEMA explained that these manipulations 
of the core are extremely difficult with relatively brittle amorphous 
steel without causing fractures. (NEMA, No. 34 at p. 12) Based on this 
feedback and the lack of any commercially available metal halide 
ballast or prototype that utilizes amorphous steel cores, DOE proposes 
to screen out amorphous steels within the ``improved core steel'' 
design option due to the impracticability to manufacture at the scale 
necessary to serve the relevant market.
    NEMA also commented that commercially available electronic ballasts 
already utilize the high-quality components. (NEMA, No. 34 at p. 12) 
Based on its teardown analysis and assessment of the components in 
commercially available metal halide electronic ballasts, DOE concurs 
with NEMA that these ballasts generally use low-loss components. 
However, as discussed in section V.C, DOE found a range of efficiencies 
commercially available for electronic ballasts. As these efficiency 
differences were, at least in part, due to variations in components 
used, DOE believes that ``improved components'' is a valid design 
option and continues to consider it in the engineering analysis.

C. Engineering Analysis

1. Approach
    The engineering analysis develops cost-efficiency relationships 
depicting the fixture manufacturing costs of achieving increased 
ballast efficiency. DOE applies two methodologies to estimate 
manufacturing costs for the engineering analysis: (1) The design-option 
approach, which provides the incremental costs of adding the design 
options (e.g., improved core steels) discussed in section V.B to 
improve the efficiency of a baseline model; and (2) the efficiency-
level approach, which estimates the costs of achieving increases in 
energy efficiency levels, through ballast efficiency testing and 
teardowns, without regard to the design options used to achieve such 
increases. Details of the engineering analysis are in chapter 5 of the 
NOPR TSD. The following discussion summarizes the general steps of the 
engineering analysis:
    Determine Representative Equipment Classes. When multiple equipment 
classes exist, to streamline testing and analysis, DOE selects certain 
classes as ``representative'' primarily because of their high market 
volumes. DOE then adapts the efficiency levels (ELs) from 
representative equipment classes to those equipment classes it does not 
analyze directly.
    Determine Representative Wattages. Within each representative 
equipment class, DOE also selects a particular wattage fixture as 
``representative'' of the wattage range, primarily because of their 
high market volumes. In this NOPR, DOE assigns only one representative 
wattage per representative equipment class.
    Representative Fixture Types. To calculate the typical cost of a 
fixture at each representative wattage, DOE selects certain types of 
fixtures to analyze as representative.
    Select Baseline Units. DOE establishes a baseline unit for each 
representative wattage. The baseline unit has attributes (circuit type, 
input voltage capability, electronic configuration) typical of ballasts 
used in fixtures of that wattage. The baseline unit also has the lowest 
(base) efficiency for each equipment class. DOE measures changes 
resulting from potential amended energy conservation standards compared 
with this baseline. For fixtures subject to existing Federal energy 
conservation standards, a baseline unit is a metal halide lamp fixture 
with a commercially available ballast that just meets existing 
standards. If no standard exists for a fixture, the baseline unit is 
the metal halide lamp fixture with a ballast within that equipment 
class with the lowest tested ballast efficiency that is sold. To 
determine energy savings and changes in price, DOE compares each higher 
energy-efficiency level with the baseline unit.
    To determine the ballast efficiency, DOE tested a range of metal 
halide ballasts from multiple ballast manufacturers. Appendix 5A of the 
NOPR TSD presents the test results. In some cases, DOE selects more 
than one baseline for a representative wattage to ensure consideration 
of different fixture and ballast types and their associated customer 
economics.
    Select More Efficient Units. DOE selects commercially available 
metal halide lamp fixtures with higher-than-baseline-efficiency 
ballasts as replacements for each baseline model in each representative 
equipment class. In general, DOE can identify the design options 
associated with each more-efficient ballast model by considering the 12 
design options identified in the technology assessment (chapter 3 of 
the NOPR TSD) and screening analysis (chapter 4 of the NOPR TSD). Where 
design options cannot be identified for that class by the product 
number or catalog description, DOE uses a database

[[Page 51491]]

of commercially available ballasts. DOE then tests these ballasts to 
determine their efficiency. Appendix 5A of the NOPR TSD presents these 
test results. All ballast efficiencies were calculated according to the 
metal halide ballast test procedures (10 CFR 431.324) unless otherwise 
specified. DOE estimates the design options likely to be used in the 
ballast to achieve a higher efficiency based on information gathered 
during manufacturer interview and information presented in ballast 
catalogs.
    Determine Efficiency Levels. DOE develops ELs based on: (1) The 
design options associated with the equipment class studied and (2) the 
maximum technologically feasible (max tech) efficiency level for that 
class. As just noted and as discussed in section IV.B.2, DOE's 
efficiency levels are based on catalog data, test data collected from 
commercially available equipment, and manufacturer input.
    Conduct Price Analysis. DOE generated a bill of material (BOM) by 
disassembling multiple manufacturers' ballasts from a range of 
efficiency levels and fixtures that span a range of applications for 
each equipment class. The BOMs describe the equipment in detail, 
including all manufacturing steps required to make and/or assemble each 
part. DOE then developed a cost model to convert the BOMs for each 
representative unit into manufacturer production costs (MPCs). By 
applying derived manufacturer markups to the MPCs, DOE calculated the 
manufacturer selling prices \27\ and constructed industry cost-
efficiency curves. In cases where DOE was not able to generate a BOM 
for a given ballast, DOE estimated an MSP based on the relationship 
between teardown data and retail data. DOE also estimated ballast and 
fixture cost adders necessary to allow replacement of more efficient 
substitutes for baseline models.
---------------------------------------------------------------------------

    \27\ The MSP is the price at which the manufacturer can recover 
all production and non-production costs and earn a profit. Non-
production costs include selling, general, and administration (SG&A) 
costs, the cost of research and development, and interest.
---------------------------------------------------------------------------

2. Representative Equipment Classes
    As described above, DOE selects certain equipment classes as 
``representative'' to focus its analysis. The 20 equipment classes 
proposed in this NOPR (based on rated lamp wattage, test voltage, and 
indoor or outdoor designation) and the criteria used for development 
are presented in section V.A.2. Due to their low shipment volume (as 
indicated through manufacturer interviews), DOE does not directly 
analyze the equipment classes containing only fixtures with ballasts 
tested at 480 V. DOE selected all other equipment classes as 
representative, resulting in a total of ten representative classes 
covering the full range of lamp wattages, as well as indoor and outdoor 
designations.
3. Representative Wattages
    In the preliminary analysis, DOE selected four representative rated 
wattages of fixtures (70 W, 250 W, 400 W, and 1000 W) to analyze in the 
engineering analysis. Each representative wattage was typically the 
most commonly sold wattage within each equipment class, based on 
analysis of fixture availability from catalogs and manufacturer input. 
DOE received several comments relating to the criteria for 
representative wattage selection, as well as recommendations to change 
specific wattages analyzed in the preliminary analysis. Also, because 
of the addition of the 101 W to 150 W equipment classes (discussed in 
section V.A.2), DOE proposes to add an additional representative 
wattage at 150 W. These comments and proposed changes are discussed 
further below.
    In general, NEMA recommended that DOE use the lowest-rated-wattage 
ballast to propose energy efficiency levels and the most prevalent 
model within a class to determine the volume of shipments. NEMA 
explained that the highest attainable efficiency for a rated wattage 
range is determined by the lowest-rated-wattage ballast, while in many 
cases that equipment may not represent the highest volume. OSI 
explained that the ballast losses (power dissipated within the ballast) 
in a lower-rated-wattage ballast represent a higher percentage of the 
total system wattage, thus resulting in lower efficiencies at lower 
rated powers. In particular, NEMA, OSI, and NEEA disagreed with the 
choice of the 250 W fixture as the representative wattage for the 150 W 
to 250 W equipment class, recommending instead 175 W as a more 
appropriate wattage due to its high market share. (OSI, Public Meeting 
Transcript, No. 33 at p. 54; NEEA, No. 31 at p. 4; OSI, No. 27 at p. 3; 
NEMA, No. 34 at p. 13)
    DOE recognizes that lower-rated-wattage ballasts will have lower 
efficiencies than higher-rated-wattage ballasts. To account for this 
effect in the NOPR, as discussed in section V.C.9, DOE is proposing to 
use equations for each wattage range to define minimum efficiency 
requirements as a function of rated lamp wattage. This equation-based 
approach allows DOE to, in general, base its selection of 
representative wattages, and thus the resulting economic analysis, on 
the high-market-share products, while still ensuring technological 
feasibility of the entire equipment class. DOE has continued to use 250 
W as the representative wattage primarily because it is the only 
wattage in the 150 W to 250 W equipment class with a range of 
commercially available magnetic ballast efficiencies above the EISA 
2007 minimum requirements. By conducting a cost-efficiency analysis on 
250 W fixtures, DOE is able to characterize the potential energy 
savings of equipment within this class at efficiency levels below those 
characterized by electronic ballasts.
    Although 175 W fixtures may currently have high market share, DOE 
understands that EISA 2007 has caused, and may continue to cause, a 
significant shift from 175 W probe-start metal halide fixtures to the 
150 W pulse-start fixtures exempted from EISA 2007 standards. DOE 
believes that this may result in 250 W fixtures gaining market share 
(relative to 175 W fixtures) in the future. Thus, DOE believes that 250 
W is an appropriate representative wattage for analysis.
    Because of the current and projected high market share of 150 W 
fixtures exempted from EISA standards, and to match the newly proposed 
equipment class for fixtures rated from 100 W to 150 W (discussed in 
section V.A.2), DOE has decided to add a 150 W representative unit. 
Based on an assessment of commercially available fixtures and 
manufacturer interviews, DOE has come to the conclusion that 150 W 
fixtures represent the vast majority of the equipment class and, 
therefore, believes it to be an appropriate representative wattage.
    In summary, after considering the comments received and changes to 
the proposed equipment class structure, DOE has selected five 
representative wattages for analysis: 70 W, 150 W, 250 W, 400 W, and 
1000 W.
4. Representative Fixture Types
    After selecting representative wattages for analysis, DOE 
identified the applications commonly served by each equipment class's 
wattage range in order to select representative Fixture Types. Although 
DOE is evaluating ballast efficiency only as a metric for reducing MHLF 
energy consumption, DOE recognizes that technological changes in the 
ballast, specifically moving from magnetic ballasts to electronic 
ballasts, can necessitate alterations to the fixture. These changes, 
discussed in further detail in section V.C.12, often incur additional 
costs dependent on the Fixture Type that is redesigned. In the 
engineering analysis, DOE estimates a baseline fixture cost as well as

[[Page 51492]]

incremental costs to the fixture (with increasing ballast efficiency) 
based on the representative Fixture Types selected.
    For the preliminary analysis, DOE selected one to three 
representative Fixture Types for each rated wattage range. For wattages 
less than 150 W, DOE selected canopy fixtures as the representative 
Fixture Types. For wattages from 150 W to 250 W, DOE identified three 
representative fixture types: canopy, low-bay, and wallpack. For 
wattages greater than 250 W, DOE chose canopy, flood, and high-bay 
fixtures as representative fixture types.\28\ Georgia Power commented 
that DOE should consider post tops as a representative fixture for 150 
W fixtures. (Georgia Power, No. 28.1 at p. 2) During metal halide lamp 
fixture manufacturer interviews, DOE requested market data on the most 
common Fixture Types sold for each wattage range analyzed. For the 
equipment class represented by the 150 W fixture, DOE did not receive 
feedback that post-tops were a large portion of that market. Instead, 
manufacturers responded that area lighting and wallpacks comprised the 
majority of the 150 W market. Thus, for this NOPR, and similar to the 
representative fixtures for the 150 W to 250 W equipment, DOE selected 
canopy, low-bay, and wallpack fixtures as representative fixture types 
for the 100 W to 150 W equipment class.
---------------------------------------------------------------------------

    \28\ Descriptions of each of these fixture types can be found in 
chapter 3 of the NOPR TSD.
---------------------------------------------------------------------------

5. Ballast Efficiency Testing
    After selecting representative wattages and fixture types, DOE 
purchased and tested a multitude of metal halide ballasts, ranging from 
low-efficiency magnetic to high-efficiency electronic, in order to 
evaluate the range of commercially available ballast efficiencies. In 
selecting units for testing and analysis, DOE focused its effort on 
representative wattage ballasts with operating characteristics similar 
to ballasts prevalent in the market. For example, through interviews 
and an assessment of commercially available products, DOE learned that 
the majority of metal halide ballasts sold are quad-input voltage 
ballasts. Thus, DOE primarily tested metal halide ballasts capable of 
quad-input or multiple-input voltage operation.
    Regarding magnetic circuit types, Progress Energy Carolinas 
commented that there is wide variation between magnetic operating 
characteristics of the different magnetic ballast types, such as 
regulated, magnetic regulated, CWA, reactor, and high-power-factor 
reactor. They suggested that DOE study this issue further to ensure 
proper selection of representative units for analysis. (Progress Energy 
Carolinas, No. 24 at p. 2) In response, DOE has investigated the 
technical differences between magnetic circuit types and provides its 
assessment in Chapter 3 of the NOPR TSD. In addition, through an 
assessment of commercially available products and manufacturer 
interviews, DOE has learned that at low wattages (less than or equal to 
150 W), high reactance autotransformer (HX-HPF) ballasts and CWA 
ballasts are most prevalent. At higher wattages, CWA ballasts compose 
the vast majority of the market. In consideration of these findings, 
DOE focused its testing and analysis on HX-HPF and CWA ballasts for the 
70 W and 150 W representative units and CWA ballasts for all other 
wattage units.
    Average ballast efficiencies (across four samples) were determined 
in accordance with metal halide ballast test procedures (10 CFR 
431.324) by dividing measured output power by measured input power. As 
discussed in sections V.C.7 and V.C.8, DOE selects baseline and higher-
efficiency representative units for analysis based on these average 
efficiencies. Also, as discussed in the following section, DOE 
determines representative ballast input power for each efficiency level 
based on these tested ballast efficiencies. To determine the efficiency 
levels under consideration, as discussed in section V.C.9, DOE uses a 
reported efficiency value based on the four tested samples, pursuant to 
the metal halide ballast certification procedures in 10 CFR 429.54.
6. Input Power Representations
    In the preliminary analysis, ballast input powers for use in the 
downstream analyses (such as the LCC and NIA analyses) were normalized 
such that the ballast outputted the rated lamp input power by dividing 
rated lamp wattage by measured ballast efficiency. In response, NEMA 
commented that ballast efficiency should not be calculated based on 
rated lamp power and input power. They remarked that not all ballasts 
operate lamps at their rated wattages and, thus, these ballasts could 
appear to have higher efficiencies than technologically feasible if 
this method is used. (NEMA, No. 34 at p. 13)
    To clarify, DOE is not calculating ballast efficiencies based on 
rated lamp powers. Rather, DOE is using measured ballast efficiencies 
and rated lamp output to calculate normalized input powers for the 
downstream energy-use analyses. Although DOE's test results indicate 
slight variations in ballast output power relative to rated lamp power 
from unit to unit, based on the marketing of these ballasts, DOE 
concludes that the metal halide ballasts tested are generally designed 
to operate lamps at their rated wattages. DOE believes these variations 
(on the order of three percent of the rated lamp power) are unlikely to 
significantly affect average ballast efficiency. In this NOPR, DOE 
continues to utilize normalized input powers in order to best 
characterize the energy use of all products that meet a particular 
efficiency level and to eliminate any artifacts due to the particular 
model chosen.
    Additionally, OSI noted that the system wattage of magnetic 
ballasts increases up to 11 percent over lamp life. In contrast, 
electronic ballasts do not exhibit this behavior and, thus, have lower 
energy use relative to a magnetic system of the same efficiency when 
considering operation over the lifetime of the lamp. (OSI, No. 27 at p. 
7) DOE's research indicates that as metal halide lamps age, they 
require higher voltages. Electronic ballasts have the capability to 
sense that the lamp voltage has increased and, in response, decrease 
their output current to maintain constant wattage throughout the life 
of the ballast. The CA IOUs also noted that electronic ballasts can 
improve lamp efficacy and lumen maintenance, resulting in higher mean 
rated lumens over the lifetime of the lamp. The CA IOUs urged DOE to 
consider scenarios where either reduced-wattage lamps or fewer (but 
more luminous) total fixtures can be used with electronic ballasts to 
capture even greater energy savings while maintaining the same mean 
system light output as the baseline system. (CA IOUs, No. 32 at p. 4)
    DOE accounted for the increase in wattage for magnetic ballasts by 
using a multiplier when calculating magnetic efficiencies. DOE assumed 
that magnetic ballasts' wattage increase occurs in a linear fashion 
over the life of the ballast. With this assumption, the ballast would 
average a 5.5 percent increase in output wattage over its lifetime. 
Therefore, DOE multiplied the rated lamp wattage by 1.055 when 
calculating the input power normalized to rated lamp power for all 
magnetic ballasts, but not for electronic ballasts. To investigate 
electronic ballast lumen maintenance, DOE reviewed lamp and ballast 
manufacturer product information, but did not find a consistent 
description of the impact of an electronic ballast on lumen 
maintenance. Based on the limited information and uncertainty of the 
potential impacts, DOE is not proposing an adjustment to electronic 
ballast input power to account for improved lumen

[[Page 51493]]

maintenance relative to magnetic ballast operation. DOE requests 
comment on using a 5.5 percent increase when calculating the 
representative input power of magnetic ballasts.
7. Baseline Ballast Models
    DOE selected baseline models as reference points for each 
representative equipment class, against which DOE measured changes in 
energy use and price resulting from potential amended energy 
conservation standards. For metal halide lamp fixtures and ballasts 
subject to existing Federal energy conservation standards, a baseline 
model is a commercially available ballast that just meets existing 
standards and provides basic consumer utility. If no standard exists 
for a specific fixture type (e.g., less than 150 W or greater than 500 
W fixtures), DOE chooses baselines that represent lowest efficiency 
products (based on average test ballast efficiencies) or highest-volume 
products within the representative parameters defined (e.g., 
representative wattage, magnetic circuit type, input voltage). For the 
preliminary analysis, DOE analyzed a CWA, quad-input voltage, pulse-
start baseline ballast for each of the 70 W, 250 W, 400 W, and 1000 W 
representative wattages. As DOE received no adverse comment to the 
selection of the 70 W, 250 W, and 400 W baselines, DOE continues to use 
the same baseline ballasts for the NOPR. The following paragraphs 
discuss changes to the 1000 W baseline and the additions of a second 70 
W baseline and a new 150 W baseline.
a. 70 W Baseline Ballast
    In the preliminary analysis, DOE analyzed a single 70 W magnetic 
ballast with an efficiency of 72.0 percent as the baseline unit. 
However, through manufacturer interviews, DOE has learned that 
electronic ballasts compose a significant portion (estimated as more 
than 25 percent) of the >=50 W and <=100 W ballasts shipped with indoor 
fixtures. Therefore, for this NOPR, DOE has added an electronic 
baseline ballast for analysis. This ballast utilizes an LFE circuit, 
operates at quad-voltage, and has an efficiency of 88.0 percent. DOE 
requests comment on the addition of this electronic 70 W baseline 
ballast.
150 W Baseline Ballast
    As discussed earlier, to analyze the new equipment classes with a 
rated wattage range of 100 W to 150 W, DOE has added a 150 W 
representative unit to its analysis. Through market research and 
ballast efficiency testing, DOE has determined that both CWA and HX-HPF 
ballasts are common at the 150 W level. Based on test results, DOE 
found the lowest efficiency ballast that could be incorporated into a 
fixture exempt from EISA 2007 standards was a magnetic pulse-start, 
quad-voltage CWA ballast with an efficiency of 81.2 percent, and, thus, 
analyzed this ballast as a baseline.
1000 W Baseline Ballast
    In the preliminary analysis, DOE selected a 1000 W CWA, quad-input 
voltage, magnetic, pulse-start ballast with an efficiency of 91.8 
percent as a baseline for the >500 W equipment class. Since publication 
of the preliminary analysis, DOE has learned that although pulse-start 
ballasts are available at the 1000 W level, probe-start, CWA, quad-
voltage units predominate in this wattage category, and are, therefore, 
more appropriate baselines. Because DOE's analysis indicates that 
ballast efficiency is not affected by starting method, DOE created a 
probe-start baseline by utilizing the same baseline ballast efficiency 
(91.8 percent) and applying a manufacturer production cost 
representative of a probe-start ballast. DOE further discusses the 
derivation of manufacturing production costs in section V.C.12 of this 
NOPR and in chapter 5 of the NOPR TSD.
8. Selection of More Efficient Units
    After selection of baseline models, DOE used a combination of two 
methods to determine more efficient units for analysis within each 
representative equipment class. The first method was by examining DOE's 
own test data (discussed in section V.C.5) to select commercially 
available ballasts to represent higher efficiency levels. The second 
method involved filling in large gaps of efficiency present in the test 
data (often between commercially available magnetic and electronic 
ballasts) through estimating efficiency increases due to the 
implementation of several of the design options described in section 
V.B. DOE derived those estimates based on manufacturer interviews and 
by validating or supplementing that input with independent modeling of 
potential reductions in losses. Specifically, DOE used the watts loss/
pound characteristics for various steel types and the resistive losses 
for various winding materials to determine the levels of efficiency 
modeled ballasts could achieve. In modeling more efficient magnetic 
ballasts, DOE maintained the physical size of the higher-efficiency 
models relative to commercially available products within the 
representative wattages. DOE seeks comment on whether features or 
consumer utility of the ballasts such as the physical size, including 
footprint, stack height, and weight can be maintained or if they would 
be adversely affected for the magnetic ballast efficiencies associated 
with the modeled ballasts.
    In summary, for the NOPR, DOE developed a maximum technologically 
feasible magnetic ballast based on either commercially available 
equipment (for the 1000 W level) or a modeled ballast (for other 
representative wattages) that utilizes the highest grade steels 
practicable for manufacturing metal halide ballasts. DOE also developed 
a maximum technologically feasible electronic ballast (which also 
serves to represent the maximum technologically feasible level overall) 
for the 70 W, 150 W, 250 W, and 400 W representative wattages. To 
determine this level, DOE conducted a survey of the MHLF market and the 
research fields that support the market. DOE concluded that, within a 
given equipment class, no working prototypes exist that have a 
distinguishably higher ballast efficiency than currently available 
electronic ballasts. As such, the highest-efficiency units analyzed in 
the engineering analysis represent the most efficient tier of 
commercially available equipment. For further details on the higher-
efficiency units analyzed in the NOPR, see chapter 5 of the NOPR TSD.
    DOE received several comments, discussed below, on the higher-
efficiency magnetic and electronic units analyzed in the preliminary 
analysis.
a. Higher-Efficiency Magnetic Ballasts
    NEMA noted that magnetic ballasts are already as efficient as 
possible while still being cost-effective, and further changes to their 
designs could make them cost-prohibitive and not physically feasible 
for use in current products. In particular, NEMA stated that 150 W 
magnetic ballasts only exist on the market due to their current 
exemption from standards, and to make them any more efficient would 
involve a size increase and redesign. (NEMA, No. 34 at p. 7, 13-14) 
Similarly, Philips stated that 88 percent efficiency is the highest 
possible efficiency for 175 W magnetic ballasts, but it is not 
achievable for lower-wattage magnetic ballasts. (Philips, Public 
Meeting Transcript, No. 33 at pp. 69-70)
    On the other hand, the CA IOUs recommended that DOE re-examine the 
maximum technologically feasible efficiency for magnetic ballasts. They 
noted that according to the CEC database, 12 fixtures (at the 
representative 400 W level) listed by

[[Page 51494]]

manufacturers in 2010 used magnetic ballasts that claimed 93 percent or 
higher ballast efficiency, which significantly more efficient than 
DOE's highest magnetic ballast analyzed. (CA IOUs, No. 32 at p. 5-6)
    As discussed in the screening analysis (section V.B), DOE 
recognizes that several commercially available magnetic ballasts (such 
as the 175 W 88-percent efficient ballast) may already utilize the 
highest efficiency design options and have reached their efficiency 
limits. However, based on feedback from manufacturer interviews, DOE 
has learned that for each of the representative wattages analyzed, 
there exist design options to improve efficiency. Therefore, DOE 
utilizes these design options to estimate the maximum technologically 
feasible efficiency for magnetic ballasts for each representative 
wattage. DOE does account for efficiency limits of non-representative 
wattages by creating efficiency-level equations (dependent on rated 
wattage) for each equipment class. In response to the CA IOUs comment, 
DOE reviewed the CEC database, but was unable find any of the more-
efficient 400 W ballasts available for purchase. As DOE was unable to 
test these ballasts and confirm their higher efficiencies, DOE could 
not include them in this analysis.
b. Electronic Ballasts
    In the preliminary analysis and in this NOPR, DOE analyzed 
electronic ballasts as higher-efficiency replacements to magnetic 
ballasts and based max tech efficiencies on commercially available 
electronic ballasts independently tested by DOE. In response to those 
efficiencies, DOE received several comments, discussed below, regarding 
the appropriate electronic max tech efficiencies, use of high-frequency 
electronic ballasts as representative units of analysis, and whether 
electronic ballasts should be considered the maximum technologically 
feasible level for 1000 W ballasts.
Maximum Technologically Feasible Efficiencies
    Regarding the maximum technologically feasible efficiency of 
electronic ballasts, OSI stated that their commercially available 
ballasts represent the current max tech. Any further increases in 
efficiency would be theoretical and not proven through actual 
performance. (OSI, No. 27 at p. 5) In contrast, the CA IOUs noted that 
the CEC database contains several electronic ballasts from 
manufacturers such as Metrolight and Advance with efficiencies 
significantly higher than those identified as max tech. The CA IOUs 
encouraged DOE to revisit maximum achievable efficiencies for each 
equipment class and technology option. (CA IOUs, No. 32 at p. 5-6)
    As DOE does not have any indication electronic ballast efficiency 
can exceed that which is currently commercially available, DOE agrees 
with OSI's assessment that any efficiency improvement above 
commercially available electronic ballasts would be widely speculative. 
Therefore, all of the max tech levels proposed by DOE reflect existing 
commercially available ballasts. DOE has attempted to purchase and test 
the highest-efficiency ballasts, as determined through catalog rated 
efficiencies and the CEC metal halide lamp fixture database. Thus, DOE 
believes that its max tech electronic ballast efficiencies represent 
the highest efficiencies that are commercially available and validated 
by independent testing in accordance with DOE's metal halide ballast 
test procedures.
High-Frequency Electronic Ballasts
    In the preliminary analysis, the maximum technologically feasible 
level for 400 W fixtures was based on a high-frequency electronic 
ballast. DOE requested comment on the appropriateness of using high-
frequency electronic ballasts as representative units, particularly 
with respect to lamp and ballast compatibility concerns.
    In response, OSI, Philips, and NEMA opposed regulatory requirements 
obtainable only with high-frequency electronic ballasts. While they 
recognized that high-frequency electronic ballasts can have higher 
efficiencies, they noted that their test measurements also have a 
significantly higher degree of error (as high as five percent) than 
those obtained with low-frequency ballasts. OSI and NEMA argued that if 
DOE establishes standards based on high-frequency technology, this 
increased variation should be accounted for. In addition, all three 
stakeholders remarked that high-frequency electronic ballast technology 
is often not compatible with the most efficacious systems, specifically 
noting their incompatibility with ceramic metal halide lamps, which 
represent the highest efficacy, best lumen maintenance, and longest 
life of metal halide lamps. (Philips, Public Meeting Transcript, No. 33 
at p. 34, 62-63; OSI, No. 27 at p. 4; NEMA, No. 34 at p. 14) While 
acknowledging that there are some lamp and ballast compatibility 
concerns, Empower Electronics stated that high-frequency ballasts can 
be more efficient and should be used as a representative unit. (Empower 
Electronics, No. 36 at p. 8)
    In response, DOE has researched product application notes in 
catalogs and technical literature regarding lamp compatibility with 
high-frequency ballasts. Based on this research, DOE agrees that due to 
acoustic resonance issues, high-frequency ballasts may have significant 
compatibility problems with some high-efficacy metal halide lamps, 
thus, reducing potential energy savings at those levels. Although DOE 
maintains high-frequency electronic ballasts as a valid design option 
to improve ballast efficiency, DOE will take the impact of lamp and 
ballast compatibility into account when adopting any amended standards.
    Acuity also commented that high-frequency ballasts are less 
reliable in outdoor applications because ambient temperature and power 
quality effects. (Acuity, Public Meeting Transcript, No. 33 at p. 63) 
DOE is considering in this NOPR (discussed in section V.C.12) fixture 
redesigns (accounting for increased thermal management and voltage 
transient suppression) and corresponding incremental costs incurred as 
a result of implementing electronic ballasts in outdoor applications. 
DOE has not found evidence of any difference between high-frequency and 
low-frequency electronic ballasts in this regard. DOE requests 
clarification on whether high-frequency electronic ballasts require 
additional thermal and transient protection relative to low-frequency 
electronic ballasts. If so, DOE requests comment on technical reasons 
for this difference and whether ballast or fixture redesigns can 
overcome these barriers.
1000 W Electronic Ballasts
    In the preliminary analysis, DOE analyzed only magnetic ballasts as 
higher efficiency replacements for the 1000 W baseline unit and 
requested comment on whether 1000 W electronic metal halide ballasts 
are technologically feasible. Philips and OSI stated that 1000 W 
electronic ballasts only exist in niche applications, with no ballasts 
in general lighting or area lighting. Even though 1000 W electronic 
ballasts are commercially available, Philips pointed out that these 
ballasts do not have a significant efficiency improvement over the 
magnetic ballasts at that wattage, but may be preferred for 
technological reasons (e.g., in high definition TVs). (Philips, Public 
Meeting Transcript, No. 33 at pp. 63-64; OSI, No. 27 at p. 5) NEEA also 
recommended that DOE analyze only magnetic ballasts at 1000 W. (NEEA, 
No. 31 at p. 4) DOE's research has confirmed that the 1000 W electronic 
ballasts on the market today appear to be for specialized functions,

[[Page 51495]]

such as hydroponics and aquariums, rather than general illumination 
applications. Because these fixtures may have unique thermal 
characteristics, DOE cannot be certain that incorporating 1000 W 
electronic ballasts into general lighting fixtures is technologically 
feasible. Thus, DOE does not consider electronic ballasts as higher 
efficiency replacements for 1000 W magnetic ballasts.
9. Efficiency Levels
    Based on the higher-efficiency ballasts selected for analysis, 
discussed in section V.C.8, DOE developed four efficiency levels for 
the 70 W, 150 W, 250 W, and 400 W representative wattages. Due to the 
fact that DOE did not analyze electronic ballasts for the 1000 W 
representative wattages, DOE analyzes only two efficiency levels for 
this wattage. The baseline of each representative equipment class 
represents the lowest-efficiency commercially available magnetic 
ballast covered by these standards. EL1 represents a moderately higher 
efficiency magnetic ballast, and EL2 represents the maximum 
technologically feasible magnetic ballast. EL1 and EL2 are 
characterized by a combination of commercially available and modeled 
magnetic ballasts. EL3 represents the lowest-efficiency commercially 
available electronic ballast, and EL4 represents the maximum 
technologically feasible level for all ballasts incorporated into metal 
halide lamp fixtures.
    In the preliminary analysis, DOE considered both binned and 
equation-based approaches to defining efficiency levels within wattage 
ranges. In a binned approach, DOE would set the same standard for all 
wattages within an equipment class. In an equation-based approach, DOE 
would define equations that relate rated lamp wattage to ballast 
efficiency such that different wattages within an equipment class would 
be subject to different efficiency requirements. For the preliminary 
analysis, DOE analyzed setting standards based on a binned approach and 
received several comments in response to this decision.
    Philips noted that there is significant change in ballast 
efficiency throughout the 150 W to 250 W range, with a definite trend 
for higher efficiency as the wattage increases up to 500 W. (Philips, 
Public Meeting Transcript, No. 33 at pp. 55, 66) Philips suggested that 
efficiencies in the 150 W to 250 W range could benefit from further 
delineation, perhaps in the form of a formula approach. (Philips, 
Public Meeting Transcript, No. 33 at p. 47) Based on manufacturer 
comments at the preliminary analysis public meeting, NEEA supported the 
proposal to either divide the 150 W to 250 W range into two classes, or 
develop efficiency levels in the form of wattage-based equations. 
(NEEA, No. 31 at pp. 3-4)
    In contrast, OSI did not recommend using an equation-based approach 
for efficiency levels. They commented that having a known, fixed 
efficiency requirement allows manufacturers to more easily redesign 
their ballasts to incorporate additional features (such as dimming or 
120 V tap). (OSI, No. 27 at p. 4)
    After considering all of the comments, DOE agrees with Philips and 
NEEA that an equation-based approach for efficiency levels would be 
most appropriate, as it allows DOE to account for changes in efficiency 
across a rated wattage range. In addition, this approach ensures that 
efficiency levels for all wattages, even those not analyzed as 
representative, are technologically feasible. To develop the equation 
forms and efficiency trends for each wattage range, DOE utilized its 
own efficiency test data as well as catalog efficiency data. The 
discussion below describes the equations used in each wattage bin. For 
further details, see chapter 5 of the NOPR TSD.
    For the two lowest wattage bins, which consist of 50 W to 150 W 
ballasts, DOE used its own test data as well as efficiency trends 
according to catalog data to generate separate power-law best fits for 
magnetic (EL1 and EL2) and electronic ballasts (EL3 and EL4).
    The next wattage bin consists of 150 W ballasts, excluding the 
currently exempted 150 W, up through and including 250 W ballasts. 
Because EISA 2007 covered equipment in this wattage bin, DOE can only 
evaluate efficiencies equal to or above the existing standards to avoid 
backsliding. Manufacturers stated during interviews that 150 W magnetic 
ballasts could not be designed to meet 88 percent and that 175 W 
ballasts only reached 88 percent by using the high-grade-score steel 
and increasing the ballast's footprint. DOE's test data also indicated 
that there are no 150 or 175 W magnetic ballasts available that exceed 
88 percent efficiency. Though DOE did not test any 200 W ballasts, a 
review of catalog data indicates that 200 W ballasts are only available 
at 88 percent efficiency. Because DOE has no specific information 
indicating that these ballasts can be designed to be more efficient, 
DOE assumed that 88 percent is also the max tech magnetic ballast 
efficiency for wattages up through 200 W. Thus, DOE maintained the EISA 
2007 efficiency requirement of 88 percent for ELs designed to represent 
levels met by magnetic ballasts. DOE did not have any information about 
the achievable efficiencies for ballasts >200 W and <250 W, as products 
in this range are not commercially available. Therefore, DOE gradually 
increased the magnetic efficiency levels (EL1 and EL2) between 200 W 
and 250 W ballasts using a linear trend from 88 percent to the 
efficiency of the EL1 and EL2 250 W representative units. For the 
electronic ballast efficiency levels (EL3 and EL4), DOE continued the 
power-law function fit from the 50 to 150 W range up to 250 W.
    The next wattage bin consists of ballasts higher than 250 W up 
through and including 500 W. Because the 250 W and 400 W magnetic 
representative units at EL1 and EL2 have the same efficiency and 
utilize similar design options, DOE created a flat efficiency 
requirement for magnetic ballasts within this wattage bin. For the 
electronic ballast efficiency levels (EL3 and EL4), DOE continued the 
power-law function fit from the 250 to 500 W range up through 500 W.
    The highest wattage bin consists of ballasts higher than 500 W up 
through and including 2000 W. DOE examined catalog data for market 
availability and found no electronic ballasts for general lighting 
applications in this wattage range. Manufacturer feedback confirmed 
that there are no electronic ballasts for general lighting applications 
commercially available above 500 W. Thus, there are two only efficiency 
levels at the highest wattage range rather than four. DOE used a linear 
fit for ballasts above 500 W through 1000 W after examining the 
efficiency trends within manufacturers' product lines in this wattage 
bin. DOE fit the linear trend from the previous wattage bin's 500 W 
efficiencies at efficiency levels 1 and 2 through the representative 
units at 1000 W. However, due to the lack of test data and limited 
wattage offerings for ballasts over 1000 W, DOE could not develop a 
conclusive trend between wattage and efficiency. Thus DOE created a 
flat efficiency requirement extending from the tested efficiency of the 
1000 W representative unit to 2000 W.
    Table V.3 summarizes all of the functions and efficiencies 
describing each equipment class. DOE requests comment on the described 
efficiency levels.

[[Page 51496]]



              Table V.3--NOPR Efficiency Level Descriptions for the Representative Equipment Class
----------------------------------------------------------------------------------------------------------------
                                                                  Minimum efficiency
 Representative equipment class    Rep. wattage       EL             equation %
---------------------------------------------------------------------------------------
>=50 W and <=100 W..............  70 W..........  EL1.......         100/(1+3.90*P[caret](-0.60)) [dagger]
                                  ..............  EL2.......             100/(1+2.50*P[caret](-0.55))
                                  ..............  EL3.......             100/(1+0.60*P[caret](-0.34))
                                  ..............  EL4.......             100/(1+0.36*P[caret](-0.30))
                                                             ---------------------------------------------------
>100 W and <150 W*..............  150 W.........  EL1.......             100/(1+3.90*P[caret](-0.60))
                                  ..............  EL2.......             100/(1+2.50*P[caret](-0.55))
                                  ..............  EL3.......             100/(1+0.60*P[caret](-0.34))
                                  ..............  EL4.......             100/(1+0.36*P[caret](-0.30))
                                                             ---------------------------------------------------
>=150 W** and <=250 W...........  250 W.........  EL1.......  >=150 W and <=200 W:      >200 W and <=250 W:
                                                               88.0.                     4.0*10[caret](-2)*P +
                                                                                         80.0
                                  ..............  EL2.......  >=150 W and <=200 W:      >200 W and <=250 W:
                                                               88.0.                     7.0*10[caret](-2)*P +
                                                                                         74.0
                                                             ---------------------------------------------------
                                  ..............  EL3.......             100/(1+0.60*P[caret](-0.34))
                                  ..............  EL4.......             100/(1+0.36*P[caret](-0.30))
>250 W and <=500 W..............  400 W.........  EL1.......                         90.0
                                  ..............  EL2.......                         91.5
                                  ..............  EL3.......             100/(1+0.60*P[caret](-0.34))
                                  ..............  EL4.......             100/(1+0.36*P[caret](-0.30))
                                                             ---------------------------------------------------
>500 W and <=2000 W.............  1000 W........  EL1.......  >500 W and <=1000 W:      >1000 W and <=2000 W:
                                                               5.0*10[caret](-3)*P +     92.5
                                                               87.5.
                                  ..............  EL2.......  >500 W and <=1000 W:      >1000 W and <=2000 W:
                                                               3.2*10[caret](-3)*P +     93.1
                                                               89.9.
----------------------------------------------------------------------------------------------------------------
* Includes 150 W fixtures exempted by EISA 2007, which are fixtures rated only for 150 watt lamps; rated for use
  in wet locations, as specified by the National Electrical Code 2002, section 410.4(A); and containing a
  ballast that is rated to operate at ambient air temperatures above 50[deg] C, as specified by UL 1029-2001.
** Excludes 150 W fixtures exempted by EISA 2007, which are fixtures rated only for 150 watt lamps; rated for
  use in wet locations, as specified by the National Electrical Code 2002, section 410.4(A); and containing a
  ballast that is rated to operate at ambient air temperatures above 50[deg] C, as specified by UL 1029-2001.
[dagger] P is defined as the rated wattage of the lamp the fixture is designed to operate.

    As discussed in section V.C.5, DOE used a reported efficiency value 
based on the four tested samples, pursuant to the metal halide ballast 
certification procedures in 10 CFR 429.54, to describe its 
representative units and to develop the ELs. DOE invites comment on 
whether any adjustments to the ELs are necessary to account for sources 
of variation not captured by the reporting requirements of 10 CFR 
429.54.
10. Design Standard
    In the preliminary TSD, DOE considered a design standard that would 
prohibit the sale of probe-start ballasts in newly sold fixtures. DOE 
notes that under 42 U.S.C. 6295(hh)(4), DOE is permitted to set an 
energy efficiency standard based on both design and performance 
requirements. EISA prescribed probe-start ballasts to be 94 percent 
efficient, effectively banning probe-start ballasts between 150 and 500 
W (except those 150 W ballasts exempt by EISA) based on their inability 
to meet this performance requirement. (42 U.S.C. 6295(hh)(1)(A)(ii) 
Manufacturers responded to the EISA 2007 standards by shifting their 
inventory to pulse-start ballasts, which are subject to less stringent 
standards. The following paragraphs describe comments received and 
DOE's analysis of a design standard prohibiting probe-start ballasts to 
be sold in new fixtures in these wattages.
    With regards to probe-start ballast availability, OSI, NEMA, 
Hubbell Lighting Incorporated, Venture Lighting, and NEEA also 
commented that there are no 70 W probe-start ballasts on the market. 
(OSI, Public Meeting Transcript, No. 33 at pp. 58-60; NEMA, No. 34 at 
p. 14; Hubbell, Public Meeting Transcript, No. 33 at pp. 42, 57, 59-60; 
Venture Lighting, Public Meeting Transcript, No. 33 at pp. 59-60; NEEA, 
No. 31 at p. 4) Hubbell also clarified that probe-start ballasts are 
available at wattages of 150 W and above. Hubbell stated that there are 
a few probe-start ballasts at 150 W and there are no probe-start 
ballasts at smaller wattages because the seals for the arc tubes in the 
lamps become too small to contain the third electrode needed to start 
probe-start ballasts. OSI added that when medium screw-base, low-
wattage metal halide lamps were first introduced to the market, they 
were all pulse-start. The manufacturers never made low-wattage probe-
start metal halide lamps. (Hubbell, Public Meeting Transcript, No. 33 
at pp. 58-59; OSI, Public Meeting Transcript, No. 33 at p. 59) Even 
though probe-start has become technically possible at 150 W, OSI and 
NEMA pointed out that because of EISA 2007, there are no new fixtures 
using probe-start ballasts less than 500 W, and, therefore, no probe-
start ballasts at less than 500 W on the market. (OSI, No. 27 at p. 5; 
NEMA, No. 34 at p. 15) Hubbell noted that pulse-start ballasts only 
provide 8 to 15 percent energy savings over probe-start ballasts for 
250 W and 400 W products, and anywhere from 0 to 8 percent energy 
savings over probe-start ballasts in the 1000 W class. (Hubbell, Public 
Meeting Transcript, No. 33 at p. 42-43) GE put forward one cause for 
the mistaken impression that there are probe-start ballasts at lower 
wattages: In the manufacturers' fixture catalogues, the lamp 
designation given for lower wattages is ``M,'' for metal halide. Even 
though the starting method of these lower wattage lamps is not 
explicitly labeled, they are all pulse-start. (GE, Public Meeting 
Transcript, No. 33 at p. 60) Finally, NEMA and Hubbell commented 
further that only 1000 W ballasts have a probe-start baseline. (NEMA, 
No. 34 at p. 14; Hubbell, Public Meeting Transcript, No. 33 at pp. 57-
58)

[[Page 51497]]

    DOE reexamined ballast availability in manufacturer catalogs and, 
in response to GE, was careful not to consider ``M'' designated lamps 
as probe-start. DOE determined that probe-start ballasts are only 
available at wattages above 150 W and also confirmed that there are no 
70 W probe-start ballasts currently on the market. EISA 2007 allowed 
probe-start ballasts in the 150 W to 500 W range, but set a minimum 
efficiency standard of 94 percent. None of the probe-start ballasts DOE 
found could meet this minimum efficiency level, so the standards from 
EISA 2007 essentially prohibit probe-start ballasts less than or equal 
to 500 W for use in new fixtures. However, because certain fixtures 
designed for use with lamps rated at 150 W are exempted from EISA 2007 
standards, probe-start ballasts can be used at 150 W in new fixtures. 
However, DOE's review of manufacturer catalogs indicates that probe-
start ballasts are not sold at 150 W. Therefore, the only wattage range 
in which probe-start ballasts are available for use in new fixtures is 
the greater than 500 W to 2000 W range. In this NOPR, DOE is analyzing 
the impact of a design standard that would prohibit probe-start 
ballasts from being sold in new fixtures in the greater than 500 to 
2000 W range.
    NEMA and Hubbell also commented that at that high wattage, there is 
very little to be gained from a switch to pulse-start, stating that 
1000 W probe-start ballasts are already 92 percent efficient and these 
lamp-ballast systems produce only slightly fewer mean lumens than 
pulse-start lamp-ballast systems. (NEMA, No. 34 at p. 14; Hubbell, 
Public Meeting Transcript, No. 33 at pp. 57-58) Given the absence of 
probe-start ballasts at the lower wattages, and the insignificant 
discrepancy between probe-start and pulse-start ballasts at the higher 
wattages, NEEA did not see much utility in a design standard that 
prohibits probe-start systems. (NEEA, No. 31 at p. 3) DOE notes that 
the major motivation for prohibiting probe-start ballasts is not the 
efficiency difference between the ballasts, but the decreased mean 
efficacy of probe-start lamps when compared to pulse-start lamps. Even 
a small percentage gain in mean lamp efficacy could yield energy 
savings on the order of the ballast efficiency savings calculated in 
other equipment classes.
    Progress Energy Carolinas, however, supported requiring pulse-start 
ballasts in all wattages. Yet, Progress Energy Carolinas also urged DOE 
to consider other technologies to realize significant efficiency gains 
over pulse-start. Specifically, Progress Energy Carolinas cited the 
examples of ceramic arc tube metal halide lamps and the super metal 
halide technology as seen in the Elite and Cosmopolis models from 
Philips. Progress Energy Carolinas argued that both of these measures 
improve not only efficiency, but also other operating characteristics. 
While Progress Energy Carolinas noted that the super technology may be 
sole-source, proprietary technology only available in low- to mid-range 
wattages, Progress Energy Carolinas commented that Philips may be 
willing to share the technology with others like they have offered to 
do with their fluorescent low-mercury lamp technology. (Progress Energy 
Carolinas, No. 24 at p. 2) DOE will not consider efficiency levels that 
require proprietary technology like that used in the Philips Elite and 
Cosmopolis systems. Though a company like Philips may be willing to 
share technology, DOE is unable to analyze the impacts of the agreement 
because the terms of the agreement cannot be known in advance. In this 
MHLF rulemaking, DOE has decided to only consider performance and 
design requirements that affect the ballast included in a metal halide 
lamp fixture. Therefore, DOE is not planning to consider a design 
requirement that mandates the use of ceramic metal halide lamps in new 
metal halide lamp fixtures.
    Empower Electronics disagreed with the use of a design standard, 
instead recommending that a minimum ballast-and-lamp efficiency 
standard be established regardless of design to effectively prohibit 
the use of inefficient probe-start systems. Empower Electronics 
suggested that this standard be set at 94 percent for fixtures designed 
to operate lamps rated for 250 W and above, effectively requiring 
electronic ballast technology. (Empower Electronics, No. 36 at p. 8) 
DOE notes that it is planning to consider efficiency levels that 
require electronic ballasts when determining a proposed standard. In 
addition to this consideration, DOE is also continuing to analyze a 
design standard as a possibility for a proposed standard.
    Georgia Power stated that the concept of using fewer fixtures when 
replacing existing probe-start systems with pulse-start systems may be 
practical for indoor applications, but not for outdoor uses. Currently, 
parking lots have lighting system designs that use probe-start fixtures 
at an acceptable photometric level. DOE assumes that the poles, bases 
and conductors are all in place and the investment has been made. 
Georgia Power said that using fewer pulse-start fixtures on the same 
poles at the same places will not result in the same photometric 
design. (Georgia Power, No. 28 at p. 2) In regards to setting a design 
standard requiring reduced wattage versions of lamps and the expected 
change in lumen output, Progress Energy Carolinas said that in general, 
the percent light reduction is half the percent wattage reduction. 
Progress Energy Carolinas also noted that reduced wattage pulse-start 
lamps are not currently available; instead, a reduced wattage probe-
start lamp is used as a replacement. (Progress Energy Carolinas, No. 24 
at p. 3) DOE agrees with Georgia Power that in some applications, 
changing the spacing of fixtures is not feasible. Instead, users of 
these applications may use the same number of pulse-start ballasts in 
their systems, but at reduced wattage to maintain light output. This 
customer response to a design standard is discussed in more detail in 
section V.C.10. DOE disagrees with Progress Energy Carolinas that 
reduced-wattage lamps are only available in the probe-start variety. 
DOE has found several pulse-start lamps available at reduced wattages 
such as 320 W and 875 W.
    To quantify the difference in mean lumen output of probe-start 
lamps relative to pulse-start lamps of the same wattage, DOE compared 
several major manufacturers' 1000 W lamp catalog data for these two 
lamp start types. DOE paired these lamps from the same manufacturer and 
of the same characteristics (open vs. enclosed, CRI, percentage of 
rated life at which the mean lumen value is recorded) and calculated 
the ratio of probe-start mean lumens divided by pulse-start mean 
lumens. Then, DOE averaged the ratio of each pairing from every 
manufacturer and determined that, on average, probe-start metal halide 
lamps are 5.6 percent less efficacious than comparable pulse-start 
lamps. Thus, pulse-start metal halide lamp and ballast fixtures can 
output 5.6 percent more lm/W than probe-start fixtures. Energy savings 
could be achieved in two ways. Because each pulse-start metal halide 
lamp fixture outputs 5.6 percent more lumens (for a given wattage) than 
comparable probe-start lamp fixtures, customers could:
    1. Illuminate an area to the same level with 5.6 percent fewer 
fixtures if they switch from probe-start to pulse-start; or
    2. Switch from full-wattage probe-start lamp fixtures to the same 
number of reduced-wattage pulse-start lamp fixtures, maintaining light 
output, but reducing energy consumption.
    Using fewer fixtures (option 1) would lead to reduced energy 
consumption and could save administrative and

[[Page 51498]]

maintenance costs associated with purchasing and maintaining fewer 
fixtures. However, this response to the design standard is only 
feasible in applications that have flexibility in fixture spacing. In 
some applications, such as small parking lots, changing spacing means 
moving poles and conductors, which would be expensive and could change 
the targeting of light in certain areas. For applications in which the 
height of the fixture is limited, the additional light output of a 
full-wattage pulse-start system might not be adequately distributed 
over a larger floor space (because the number of fixtures has been 
reduced) without fixture redesign.
    For customers using reduced-wattage pulse-start fixtures (option 
2), a customer could, for example, change a 1000 W probe-start fixture 
for an 875 W pulse-start fixture, maintaining light output to near the 
original level. DOE's view is that replacing probe-start lamp fixtures 
with reduced-wattage pulse-start lamp fixtures is generally more 
realistic and practical than replacing them with fewer pulse-start lamp 
fixtures because fixture spacing does not need to be changed. For this 
reason, DOE assumed reduced-wattage replacements in its analysis of a 
proposed design standard to prohibit metal halide lamp fixtures that 
use probe-start as their starting method.
    When analyzing the energy-savings impact of a design standard 
efficiency level, DOE multiplied the normalized input power of the 1000 
W ballast tested by 0.944. Because DOE determined that using the same 
number of reduced-wattage fixtures is the most likely market response 
to a design standard, DOE did not also scale the cost of a design 
standard efficiency level by 0.944. Instead, DOE assumed that reduced-
wattage systems would cost approximately the same amount as full-
wattage systems, with the exception of the addition of an igniter 
(device that provides a voltage pulse to start the lamp). In the non-
design-standard scenario, DOE assumed that the representative cost of a 
1000 W ballast would equal the cost of a probe-start ballast as this 
starting method is the most common in the greater than 500 W but less 
than or equal to 2000 W equipment classes. However, in the design-
standard scenario, an igniter would need to be added, as only pulse-
start ballasts could be included in new fixtures.
    DOE requests comment on the decision to include a design standard 
that would prohibit the sale of probe-start ballasts in newly sold 
fixtures, the proposed methods of analyzing these levels, and the 
potential for lessening of the utility or the performance through the 
prohibition of the sale of probe-start ballasts in newly sold fixtures.
11. Scaling to Equipment Classes Not Analyzed
    In the preliminary analysis, DOE analyzed all equipment classes as 
representative and, therefore, did not scale. As discussed in section 
V.C.2, DOE has added additional equipment classes for the NOPR. 
Although DOE set efficiency levels for quad-voltage ballasts directly, 
DOE did not analyze 480 V input voltage ballasts directly. Thus, it was 
necessary to develop a scaling relationship for this input voltage. To 
do so, DOE compared quad-voltage ballasts to their 480 V ballast 
counterparts using catalog data over all representative wattages at 
various efficiencies. DOE found the average reduction to ballast 
efficiency to be 0.6 percent. Thus, DOE proposes to apply this scaling 
factor to the efficiency levels for the quad-volt ballasts to determine 
the appropriate values for the 480 V ballasts. For the >=150 W to <=250 
W equipment classes, DOE made adjustments to resulting scaled equations 
to ensure all efficiency levels were more stringent than the existing 
standards (see chapter 5 of the NOPR TSD for additional detail). DOE 
requests comment on this proposal.
12. Manufacturer Selling Prices
    For the preliminary analysis, DOE developed the manufacturer 
selling prices for metal halide lamp fixtures and ballasts by 
determining a manufacturer production cost (MPC), either through a 
teardown or retail pricing analysis, and then applying a markups 
analysis to arrive at the manufacturer selling price (MSP). For further 
details on this analysis, see chapter 5 of the NOPR TSD.
    Based on stakeholder comments and manufacturer interviews, DOE 
adjusted a number of parameters in its pricing analysis for this NOPR. 
In calculating prices, DOE adjusted material prices to better reflect 
current trends based on manufacturer input and commodity prices 
research. Additionally, for this NOPR, DOE applied incremental costs to 
fixtures utilizing electronic ballasts based on application 
characteristics (indoor vs. outdoor). Finally, DOE modified its 
approach to applying manufacturer markups to align better with existing 
fixture component manufacturing channels. The following sections 
describe these changes and approaches.
a. Manufacturer Production Costs
    For the NOPR analyses, DOE conducted teardown analyses on a total 
of 32 commercially available metal halide ballasts (including four 150 
W ballasts not presented in the preliminary analysis) and eight metal 
halide lamp fixtures. Using the information from these teardowns, DOE 
summed the direct materials, labor, and overhead costs used to 
manufacture a product to calculate the MPC.\29\ In the case of 
electronic ballasts, direct material costs represent the direct 
purchase price of components (resistors, connecting wires, etc.). In 
the case of magnetic ballasts, direct material costs represent the 
purchase prices of steel laminations, copper wires, and other 
components. The direct labor costs include fabrication and assembly 
labor.
---------------------------------------------------------------------------

    \29\ When viewed from the company-wide perspective, the sum of 
all material, labor, and overhead costs equals the company's sales 
cost, also referred to as the cost of goods sold (COGS).
---------------------------------------------------------------------------

    When determining material costs, DOE used material prices based on 
a five-year average to account for the fluctuations in the prices of 
certain raw materials, such as steel and copper. Several manufacturers 
of ballasts and fixtures noted the high prices and scarcity of copper 
and high-grade steels, such as M6 steel. Philips also commented that M6 
steel is mostly manufactured in China, resulting in potential import 
difficulties. Acuity stated that volatility of material markets, 
especially in the availability and pricing of steel and copper, has 
greatly increased since the preliminary analysis. Acuity and NEMA 
suggested that DOE consider availability and price volatility of an 
improved steel core or copper wiring in their cost analysis. NEMA 
suggested that DOE factor in expected inflation and price volatility 
for materials. (Philips, Public Meeting Transcript, No. 33 at p. 71; 
Hubbell, Public Meeting Transcript, No. 33 at p. 70; NEMA, No. 34 at p. 
7, 12, 16; Acuity, Public Meeting Transcript, No. 33 at p. 132-133)
    DOE agrees that high-grade steel laminations and copper are 
materials that have seen high price fluctuations in recent years. Due 
to the uncertainty of how these prices will continue to change, DOE 
continues to use five-year average materials prices, rather than 
projected inflations, to characterize the expected cost impacts in 
years following the compliance date of the amended standards considered 
in this rule. For this NOPR, DOE updated these averages to include 2010 
price data.
    For the preliminary analysis, DOE used financial data to estimate 
the

[[Page 51499]]

overhead cost (including indirect material and labor costs, 
maintenance, depreciation, taxes, and insurance related to assets) by 
calculating it as a percentage of the MPC. NEEA noted that 
manufacturers have previously recommended that DOE apply overhead only 
to labor costs. NEEA urged DOE to ensure that this part of the analysis 
accurately reflects reality in the manufacturing world relevant to each 
rulemaking. (NEEA, No. 31 at p. 5) NEMA and OSI noted that 
manufacturing and overhead costs can vary greatly by manufacturer, 
production volume, and complexity of the product (e.g., magnetic versus 
electronic technology). NEMA stated that design and overhead costs for 
electronic ballasts are inherently higher than those for magnetic 
ballasts and require different engineering specializations. (NEMA, No. 
34 at p. 16; OSI, No. 27 at p. 5)
    DOE recognizes that manufacturing and overhead costs can vary and, 
therefore, developed separate estimates for material, labor, and 
overhead for each representative unit in the analysis. In response to 
NEEA's comment, DOE notes that because it calculates overhead from 
available financial data, it can either calculate overhead as a 
percentage of the material and labor costs, or labor costs alone. In 
either case, overhead as a percentage of net sales remains the same. 
Thus, DOE maintained its approach from the preliminary TSD by utilizing 
information available in the recent standards rulemaking for 
fluorescent lamp ballasts.\30\ In that rulemaking, DOE used financial 
data to estimate the overhead cost by calculating it as a percentage of 
the MPC. DOE estimated the depreciation cost from a representative 
electronics fabrication company's U.S. Securities and Exchange 
Commission (SEC) 10-K, and determined that it is approximately 2.6 
percent of the cost of goods sold or the MPC. To determine the material 
and labor percentage, DOE marked down aggregated confidential MSPs to 
an MPC using the manufacturer markup. Then, DOE computed the ratio of 
aggregated teardown-sourced material and labor costs to the 
manufacturer-markdown-sourced MPC. DOE found the material and labor 
costs to be approximately 93.8 percent of the MPC. DOE then subtracted 
the materials and labor and depreciation percentages from 100 percent 
to back out the remainder of overhead as a percentage of MPC. Overhead 
was estimated to be 3.6 percent of the MPC. DOE found overhead and 
depreciation to be 6.2 percent of the MPC or 6.6 percent of the 
material and labor costs. The 6.6 percent factor was then used to mark 
up the material and labor costs contained in the teardown results to 
the MPC.
---------------------------------------------------------------------------

    \30\ http://www1.eere.energy.gov/buildings/appliance_standards/product.aspx/productid/62.
---------------------------------------------------------------------------

Incremental Costs for Electronically Ballasted Fixtures
    After determining metal halide ballast MPCs and baseline fixture 
MPCs, DOE considered whether transitioning from magnetic to electronic 
ballast technology would require any further ballast or fixture design 
changes to accommodate the electronic ballast or maintain similar 
utility to the baseline magnetic ballast. In the preliminary analysis, 
DOE identified three potential sources of additional costs of switching 
from magnetic to electronic ballasts: Increasing the size of the 
fixture to accommodate the new footprint of the electronic ballast; 
increasing the heat sinking of the fixture to reduce thermal build up; 
and including voltage transient suppression for outdoor applications.
    Based on its initial evaluation, DOE did not include any of these 
incremental costs in the preliminary analysis. In response, Philips and 
Georgia Power emphasized that electronic ballasts are not direct 
replacements for magnetic ballasts due to form factor. (Philips 
Lighting Electronics, Public Meeting Transcript, No. 33 at p. 64; 
Georgia Power, No. 28 at p. 1) Georgia Power noted that redesign of 
magnetic ballast fixture housing and optics may be required to 
accommodate electronic ballasts. (Georgia Power, No. 28 at p. 1) NEEA 
did not agree that there are no fixture incremental costs associated 
with a switch to electronic ballasts. NEEA recommended that DOE derive 
some incremental cost values for the analysis, and to the extent 
possible, use a distribution of costs for the analysis, perhaps with 
zero at the bottom end. (NEEA, No. 31 at p. 5)
    While DOE agrees that fixtures may require redesign to accommodate 
a new form factor of ballast, based on its analysis of selected 
commercially available fixtures, DOE tentatively concludes that this 
redesign does not necessarily incur additional material or labor costs. 
Instead, DOE accounts for the capital conversion costs of redesigning 
fixtures in the MIA, as discussed in section V.I.2. However, for this 
NOPR, DOE further investigated three sources of potential incremental 
costs: (1) Outdoor transient protection, (2) thermal management, and 
(3) 120 V auxiliary power functionality.
Outdoor Transient Protection
    In response to the preliminary TSD, DOE received a number of 
comments indicating that electronic ballasts were unfit to be used 
outside because of their inability to withstand high voltage surges. 
Cooper commented that the ANSI standard for area and roadway lighting 
in the utility division, ANSI C62.41.1-2002, requires that outdoor 
lighting be able to withstand a voltage transient of 10 kV. (Cooper, 
Public Meeting Transcript, No. 33 at p. 78) Progress Energy Carolinas 
specified that an inline MOV (a surge-protection device external to the 
ballast) is required for electronic ballasts in outdoor fixture. 
(Progress Energy Carolinas, No. 24 at p. 3) In response, OSI and 
Empower Electronics commented that some electronic ballasts incorporate 
integral transient protection and do not require additional technology. 
(OSI, Public Meeting Transcript, No. 33 at p. 74; Empower Electronics, 
No. 36 at p. 5) Similarly, NEEA agreed that because many electronic 
ballasts have voltage transient protection built-in already, transient 
protection will not be an incremental cost in all cases. (NEEA, No. 31 
at p. 5)
    DOE recognizes the necessity for outdoor fixtures to be able to 
withstand large voltage transients, primarily due to lightning strikes. 
While metal halide fixtures with magnetic ballasts are robust and do 
not require any additional devices or enhancements to withstand these 
transients, based on its evaluation of commercially available products, 
DOE finds that fixtures with electronic ballasts usually require 
additional design features in order to have adequate protection. Some 
manufacturers indicated that a portion of their electronic ballasts 
already have 10 kV surge protection built in, but most electronic 
ballasts are only rated for 2.5-6 kV voltage spikes. Though magnetic 
ballasts are known to provide protection in excess of the 10 kV ANSI 
C62.41.1-2002 Class C rating, for this NOPR, DOE only considers the 
cost of meeting the 10 kV requirement. Through interviews and an 
assessment of commercially available voltage-transient suppressors, DOE 
developed an incremental fixture cost of $19 for 10 kV inline (external 
to the ballast) surge protection for electronically ballasted outdoor 
fixtures.
Thermal Management
    Commenters also indicated that electronic ballasts are more 
vulnerable than magnetic ballasts to high ambient temperatures, which, 
if not managed well, can cause premature ballast failure. In order to 
correct for this

[[Page 51500]]

difference, fixtures housing electronic ballasts would need to be 
redesigned to account for thermal management in both indoor and outdoor 
applications.
    NEMA expressed concern about electronic ballasts' ability to 
operate at high ambient temperatures. (NEMA, Public Meeting Transcript, 
No. 33 at p. 16) NEMA noted that while magnetic ballasts can operate at 
temperatures as high as 150 [deg]C, electronic ballasts generally 
cannot operate at temperatures exceeding 90 [deg]C. This temperature 
limit makes it impossible to place electronic ballasts in a fixture in 
the traditional location near the lamp. (NEMA, No. 34 at pp. 8-9) NEMA 
and Progress Energy Carolinas indicated that the sensitivity of 
electronics to thermal conditions requires redesign of the fixture or 
ballast, such as larger ballast housing, thermal shields, or fixture 
venting to sink the heat outside of the fixture. (NEMA, No. 34. at pp. 
8-9; Progress Energy Carolinas, No. 24 at p. 3) NEMA noted that these 
requirements add additional materials, redesigning, engineering, UL 
testing, and warranty burden costs. (NEMA, No. 34. at pp. 8-9)
    In contrast, OSI explained that electronic ballasts are more 
efficient than magnetic ballasts, and, therefore, generate less heat 
and run at cooler temperatures. OSI commented that they manufacture an 
electronic metal halide ballast with a maximum allowable case 
temperature of 90 [deg]C, and a maximum ambient temperature of 55 
[deg]C. These ballasts also use a power foldback feature to manage the 
temperature of the ballast and prevent damage to the ballast in extreme 
high-heat conditions. OSI has successfully retrofitted magnetically 
ballasted fixtures with these electronic ballasts and achieved thermal 
performance that met the requirements of their five-year warranty. 
(OSI, No. 27 at p. 2) Empower Electronics noted that several companies 
have made strides in managing thermal issues surrounding electronic 
ballasts with a maximum tolerable case temperature of 85 [deg]C. 
(Empower Electronics, No. 36 at p. 5)
    DOE agrees that because of temperature sensitivity concerns, 
manufacturers cannot directly replace a magnetic ballast with an 
electronic ballast in fixtures. Instead, the fixtures must be 
redesigned to tolerate the higher sensitivity to temperature of an 
electronic ballast. Manufacturers must design new and often larger 
brackets, and apply additional potting material to create an adequate 
thermal contact between the ballast and fixture. During interviews, 
manufacturers gave DOE information about the cost to add thermal 
management to fixtures with electronic ballasts. In aggregate, 
manufacturers indicated a 20-percent increase in fixture MPCs 
associated with thermal management. Additionally, DOE conducted 
teardown analyses of empty metal halide fixtures. Through analysis of 
pairs of fixtures designed for electronic ballasts and fixtures 
designed for comparable magnetic ballasts, DOE also found an 
approximately 20-percent increase in fixture MPCs to include thermal 
management for electronic ballasts. Accordingly, in the cost analysis 
for this rulemaking, all electronically ballasted metal halide lamp 
fixtures incur a 20-percent incremental cost to the empty fixture MPCs.
120 V Auxiliary Tap
    In manufacturer interviews, DOE learned that for indoor 
applications, a number of magnetic ballasts include a 120 V auxiliary 
tap. This output is used to operate an emergency incandescent lamp 
after a temporary loss of power and while the metal halide lamp is 
still too hot to restart. These taps, primarily used in indoor 
applications, are generally required for only one out of every ten 
indoor lamp fixtures. A 120 V tap is easily incorporated into a 
magnetic ballast due to its traditional core and coil design, and 
incurs a negligible incremental cost. Electronic ballasts, though, 
require additional design to add this 120 V auxiliary power 
functionality. Using a combination of manufacturer information and 
market research, DOE concluded that a representative value for 
electronic ballasts to incorporate this auxiliary tap is $7.50. Because 
this functionality is only needed for 10 percent of ballasts in indoor 
fixtures, that number is multiplied by 0.10 to get an incremental 
ballast cost of $0.75 per indoor ballast.
Manufacturer Markups
    The last step in determining manufacturer selling prices is 
development and application of manufacturer markups to scale the MPCs 
to MSPs. DOE developed initial manufacturer markup estimates by 
examining the annual SEC 10-K reports filed by publicly traded 
manufacturers of metal halide ballasts and metal halide lamp fixtures, 
among other products. DOE recognized that the financial information 
summarized in the 10-K reports is not usually exclusive to the metal 
halide portion of their businesses. To account for this, DOE asked 
manufacturers during interviews to comment on the calculated average 
MSP, and to provide both the manufacturer markup and manufacturer 
selling price of metal halide ballasts or metal halide lamp fixtures. 
Using this information, DOE determined in the preliminary TSD that a 
manufacturer markup of 1.47 was appropriate for both the metal halide 
ballast and fixture industries across all distribution channels.
    In the preliminary TSD, DOE assumed that fixture manufacturers 
would not apply an additional markup to the ballasts they either 
purchase or manufacture in-house. Philips commented that a manufacturer 
would not carry the overhead of manufacturing their own ballasts if 
they could realize the same overall margin by purchasing one from a 
third party. Therefore, Philips found it unreasonable to use a single 
markup on the ballast. (Philips, Public Meeting Transcript, No. 33 at 
p. 74) NEEA suggested that DOE use separate markups for ballast 
manufacturers and fixture manufacturers, with the ballast manufacturer 
markup split into one value for the Original Equipment Manufacturer 
(OEM) channel and one value for the distributor channel. (NEEA, No. 31 
at p. 4) NEEA also indicated that DOE should take into account the 
unique distribution channel for outdoor fixtures in its analysis when 
estimating markups and pricing for fixtures. (NEEA, No. 31 at p. 5)
    DOE has revised its markup structure for today's NOPR. Based on 
feedback from manufacturers, DOE now uses separate markups for ballast 
manufacturers (1.47) and fixture manufacturers (1.58). DOE also assumes 
that fixture manufacturers apply the 1.58 markup to the ballasts used 
in their fixtures rather than to only the empty fixtures as assumed in 
the preliminary TSD. This assumption is consistent with feedback from 
both fixture manufacturers that purchase their ballasts and those that 
produce their ballasts in-house. In aggregate, the markup also accounts 
for the different markets served by fixture manufacturers. The 1.47 
markup for ballast manufacturers now applies only to ballasts sold to 
fixture OEMs directly impacted by this rulemaking. For the purpose of 
the LCC analysis, DOE assumes a higher markup of 1.60 for ballasts that 
are sold to distributors for the replacement market.

D. Markups To Determine Equipment Price

    By applying markups to the MSPs estimated in the engineering 
analysis, DOE estimated the amounts customers would pay for baseline 
and more efficient equipment. At each step in the distribution channel, 
companies mark

[[Page 51501]]

up the price of the equipment to cover business costs and profit 
margin. Identifying the appropriate markups and ultimately determining 
customer equipment price depend on the type of distribution channels 
through which the equipment moves from manufacturer to customer.
1. Distribution Channels
    Before it could develop markups, DOE needed to identify 
distribution channels (i.e., how the equipment is distributed from the 
manufacturer to the end-user) for the metal halide lamp fixture designs 
addressed in this rulemaking. In an electrical wholesaler distribution 
channel, DOE assumed the fixture manufacturer sells the fixture to an 
electrical wholesaler (i.e., distributor), who in turn sells it to a 
contractor, who sells it to the end-user. In a contractor distribution 
channel, DOE assumed the fixture manufacturer sells the fixture 
directly to a contractor, who sells it to the end-user. In a utility 
distribution channel, DOE assumed the fixture manufacturer sells the 
fixture directly to the end-user (i.e., electrical utility).
2. Estimation of Markups
    To estimate wholesaler and utility markups, DOE used financial data 
from 10-K reports from publicly owned electrical wholesalers and 
utilities. DOE's markup analysis developed both baseline and 
incremental markups to transform the fixture MSP into an end-user 
equipment price. DOE used the baseline markups to determine the price 
of baseline designs. Incremental markups are coefficients that relate 
the change in the MSP of higher-efficiency designs to the change in the 
wholesaler and utility sales prices. These markups refer to higher-
efficiency designs sold under market conditions with new and amended 
energy conservation standards.
    In the preliminary analysis, DOE assumed a wholesaler baseline 
markup of 1.23 and a contractor baseline markup of 1.13, for a total 
wholesaler distribution channel baseline markup of 1.39 (excluding 
sales tax). In the public meeting, Philips inquired about documentation 
for these values. (Philips, Public Meeting Transcript, No. 33 at p. 89) 
DOE responded that these values were consistent with values used in 
other lighting-related rules (e.g., for fluorescent lamp ballasts), and 
that DOE would review the values. In its manufacturer interviews and 
background research, DOE confirmed that although the individual values 
for wholesaler and contractor markups varied, the total value was 
consistent with actual markups. For this proposed rule, DOE retained 
its wholesaler and contractor markups, and also assumed utility 
baseline markups of 1.00 and 1.13 for the utility distribution channel 
in which the manufacturer sells a fixture directly to the end-user, and 
the channel in which a manufacturer sells a fixture to a contractor who 
in turn sells it to the end-user, respectively.
    The sales tax represents state and local sales taxes applied to the 
end-user equipment price. For the preliminary analysis, DOE obtained 
state and local tax data from the Sales Tax Clearinghouse.\31\ These 
data represent weighted averages that include state, county, and city 
rates. DOE then calculated population-weighted average tax values for 
each census division and large state, and then derived U.S. average tax 
values using a population-weighted average of the census division and 
large state values. This approach provided a national average tax rate 
of 7.13 percent. DOE received no comments related to sales tax, and 
retained its approach for this proposed rule.
---------------------------------------------------------------------------

    \31\ The Sales Tax Clearinghouse. Available at https://thestc.com/STRates.stm. (Last accessed June 24, 2013.)
---------------------------------------------------------------------------

3. Summary of Markups
    Table V.4 summarizes the markups at each stage in the distribution 
channels and the overall baseline and incremental markups, and sales 
taxes, for each of the three identified channels.

                                               Table V.4--Summary of Fixture Distribution Channel Markups
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                              Wholesaler distribution                          Utility distribution
                                                         -----------------------------------------------------------------------------------------------
                                                                                            Via wholesaler & contractor         Direct to end-user
                                                             Baseline       Incremental  ---------------------------------------------------------------
                                                                                             Baseline       Incremental      Baseline       Incremental
--------------------------------------------------------------------------------------------------------------------------------------------------------
Electrical Wholesaler (Distributor).....................            1.23            1.05             N/A             N/A             N/A             N/A
Utility.................................................             N/A             N/A            1.00            1.00            1.00            1.00
Contractor or Installer.................................            1.13            1.13            1.13            1.13             N/A             N/A
--------------------------------------------------------------------------------------------------------------------------------------------------------
Sales Tax...............................................               1.07
                                                                       1.07
                                                                       1.07
--------------------------------------------------------------------------------------------------------------------------------------------------------
Overall.................................................            1.49            1.27            1.21            1.21            1.07            1.07
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Using these markups, DOE generated fixture end-user prices for each 
efficiency level it considered, assuming that each level represents a 
new minimum efficiency standard. Chapter 6 of the NOPR TSD provides 
additional detail on the markups analysis.

E. Energy Use Analysis

    For the energy use analysis, DOE estimated the energy use of metal 
halide lamp fixtures in actual field conditions. The energy use 
analysis provided the basis for other DOE analyses, particularly 
assessments of the energy savings and the savings in operating costs 
that could result from DOE's adoption of new and amended standard 
levels.
    To develop annual energy use estimates for the preliminary 
analysis, DOE multiplied annual usage (in hours per year) by the lamp 
and ballast system input power (in watts). DOE characterized 
representative lamp and ballast systems in the engineering analysis, 
which provided measured input power ratings. To characterize the 
country's average use of fixtures for a typical year, DOE developed 
annual operating hour distributions by sector, using data published in 
the 2010 U.S. Lighting Market Characterization: (LMC),\32\ the 
Commercial Building Energy Consumption Survey (CBECS),\33\ and the 
Manufacturer Energy

[[Page 51502]]

Consumption Survey (MECS).\34\ NEMA agreed with this approach. (NEMA, 
No. 34 at p. 17)
---------------------------------------------------------------------------

    \32\ U.S. Department of Energy, Office of Energy Efficiency and 
Renewable Energy. 2010 U.S. Lighting Market Characterization. 2010. 
Available at http://apps1.eere.energy.gov/buildings/publications/pdfs/ssl/2010-lmc-final-jan-2012.pdf.
    \33\ U.S. Department of Energy, Energy Information Agency. 
Commercial Building Energy Consumption Survey: Micro-Level Data, 
File 2 Building Activities, Special Measures of Size, and Multi-
building Facilities. 2003. Available at www.eia.doe.gov/emeu/cbecs/public_use.html.
    \34\ U.S. Department of Energy, Energy Information Agency. 
Manufacturing Energy Consumption Survey, Table 1.4: Number of 
Establishments Using Energy Consumed for All Purpose. 2006. 
Available at www.eia.doe.gov/emeu/mecs/mecs2006/2006tables.html.
---------------------------------------------------------------------------

    In the preliminary analysis, DOE assumed the different operating 
hours for commercial and industrial (typically indoor) fixtures and for 
outdoor fixtures. NEMA stated that outdoor equipment operates largely 
at night. (NEMA, No. 34 at p. 21) NEEA did its own analysis of fixture 
operating hours and generally supported the estimates DOE used in the 
preliminary analysis. (NEEA, No. 31 at p.6) For this proposed rule, DOE 
revised its assumed fixture operating hours to better distinguish 
indoor and outdoor applications.
    DOE's preliminary energy use analysis assumed full operating power 
and no dimmed operation. NEMA suggested that HID dimming is possible, 
but significantly increases ballast and fixture cost, whereas 
fluorescent or other lighting technologies can be more easily and 
affordably dimmed. (NEMA, No. 34 at p. 8) OSI confirmed that they are 
developing dimming electronic ballasts for metal halide lamp fixtures. 
(OSI, No. 27 at p.3) DOE maintains that dimming is still a small 
portion of the MH market, however, and did not assume dimmed operation 
in the energy use analysis for this proposed rule. Chapter 7 of the 
NOPR TSD provides a more detailed description of DOE's energy use 
analysis. DOE is seeking data and information on the energy use 
analysis.

F. Life-Cycle Cost and Payback Period Analysis

    DOE conducted the LCC and PBP analysis to evaluate the economic 
effects of potential energy conservation standards for metal halide 
lamp fixtures on individual customers. For any given efficiency level, 
DOE measured the PBP and the change in LCC relative to an estimated 
baseline equipment efficiency level. The LCC is the total customer 
expense over the life of the equipment, consisting of purchase, 
installation, and operating costs (expenses for energy use, 
maintenance, and repair). To compute the operating costs, DOE 
discounted future operating costs to the time of purchase and summed 
them over the lifetime of the equipment. The PBP is the estimated 
amount of time (in years) it takes customers to recover the increased 
purchase cost (including installation) of more efficient equipment 
through lower operating costs. DOE calculates the PBP by dividing the 
change in purchase cost (normally higher) by the change in average 
annual operating cost (normally lower) that results from the more 
efficient standard.
    Inputs to the calculation of total installed cost include the cost 
of the equipment--which includes MSPs, distribution channel markups, 
and sales taxes--and installation costs. Inputs to the calculation of 
operating expenses include annual energy consumption, energy prices and 
price projections, repair and maintenance costs, equipment lifetimes, 
discount rates, and the year that compliance with new and amended 
standards is required. To account for uncertainty and variability, DOE 
created value distributions for selected inputs, including operating 
hours, electricity prices, discount rates, and sales tax rates. For 
example, DOE created a probability distribution of annual energy 
consumption in its energy use analysis, based in part on a range of 
annual operating hours. The operating hour distributions capture 
variations across building types, lighting applications, and metal 
halide systems for three sectors (commercial, industrial, and outdoor 
stationary). In contrast, fixture MSPs were specific to the 
representative designs evaluated in DOE's engineering analysis, and 
price markups were based on limited publicly available financial data. 
Consequently, DOE used discrete values instead of distributions for 
these inputs.
    The computer model DOE uses to calculate the LCC and PBP, which 
incorporates Crystal Ball (a commercially available software program), 
relies on a Monte Carlo simulation to incorporate uncertainty and 
variability into the analysis. The Monte Carlo simulations randomly 
sample input values from the probability distributions and fixture user 
samples. NOPR TSD chapter 8 and its appendices provide details on the 
spreadsheet model and all the inputs to the LCC and PBP analysis.
    Table V.5 summarizes the approach and data DOE used to develop 
inputs to the LCC and PBP calculations for the April 2011 preliminary 
TSD as well as the changes made for today's NOPR. The subsections that 
follow discuss the initial inputs and DOE's changes to them.

   Table V.5--Summary of Inputs and Key Assumptions in the LCC and PBP
                              Analysis \*\
------------------------------------------------------------------------
                                                Changes for the proposed
       Inputs              Preliminary TSD                rule
------------------------------------------------------------------------
Equipment Cost......  Derived by multiplying    No change.
                       MHLF MSPs by
                       distribution channel
                       markups and sales tax.
Installation Cost...  Calculated costs using    No change.
                       estimated labor times
                       and applicable labor
                       rates from RS Means
                       Electrical Cost Data
                       (2009) and U.S. Bureau
                       of Labor Statistics.
Annual Energy Use...  Determined operating      Determined operating
                       hours by associating      hours separately for
                       building-type-specific    indoor and outdoor
                       operating hours with      fixtures. Used lighting
                       distributions of          market data: LMC
                       various building types    (2012).
                       using lighting market
                       and building energy
                       consumption survey
                       data: LMC (2002), CBECS
                       (2003), and MECS (2006).
Energy Prices.......  Electricity: Based on     Electricity: Based on
                       EIA's Form 861 data for   EIA's Form 826 data for
                       2010.                     2012.
                                                Variability: Energy
                                                 prices determined at
                                                 state level;
                                                 incorporated off-peak
                                                 electricity prices in
                                                 the Monte Carlo
                                                 analysis.
Energy Price          Projected using AEO2010.  Projected using AEO2013.
 Projections.
Replacement Costs...  Included labor and        No change.
                       material costs for lamp
                       and ballast replacement
                       at the end of their
                       lifetimes.
Equipment Lifetime..  Ballasts: Assumed 50,000  Ballasts: Assumed 50,000
                       hours for magnetic        hours for magnetic
                       ballasts and 30,000       ballasts and 40,000
                       hours for electronic      hours for electronic
                       ballasts.                 ballasts.

[[Page 51503]]

 
                      Fixtures: Assumed 20      Fixtures: No change.
                       years for indoor
                       fixtures and 25 years
                       for outdoor fixtures.
Discount Rates......  Commercial/Industrial:    Commercial/Industrial:
                       Estimated cost of         Developed a
                       capital to affected       distribution of
                       firms and industries;     discount rates for each
                       developed weighted        end-use sector.
                       average of the cost to
                       the company of equity
                       and debt financing.
                      Outdoor Stationary:       Outdoor Stationary:
                       Assumed to be the same    Developed a
                       as commercial sector.     distribution of
                                                 discount rates for each
                                                 end-use sector.
------------------------------------------------------------------------
\*\ References for the data sources mentioned in this table are provided
  in the sections following the table or in chapter 8 of the NOPR TSD.

1. Equipment Cost
    To calculate customer equipment costs, DOE multiplied the MSPs 
developed in the engineering analysis by the distribution channel 
markups described in section V.D.1 (along with sales taxes). DOE used 
different markups for baseline equipment and higher-efficiency 
equipment because the markups estimated for incremental costs differ 
from those estimated for baseline models.
    For the April 2011 preliminary TSD, DOE assumed that the MSPs and 
retail prices of products meeting various efficiency levels remain 
fixed, in real terms, after 2010 (the year for which the engineering 
analysis estimated costs) and throughout the analysis period. 
Subsequently, examination of historical price data for various 
appliances and equipment indicates that the assumption of constant real 
prices and costs may, in many cases, overestimate long-term appliance 
and equipment price trends. Economic literature and historical data 
suggest that the real costs of these products may in fact trend 
downward over time, partially because of ``learning'' or 
``experience.'' \35\
---------------------------------------------------------------------------

    \35\ A draft paper, Using the Experience Curve Approach for 
Appliance Price Forecasting, posted on the DOE Web site at 
www.eere.energy.gov/buildings/appliance_standards, provides a 
summary of the data and literature currently available to DOE that 
is relevant to price forecasts for selected appliances and 
equipment.
---------------------------------------------------------------------------

    On February 22, 2011, DOE published a notice of data availability 
(February 2011 NODA; 76 FR 9696) stating that DOE may consider 
improving regulatory analysis by addressing equipment price trends. DOE 
notes that learning-curve analysis characterizes the reduction in 
production cost mainly associated with labor-based performance 
improvement and higher investment in new capital equipment at the 
microeconomic level. Experience-curve analysis tends to focus more on 
entire industries and aggregates over various casual factors at the 
macroeconomic level: ``Experience curve'' and ``progress function'' 
typically represent generalizations of the learning concept to 
encompass behavior of all inputs to production and cost (i.e., labor, 
capital, and materials). The economic literature often uses these two 
terms interchangeably. The term ``learning'' is used here to broadly 
cover these general macroeconomic concepts.
    For this proposed rule and consistent with the February 2011 NODA, 
DOE examined two methods for estimating price trends for metal halide 
lamp fixtures: Using historical producer price indices (PPIs), and 
using projected price indices (called deflators). With PPI data, DOE 
found both positive and negative real price trends, depending on the 
specific time period examined, and did not use this method to adjust 
fixture prices. DOE instead adjusted fixture prices using deflators 
used by EIA to develop the AEO. When adjusted for inflation, the 
deflator-based price indices decline from 100 in 2010 to approximately 
76 in 2045.
    DOE invites comment on methods to improve its fixture price 
projections beyond the assumption of constant real prices, as well as 
any data supporting alternate methods. A more detailed discussion of 
price trend modeling and calculations is provided in appendix 8B of the 
NOPR TSD.
2. Installation Cost
    Installation costs for metal halide lamp fixtures include the costs 
to install the fixture, maintain the ballast, and replace the lamp. For 
the April 2011 preliminary TSD, DOE used data collected for its July 
2010 HID lamps determination,\36\ labor rates for electricians from RS 
Means,\37\ and other research to estimate the installation costs. DOE 
annualized maintenance costs in its preliminary analysis, and NEEA 
questioned why DOE annualized costs that do not occur annually, but 
rather occur periodically during the equipment lifetime. (NEEA, Public 
Meeting Transcript, No. 33 at p. 102) For this NOPR, DOE developed a 
methodology that allows the use of annualized maintenance costs while 
maintaining the integrity of the NPV calculations in the NIA. For 
further detail, see chapter 8 of the NOPR TSD.
---------------------------------------------------------------------------

    \36\ U.S. Department of Energy-Office of Energy Efficiency and 
Renewable Energy. Energy Conservation Program for Consumer 
Equipment: Preliminary Technical Support Document: High-Intensity 
Discharge Lamps. 2010. Washington, DC <www1.eere.energy.gov/buildings/appliance_standards/product.aspx/productid/60>
    \37\ R.S. Means Company, Inc. 2010 RS Means Electrical Cost 
Data. 2010. Kingston, MA.
---------------------------------------------------------------------------

3. Annual Energy Use
    As discussed in section V.E, DOE estimated the annual energy use of 
representative metal halide systems using system input power ratings 
and sector operating hours. The annual energy use inputs to the LCC and 
PBP analysis are based on weighted average annual operating hours, 
whereas the Monte Carlo simulation draws on a distribution of annual 
operating hours to determine annual energy use.
4. Energy Prices
    For the April 2011 preliminary TSD, DOE developed weighted average 
energy prices for 13 U.S. geographic areas consisting of the 9 census 
divisions, with 4 large states (1. California, 2. Florida, 3. New York, 
and 4. Texas) treated separately. For census divisions containing one 
of these large states, DOE calculated the regional average excluding 
the data for the large state. Prices were based on data from EIA Form 
826, ``Monthly Electric Utility Sales and Revenue Data, 2011.'' GE 
commented that metal halide lighting is commonly used outdoors during 
off-peak hours, and recommended that DOE account for off-peak 
electricity prices in the analysis. (GE, Public Meeting Transcript, No. 
33 at p. 135) For this proposed rule, DOE incorporated off-peak 
electricity pricing by using a distribution of percentages of average 
electricity prices in its Monte Carlo analysis, from which a lower 
average electricity price for the outdoor sector was calculated and 
used in the main LCC analysis. For more information, see chapter 8 of 
the NOPR TSD.
5. Energy Price Projections
    To estimate the trends in energy prices, DOE used the price 
projections

[[Page 51504]]

in AEO2013. To arrive at prices in future years, DOE multiplied current 
average prices by the projected of annual average price changes in 
AEO2013. Because AEO2013 projects prices to 2040, DOE used the average 
rate of change from 2010 to 2040 to estimate the price trend for 
electricity after 2040. In addition, the spreadsheet tools that DOE 
used to conduct the LCC and PBP analysis allow users to select price 
forecasts from the AEO low-growth, high-growth, and reference-case 
scenarios to estimate the sensitivity of the LCC and PBP to different 
energy price forecasts. DOE received no comments on the April 2011 
preliminary TSD concerning its energy price projecting method for the 
LCC analysis, and retained this approach for this proposed rule.
6. Replacement Costs
    In the April 2011 preliminary TSD, DOE addressed ballast and lamp 
replacements that occur within the LCC analysis period. Replacement 
costs include the labor and materials costs associated with replacing a 
ballast or lamp at the end of their lifetimes and are annualized across 
the years preceding and including the actual year in which equipment is 
replaced. For the LCC and PBP analysis, the analysis period corresponds 
with the fixture lifetime that is assumed to be longer than that of 
either the lamp or the ballast. For this reason, ballast and lamp 
prices and labor costs are included in the calculation of total 
installed costs. DOE received comments regarding its annualizing 
approach concerning replacement costs for the LCC analysis in its April 
2011 preliminary TSD and developed a new annualizing methodology for 
this proposed rule. (NEEA, Public Meeting Transcript, No. 33 at p. 103)
7. Equipment Lifetime
    For the April 2011 preliminary TSD, DOE defined equipment lifetime 
as the age (in hours in operation) when a fixture, ballast, or lamp is 
retired from service. For fixtures in all equipment classes, DOE 
assumed lifetimes for indoor and outdoor fixtures of 20 and 25 years, 
respectively.
    Metal halide lamp fixtures are operated by either magnetic or 
electronic ballasts. In the April 2011 preliminary analysis, DOE 
assumed that magnetic ballasts last for 50,000 hours and electronic 
ballasts last for 30,000 hours. NEMA and Empower Electronics agreed 
with DOE's general estimates about magnetic and electronic ballast 
lifetimes, but NEMA cautioned that fixtures are often removed before 
end of service life, especially as new energy-efficient alternatives 
appear on the market. (NEMA, No. 34 at p. 18; Empower Electronics, No. 
36 at p. 11) Similarly, Philips noted that ballasts may be replaced 
prior to physical failure. (Philips, Public Meeting Transcript, No. 33 
at p. 107) OSI suggested an average rated life of 50,000 hours for 
electronic ballasts, and agreed with NEMA and Philips that fixtures may 
be replaced before end of service life. (OSI, No. 27 at p. 6) The 
California IOUs believed that DOE underestimated electronic ballast 
lifetime by as much as twofold based on their experience with 
electronic ballast manufacturers. (California IOUs, No. 32 at p. 3) 
Finally, NEEA suggested that DOE use a distribution of ballast 
lifetimes for LCC and other analyses. (NEEA, No. 31 at p. 7)
    DOE notes that actual ballast lifetime data are limited. However, 
based on comments and additional research, DOE revised its average 
electronic ballast lifetime to 40,000 hours and maintained its average 
lifetime of 50,000 hours for magnetic ballasts for this proposed rule. 
DOE agrees that ballast lifetimes can vary due to both physical failure 
and economic factors (e.g., early replacements due to retrofits). 
Consequently, DOE accounted for variability in lifetime in LCC and PBP 
via the Monte Carlo simulation, and in the shipments and NIA analyses 
by assuming a Weibull distribution for lifetimes to accommodate 
failures and replacements.\38\
---------------------------------------------------------------------------

    \38\ Weibull distribution is a probability density function; for 
more information, see www.itl.nist.gov/div898/handbook/eda/section3/eda3668.htm.
---------------------------------------------------------------------------

    Metal halide lamp lifetimes vary by fixture equipment class. For 
the April 2011 preliminary TSD, DOE assumed that lamps in the 70 W, 250 
W, 400 W, and 1000 W equipment classes operate for 12,000, 15,000, 
20,000, and 12,000 hours, respectively. Commenters noted that lamp 
lifetime can vary with operating position (e.g., vertical, horizontal, 
or tilted), and recommended that DOE consider this variation in 
developing weighted-average lamp lifetimes. (GE, Public Meeting 
Transcript, No. 33 at p. 97; Hubbell, Public Meeting Transcript, No. 33 
at p. 98) DOE agrees with the comments, and surveyed published MH lamp 
life ratings in developing weighted-average lamp lifetimes for this 
proposed rule.
    Some public meeting participants asked about the effects of ballast 
type (i.e., magnetic vs. electronic) on lamp life. (ASAP, Public 
Meeting Transcript, No. 33 at p. 98; Energy Solutions Public Meeting 
Transcript, No. 33 at p. 104) Hubbell and Philips acknowledged the lack 
of industry consensus on this subject and the variability of related 
lifetime data between manufacturers. (Hubbell, Public Meeting 
Transcript, No. 33 at p. 98; Philips, Public Meeting Transcript, No. 33 
at p. 104) Based on its review of industry data and literature, DOE 
could not substantiate the effect of ballast type on MH lamp lifetimes, 
and used published lamp life ratings only in developing weighted-
average lamp lifetimes for this proposed rule.
8. Discount Rates
    The discount rate is the rate at which future expenditures are 
discounted to estimate their present value. In this NOPR, DOE estimated 
separate discount rates for commercial, industrial and outdoor 
stationary customers. For all such customers, DOE estimated the cost of 
capital for commercial and industrial companies by examining both debt 
and equity capital, and developed an appropriately weighted average of 
the cost to the company of equity and debt financing. For the proposed 
rule, DOE also developed a distribution of discount rates for each end-
use sector from which the Monte Carlo simulation samples.
    For each sector, DOE assembled data on debt interest rates and the 
cost of equity capital for representative firms that use metal halide 
lamp fixtures. DOE determined a distribution of the weighted-average 
cost of capital for each class of potential owners using data from the 
Damodaran online financial database.\39\ The average discount rates, 
weighted by the shares of each rate value in the sectoral 
distributions, are 4.5 percent for commercial end-users, 4.3 percent 
for industrial end-users, and 3.4 percent for outdoor stationary end-
users.
---------------------------------------------------------------------------

    \39\ The data are available at pages.stern.nyu.edu/~adamodar.
---------------------------------------------------------------------------

    DOE received no comments on the April 2011 preliminary TSD 
concerning its estimated discount rates for the LCC analysis and 
retained this approach for this proposed rule.
9. Analysis Period
    DOE calculated the LCC for all end-users as if each one would 
purchase a new fixture in the year 2016.
10. Fixture Purchasing Events
    DOE designed the LCC and PBP analysis for this rulemaking around 
scenarios where customers need to purchase a metal halide lamp fixture. 
The ``event'' that prompts the purchase

[[Page 51505]]

of a new fixture (either a ballast failure or new construction/
renovation) was assumed to influence the cost-effectiveness of the 
customer purchase decision. DOE assumed that a customer will replace a 
failed fixture with an identical fixture in the base case, or a new 
standards-compliant fixture with comparable light output in the 
standards case. DOE analyzed five representative equipment classes for 
fixtures and presented the results for each of these representative 
equipment classes by fixture purchasing event, which influenced the LCC 
and PBP results.
    DOE received no comments on the April 2011 preliminary TSD 
concerning its assumed fixture purchasing events for the LCC analysis 
and retained this approach for this proposed rule.

G. National Impact Analysis--National Energy Savings and Net Present 
Value Analysis

    DOE's NIA assessed the national energy savings (NES) and the 
national net present value (NPV) of total customer costs and savings 
that would be expected to result from new or amended standards at 
specific efficiency levels. (``Customer'' in this context refers to 
users of the regulated equipment.)
    DOE used a Microsoft Excel spreadsheet model to calculate the 
energy savings and the national customer costs and savings from each 
TSL. The TSD and other documentation for the rulemaking help explain 
the models and how to use them, allowing interested parties to review 
DOE's analyses by changing various input quantities within the 
spreadsheet.
    DOE used the NIA spreadsheet to calculate the NES and NPV based on 
the annual energy use and total installed cost data from the energy use 
and LCC analyses. DOE projected the energy savings, energy cost 
savings, equipment costs, and NPV of customer benefits for each 
equipment class for equipment sold from 2016 through 2045. The 
projections provided annual and cumulative values for all four output 
parameters.
    DOE evaluated the impacts of new and amended standards for metal 
halide lamp fixtures by comparing base-case projections with standards-
case projections. The base-case projections characterize energy use and 
customer costs for each equipment class in the absence of new or 
amended energy conservation standards. DOE compared these projections 
with projections characterizing the market for each equipment class if 
DOE adopted new or amended standards at specific energy efficiency 
levels (i.e., the TSLs or standards cases) for that class. In 
characterizing the base and standards cases, DOE considered historical 
shipments, the mix of efficiencies sold in the absence of new 
standards, and how that mix may change over time. Additional 
information about the NIA spreadsheet is in the NOPR TSD chapter 11.
    Table V.6 summarizes the approach and data DOE used to derive the 
inputs to the NES and NPV analyses for the April 2011 preliminary TSD, 
as well as the changes to the analyses for the proposed rule. A 
discussion of selected inputs and changes follows. See chapter 11 of 
the NOPR TSD for further details.

      Table V.6--Approach and Data Used for National Energy Savings and Customer Net Present Value Analyses
----------------------------------------------------------------------------------------------------------------
               Inputs                      Preliminary TSD                Changes for the proposed rule
----------------------------------------------------------------------------------------------------------------
Shipments..........................  Developed annual shipments  See Table V.7.
                                      from shipments model.
Annual Energy Consumption per Unit.  Established in the energy   See section V.E.
                                      use characterization
                                      (preliminary TSD chapter
                                      7).
Rebound Effect.....................  0%........................  No change.
Electricity Price Forecast.........  AEO2010...................  AEO2013.
Energy Site-to-Source Conversion     Assumed to be constant      Used annually variable site kWh to source Btu
 Factor.                              across time: 1 site kWh =   conversion factor.
                                      10,239 source Btu.
Discount Rate......................  3% and 7% real............  No change.
Present Year.......................  2011......................  2013.
----------------------------------------------------------------------------------------------------------------

1. Shipments
    Equipment shipments are an important component of any estimate of 
the future impact of a standard. Using a three-step process, DOE 
developed the shipments portion of the NIA spreadsheet, a model that 
uses historical data as a basis for projecting future fixture 
shipments. First, DOE used a combination of historical fixture shipment 
data from the U.S. Census Bureau for HID fixtures from 1993 to 2001. 
DOE correlated the HID fixture data with HID lamp data from 1990 to 
2010 from the HID lamps rulemaking (EERE-2010-BT-STD-0043). Fixture 
shipments correlated to roughly a third of lamp shipments. DOE applied 
this fixture-to-lamp correlation to the larger and more detailed data 
set of HID lamp data to estimate the total historical shipments of each 
fixture type analyzed. Second, DOE estimated an installed stock for 
each fixture in 2016 based on the average service lifetime of each 
fixture type. Third, DOE developed annual shipment projections for 
2016-2045 by modeling fixture purchasing events, such as replacement 
and new construction, and applying growth rate, replacement rate, and 
alternative technologies penetration rate assumptions. For details on 
the shipments analysis, see chapter 10 of the NOPR TSD. DOE is seeking 
comment on whether the assumptions and methods used to project MHLF 
shipments are reasonable and likely to occur. DOE is also seeking data 
and information that could be used to refine DOE's estimates. DOE also 
requests comment on the impediments that prevent users of metal halide 
lamp fixtures from switching to LED lighting to garner further energy 
savings.

                          Table V.7--Approach and Data Used for the Shipments Analysis
----------------------------------------------------------------------------------------------------------------
               Inputs                           Preliminary TSD                 Changes for the proposed rule
----------------------------------------------------------------------------------------------------------------
Historical Shipments...............  Used historical shipments for 1990-    Used historical MH lamp shipments
                                      2008 to develop shipments and stock    for 1990-2010 to develop shipments
                                      projections for the analysis period.   and stock projections for MH
                                                                             fixtures.

[[Page 51506]]

 
Fixture Stock......................  Based projections on the shipments     No change.
                                      that survive up to a given date;
                                      assumed Weibull lifetime
                                      distribution.
Growth.............................  Adjusted based on fixture market.....  No change.
Base Case Scenarios................  Analyzed one scenario incorporating    Developed ``low'' and ``high''
                                      alternative technologies encroaching   shipments scenarios.
                                      on fixture shipments.
Standards Case Scenarios...........  Analyzed Roll-up and Shift scenarios.  Analyzed Roll-up only.
----------------------------------------------------------------------------------------------------------------

a. Historical Shipments
    For the April 2011 preliminary TSD, DOE reviewed U.S. Census Bureau 
data from 1993 to 2001 for metal halide lamp fixtures.\40\ DOE compared 
the MHLF census data to NEMA data for historical metal halide lamp 
shipments from 1990 to 2008 taken from DOE's final determination for 
HID lamps published on July 1, 2010. 75 FR 37975. DOE found a 
correlation between metal halide lamp fixture and metal halide lamp 
shipments. From 1993 to 2001, the number of MHLF shipments on average 
represented 37 percent of the amount of lamp shipments, with a standard 
deviation of 3 percent. Using this relationship, DOE multiplied all of 
the metal halide lamp shipments from 1990 to 2010 by 37 percent to 
estimate the historical shipments of metal halide lamp fixtures. DOE 
received no comments on the April 2011 preliminary TSD regarding 
historical fixture shipments data and estimates and retains this 
approach for this proposed rule.
---------------------------------------------------------------------------

    \40\ U.S. Census Bureau. Manufacturing, Mining, and Construction 
Statistics. Current Industrial Reports, Fluorescent Lamp Ballasts, 
MQ335C. 2008. (Last accessed September 1, 2010). <www.census.gov/mcd/>.
---------------------------------------------------------------------------

b. Fixture Stock Projections
    In its preliminary shipments analysis, DOE calculated the installed 
fixture stock using historical fixture shipments estimated from U.S. 
Census Bureau Current Industrial Reports data (1993-2001), data from 
the HID lamps rule, and its projected shipments for future years. DOE 
estimated the installed stock during the analysis period by using 
fixture shipments and calculating how many will survive up to a given 
year based on a Weibull lifetime distribution for each fixture type. 
DOE received no comments on the April 2011 preliminary TSD regarding 
its fixture stock projection method and retained this approach for this 
proposed rule.
c. Base Case Shipment Scenarios
    For the April 2011 preliminary TSD, DOE's projection showed fixture 
shipments increasing until 2020 and then declining. Several 
manufacturers stated that DOE's projection overestimated fixtures 
shipments in the near term. (Acuity, Cooper, GE, Philips, Public 
Meeting Transcript, No. 33 at pp. 112-120) Philips noted that T5 and T8 
fluorescent systems are already displacing metal halide systems, with 
solid-state lighting also starting to penetrate the metal halide lamp 
fixture market. (Philips, Public Meeting Transcript, No. 33 at p. 113) 
DOE revisited its preliminary fixture shipment estimates and 
manufacturer interview data, and revised its projections downward for 
this proposed rule. DOE assumed that shipments for metal halide lamp 
fixtures would peak somewhere between 2010 and 2015. From the 
manufacturer interviews, DOE was able to approximate the shipments in 
2010. Through separate data, additional assumptions, and research, DOE 
was able to approximate the same shipments in 2010 in the DOE model. In 
the ``low'' shipment scenario, DOE reviewed trends in replacement 
technologies and projected a decline such that the 2040 shipment 
projection fell back to the level of the 2000 shipments. In the 
``high'' scenario, the decline in metal halide lamp fixture shipments 
is not as large as in the ``low'' scenario. The shipments in the 
``high'' scenario in 2040 roughly equal the shipments in 2006.
d. Standards Case Efficiency Scenarios
    Several of the inputs for determining NES (e.g., the annual energy 
consumption per unit) and NPV (e.g., the total annual installed cost 
and the total annual operating cost savings) depend on equipment 
efficiency. For the April 2011 preliminary TSD, DOE used two shipment 
efficiency scenarios: ``Roll-up'' and ``Shift.'' DOE received no 
comments on its efficiency scenarios, but eliminated the Shift scenario 
and retained the Roll-up scenario for this proposed rule. The Roll-up 
scenario is a standards case in which all equipment efficiencies in the 
base case that do not meet the standard would `roll up' to the lowest 
level that can meet the new standard level. Equipment efficiencies in 
the base case above the standard level are unaffected in the Roll-up 
scenario, as these customers are assumed to continue to purchase the 
same base-case fixtures. The Roll-up scenario characterizes customers 
primarily driven by the first cost of the analyzed equipment, which DOE 
believes more accurately characterizes the metal halide lamp fixture 
marketplace.
2. Site-to-Source Energy Conversion
    To estimate the national energy savings expected from appliance 
standards, DOE uses a multiplicative factor to convert site energy 
consumption into primary or source energy consumption (the energy 
required to convert and deliver the site energy). These conversion 
factors account for the energy used at power plants to generate 
electricity and losses in transmission and distribution, as well as for 
natural gas losses from pipeline leakage and energy used for pumping. 
For electricity, the conversion factors vary over time due to projected 
changes in generation sources (i.e., the types of power plants 
projected to provide electricity to the country). The factors that DOE 
developed are marginal values, which represent the response of the 
system to an incremental decrease in consumption associated with 
appliance standards.
    For the April 2011 preliminary TSD, DOE used the average of all 
annual site-to-source conversion factors based on the version of NEMS 
that corresponds to AEO2010, which provides energy forecasts through 
2035. For 2036-2044, DOE used conversion factors that remain constant 
at the 2035 values.
    DOE has historically presented NES in terms of primary energy 
savings. In response to the recommendations of a committee on ``Point-
of-Use and Full-Fuel-Cycle Measurement Approaches to Energy Efficiency 
Standards'' appointed by the National Academy of Science, DOE announced 
its intention to use FFC measures of energy use and greenhouse gas and 
other emissions in the national impact analyses and emissions analyses 
included in future energy conservation standards rulemakings. 76 FR 
51281 (August 18, 2011) While DOE stated in that notice that it 
intended to use the Greenhouse Gases, Regulated Emissions,

[[Page 51507]]

and Energy Use in Transportation (GREET) model to conduct the analysis, 
it also said it would review alternative methods, including the use of 
NEMS. After evaluating both models and the approaches discussed in the 
August 18, 2011 notice, DOE published a statement of amended policy in 
the Federal Register in which DOE explained its determination that NEMS 
is a more appropriate tool for its FFC analysis and its intention to 
use NEMS for that purpose. 77 FR 49701 (August 17, 2012). DOE received 
one comment, which was supportive of the use of NEMS for DOE's FFC 
analysis.\41\
---------------------------------------------------------------------------

    \41\ Docket ID: EERE-2010-BT-NOA-0028, comment by Kirk 
Lundblade.
---------------------------------------------------------------------------

    The approach used for today's NOPR, and the FFC multipliers that 
were applied, are described in appendix 11B of the NOPR TSD. NES 
results are presented in both primary and FFC savings in section VI.B.

H. Customer Subgroup Analysis

    The life-cycle cost subgroup analysis evaluates impacts of 
standards on identifiable groups, such as different customer 
populations or business types that may be disproportionately affected 
by any national energy conservation standard level. DOE will estimate 
LCC savings and PBPs for customers in the commercial, industrial, and 
outdoor stationary sectors. DOE will also analyze the LCC effects on 
customers living in or operating different buildings in the commercial 
and industrial sectors. In addition, DOE will analyze effects on 
customers in different regions of the country.

I. Manufacturer Impact Analysis

1. Overview
    DOE performed a manufacturer impact analysis (MIA) to estimate the 
financial impact of proposed new and amended energy conservation 
standards on manufacturers of metal halide lamp fixtures and ballasts, 
and to estimate the impact of such standards on employment and 
manufacturing capacity. The MIA has both quantitative and qualitative 
aspects. The quantitative part of the MIA primarily relies on the GRIM, 
an industry cash flow model using inputs specific to this rulemaking. 
The key GRIM inputs are data on the industry cost structure, equipment 
costs, shipments, and assumptions about markups and conversion 
expenditures. The key output is the industry net present value (INPV). 
Different sets of shipment and markup assumptions (scenarios) will 
produce different results. The qualitative part of the MIA addresses 
factors such as equipment attributes; characteristics of, and impacts 
on, particular sub-groups of firms; and market and product trends. 
Chapter 13 of the NOPR TSD outlines the complete MIA.
    DOE conducted the MIA for this rulemaking in three phases. In Phase 
1, Industry Profile, DOE prepared an industry characterization based on 
the market and technology assessment, preliminary manufacturer 
interviews, and publicly available information. In Phase 2, Industry 
Cash Flow Analysis, DOE estimated industry cash flows in the GRIM using 
industry financial parameters derived in Phase 1 and the shipment 
scenarios used in the NIA. In Phase 3, Sub-Group Impact Analysis, DOE 
conducted structured, detailed interviews with a representative cross-
section of manufacturers that represent more than 65 percent of 
domestic fixture sales and 90 percent of domestic ballast sales. During 
these interviews, DOE discussed engineering, manufacturing, 
procurement, and financial topics specific to each company, and 
obtained each manufacturer's view of the MHLF industry as a whole. The 
interviews provided valuable information that DOE used to evaluate the 
impacts of new and amended standards on manufacturers' cash flows, 
manufacturing capacities, and employment levels. See section V.I.4 for 
a description of the key issues manufacturers raised during the 
interviews.
    During Phase 3, DOE also used the results of the industry 
characterization analysis in Phase 1 and feedback from manufacturer 
interviews to group manufacturers that exhibit similar production and 
cost structure characteristics. DOE identified one sub-group for a 
separate impact analysis--small manufacturers--using the small business 
size standards published by the Small Business Administration 
(SBA).\42\ These thresholds include all employees in a business' parent 
company and any other subsidiaries. Based upon this classification, DOE 
identified 54 small metal halide lamp fixture manufacturers and five 
small metal halide ballast manufacturers that qualify as small 
businesses.
---------------------------------------------------------------------------

    \42\ DOE determined whether a company is a small business (65 FR 
30836, 30848 (May 15, 2000), as amended at 65 FR 53533, 53544 (Sept. 
5, 2000) and codified at 13 CFR part 121). To be categorized as a 
small business, a metal halide lamp fixture manufacturer may have up 
to 500 employees; a metal halide ballast manufacturer may have up to 
750 employees.
---------------------------------------------------------------------------

2. GRIM Analysis and Key Inputs
    DOE uses the GRIM to quantify the changes in cash flow that result 
in a higher or lower industry value. The GRIM analysis uses a standard 
annual cash-flow analysis that incorporates manufacturer costs, 
markups, shipments, and industry financial information as inputs and 
models changes in costs, investments, and manufacturer margins that 
would result from new and amended energy conservation standards. The 
GRIM spreadsheet uses the inputs to calculate a series of annual cash 
flows beginning with the base year of the analysis, 2013, and 
continuing to 2045. DOE computes INPVs by summing the stream of annual 
discounted cash flows during this period. DOE uses a real discount rate 
of 9.5 percent and 8.9 percent for fixtures and ballasts, respectively. 
The discount rate estimates were derived from industry corporate annual 
reports to the Securities and Exchange Commission (SEC 10-Ks) and then 
modified according to feedback during manufacturer interviews.
    The GRIM calculates cash flows using standard accounting principles 
and compares changes in INPV between a base case and various TSLs (the 
standards cases). The difference in INPV between the base case and a 
standards case represents the financial impact of the new and amended 
standard on manufacturers. The GRIM results are shown in section 
VI.B.2. Additional details about the GRIM can be found in chapter 13 of 
the NOPR TSD.
    DOE typically presents its estimates of manufacturer impacts by 
groups of the major equipment types served by the same manufacturers. 
Although the covered equipment in today's proposed rulemaking is metal 
halide lamp fixtures, by requiring a particular ballast efficiency in 
this regulation, metal halide ballast manufacturers will also be 
affected by new and amended standards. Because fixture and ballast 
markets are served by separate groups of manufacturers, DOE presents 
impacts on metal halide lamp fixture manufacturers and metal halide 
ballast manufacturers separately.
a. Manufacturer Production Costs
    Manufacturing a higher-efficiency product is typically more 
expensive than manufacturing a baseline product due to the use of 
components that are more costly than baseline components. The changes 
in the MPCs of the analyzed equipment can affect the revenues, gross 
margins, and cash flows of the manufacturer, making these equipment 
cost data key GRIM inputs for DOE's analysis. DOE employed one of two 
methods to derive these per-unit production costs. DOE was able to 
establish a BOM for those ballasts it tore

[[Page 51508]]

down. DOE then converted the BOMs at each efficiency level into 
corresponding MPCs composed of labor, materials, and overhead expenses 
using its engineering cost model. When DOE was not able to generate a 
BOM for a given ballast, DOE estimated the per-unit production costs 
based on the relationship between teardown data and manufacturer-
supplied MSPs. DOE included a cost adder for indoor electronic ballasts 
to account for the additional cost of including a 120 V auxiliary tap 
in some models. DOE also developed fixture MPCs for several different 
fixture types using either a teardown analysis or retail price scaling. 
With these costs for several common fixture types, DOE created a single 
``hybrid'' fixture for each of the five representative wattages, 
reflecting the weighted average of the common fixture types. DOE 
included a cost adder for all fixtures that use electronic ballasts to 
account for thermal management and a cost adder for outdoor fixtures 
that use electronic ballasts to account for voltage transient 
protection. For a complete description these cost adders, see section 
V.C.12 of this NOPR. In addition, DOE used teardown cost data to 
disaggregate the ballast and fixture MPCs into material, labor, and 
overhead costs.
b. Base Case Shipment Projections
    Changes in sales volumes and efficiencies over time can 
significantly affect manufacturer finances. The GRIM estimates 
manufacturer revenues based on total unit shipment projections and the 
distribution of shipments by efficiency level. For this analysis, the 
GRIM uses the NIA's annual shipment projections from 2013 to 2045, the 
end of the analysis period. The shipments analysis also estimated the 
distribution of fixture efficiencies in the base case for all equipment 
classes.
    DOE employed two scenarios that affect base case shipments over the 
analysis period (2016 through 2045): a low-shipment scenario and a 
high-shipment scenario. In the low-shipment scenario, DOE reviewed 
trends in fixture replacement technologies and projected a decline in 
shipments over the analysis period. In the high-shipment scenario, the 
decline in metal halide lamp fixture shipments is not as large as in 
the low-shipment scenario. Manufacturers earn greater revenue under the 
high-shipment scenario compared to the low-shipment scenario. See 
chapter 10 of the NOPR TSD for additional details on shipments.
c. Standards Case Shipment Projections
    In addition to the two shipment scenarios affecting base case 
shipments, DOE modeled a roll-up scenario to estimate the standards 
case efficiency distributions. See chapter 10 of the NOPR TSD for more 
information on the standards case shipment scenarios.
d. Markup Scenarios
    As discussed above, MSPs include direct manufacturing production 
costs (i.e., labor, material, and overhead estimated in DOE's MPCs) and 
all non-production costs (i.e., selling, general and administrative 
expenses (SG&A), R&D, and interest), along with profit. To calculate 
the MSPs in the GRIM, DOE applied markups to the MPCs estimated in the 
engineering analysis for each equipment class and efficiency level. 
Modifying these markups in the standards cases yields different sets of 
impacts on manufacturers. For the MIA, DOE modeled two standards case 
markup scenarios to represent the uncertainty regarding impacts on 
prices and profitability: (1) A flat markup scenario, and (2) a 
`preservation of operating profit' markup scenario. These scenarios 
lead to different markups values, which, when multiplied by the MPCs, 
result in varying revenue and cash flow impacts.
    The flat markup scenario assumes that the cost of goods sold for 
each product is marked up by a flat percentage to cover SG&A expenses, 
R&D expenses, and profit. The flat markup scenario uses the baseline 
manufacturer markup (1.47 for ballasts and 1.58 for fixtures, as 
discussed in chapter 5 of the NOPR TSD) for all fixture equipment 
classes in both the base case and the standards case. This scenario 
represents the upper bound of industry profitability in the standards 
case because it is designed so that manufacturers can fully pass 
through additional costs due to standards to their customers. To derive 
the flat markup percentage, DOE evaluated publicly available financial 
information for manufacturers of metal halide ballasts or fixtures. DOE 
also requested feedback on this value during manufacturer interviews.
    During interviews, manufacturers expressed skepticism that they 
would be able to mark up higher equipment costs in the standards case 
to the same degree as in the base case. In recognition of this concern, 
DOE also modeled a scenario called the `preservation of operating 
profit' markup scenario. In this scenario, markups in the standards 
case are lowered such that manufacturers are only able to maintain 
their total base case operating profit in absolute dollars, despite 
higher product costs and investments. This scenario represents the 
lower bound of industry profitability following new and amended energy 
conservation standards because the resulting higher production costs 
and investments do not yield any additional operating profits. DOE 
implemented this scenario in the GRIM by lowering the manufacturer 
markups at each TSL to yield approximately the same earnings before 
interest and taxes in the standards case in 2017, as in the base case.
e. Product and Capital Conversion Costs
    New and amended energy conservation standards will cause 
manufacturers to incur conversion costs to bring their production 
facilities and product designs into compliance. For the MIA, DOE 
classified these conversion costs into two major groups: (1) Product 
conversion costs and (2) capital conversion costs. Product conversion 
costs are investments in research, development, testing, marketing, and 
other non-capitalized costs necessary to make product designs comply 
with the 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 product designs can be fabricated and assembled.
    NEMA expressed concern about the costs (in time and dollars) that 
manufacturers may incur due to this rulemaking, specifically with 
respect to product redesigns and product testing. NEMA disagreed with 
DOE's assumption in the preliminary analysis that ballast redesigns 
would not cause fixture redesigns. NEMA argued that DOE should account 
for fixture redesign costs for both magnetic and electronic ballast 
efficiency levels and provided estimates of these costs. (NEMA, No. 34 
at p. 7, 21) Acuity and OSI agreed that fixture manufacturers would 
face increased costs due to additional engineering, testing, and 
material costs. (Acuity, Public Meeting Transcript, No. 33 at p. 79; 
OSI, No. 27 at p. 6)
    For today's NOPR, DOE has revised its assumption about additional 
fixture costs and believes that empty fixture costs are likely to 
increase for standards requiring electronic ballasts, as described in 
section V.C.12, because of the need to incorporate thermal protection 
and voltage transient protection. Because the use of electronic 
ballasts could necessitate fixture redesigns, DOE includes the costs of 
these fixture redesigns in its product and capital conversion costs. 
DOE has taken into account the feedback and estimates provided by NEMA 
in its analysis, as well as the input from individual manufacturers 
during

[[Page 51509]]

confidential manufacturer interviews. DOE's methodology for developing 
product and capital conversion cost estimates is described below and in 
chapter 13 of the NOPR TSD. DOE requests comment on the methodology 
applied to determine the product and capital conversion costs.
    Several stakeholders commented that the costs to develop and test 
electronic ballasts are higher than for magnetic ballasts. (NEMA, No 34 
at p. 8; OSI, No. 27 at p. 6) Cooper noted that the cost of UL 
certification when switching from magnetic to electronic ballasts falls 
into this category. (Cooper, Public Meeting Transcript, No. 33 at p. 
76) Acuity added that long lead times accentuate the cost of UL 
certification and make it more difficult for manufacturers to quickly 
bring new products to market. (Acuity, Public Meeting Transcript, No. 
33 at p. 79) DOE agrees that the engineering, testing, and 
certification costs for electronic ballasts may be significant and has 
included these costs in today's analysis, as described in what follows.
Ballast Industry Conversion Costs
    DOE's interviews with ballast manufacturers revealed that they 
expect the need to develop new and improved circuit designs--as opposed 
to the purchase of new capital equipment--will account for most of the 
conversion costs at each TSL. Due to the flexible nature of most 
ballast production equipment and DOE's assumption that the stack height 
of magnetic ballasts will not increase, manufacturers do not expect new 
and amended standards to strand (make obsolete in advance of complete 
depreciation) a significant share of their production assets. As 
opposed to other more capital-intensive appliance manufacturers, much 
of the expenses required to achieve higher efficiency levels would 
occur through research and development, engineering, and testing 
efforts.
    DOE based its estimates of the product conversion costs that would 
be required to meet each TSL on information obtained from manufacturer 
interviews and catalog data on the number and efficiency of models that 
each major manufacturer supports. DOE estimated the product development 
costs manufacturers would incur for each model that would need to be 
converted based on the necessary engineering and testing resources 
required to redesign each model. DOE assumed higher R&D and testing 
costs for levels requiring electronic ballasts compared to magnetic 
ballasts. Testing costs include internal testing, UL testing, 
additional certifications, pilot runs, and product training. DOE then 
multiplied these per-model cost estimates for each interviewed 
manufacturer by the total number of ballast models that would need to 
be converted at each efficiency level in each wattage bin, based on 
information from manufacturer catalogs and interviews, to estimate the 
total product conversion costs.
    To separate total product conversion costs into indoor and outdoor 
equipment classes, DOE assigned costs based on the percentage of indoor 
or outdoor shipments in the NIA. Finally, DOE scaled these costs to 
account for the market share of the companies not interviewed. DOE's 
estimates of the product conversion costs for metal halide ballasts 
affected by this rulemaking can be found in section VI.B.2, as follows 
and in chapter 13 of the NOPR TSD.
    As discussed above, DOE also estimated the capital conversion costs 
ballast manufacturers would incur to comply with the potential new and 
amended energy conservation standards represented by each TSL. During 
interviews, DOE asked manufacturers to estimate the capital 
expenditures required to expand the production of higher-efficiency 
products. These estimates included the required tooling and plant 
changes that would be necessary if product lines meeting the proposed 
standard did not currently exist.
    DOE estimated capital conversion costs, like product conversion 
costs, based on interviews with manufacturers. Some manufacturers 
anticipated minimal to no conversion costs because of the flexibility 
of their existing equipment or because they source certain ballast 
types rather than produce them in-house. Other manufacturers expected 
greater capital conversion costs because they would need to acquire new 
stamping dies for higher-efficiency magnetic ballasts and/or wave 
solder machines for electronic ballasts. In general, DOE's view is that 
significant changes to existing production lines and equipment would 
not be necessary in response to new or amended standards. It is 
therefore unlikely that most manufacturers would require high levels of 
capital expenditures compared to ordinary capital additions or 
replacements.
    DOE scaled its estimated conversion costs based on interviews to 
account for the market share of the companies not interviewed. DOE's 
estimates of the capital conversion costs for metal halide ballasts can 
be found in section VI.B.2, as follows and in chapter 13 of the NOPR 
TSD.
Fixture Industry Conversion Costs
    To estimate conversion costs for fixture manufacturers, DOE again 
based its estimates on manufacturer interviews and industry research. 
DOE doubts that the stack height of magnetic ballasts will increase in 
response to new and amended standards. As such, DOE assumed that 
fixture manufacturers would be able to use higher-efficiency magnetic 
ballasts without incurring redesign or capital costs. Even if higher-
efficiency levels can be met with magnetic ballasts, DOE expects 
manufacturers will incur one-time non-capital expenses at these levels 
associated with testing, literature changes, and marketing costs. These 
costs are included in DOE's product conversion cost estimates.
    At efficiency levels requiring electronic ballasts, DOE expects 
that fixture manufacturers may face more significant conversion costs. 
Manufacturers will have to consider thermal protection in their product 
designs because more-efficient electronic ballasts have lower 
tolerances for high temperatures than magnetic ballasts do. DOE 
estimated product conversion costs for fixture manufacturers by 
multiplying the number of product families in each wattage bin by the 
expected cost of fixture redesign and testing. DOE then multiplied 
these totals by the percentage of fixtures that would need to be 
redesigned at each efficiency level.
    DOE employed a similar methodology to estimate fixture capital 
conversion costs at efficiency levels associated with electronic 
ballasts. Based on manufacturer interviews, DOE estimated platform 
tooling and equipment costs, such as costs for die castings, 
bracketing, and extrusions, and multiplied these costs by the number of 
fixtures affected by the standard.
    To separate total product and capital conversion costs for fixture 
manufacturers into indoor and outdoor equipment classes, DOE assigned 
costs based on the percentage of indoor and outdoor fixtures each 
interviewed manufacturer offers. DOE's estimates of the product and 
capital conversion costs for metal halide lamp fixtures addressed in 
this rulemaking can be found in section VI.B.2, as follows and in 
chapter 13 of the NOPR TSD.
3. Discussion of Comments
    During the April 2011 public meeting, interested parties commented 
on the assumptions and results of the preliminary TSD. DOE addresses 
those comments below relating to the compliance period, the opportunity 
cost

[[Page 51510]]

of investments, and impacts on competition.
a. Compliance Period
    NEMA stated that fixture manufacturers may be unable to meet the 
compliance date of standards for all products. NEMA believes that it 
could take one year to redesign the ballasts, one year to test and 
certify the ballasts, and one year to handle marketing of fixture 
phase-outs. NEMA said that this entire process may be difficult and 
burdensome given the scope of the rulemaking. (NEMA, No. 34 at p. 15) 
OSI also noted its concern about the compliance period, stating that 
any change in the standard must provide adequate time for the ballast 
OEMs to develop, test, and begin producing the additional ballast types 
needed to provide a complete line of electronic metal halide ballasts. 
Fixture OEMs would, in turn, need adequate time to redesign their 
products. (OSI, No. 27 at p. 6)
    At the same time, OSI stated that ballast OEMs could provide bench-
top temperature-rise data to help reduce the UL testing requirements 
and costs for the fixture OEMs. OSI also stated that several ballast 
manufacturers are already manufacturing electronic metal halide 
ballasts and are developing additional products to broaden their 
product offerings. OSI has plans to expand production capacity to 
supply market needs. On the fixture side, several manufacturers are 
already developing fixtures using electronic metal halide ballasts, and 
these manufacturers will be able to expand their fixture offering as 
more ballast types become available. (OSI, No. 27 at p. 6, 7)
    DOE acknowledges that fixture manufacturers and ballast 
manufacturers may need to coordinate production to comply with a MHLF 
energy conservation standard. However, EISA 2007 specifies a compliance 
date of January 1, 2015, and DOE proposes to adopt this date in today's 
NOPR. (42 U.S.C. 6295(hh)(2)(B)) DOE requests comment on the impact and 
feasibility of the compliance date for manufacturers.
b. Opportunity Cost of Investments
    Several manufacturers argued that developing products to meet new 
and amended energy conservation standards has an opportunity cost due 
to the limited resources at their disposal. Manufacturers are currently 
focusing on new technologies such as solid-state lighting and controls 
with greater potential energy savings than mature technologies such as 
HID. New and amended standards for metal halide lamp fixtures could 
divert finite resources away from new product development, at a 
significant cost to the manufacturers. (NEMA, No. 34 at p. 7-8; 
Philips, Public Meeting Transcript, No. 33 at p. 81; Georgia Power, No. 
28 at p.1) Manufacturers may also choose not to convert their products 
and abandon the market because of the high opportunity cost. This could 
effectively eliminate the metal halide market and negate any potential 
energy savings from MHLF and HID lamp standards as well. (Philips, 
Public Meeting Transcript, No. 33 at p. 132; NEMA, No 34 at p. 16)
    DOE recognizes the opportunity cost associated with any investment, 
and agrees that manufacturers would need to spend capital to meet 
today's standards that they would not have to spend in the base case. 
As a result, manufacturers must determine the extent to which they will 
balance investment in the metal halide market with investment in 
emerging technologies. The companies will have to weigh tradeoffs 
between deferring investments and deploying additional capital. DOE 
includes the costs of meeting today's proposed standard in its 
analysis.
c. Impact on Competition
    NEMA stated that manufacturers who produce only magnetic ballasts 
would be at a disadvantage should DOE set a standard that requires the 
use of electronic ballasts. NEMA believed that magnetic ballast 
manufacturers would not be able to move to electronic ballast 
production because of the increased cost and complexity of electronic 
ballast designs and because of the different engineering 
specializations required. (NEMA, No. 34 at p. 16) OSI stated, however, 
that no manufacturers produce magnetic ballasts as their only product 
type, and many of those that offer magnetic ballasts also manufacture 
LED power supplies and drivers, which require the same or greater 
technology knowledge to develop and manufacture as electronic ballasts 
do. (OSI, No. 27 at p. 5)
    DOE agrees with NEMA that manufacturers with no experience 
producing electronic ballasts would face a steeper learning curve than 
those with experience. DOE doubts that competition will be 
significantly affected, however. Electronic ballasts are widely used 
throughout the industry, particularly at lower wattages. Additionally, 
as suggested by OSI, DOE has not identified any manufacturers that 
produce only magnetic metal halide ballasts.
4. Manufacturer Interviews
    DOE interviewed manufacturers representing more than 65 percent of 
metal halide lamp fixture sales and 90 percent of metal halide ballast 
sales. These NOPR interviews were in addition to the preliminary 
interviews DOE conducted as part of the engineering analysis. The 
information gathered during these interviews enabled DOE to tailor the 
GRIM to reflect the unique financial characteristics of the ballast and 
fixture industries. All interviews provided information that DOE used 
to evaluate the impacts of potential new and amended energy 
conservation standards on manufacturer cash flows, manufacturing 
capacities, and employment levels. Appendix 13A of the NOPR TSD 
contains the interview guides DOE used to conduct the MIA interviews.
    During the manufacturer interviews, DOE asked manufacturers to 
describe their major concerns about this rulemaking. The following 
sections describe the most significant issues identified by 
manufacturers. DOE also included additional concerns in chapter 13 of 
the NOPR TSD.
a. Ability To Recoup Investments
    Several manufacturers worried that new and amended energy 
conservation standards would force them to invest while their market 
was shrinking. The increasing market penetration of emerging 
technologies could strand these investments, particularly as metal 
halide lamp fixture standards hasten the switch to emerging 
technologies by narrowing the difference between MHLF and emerging 
technology purchase prices. If the standard threatens to accelerate the 
ongoing migration to new technology, manufacturers would be more likely 
to abandon their metal halide product lines.
    To address the emerging technologies issues discussed by 
manufacturers, DOE included several shipment scenarios in both the NIA 
and the GRIM. See chapter 10 and chapter 13 of the NOPR TSD for a 
discussion of the shipment scenarios used in the respective analyses. 
DOE is seeking comment on whether manufacturers' ability to recoup 
investment, combined with the opportunity cost of investment would 
encourage manufacturers to exit the metal halide lamp fixture market.
b. Efficiency Metric Used
    Some manufacturers disagreed over which metric should be used to 
regulate efficiency for metal halide lamp fixtures. Manufacturers 
agreed that

[[Page 51511]]

ballast efficiency is the most straightforward metric to use and the 
simplest for compliance purposes, but they noted that it ignores 
opportunities for energy savings from lamps and the fixtures 
themselves. At the same time, some manufacturers did not favor a lamp 
and ballast metric because a lamp and ballast metric could confer a 
competitive advantage to those manufacturers who produce both metal 
halide lamps and ballasts. Lastly, several manufacturers opposed the 
use of a fixture efficiency metric.
    In today's notice, DOE proposes a ballast efficiency metric for the 
reasons described in section III.B. DOE notes that it is concurrently 
conducting a rulemaking for HID lamps, including metal halide lamps, 
which will examine the lamp efficiency component of the metal halide 
system.
c. Maintenance of 150 W Exemption
    Nearly all manufacturers said that DOE should maintain its 
exemption for 150 W only fixtures rated for wet (e.g., outdoor) 
locations and containing ballasts rated to operate in air temperatures 
higher than 50 [deg]C. Manufacturers stated that it is cost-prohibitive 
to meet EISA 2007 standard levels with magnetic ballasts, and 
electronic ballasts are currently less reliable for outdoor 
applications. Furthermore, manufacturers acknowledged that this 
exemption created energy savings by pushing customers of the more-
expensive 175 W ballasts to the less-expensive 150 W magnetic ballasts. 
Manufacturers contended that customers would revert back to the 175 W 
equipment if the exemption were not maintained because of the 
significant price increase caused by bringing the 150 W ballast into 
compliance. This cost increase would cause customers to revert to 175 
W, they said, thereby negating any potential energy savings that could 
have been achieved by regulating 150 W products.
    DOE, however, is proposing not to maintain the 150 W exemption in 
today's notice for the reasons detailed in section III.A.1.

J. Employment Impact Analysis

    DOE considers employment impacts in the domestic economy as one 
factor in selecting a standard. Employment impacts consist of direct 
and indirect impacts. Direct employment impacts--which are not 
considered here--are any changes in the number of employees working for 
manufacturers of the equipment that is the subject of this rulemaking, 
their suppliers, and related service firms. Indirect employment 
impacts--the subject of this section--are changes in employment within 
the larger economy that occur due to the shift in expenditures and 
capital investment caused by the purchase and operation of more-
efficient equipment. The MIA addresses the direct employment impacts 
that concern metal halide lamp fixture manufacturers in section VI.B.2.
    The indirect employment impacts of standards consist of the net 
jobs created or eliminated in the national economy, outside of the 
manufacturing sector being regulated, because of: (1) Reduced spending 
on energy by end-users; (2) reduced spending on new energy supplies by 
the utility industry; (3) increased spending on new equipment to which 
the new standards apply; and (4) the effects of those three factors 
throughout the economy. DOE expects the net monetary savings from 
standards to be redirected to other forms of economic activity, and 
expects these shifts in spending and economic activity to affect the 
demand for labor in the short term, as explained as follows.
    One method for assessing the possible effects of such shifts in 
economic activity on the demand for labor is to compare sector 
employment statistics developed by the Labor Department's Bureau of 
Labor Statistics (BLS). (Data on industry employment, hours, labor 
compensation, value of production, and the implicit price deflator for 
output for these industries are available upon request by calling the 
Division of Industry Productivity Studies (202-691-5618) or by sending 
a request by email to dipsweb@bls.gov. These data are also available at 
www.bls.gov/news.release/prin1.nr0.htm. The BLS regularly publishes its 
estimates of the number of jobs per million dollars of economic 
activity in different sectors of the economy, as well as the jobs 
created elsewhere in the economy by this same economic activity. Data 
from the BLS indicate that expenditures in the utility sector generally 
create fewer jobs (both directly and indirectly) than expenditures in 
other sectors of the economy. There are many reasons for these 
differences, including wage differences and the fact that the utility 
sector is more capital-intensive and less labor-intensive than other 
sectors.\43\
---------------------------------------------------------------------------

    \43\ See Bureau of Economic Analysis, Regional Multipliers: A 
User Handbook for the Regional Input-Output Modeling System (RIMS 
II), Washington, DC., U.S. Department of Commerce, 1992.
---------------------------------------------------------------------------

    Energy conservation standards reduce customer utility bills. 
Because reduced customer expenditures for energy likely lead to 
increased expenditures in other sectors of the economy, the general 
effect of efficiency standards is to shift economic activity from a 
less labor-intensive sector (i.e., the utility sector) to more labor-
intensive sectors (e.g., the retail and manufacturing sectors). Thus, 
based on the BLS data alone, the Department believes that net national 
employment will increase due to shifts in economic activity resulting 
from new and amended standards for metal halide lamp fixtures.
    In developing today's proposed standards, DOE estimated indirect 
national employment impacts using an input/output model of the U.S. 
economy called Impact of Sector Energy Technologies (ImSET), version 
3.1.1. ImSET is a spreadsheet model of the U.S. economy that focuses on 
187 sectors most relevant to industrial, commercial, and residential 
building energy use.\44\ ImSET is a special-purpose version of the 
``U.S. Benchmark National Input-Output'' (I-O) model, designed to 
estimate the national employment and income effects of energy-saving 
technologies. The ImSET software includes a computer-based I-O model 
with structural coefficients to characterize economic flows among the 
187 sectors. ImSET's national economic I-O structure is based on a 2002 
U.S. benchmark table,\45\ specially aggregated to the 187 sectors. DOE 
estimated changes in expenditures using the NIA spreadsheet. Using 
ImSET, DOE estimated the net national, indirect employment impacts on 
employment by sector of potential new efficiency standards for metal 
halide ballasts. For more details on the employment impact analysis, 
see chapter 14 of the NOPR TSD.
---------------------------------------------------------------------------

    \44\ Roop, J. M., M. J. Scott, and R. W. Schultz, ImSET 3.1: 
Impact of Sector Energy Technologies (PNNL-18412 Pacific Northwest 
National Laboratory) (2009). Available at www.pnl.gov/main/publications/external/technical_reports/PNNL-18412.pdf.
    \45\ Stewart, R.L., J.B. Stone, and M.L. Streitwieser, ``U.S. 
Benchmark Input-Output Accounts, 2002,'' Survey of Current Business 
(Oct. 2007).
---------------------------------------------------------------------------

    DOE notes that ImSET is not a general equilibrium projection model, 
and understands the uncertainties involved in projecting employment 
impacts, especially changes in the later years of the analysis.\46\ 
Because ImSET does not incorporate price changes, the employment 
effects predicted by ImSET may over-estimate actual job impacts over 
the long run for this rule. Because ImSET predicts small job impacts 
resulting from this rule, regardless of these uncertainties, the actual 
job impacts are likely to be negligible in the

[[Page 51512]]

overall economy. DOE may consider the use of other modeling approaches 
for examining long-run employment impacts.
---------------------------------------------------------------------------

    \46\ Scott, M., J.M. Roop, R.W. Schultz, D.M. Anderson, K.A. 
Cort, ``The Impact of DOE Building Technology Energy Efficiency 
Programs on U.S. Employment, Income, and Investment.'' Energy 
Economics (Sep. 2008).
---------------------------------------------------------------------------

    DOE also notes that the employment impacts estimated with ImSET for 
the entire economy differ from the employment impacts in the lighting 
manufacturing sector estimated in NOPR TSD chapter 13 using the GRIM. 
The methodologies used and the sectors analyzed in the ImSET and GRIM 
models are different.

K. Utility Impact Analysis

    The utility impact analysis estimates several important effects on 
the utility industry of the adoption of new or amended standards. For 
this analysis, DOE used the NEMS-BT model to generate forecasts of 
electricity consumption, electricity generation by plant type, and 
electric generating capacity by plant type, that would result from each 
considered TSL. DOE obtained the energy savings inputs associated with 
efficiency improvements to considered products from the NIA. DOE 
conducts the utility impact analysis as a scenario that departs from 
the latest AEO Reference Case. In the analysis for today's rule, the 
estimated impacts of standards are the differences between values 
forecasted by NEMS-BT and the values in the AEO2013 Reference Case. 
Chapter 15 of the NOPR TSD describes the utility impact analysis.

L. Emissions Analysis

    In the emissions analysis, DOE estimated the reduction in power 
sector emissions of CO2, NOX, SO2, and 
Hg from potential energy conservation standards for metal halide lamp 
fixtures. In addition to estimating impacts of standards on power 
sector emissions, DOE estimated emissions impacts in production 
activities that provide the energy inputs to power plants. These are 
referred to as ``upstream'' emissions. In accordance with the FFC 
Statement of Policy (76 FR 51281 (August 18, 2011)), this FFC analysis 
includes impacts on emissions of methane (CH4) and nitrous 
oxide (N2O), both of which are recognized as greenhouse 
gases.
    To estimate impacts on the environment, DOE conducted the emissions 
analysis using emissions factors that were derived from data in 
AEO2013, supplemented by data from other sources. DOE developed 
separate emissions factors for power sector emissions and upstream 
emissions. The method that DOE used to derive emissions factors is 
described in chapter 16 of the NOPR TSD.
    EIA prepares the Annual Energy Outlook using NEMS. Each annual 
version of NEMS incorporates the projected impacts of existing air 
quality regulations on emissions. AEO2013 generally represents current 
legislation and environmental regulations, including recent government 
actions, for which implementing regulations were available as of 
December 31, 2012.
    SO2 emissions from affected electricity-generating units 
(EGUs) are subject to nationwide and regional emissions cap-and-trade 
programs. Title IV of the Clean Air Act sets an annual emissions cap on 
SO2 for affected EGUs in the 48 contiguous states and the 
District of Columbia (DC). SO2 emissions from 28 eastern 
states and DC were also limited under the Clean Air Interstate Rule 
(CAIR; 70 FR 25162 (May 12, 2005)), which created an allowance-based 
trading program. CAIR was remanded to the U.S. Environmental Protection 
Agency (EPA) by the U.S. Court of Appeals for the District of Columbia 
Circuit but it remained in effect. See North Carolina v. EPA, 550 F.3d 
1176 (D.C. Cir. 2008); North Carolina v. EPA, 531 F.3d 896 (D.C. Cir. 
2008). On July 6, 2011 EPA issued a replacement for CAIR, the Cross-
State Air Pollution Rule (CSAPR). 76 FR 48208 (Aug. 8, 2011). On August 
21, 2012, the D.C. Circuit issued a decision to vacate CSAPR. See EME 
Homer City Generation, LP v. EPA, 696 F.3d 7, 38 (D.C. Cir. 2012). The 
court ordered EPA to continue administering CAIR. The AEO2013 emissions 
factors used for today's NOPR assume that CAIR remains a binding 
regulation through 2040.
    The attainment of emissions caps is typically flexible among EGUs 
and is enforced through the use of emissions allowances and tradable 
permits. Under existing EPA regulations, any excess SO2 
emissions allowances resulting from the lower electricity demand caused 
by the imposition of an efficiency standard could be used to permit 
offsetting increases in SO2 emissions by any regulated EGU. 
In past rulemakings, DOE recognized that there was uncertainty about 
the effects of efficiency standards on SO2 emissions covered 
by the existing cap-and-trade system, but it concluded that negligible 
reductions in power sector SO2 emissions would occur as a 
result of standards.
    Beginning in 2015, however, SO2 emissions will fall as a 
result of the Mercury and Air Toxics Standards (MATS) for power plants, 
which were announced by EPA on December 21, 2011. 77 FR 9304 (Feb. 16, 
2012). In the final MATS rule, EPA established a standard for hydrogen 
chloride as a surrogate for acid gas hazardous air pollutants (HAP), 
and also established a standard for SO2 (a non-HAP acid gas) 
as an alternative equivalent surrogate standard for acid gas HAP. The 
same controls are used to reduce HAP and non-HAP acid gas; thus, 
SO2 emissions will be reduced as a result of the control 
technologies installed on coal-fired power plants to comply with the 
MATS requirements for acid gas. AEO2013 assumes that, in order to 
continue operating, coal plants must have either flue gas 
desulfurization or dry sorbent injection systems installed by 2015. 
Both technologies, which are used to reduce acid gas emissions, also 
reduce SO2 emissions. Under the MATS, NEMS shows a reduction 
in SO2 emissions when electricity demand decreases (e.g., as 
a result of energy efficiency standards). Emissions will be far below 
the cap that would be established by CSAPR, so it is unlikely that 
excess SO2 emissions allowances resulting from the lower 
electricity demand would be needed or used to permit offsetting 
increases in SO2 emissions by any regulated EGU. Therefore, 
DOE believes that efficiency standards will reduce SO2 
emissions in 2015 and beyond.
    CSAPR established a cap on NOX emissions in 28 eastern 
States and the District of Columbia. Energy conservation standards are 
expected to have little effect on NOX emissions in those 
States covered by CSAPR because excess NOX emissions 
allowances resulting from the lower electricity demand could be used to 
permit offsetting increases in NOX emissions. However, 
standards would be expected to reduce NOX emissions in the 
States not affected by the caps, so DOE estimated NOX 
emissions reductions from the standards considered in today's NOPR for 
these States.
    The MATS limit mercury emissions from power plants, but they do not 
include emissions caps and, as such, DOE's energy conservation 
standards would likely reduce Hg emissions. DOE estimated mercury 
emissions reduction using NEMS-BT based on AEO2013, which incorporates 
the MATS.

M. Monetizing Carbon Dioxide and Other Emissions Impacts

    As part of the development of this proposed rule, DOE considered 
the estimated monetary benefits likely to result from the reduced 
emissions of CO2 and NOX that are expected to 
result from each of the TSLs considered. In order to make this 
calculation, similar to the calculation of the NPV of customer benefit, 
DOE considered the reduced emissions expected to result over the

[[Page 51513]]

lifetime of products shipped in the projection period for each TSL. 
This section summarizes the basis for the monetary values used for each 
of these emissions and presents the values considered in this 
rulemaking.
    For today's NOPR, DOE is relying on a set of values for the social 
cost of carbon (SCC) that was developed by an interagency process. A 
summary of the basis for these values is provided below, and a more 
detailed description of the methodologies used is provided as an 
appendix to chapter 17 of the NOPR TSD.
1. Social Cost of Carbon
    The SCC is an estimate of the monetized damages associated with an 
incremental increase in carbon emissions in a given year. It is 
intended to include (but is not limited to) changes in net agricultural 
productivity, human health, property damages from increased flood risk, 
and the value of ecosystem services. Estimates of the SCC are provided 
in dollars per metric ton of carbon dioxide. A domestic SCC value is 
meant to reflect the value of damages in the United States resulting 
from a unit change in carbon dioxide emissions, while a global SCC 
value is meant to reflect the value of damages worldwide.
    Under section 1(b) of E.O. 12866, agencies must, to the extent 
permitted by law, ``assess both the costs and the benefits of the 
intended regulation and, recognizing that some costs and benefits are 
difficult to quantify, propose or adopt a regulation only upon a 
reasoned determination that the benefits of the intended regulation 
justify its costs.'' The purpose of the SCC estimates presented here is 
to allow agencies to incorporate the monetized social benefits of 
reducing CO2 emissions into cost-benefit analyses of 
regulatory actions that have small, or ``marginal,'' impacts on 
cumulative global emissions. The estimates are presented with an 
acknowledgement of the many uncertainties involved and with a clear 
understanding that they should be updated over time to reflect 
increasing knowledge of the science and economics of climate impacts.
    As part of the interagency process that developed these SCC 
estimates, technical experts from numerous agencies met on a regular 
basis to consider public comments, explore the technical literature in 
relevant fields, and discuss key model inputs and assumptions. The main 
objective of this process was to develop a range of SCC values using a 
defensible set of input assumptions grounded in the existing scientific 
and economic literatures. In this way, key uncertainties and model 
differences transparently and consistently inform the range of SCC 
estimates used in the rulemaking process.
a. Monetizing Carbon Dioxide Emissions
    When attempting to assess the incremental economic impacts of 
CO2 emissions, the analyst faces a number of serious 
challenges. A recent report from the National Research Council \47\ 
points out that any assessment will suffer from uncertainty, 
speculation, and lack of information about (1) future emissions of 
GHGs, (2) the effects of past and future emissions on the climate 
system, (3) the impact of changes in climate on the physical and 
biological environment, and (4) the translation of these environmental 
impacts into economic damages. As a result, any effort to quantify and 
monetize the harms associated with climate change will raise serious 
questions of science, economics, and ethics and should be viewed as 
provisional.
---------------------------------------------------------------------------

    \47\ National Research Council. Hidden Costs of Energy: Unpriced 
Consequences of Energy Production and Use. National Academies Press: 
Washington, DC (2009).
---------------------------------------------------------------------------

    Despite the serious limits of both quantification and monetization, 
SCC estimates can be useful in estimating the social benefits of 
reducing CO2 emissions. Most Federal regulatory actions can 
be expected to have marginal impacts on global emissions. For such 
policies, the agency can estimate the benefits from reduced emissions 
in any future year by multiplying the change in emissions in that year 
by the SCC value appropriate for that year. The net present value of 
the benefits can then be calculated by multiplying each of these future 
benefits by an appropriate discount factor and summing across all 
affected years. This approach assumes that the marginal damages from 
increased emissions are constant for small departures from the baseline 
emissions path, an approximation that is reasonable for policies that 
have effects on emissions that are small relative to cumulative global 
CO2 emissions. For policies that have a large (non-marginal) 
impact on global cumulative emissions, there is a separate question of 
whether the SCC is an appropriate tool for calculating the benefits of 
reduced emissions. This concern is not applicable to this notice, 
however.
    It is important to emphasize that the interagency process is 
committed to updating these estimates as the science and economic 
understanding of climate change and its impacts on society improves 
over time. In the meantime, the interagency group will continue to 
explore the issues raised by this analysis and consider public comments 
as part of the ongoing interagency process.
b. Social Cost of Carbon Values Used in Past Regulatory Analyses
    Past economic analyses for Federal regulations used a wide range of 
values to estimate the benefits associated with reducing CO2 
emissions. The model year 2011 Corporate Average Fuel Economy final 
rule used both a ``domestic'' SCC value of $2 per metric ton of 
CO2 and a ``global'' SCC value of $33 per metric ton of 
CO2 for 2007 emission reductions (in 2007$), increasing both 
values at 2.4 percent per year. It also included a sensitivity analysis 
at $80 per metric ton of CO2.\48\ The proposed rule for 
Model Years 2011-2015 assumed a domestic SCC value of $7 per metric ton 
of CO2 (in 2006$) for 2011 emission reductions (with a range 
of $0-$14 for sensitivity analysis), also increasing at 2.4 percent per 
year.\49\ A regulation for packaged terminal air conditioners and 
packaged terminal heat pumps finalized by DOE in 2008 used a domestic 
SCC range of $0 to $20 per metric ton CO2 for 2007 emission 
reductions (in 2007$). 73 FR 58772, 58814 (Oct. 7, 2008) In addition, 
EPA's 2008 Advance Notice of Proposed Rulemaking on Regulating 
Greenhouse Gas Emissions Under the Clean Air Act identified what it 
described as ``very preliminary'' SCC estimates subject to revision. 73 
FR 44354 (July 30, 2008). EPA's global mean values were $68 and $40 per 
metric ton CO2 for discount rates of approximately 2 percent 
and 3 percent, respectively (in 2006$ for 2007 emissions).
---------------------------------------------------------------------------

    \48\ See Average Fuel Economy Standards Passenger Cars and Light 
Trucks Model Year 2011, 74 FR 14196 (March 30, 2009) (Final Rule); 
Final Environmental Impact Statement Corporate Average Fuel Economy 
Standards, Passenger Cars and Light Trucks, Model Years 2011-2015 at 
3-90 (Oct. 2008) (Available at: www.nhtsa.gov/fuel-economy).
    \49\ See Average Fuel Economy Standards, Passenger Cars and 
Light Trucks, Model Years 2011-2015, 73 FR 24352 (May 2, 2008) 
(Proposed Rule); Draft Environmental Impact Statement Corporate 
Average Fuel Economy Standards, Passenger Cars and Light Trucks, 
Model Years 2011-2015 at 3-58 (June 2008) (Available at: 
www.nhtsa.gov/fuel-economy).
---------------------------------------------------------------------------

    In 2009, an interagency process was initiated to offer a 
preliminary assessment of how best to quantify the benefits from 
reducing CO2 emissions. To ensure consistency in how 
benefits are evaluated across agencies, the Administration sought to 
develop a transparent and defensible method, specifically designed for 
the rulemaking process, to quantify avoided climate change damages from 
reduced CO2

[[Page 51514]]

emissions. The interagency group did not undertake any original 
analysis. Instead, it combined SCC estimates from the existing 
literature to use as interim values until a more comprehensive analysis 
could be conducted. The outcome of the preliminary assessment by the 
interagency group was a set of five interim values: global SCC 
estimates for 2007 (in 2006$) of $55, $33, $19, $10, and $5 per ton of 
CO2. These interim values represent the first sustained 
interagency effort within the U.S. government to develop an SCC for use 
in regulatory analysis. The results of this preliminary effort were 
presented in several proposed and final rules.
c. Current Approach and Key Assumptions
    After the release of the interim values, the interagency group 
reconvened on a regular basis to generate improved SCC estimates. The 
group considered public comments and further explored the technical 
literature in relevant fields. The interagency group relied on three 
integrated assessment models commonly used to estimate the SCC: the 
FUND, DICE, and PAGE models. These models are frequently cited in the 
peer-reviewed literature and were used in the last assessment of the 
Intergovernmental Panel on Climate Change. Each model was given equal 
weight in the SCC values that were developed. The SCC values used for 
today's notice were generated using the most recent versions of the 
three integrated assessment models that have been published in the 
peer-reviewed literature.\50\
---------------------------------------------------------------------------

    \50\ Social Cost of Carbon for Regulatory Impact Analysis Under 
Executive Order 12866, Technical Model Update for the Social Cost of 
Carbon (SCC). Interagency Working Group on Social Cost of Carbon, 
United States Government, May 2013.
---------------------------------------------------------------------------

    Each model takes a slightly different approach to model how changes 
in emissions result in changes in economic damages. A key objective of 
the interagency process was to enable a consistent exploration of the 
three models while respecting the different approaches to quantifying 
damages taken by the key modelers in the field. An extensive review of 
the literature was conducted to select three sets of input parameters 
for these models: climate sensitivity, socio-economic and emissions 
trajectories, and discount rates. A probability distribution for 
climate sensitivity was specified as an input into all three models. In 
addition, the interagency group used a range of scenarios for the 
socio-economic parameters and a range of values for the discount rate. 
All other model features were left unchanged, relying on the model 
developers' best estimates and judgments.
    The interagency group selected four sets of SCC values for use in 
regulatory analyses.\51\ Three values are based on the average SCC from 
three integrated assessment models, at discount rates of 2.5, 3, and 5 
percent. The fourth value, which represents the 95th percentile SCC 
estimate across all three models at a 3-percent discount rate, is 
included to represent higher-than-expected impacts from temperature 
change further out in the tails of the SCC distribution. The values 
estimated for 2010 grow in real terms over time, as depicted in Table 
V.8. Additionally, the interagency group determined that a range of 
values from 7 percent to 23 percent should be used to adjust the global 
SCC to calculate domestic effects, although preference is given to 
consideration of the global benefits of reducing CO2 
emissions.
---------------------------------------------------------------------------

    \51\ Social Cost of Carbon for Regulatory Impact Analysis Under 
Executive Order 12866. Interagency Working Group on Social Cost of 
Carbon, United States Government, 2010.

                      Table V.8--Annual SCC Values From 2010 Interagency Report, 2010-2050
                                      [In 2007 dollars per metric ton CO2]
----------------------------------------------------------------------------------------------------------------
                                                                                 Discount rate
                                                             ---------------------------------------------------
                                                                5% Avg.      3% Avg.     2.5% Avg.     3% 95th
----------------------------------------------------------------------------------------------------------------
2010........................................................          4.7         21.4         35.1         64.9
2015........................................................          5.7         23.8         38.4         72.8
2020........................................................          6.8         26.3         41.7         80.7
2025........................................................          8.2         29.6         45.9         90.4
2030........................................................          9.7         32.8         50.0        100.0
2035........................................................         11.2         36.0         54.2        109.7
2040........................................................         12.7         39.2         58.4        119.3
2045........................................................         14.2         42.1         61.7        127.8
2050........................................................         15.7         44.9         65.0        136.2
----------------------------------------------------------------------------------------------------------------

    Table V.9 shows the updated sets of SCC estimates in five year 
increments from 2010 to 2050. Appendix 17B of the NOPR TSD provides the 
full set of values, as well as the 2013 draft report from the 
interagency group. The central value that emerges is the average SCC 
across models at the 3 percent discount rate. However, for purposes of 
capturing the uncertainties involved in regulatory impact analysis, the 
interagency group emphasizes the importance of including all four sets 
of SCC values.

                      Table V.9--Annual SCC Values From 2013 Interagency Update, 2010-2050
                                      [In 2007 dollars per metric ton CO2]
----------------------------------------------------------------------------------------------------------------
                                                                                Discount rate %
                                                             ---------------------------------------------------
                                                                   5            3           2.5           3
                            Year                             ---------------------------------------------------
                                                                                                         95th
                                                                Average      Average      Average     Percentile
----------------------------------------------------------------------------------------------------------------
2010........................................................           11           33           52           90
2015........................................................           12           38           58          109
2020........................................................           12           43           65          129

[[Page 51515]]

 
2025........................................................           14           48           70          144
2030........................................................           16           52           76          159
2035........................................................           19           57           81          176
2040........................................................           21           62           87          192
2045........................................................           24           66           92          206
2050........................................................           27           71           98          221
----------------------------------------------------------------------------------------------------------------

    It is important to recognize that a number of key uncertainties 
remain, and that current SCC estimates should be treated as provisional 
and revisable since they will evolve with improved scientific and 
economic understanding. The interagency group also recognized that the 
existing models are imperfect and incomplete. The National Research 
Council report mentioned above points out that there is tension between 
the goal of producing quantified estimates of the economic damages from 
an incremental ton of CO2 emissions and the limits of 
existing efforts to model these effects. There are a number of concerns 
and problems that should be addressed by the research community, 
including research programs housed in many of the Federal agencies 
participating in the interagency process to estimate the SCC. The 
interagency group intends to periodically review and reconsider those 
estimates to reflect increasing knowledge of the science and economics 
of climate impacts, as well as improvements in modeling.
    In summary, in considering the potential global benefits resulting 
from reduced CO2 emissions, DOE used the values from the 
2013 interagency report, adjusted to 2012$ using the Gross Domestic 
Product price deflator. For each of the four cases specified, the 
values used for emissions in 2015 were $12.9, $40.8, $62.2, and $117 
per metric ton avoided (values expressed in 2012$).\52\ DOE derived 
values after 2050 using the growth rate for the 2040-2050 period in the 
interagency update.
---------------------------------------------------------------------------

    \52\ The interagency report presents SCC values through 2050. 
DOE derived values after 2050 using the 3-percent per year 
escalation rate used by the interagency group.
---------------------------------------------------------------------------

    DOE multiplied the CO2 emissions reduction estimated for 
each year by the SCC 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 SCC values in each case.
2. Valuation of Other Emissions Reductions
    DOE investigated the potential monetary benefit of reduced 
NOX emissions from the TSLs it considered. As noted above, 
DOE has taken into account how new or amended energy conservation 
standards would reduce NOX emissions in those 22 states that 
are not affected by the CSAPR. DOE estimated the monetized value of 
NOX emissions reductions resulting from each of the TSLs 
considered for today's NOPR based on estimates found in the relevant 
scientific literature. Available estimates suggest a very wide range of 
monetary values per ton of NOX from stationary sources, 
ranging from $468 to $4,809 per ton in 2012$).\53\ In accordance with 
OMB guidance,\54\ DOE calculated the monetary benefits using each of 
the economic values for NOX and real discount rates of 3 
percent and 7 percent.
---------------------------------------------------------------------------

    \53\ For additional information, refer to U.S. Office of 
Management and Budget, Office of Information and Regulatory Affairs, 
2006 Report to Congress on the Costs and Benefits of Federal 
Regulations and Unfunded Mandates on State, Local, and Tribal 
Entities, Washington, DC.
    \54\ OMB, Circular A-4: Regulatory Analysis (Sept. 17, 2003).
---------------------------------------------------------------------------

    DOE did not monetize Hg emission reductions because it is currently 
evaluating estimates of the value of Hg emissions.

VI. Analytical Results

A. Trial Standard Levels

    DOE analyzed the benefits and burdens of a number of TSLs for the 
metal halide lamp fixtures that are the subject of today's proposed 
rule. Table VI.1 presents the trial standard levels and the 
corresponding equipment class ELs for representative equipment 
classes.\55\ See the engineering analysis in section V.C.9 of this NOPR 
for a more detailed discussion of the efficiency levels.
---------------------------------------------------------------------------

    \55\ See section V.C.3 for more information on the chosen 
representative wattages.
---------------------------------------------------------------------------

    In the following section, DOE presents the analytical results for 
the TSLs of the equipment classes that DOE analyzed directly. DOE 
scaled the ELs for these representative equipment classes to create ELs 
for other equipment classes that were not directly analyzed as set 
forth in chapter 5 of the NOPR TSD. For more details on the 
representative equipment classes, please see section V.C.2.

                                        Table VI.1--Trial Standard Levels
----------------------------------------------------------------------------------------------------------------
         Rep. wattage                TSL 1            TSL 2            TSL 3           TSL 4           TSL 5
----------------------------------------------------------------------------------------------------------------
70 W Indoor...................  EL1              EL2              EL2             EL2             EL4
70 W Outdoor..................  EL1              EL2              EL2             EL3             EL4
150 W Indoor..................  EL1              EL2              EL4             EL4             EL4
150 W Outdoor.................  EL1              EL2              EL4             EL4             EL4
250 W Indoor..................  EL1              EL2              EL2             EL2             EL4
250 W Outdoor.................  EL1              EL2              EL2             EL2             EL4
400 W Indoor..................  EL1              EL2              EL2             EL2             EL4

[[Page 51516]]

 
400 W Outdoor.................  EL1              EL2              EL2             EL2             EL4
1000 W Indoor.................  EL1+DS *         EL2+DS           EL2+DS          EL2+DS          EL2+DS
1000 W Outdoor................  EL1+DS           EL2+DS           EL2+DS          EL2+DS          EL2+DS
----------------------------------------------------------------------------------------------------------------
* DS is a design standard that bans the use of probe-start ballasts in new metal halide lamp fixtures.

    TSL1 represents EL1 for each equipment class with a positive NPV at 
EL1. TSL 1 would set energy conservation standards at EL1 for the 
indoor and outdoor fixtures at 70 W,\56\ 150 W, 250 W, 400 W, and 1000 
W. Standards included in TSL 1 typically can be satisfied by magnetic 
ballasts with mid-grade steel and copper windings. These ballasts are 
commercially available for the ballasts in indoor and outdoor 70 W, 250 
W, and 1000 W fixtures, with the rest being modeled. TSL 1 includes a 
design standard for indoor and outdoor 1000 W fixtures that prohibits 
the sale of probe-start ballasts in new fixtures.
---------------------------------------------------------------------------

    \56\ The nomenclature 70 W indoor fixture refers to the >=50 W 
and <=100 W indoor equipment class. 70 W is the representative 
wattage for the equipment class as discussed in section V.C.3. A 
similar shorthand naming convention is used for other equipment 
classes.
---------------------------------------------------------------------------

    TSL 2 represents the max tech magnetic ballast EL for each 
equipment class. TSL 2 would set energy conservation standards at EL2 
for the indoor and outdoor fixtures at 70 W, 150 W, 250 W, 400 W, and 
1000 W. EL2 is the max tech EL for the indoor and outdoor 1000 W 
fixtures. Standards included in TSL 2 typically can be satisfied by 
fixtures that contain magnetic ballasts with high-grade core steel and 
copper windings. These ballasts are modeled, except for the 1000 W 
ballasts, which are commercially available. TSL 2 includes a design 
standard for the indoor and outdoor 1000 W fixtures that prohibits the 
sale of probe-start ballasts in new fixtures. TSL 2 sets the same 
standards for indoor and outdoor representative equipment classes at 
the same wattage.
    TSL 3 represents the maximum energy savings achievable with maximum 
positive NPV with the requirement that the same efficiency levels for 
fixtures operating indoors and outdoors be analyzed. TSL 3 would set 
energy conservation standards at EL2 for indoor and outdoor fixtures at 
70 W, 250 W, 400 W, and 1000 W, and EL4 for indoor and outdoor fixtures 
at 150 W. EL4 is the max tech EL for indoor and outdoor fixtures at 150 
W, and EL2 is the max tech EL for indoor and outdoor fixtures at 1000 
W. Standards included in TSL 3 typically can be satisfied by fixtures 
that contain magnetic ballasts with high-grade core steel and copper 
windings, except for the 150 W fixtures, which require max tech 
electronic ballasts with high-grade electronic components. The 150 W 
and 1000 W ballasts are commercially available, while the rest are 
modeled. TSL 3 includes a design standard for indoor and outdoor 1000 W 
fixtures that prohibits the sale of probe-start ballasts in new 
fixtures. TSL 3 sets the same standards for indoor and outdoor 
representative equipment classes at the same wattage.
    TSL 4 represents the maximum energy savings achievable with a 
positive NPV for each equipment class, considering indoor and outdoor 
fixtures separately. TSL4 would set energy conservation standards at 
EL2 for indoor and outdoor 250 W, 400 W, and 1000 W fixtures and indoor 
70 W fixtures, EL3 for outdoor 70 W fixtures, and EL4 for indoor and 
outdoor 150 W fixtures. EL4 is the max tech EL for indoor and outdoor 
fixtures at 150 W, and EL2 is the max tech EL for indoor and outdoor 
fixtures at 1000 W. Standards included in TSL 4 typically can be 
satisfied by fixtures that contain magnetic ballasts with high-grade 
core steel and copper windings, except for 70 W outdoor fixtures, which 
require standard-grade electronic ballasts, and 150 W fixtures, which 
require max tech electronic ballasts with high-grade electronic 
components. The ballasts for indoor and outdoor 150 W and 1000 W 
fixtures and outdoor 70 W fixtures are commercially available, and the 
rest are modeled. TSL 4 includes a design standard for indoor and 
outdoor 1000 W fixtures that prohibits the sale of probe-start ballasts 
in new fixtures.
    TSL 5 represents all of the max tech efficiency levels, which would 
set energy conservation standards at EL4 for indoor and outdoor 70, 
150, 250, and 400 W fixtures, and EL2 for indoor and outdoor 1000 W 
fixtures. Standards included in TSL 5 require fixtures to contain the 
max tech electronic ballasts with high-grade electronic components for 
indoor and outdoor 70, 150, 250, and 400 W fixtures. High-grade core 
steel and copper windings are typically used in the ballasts included 
in 1000 W fixtures. Commercially available ballasts meet TSL 5 for all 
equipment classes. TSL 5 would require high-frequency electronic 
ballasts for 400 W indoor and outdoor fixtures, which have limited 
compatibility with CMH technology. See section V.C.8 for additional 
detail.TSL 5 includes a design standard for indoor and outdoor 1000 W 
fixtures that prohibits the sale of probe-start ballasts in new 
fixtures. TSL 5 sets the same standards for indoor and outdoor 
representative equipment classes at the same wattage.
    DOE requests comment on these proposed trial standard levels.

B. Economic Justification and Energy Savings

1. Economic Impacts on Individual Customers
a. Life-Cycle Cost and Payback Period
    Customers affected by new or amended standards usually experience 
higher purchase prices and lower operating costs. Generally, these 
effects on individual customers are best summarized by changes in LCCs 
and PBP. DOE calculated the LCC and PBP values for the potential 
standard levels considered in this rulemaking to provide key inputs for 
each TSL. These values are reported by equipment class in Table VI.2 
through Table VI.13. Each table includes the average total LCC and the 
average LCC savings, as well as the fraction of equipment customers for 
which the LCC will either decrease (net benefit) or increase (net cost) 
relative to the baseline case. The last column in each table contains 
the median PBPs for the customer purchasing a design compliant with the 
TSL.
    The results for each TSL are presented relative to the energy use 
in the baseline case (no new or amended standards), based on energy 
consumption under conditions of actual equipment use. As discussed in 
section IV.D.2, the presumption PBP is based on test values under 
conditions prescribed by the DOE test procedures, as required by EPCA. 
(42 U.S.C. 6295(o)(2)(B)(iii))

[[Page 51517]]



                   Table VI.2--Equipment Class 1--70 Watt Metal Halide Lamp Fixtures (Indoor, Magnetic Baseline): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
         Trial standard level             Efficiency level      Installed    Discounted                 Average         that experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       537.80     1,379.32     1,917.12  ...........  ...........  ...........  ...........
1....................................  1.....................       539.03     1,345.26     1,884.28        32.84          0.0        100.0          0.5
2, 3, 4..............................  2.....................       552.28     1,326.43     1,878.71        38.41          0.0        100.0          4.2
                                       3.....................       555.25     1,379.56     1,934.80       -17.68           24           76          3.3
5....................................  4.....................       568.68     1,374.61     1,943.29       -26.16           28           72          5.4
--------------------------------------------------------------------------------------------------------------------------------------------------------


                   Table VI.3 Equipment Class 1--70 Watt Metal Halide Lamp Fixtures (Indoor, Electronic Baseline): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
         Trial standard level             Efficiency level      Installed    Discounted                 Average         that experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
1, 2, 3, 4...........................  Baseline/3                   555.25     1,379.56     1,934.80  ...........  ...........  ...........  ...........
5....................................  4                            568.68     1,374.61     1,943.29        -8.48           96            4         32.3
--------------------------------------------------------------------------------------------------------------------------------------------------------


                   Table VI.4--Equipment Class 1--70 Watt Metal Halide Lamp Fixtures (Outdoor, Magnetic Baseline): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
         Trial standard level             Efficiency level      Installed    Discounted                 Average         that experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       527.98     1,844.61     2,372.59  ...........  ...........  ...........  ...........
1....................................  1.....................       529.16     1,803.94     2,333.09        39.50          0.0        100.0          0.6
2, 3.................................  2.....................       541.86     1,784.29     2,326.15        46.44          0.0        100.0          4.4
4....................................  3.....................       580.46     1,722.54     2,303.00        69.59           42           58         12.8
5....................................  4.....................       593.33     1,715.50     2,308.82        63.77           43           57         14.6
--------------------------------------------------------------------------------------------------------------------------------------------------------


                  Table VI.5--Equipment Class 1--70 Watt Metal Halide Lamp Fixtures (Outdoor, Electronic Baseline): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
         Trial standard level             Efficiency level      Installed    Discounted                 Average         that experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
1, 2, 3, 4...........................  Baseline/3............       580.46     1,722.54     2,303.00  ...........  ...........  ...........  ...........
5....................................  4.....................       593.33     1,715.50     2,308.82        -5.82           84           16         44.7
--------------------------------------------------------------------------------------------------------------------------------------------------------


                            Table VI.6--Equipment Class 2--150 Watt Metal Halide Lamp Fixtures (Indoor): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
         Trial standard level             Efficiency level      Installed    Discounted                 Average         that experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       657.04     2,110.32     2,767.36  ...........  ...........  ...........  ...........
1....................................  1.....................       673.27     2,075.60     2,748.87        18.50            1           99          7.2
2....................................  2.....................       681.07     2,046.61     2,727.68        39.68            0          100          5.8
                                       3.....................       676.72     2,063.23     2,739.95        27.41           15           85          2.4
3,4,5................................  4.....................       696.00     2,061.22     2,757.23        10.14           23           77          4.7
--------------------------------------------------------------------------------------------------------------------------------------------------------


[[Page 51518]]


                            Table VI.7--Equipment Class 2--150 Watt Metal Halide Lamp Fixtures (Outdoor): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
         Trial standard level             Efficiency level      Installed    Discounted                 Average         that experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       641.19     2,681.81     3,322.99  ...........  ...........  ...........  ...........
1....................................  1.....................       656.74     2,645.59     3,302.33        20.66            0          100          8.3
2....................................  2.....................       664.20     2,614.09     3,278.30        44.70            0          100          6.6
                                       3.....................       695.81     2,499.35     3,195.16       127.84           16           84          7.9
3, 4, 5..............................  4.....................       714.28     2,496.20     3,210.48       112.51           26           74         10.5
--------------------------------------------------------------------------------------------------------------------------------------------------------


                            Table VI.8--Equipment Class 3--250 Watt Metal Halide Lamp Fixtures (Indoor): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
         Trial standard level             Efficiency level      Installed    Discounted                 Average         that experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       710.86     2,485.37     3,196.24  ...........  ...........  ...........  ...........
1....................................  1.....................       734.37     2,455.32     3,189.69         6.55           36           64         12.4
2, 3, 4..............................  2.....................       749.99     2,433.12     3,183.11        13.12           31           69         11.8
                                       3.....................       790.69     2,485.61     3,276.30       -80.07           52           48         14.4
5....................................  4.....................       783.45     2,472.23     3,255.68       -59.44           44           56         11.5
--------------------------------------------------------------------------------------------------------------------------------------------------------


                            Table VI.9--Equipment Class 3--250 Watt Metal Halide Lamp Fixtures (Outdoor): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
         Trial standard level             Efficiency level      Installed    Discounted                 Average         that experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       690.34     3,132.65     3,822.99  ...........  ...........  ...........  ...........
1....................................  1.....................       712.86     3,103.40     3,816.26         6.73           20           80         14.8
2, 3, 4..............................  2.....................       727.82     3,081.42     3,809.24        13.75           15           85         14.0
                                       3.....................       802.58     2,996.28     3,798.86        24.13           65           35         28.0
5....................................  4.....................       795.64     2,981.26     3,776.91        46.08           54           46         21.4
--------------------------------------------------------------------------------------------------------------------------------------------------------


                            Table VI.10--Equipment Class 4--400 Watt Metal Halide Lamp Fixtures (Indoor): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
         Trial standard level             Efficiency level      Installed    Discounted                 Average         that experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       784.44     3,453.98     4,238.41  ...........  ...........  ...........  ...........
1....................................  1.....................       823.04     3,406.28     4,229.31         9.10           40           60         12.8
2, 3, 4..............................  2.....................       841.82     3,368.36     4,210.18        28.23           18           82         10.5
                                       3.....................       921.01     3,389.35     4,310.36       -71.95           49           51         13.8
5....................................  4.....................       962.37     3,375.11     4,337.48       -99.07           61           39         16.2
--------------------------------------------------------------------------------------------------------------------------------------------------------


                           Table VI.11--Equipment Class 4--400 Watt Metal Halide Lamp Fixtures (Outdoor): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
         Trial standard level             Efficiency level      Installed    Discounted                 Average         that experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       760.80     4,173.10     4,933.90  ...........  ...........  ...........  ...........
1....................................  1.....................       797.78     4,126.96     4,924.74         9.16           22           78         15.4
2, 3, 4..............................  2.....................       815.77     4,087.66     4,903.43        30.47            7           93         12.3
                                       3.....................       927.40     3,958.53     4,885.93        47.97           56           44         21.3
5....................................  4.....................       967.02     3,940.38     4,907.40        26.49           63           37         24.4
--------------------------------------------------------------------------------------------------------------------------------------------------------


[[Page 51519]]


                           Table VI.12--Equipment Class 5--1000 Watt Metal Halide Lamp Fixtures (Indoor): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
         Trial standard level             Efficiency level      Installed    Discounted                 Average         that experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............     1,143.88    11,657.30    12,801.18  ...........  ...........  ...........  ...........
                                       1.....................     1,185.86    11,619.06    12,804.91        -3.73           62           38         16.3
1....................................  1 + DS *..............     1,207.74    11,122.24    12,329.98       471.20          0.0        100.0          1.8
                                       2.....................     1,199.97    11,570.62    12,770.60        30.58           12           88          9.7
2, 3, 4, 5...........................  2 + DS*...............     1,221.85    11,077.12    12,298.97       502.21          0.0        100.0          2.0
--------------------------------------------------------------------------------------------------------------------------------------------------------
* DS = Design standard requiring that all fixtures sold shall not contain a probe-start ballast.


                           Table VI.13--Equipment Class 5--1000 Watt Metal Halide Lamp Fixtures (Outdoor): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
         Trial standard level             Efficiency level      Installed    Discounted                 Average         that experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............     1,101.52     9,854.56    10,956.08  ...........  ...........  ...........  ...........
                                       1.....................     1,141.74     9,823.86    10,965.59        -9.52           67           33         24.9
1....................................  1 + DS *..............     1,162.70     9,408.20    10,570.89       385.18          0.0        100.0          2.7
                                       2.....................     1,155.26     9,783.72    10,938.98        17.10           18           82         14.5
2, 3, 4, 5...........................  2 + DS *..............     1,176.22     9,370.84    10,547.05       409.02          0.0        100.0          3.0
--------------------------------------------------------------------------------------------------------------------------------------------------------
* DS = Design standard requiring that all fixtures sold shall not contain a probe-start ballast.

b. Customer Subgroup Analysis
    Using the LCC spreadsheet model, DOE determined the effect of the 
trial standard levels on the following customer sub-groups: utilities, 
owners of transportation facilities, and warehouse owners. DOE adjusted 
particular inputs to the LCC model to reflect conditions faced by the 
identified subgroups. For utilities, DOE assumed that maintenance costs 
would be higher than average maintenance costs because utilities have 
to maintain more equipment than the other subgroups do. DOE assumed 
that owners of transportation facilities face higher annual operating 
hours than the average used in the main LCC analysis. For warehouse 
owners, DOE assumed lower annual operating hours than average used in 
the main LCC analysis.
    Table VI.14 through Table VI.25 show the LCC effects and PBPs for 
identified sub-groups that purchase metal halide lamp fixtures. In 
general, the average LCC savings for the identified subgroups at the 
considered efficiency levels are not significantly different from the 
average for all customers.

                  Table VI.14--Equipment Class 1--70 Watt Metal Halide Lamp Fixtures (Indoor, Magnetic Baseline): LCC Subgroup Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
         Trial standard level             Efficiency level      Installed    Discounted                 Average         that experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Subgroup: Utilities
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       650.30     1,632.71     2,283.01  ...........  ...........  ...........  ...........
1....................................  1.....................       651.53     1,598.65     2,250.17        32.84          0.0        100.0          0.5
2, 3, 4..............................  2.....................       664.78     1,579.82     2,244.60        38.41          0.0        100.0          4.2
                                       3.....................       667.75     1,663.46     2,331.20       -48.19           35           65          3.5
5....................................  4.....................       681.18     1,658.51     2,339.68       -56.67           36           64          5.8
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                        Subgroup: Transportation Facility Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       537.80     1,428.88     1,966.68  ...........  ...........  ...........  ...........
1....................................  1.....................       539.03     1,392.23     1,931.26        35.41          0.0        100.0          0.5
2, 3, 4..............................  2.....................       552.28     1,371.90     1,924.18        42.49          0.0        100.0          3.9
                                       3.....................       555.25     1,413.15     1,968.39        -1.72           26           74          3.0
5....................................  4.....................       568.68     1,407.13     1,975.80        -9.13           29           71          5.0
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Subgroup: Warehouse Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       537.80     1,372.08     1,909.88  ...........  ...........  ...........  ...........
1....................................  1.....................       539.03     1,338.45     1,877.47        32.40          0.0        100.0          0.4

[[Page 51520]]

 
2, 3, 4..............................  2.....................       552.28     1,319.92     1,872.20        37.68          0.0        100.0          3.4
                                       3.....................       555.25     1,373.94     1,929.19       -19.31           14           86          1.9
5....................................  4.....................       568.68     1,369.17     1,937.85       -27.97           15           85          3.2
--------------------------------------------------------------------------------------------------------------------------------------------------------


                  Table VI.15--Equipment Class 1--70 Watt Metal Halide Lamp Fixtures (Indoor, Electronic Baseline): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
         Trial standard level             Efficiency level      Installed    Discounted                 Average         that experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Subgroup: Utilities
--------------------------------------------------------------------------------------------------------------------------------------------------------
1, 2, 3, 4...........................  Baseline/3............       667.75     1,663.46     2,331.20  ...........  ...........  ...........  ...........
5....................................  4.....................       681.18     1,658.51     2,339.68        -8.48           96            4         32.4
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                        Subgroup: Transportation Facility Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
1, 2, 3, 4...........................  Baseline/3............       555.25     1,413.15     1,968.39  ...........  ...........  ...........  ...........
5....................................  4.....................       568.68     1,407.13     1,975.80        -7.41           95            5         31.3
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Subgroup: Warehouse Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
1, 2, 3, 4...........................  Baseline/3............       555.25     1,373.94     1,929.19  ...........  ...........  ...........  ...........
5....................................  4.....................       568.68     1,369.17     1,937.85        -8.66           98            2         21.9
--------------------------------------------------------------------------------------------------------------------------------------------------------


                  Table VI.16--Equipment Class 1--70 Watt Metal Halide Lamp Fixtures (Outdoor, Magnetic Baseline): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
         Trial standard level             Efficiency level      Installed    Discounted                 Average         that experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Subgroup: Utilities
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       640.48     2,205.61     2,846.10  ...........  ...........  ...........  ...........
1....................................  1.....................       641.66     2,164.94     2,806.60        39.50          0.0        100.0          0.6
2, 3.................................  2.....................       654.36     2,145.30     2,799.66        46.44          0.0        100.0          4.4
4....................................  3.....................       692.96     2,090.08     2,783.04        63.06           46           54         16.9
5....................................  4.....................       705.83     2,083.03     2,788.86        57.23           48           52         18.7
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                         Sugroup: Transportation Facility Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       527.98     1,844.61     2,372.59  ...........  ...........  ...........  ...........
1....................................  1.....................       529.16     1,803.94     2,333.09        39.50          0.0        100.0          0.6
2, 3.................................  2.....................       541.86     1,784.29     2,326.15        46.44          0.0        100.0          4.4
4....................................  3.....................       580.46     1,722.54     2,303.00        69.59           46           54         16.9
5....................................  4.....................       593.33     1,715.50     2,308.82        63.77           48           52         18.7
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Subgroup: Warehouse Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       527.98     1,844.61     2,372.59
1....................................  1.....................       529.16     1,803.94     2,333.09        39.50          0.0        100.0          0.6
2, 3.................................  2.....................       541.86     1,784.29     2,326.15        46.44          0.0        100.0          4.4
4....................................  3.....................       580.46     1,722.54     2,303.00        69.59           38           62         12.4
5....................................  4.....................       593.33     1,715.50     2,308.82        63.77           41           59         14.2
--------------------------------------------------------------------------------------------------------------------------------------------------------


[[Page 51521]]


                 Table VI.17--Equipment Class 1--70 Watt Metal Halide Lamp Fixtures (Outdoor, Electronic Baseline): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
         Trial standard level             Efficiency level      Installed    Discounted                 Average         that experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Subgroup: Utilities
--------------------------------------------------------------------------------------------------------------------------------------------------------
1, 2, 3, 4...........................  Baseline/3............       692.96     2,090.08     2,783.04  ...........  ...........  ...........  ...........
5....................................  4.....................       705.83     2,083.03     2,788.86        -5.82           85           15         44.3
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                        Subgroup: Transportation Facility Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
1, 2, 3, 4...........................  Baseline/3............       580.46     1,722.54     2,303.00  ...........  ...........  ...........  ...........
5....................................  4.....................       593.33     1,715.50     2,308.82        -5.82           95            5         31.0
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Subgroup: Warehouse Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
1, 2, 3, 4...........................  Baseline/3............       580.46     1,722.54     2,303.00  ...........  ...........  ...........  ...........
5....................................  4.....................       593.33     1,715.50     2,308.82        -5.82           85           15         44.3
--------------------------------------------------------------------------------------------------------------------------------------------------------


                            Table VI.18--Equipment Class 2--150 Watt Metal Halide Lamp Fixtures (Indoor): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
         Trial standard level             Efficiency level      Installed    Discounted                 Average         that experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Subgroup: Utilities
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       792.04     2,416.48     3,208.52  ...........  ...........  ...........  ...........
1....................................  1.....................       808.27     2,381.76     3,190.03        18.50            1           99          7.2
2....................................  2.....................       816.07     2,352.77     3,168.84        39.68            0          100          5.8
                                       3.....................       811.72     2,404.29     3,216.01        -7.48           29           71          2.7
3, 4, 5..............................  4.....................       831.00     2,402.28     3,233.28       -24.76           34           66          5.2
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                        Subgroup: Transportation Facility Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       657.04     2,225.70     2,882.74  ...........  ...........  ...........  ...........
1....................................  1.....................       673.27     2,187.50     2,860.77        21.97            1           99          6.8
2....................................  2.....................       681.07     2,155.69     2,836.76        45.98            0          100          5.4
                                       3.....................       676.72     2,173.66     2,850.38        32.36           12           88          2.2
3, 4, 5..............................  4.....................       696.00     2,171.29     2,867.29        15.45           20           80          4.4
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Subgroup: Warehouse Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       657.04     2,098.07     2,755.11  ...........  ...........  ...........  ...........
1....................................  1.....................       673.27     2,063.78     2,737.05        18.06            0          100          5.8
2....................................  2.....................       681.07     2,035.14     2,716.20        38.91            0          100          4.7
                                       3.....................       676.72     2,053.01     2,729.73        25.37            8           92          1.3
3, 4, 5..............................  4.....................       696.00     2,051.17     2,747.17         7.93           12           88          2.6
--------------------------------------------------------------------------------------------------------------------------------------------------------


                           Table VI.19--Equipment Class 2--150 Watt Metal Halide Lamp Fixtures (Outdoor): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
         Trial standard level             Efficiency level      Installed    Discounted                 Average         that experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Subgroup: Utilities
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       776.19     3,115.02     3,891.20  ...........  ...........  ...........  ...........
1....................................  1.....................       791.74     3,078.80     3,870.54        20.66            0          100          8.3
2....................................  2.....................       799.20     3,047.30     3,846.51        44.70            0          100          6.5
                                       3.....................       830.81     2,940.40     3,771.21       120.00           33           67          9.2
3, 4, 5..............................  4.....................       849.28     2,937.25     3,786.53       104.67           38           62         12.2
--------------------------------------------------------------------------------------------------------------------------------------------------------

[[Page 51522]]

 
                                                        Subgroup: Transportation Facility Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       641.19     2,681.81     3,322.99  ...........  ...........  ...........  ...........
1....................................  1.....................       656.74     2,645.59     3,302.33        20.66            0          100          8.3
2....................................  2.....................       664.20     2,614.09     3,278.30        44.70            0          100          6.5
                                       3.....................       695.81     2,499.35     3,195.16       127.84           33           67          9.2
3, 4, 5..............................  4.....................       714.28     2,496.20     3,210.48       112.51           38           62         12.2
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Subgroup: Warehouse Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       641.19     2,681.81     3,322.99  ...........  ...........  ...........  ...........
1....................................  1.....................       656.74     2,645.59     3,302.33        20.66            0          100          8.3
2....................................  2.....................       664.20     2,614.09     3,278.30        44.70            0          100          6.5
                                       3.....................       695.81     2,499.35     3,195.16       127.84           16           84          7.7
3, 4, 5..............................  4.....................       714.28     2,496.20     3,210.48       112.51           25           75         10.3
--------------------------------------------------------------------------------------------------------------------------------------------------------


                            Table VI.20--Equipment Class 3--250 Watt Metal Halide Lamp Fixtures (Indoor): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
         Trial standard level             Efficiency level      Installed    Discounted                 Average         that experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Subgroup: Utilities
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       845.86     2,706.30     3,552.16  ...........  ...........  ...........  ...........
1....................................  1.....................       869.37     2,676.24     3,545.61         6.55           36           64         12.4
2, 3, 4..............................  2.....................       884.99     2,654.05     3,539.04        13.12           30           70         11.9
                                       3.....................       925.69     2,741.43     3,667.13      -114.96           57           43         16.9
5....................................  4.....................       918.45     2,728.05     3,646.50       -94.34           49           51         13.0
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                        Subgroup: Transportation Facility Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       710.86     2,918.78     3,629.64  ...........  ...........  ...........  ...........
1....................................  1.....................       734.37     2,885.59     3,619.96         9.69           29           71         11.8
2, 3, 4..............................  2.....................       749.99     2,861.10     3,611.09        18.56           24           76         11.2
                                       3.....................       790.69     2,918.08     3,708.78       -79.13           50           50         14.3
5....................................  4.....................       783.45     2,903.52     3,686.97       -57.32           43           57         11.1
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Subgroup: Warehouse Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       710.86     2,466.57     3,177.44  ...........  ...........  ...........  ...........
1....................................  1.....................       734.37     2,436.94     3,171.31         6.13           17           83         10.1
2, 3, 4..............................  2.....................       749.99     2,415.04     3,165.03        12.40           15           85          9.6
                                       3.....................       790.69     2,468.82     3,259.52       -82.08           26           74          6.7
5....................................  4.....................       783.45     2,455.53     3,238.98       -61.54           22           78          5.6
--------------------------------------------------------------------------------------------------------------------------------------------------------


                           Table VI.21--Equipment Class 3--250 Watt Metal Halide Lamp Fixtures (Outdoor): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
         Trial standard level             Efficiency level      Installed    Discounted                 Average         that experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Subgroup: Utilities
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       825.34     3,472.93     4,298.27  ...........  ...........  ...........  ...........
1....................................  1.....................       847.86     3,443.68     4,291.54         6.73           20           80         14.8
2, 3, 4..............................  2.....................       862.82     3,421.70     4,284.52        13.75           16           84         14.1
                                       3.....................       937.58     3,344.40     4,281.98        16.29           72           28         39.8
5....................................  4.....................       930.64     3,329.38     4,260.03        38.25           61           39         28.2
--------------------------------------------------------------------------------------------------------------------------------------------------------

[[Page 51523]]

 
                                                        Subgroup: Transportation Facility Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       690.34     3,132.65     3,822.99  ...........  ...........  ...........  ...........
1....................................  1.....................       712.86     3,103.40     3,816.26         6.73           20           80         14.8
2, 3, 4..............................  2.....................       727.82     3,081.42     3,809.24        13.75           16           84         14.1
                                       3.....................       802.58     2,996.28     3,798.86        24.13           72           28         39.8
5....................................  4.....................       795.64     2,981.26     3,776.91        46.08           61           39         28.2
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Subgroup: Warehouse Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       690.34     3,132.65     3,822.99  ...........  ...........  ...........  ...........
1....................................  1.....................       712.86     3,103.40     3,816.26         6.73           20           80         14.8
2, 3, 4..............................  2.....................       727.82     3,081.42     3,809.24        13.75           16           84         14.1
                                       3.....................       802.58     2,996.28     3,798.86        24.13           64           36         27.1
5....................................  4.....................       795.64     2,981.26     3,776.91        46.08           54           46         20.7
--------------------------------------------------------------------------------------------------------------------------------------------------------


                            Table VI.22--Equipment Class 4--400 Watt Metal Halide Lamp Fixtures (Indoor): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
         Trial standard level             Efficiency level      Installed    Discounted                 Average         that experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Subgroup: Utilities
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       934.44     3,649.31     4,583.74  ...........  ...........  ...........  ...........
1....................................  1.....................       973.04     3,601.60     4,574.64         9.10           40           60         12.9
2, 3, 4..............................  2.....................       991.82     3,563.69     4,555.51        28.23           18           82         10.5
                                       3.....................     1,071.01     3,623.45     4,694.47      -110.72           56           44         15.5
5....................................  4.....................     1,112.37     3,609.21     4,721.58      -137.84           66           34         18.2
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                        Subgroup: Transportation Facility Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       784.44     3,880.58     4,665.01  ...........  ...........  ...........  ...........
1....................................  1.....................       823.04     3,827.87     4,650.91        14.10           34           66         12.2
2, 3, 4..............................  2.....................       841.82     3,786.15     4,627.97        37.04           14           86         10.0
                                       3.....................       921.01     3,808.34     4,729.36       -64.34           48           52         13.4
5....................................  4.....................       962.37     3,792.38     4,754.75       -89.74           58           42         15.9
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Subgroup: Warehouse Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       784.44     3,423.90     4,208.33  ...........  ...........  ...........  ...........
1....................................  1.....................       823.04     3,376.86     4,199.90         8.43           20           80         10.4
2, 3, 4..............................  2.....................       841.82     3,339.44     4,181.25        27.08            9           91          8.5
                                       3.....................       921.01     3,362.34     4,283.36       -75.02           25           75          7.5
5....................................  4.....................       962.37     3,348.56     4,310.93      -102.59           30           70          8.9
--------------------------------------------------------------------------------------------------------------------------------------------------------


                           Table VI.23--Equipment Class 4--400 Watt Metal Halide Lamp Fixtures (Outdoor): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
         Trial standard level             Efficiency level      Installed    Discounted                 Average         that experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Subgroup: Utilities
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       910.80     4,462.71     5,373.51  ...........  ...........  ...........  ...........
1....................................  1.....................       947.78     4,416.57     5,364.35         9.16           23           77         15.4
2, 3, 4..............................  2.....................       965.77     4,377.27     5,343.04        30.47            7           93         12.4
                                       3.....................     1,077.40     4,256.85     5,334.25        39.26           61           39         24.5
5....................................  4.....................     1,117.02     4,238.70     5,355.73        17.79           68           32         27.7
--------------------------------------------------------------------------------------------------------------------------------------------------------

[[Page 51524]]

 
                                                        Subgroup: Transportation Facility Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       760.80     4,173.10     4,933.90  ...........  ...........  ...........  ...........
1....................................  1.....................       797.78     4,126.96     4,924.74         9.16           23           77         15.4
2, 3, 4..............................  2.....................       815.77     4,087.66     4,903.43        30.47            7           93         12.4
                                       3.....................       927.40     3,958.53     4,885.93        47.97           61           39         24.5
5....................................  4.....................       967.02     3,940.38     4,907.40        26.49           68           32         27.7
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Subgroup: Warehouse Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       760.80     4,173.10     4,933.90  ...........  ...........  ...........  ...........
1....................................  1.....................       797.78     4,126.96     4,924.74         9.16           23           77         15.4
2, 3, 4..............................  2.....................       815.77     4,087.66     4,903.43        30.47            7           93         12.4
                                       3.....................       927.40     3,958.53     4,885.93        47.97           55           45         21.0
5....................................  4.....................       967.02     3,940.38     4,907.40        26.49           62           38         24.1
--------------------------------------------------------------------------------------------------------------------------------------------------------


                           Table VI.24--Equipment Class 5--1000 Watt Metal Halide Lamp Fixtures (Indoor): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-Cycle Cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
         Trial standard level             Efficiency level      Installed    Discounted                 Average         that experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Subgroup: Utilities
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............     1,353.88    12,420.47    13,774.35  ...........  ...........  ...........  ...........
1....................................  1 + DS*...............     1,417.74    11,885.42    13,303.15       471.20          0.0        100.0          1.8
2, 3, 4, 5...........................  2 + DS*...............     1,431.85    11,840.29    13,272.15       502.21          0.0        100.0          2.0
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                        Subgroup: Transportation Facility Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............     1,143.88    13,479.99    14,623.87  ...........  ...........  ...........  ...........
1....................................  1 + DS*...............     1,207.74    12,835.48    14,043.22       580.65          0.0        100.0          1.5
2, 3, 4, 5...........................  2 + DS*...............     1,221.85    12,780.37    14,002.23       621.64          0.0        100.0          1.7
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Subgroup: Warehouse Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............     1,143.88    11,657.30    12,801.18  ...........  ...........  ...........  ...........
1....................................  1 + DS*...............     1,207.74    11,122.24    12,329.98       471.20          0.0        100.0          1.4
2, 3, 4, 5...........................  2 + DS*...............     1,221.85    11,077.12    12,298.97       502.21          0.0        100.0          1.6
--------------------------------------------------------------------------------------------------------------------------------------------------------
* DS = Design standard requiring all fixtures sold shall not contain a probe-start ballast.


                           Table VI.25--Equipment Class 5--1000 Watt Metal Halide Lamp Fixtures (Outdoor): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-Cycle Cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
         Trial standard level             Efficiency level      Installed    Discounted                 Average         that experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Subgroup: Utilities
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............     1,311.52    10,528.44    11,839.96  ...........  ...........  ...........  ...........
1....................................  1 + DS*...............     1,372.70    10,082.08    11,454.77       385.18          0.0        100.0          2.6
2, 3, 4, 5...........................  2 + DS*...............     1,386.22    10,044.72    11,430.93       409.02          0.0        100.0          3.0
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                        Subgroup: Transportation Facility Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............     1,101.52     9,854.56    10,956.08  ...........  ...........  ...........  ...........
1....................................  1 + DS*...............     1,162.70     9,408.20    10,570.89       385.18          0.0        100.0          2.6
2, 3, 4, 5...........................  2 + DS*...............     1,176.22     9,370.84    10,547.05       409.02          0.0        100.0          3.0
--------------------------------------------------------------------------------------------------------------------------------------------------------

[[Page 51525]]

 
                                                               Subgroup: Warehouse Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............     1,101.52     9,854.56    10,956.08  ...........  ...........  ...........  ...........
1....................................  1 + DS*...............     1,162.70     9,408.20    10,570.89       385.18          0.0        100.0          2.6
2, 3, 4, 5...........................  2 + DS*...............     1,176.22     9,370.84    10,547.05       409.02          0.0        100.0          3.0
--------------------------------------------------------------------------------------------------------------------------------------------------------
* DS = Design standard requiring that all fixtures sold shall not contain a probe-start ballast.

Rebuttable Presumption Payback
    As discussed in section IV.D.2, EPCA provides a rebuttable 
presumption that an energy conservation standard is economically 
justified if the increased purchase cost for equipment that meets the 
standard is less than three times the value of the first-year energy 
savings resulting from the standard. DOE's LCC and PBP analysis 
generates values for calculating the PBP for customers affected by 
potential energy conservation standards. This includes the 3-year PBP 
contemplated under the rebuttable presumption test discussed in section 
IV.D.2. DOE, however, routinely conducts an economic analysis that 
considers the full range of impacts--including those on consumers, 
manufacturers, the nation, and the environment--as required under 42 
U.S.C. 6295(o)(2)(B)(i).
    For this proposed rule, DOE calculated a rebuttable presumption PBP 
for each TSL. DOE used discrete values rather than distributions for 
inputs and, as required by EPCA, based the calculations on using the 
applicable DOE test procedures for metal halide lamp fixtures. DOE then 
calculated a single rebuttable presumption payback value, rather than a 
distribution of PBPs, for each TSL. Table VI.26 shows the rebuttable 
presumption PBPs that are less than 3 years.
    While DOE examined the rebuttable-presumption criterion, it also 
conducted a more detailed analysis of the economic impacts of these 
levels to determine whether the proposed standard levels are 
economically justified pursuant to 42 U.S.C. 6295(o)(2)(B)(i). The 
results of this analysis serve as the basis for DOE to evaluate the 
economic justification for a potential standard level (thereby 
supporting or rebutting the results of any preliminary determination of 
economic justification).

 Table VI.26--Fixture Efficiency Levels with a Rebuttable Payback Period
                        of Less Than Three Years
------------------------------------------------------------------------
                                                         Median payback
        Equipment class            Efficiency level       period years
------------------------------------------------------------------------
70 W (indoor, magnetic          1....................                0.5
 baseline).
70 W (outdoor, magnetic         1....................                0.5
 baseline).
1000 W (indoor)...............  1 + DS*..............                1.7
                                2 + DS*..............                1.9
1000 W (outdoor)..............  1 + DS*..............                2.4
                                2 + DS*..............                2.7
------------------------------------------------------------------------
* DS = Design standard requiring that all fixtures shall not contain a
  probe-start ballast.

2. Economic Impacts on Manufacturers
    DOE performed an MIA to estimate the impact of new and amended 
energy conservation standards on manufacturers of metal halide lamp 
fixtures and metal halide ballasts. The section below describes the 
expected impacts on manufacturers at each TSL. Chapter 13 of the NOPR 
TSD explains the analysis in further detail.
a. Industry Cash-Flow Analysis Results
    The tables below depict the financial impacts (represented by 
changes in INPV) of new and amended energy standards on manufacturers 
as well as the conversion costs that DOE estimates manufacturers would 
incur at each TSL. DOE breaks out the impacts on manufacturers of 
ballasts and fixtures separately. Within each industry, DOE presents 
the results for all equipment classes in one group because most 
equipment classes are generally made by the same manufacturers. To 
evaluate the range of cash flow impacts on the ballast and fixture 
industries, DOE modeled four different scenarios using different 
assumptions for markups and shipments that correspond to the range of 
anticipated market responses to new and amended standards. Each 
scenario results in a unique set of cash flows and corresponding 
industry values at each TSL.
    Two of these market response scenarios are presented below, 
corresponding to the outer bounds of a range of market responses that 
DOE anticipates could occur in the standards case. In the following 
discussion, the INPV results refer to the difference in industry value 
between the base case and the standards case that result from the sum 
of discounted cash flows from the base year (2013) through the end of 
the analysis period. The results also discuss the difference in cash 
flow between the base case and the standards case in 2015. This figure 
represents the size of the required conversion costs relative to the 
cash flow generated by the industry in the absence of new and amended 
energy conservation standards.

[[Page 51526]]

Cash-Flow Analysis Results by TSL for Metal Halide Ballasts
    To assess the upper (less severe) end of the range of potential 
impacts on metal halide ballast manufacturers, DOE modeled a flat 
markup scenario. The flat markup scenario assumes that in the standards 
case, manufacturers would be able to pass along all the higher 
production costs required for more efficient products to their 
customers. Specifically, the industry would be able to maintain its 
average base case gross margin, as a percentage of revenue, despite the 
higher product costs in the standards case. In general, the larger the 
product price increases, the less likely manufacturers are to achieve 
the cash flow from operations calculated in this scenario because it is 
less likely that manufacturers would be able to fully markup these 
larger cost increases.
    DOE also used the high-shipment scenario to assess the upper bound 
of impacts. Under the high-shipment scenario, base case shipments of 
metal halide lamp fixtures decrease at a slower rate over the analysis 
period compared to the low-shipment scenario. Of all the scenario 
combinations analyzed in the MIA, the flat markup and high-shipment 
scenario provides the best conditions for cash flow generation--the 
annual shipment volume and the ability to preserve gross margins are 
greatest. Thus, this scenario set yields the greatest modeled industry 
profitability.
    To assess the lower (more severe) end of the range of potential 
impacts on the metal halide ballast industry, DOE modeled the 
`preservation of operating profit' markup scenario. The scenario 
represents the lower end of the range of potential impacts on 
manufacturers because no additional operating profit is earned on the 
higher production costs, eroding profit margins as a percentage of 
total revenue.
    DOE also used the low-shipment scenario to assess the lower bound 
of impacts. Under the low-shipment scenario, metal halide lamp fixture 
shipments decrease at a faster rate over the analysis period compared 
to the high-shipment scenario. Of all the scenarios analyzed in the 
MIA, this combination of scenarios (`preservation of operating profit' 
markup and low-shipment) most restricts manufacturers' ability to pass 
on costs to customers and assumes the lowest level of shipments. Thus, 
this scenario set estimates the largest manufacturer impacts.

                       Table VI.27--Manufacturer Impact Analysis for Metal Halide Ballasts--Flat Markup and High-Shipment Scenario
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                  Trial standard level
                                                               Units                Base case ----------------------------------------------------------
                                                                                                   1           2           3           4           5
--------------------------------------------------------------------------------------------------------------------------------------------------------
INPV...........................................  (2012$ millions).................        123        123       126         127         127         159
Change in INPV.................................  (2012$ millions).................  .........        0.8         3.3         4.5         4.7        36.5
                                                 (%)..............................  .........       0.7%         2.7         3.7         3.8        29.8
Product Conversion Costs.......................  (2012$ millions).................  .........          9        12          13          14          20
Capital Conversion Costs.......................  (2012$ millions).................  .........         10        17          16          14           7
                                                                                   ---------------------------------------------------------------------
    Total Conversion Costs.....................  (2012$ millions).................  .........         19        30          29          28          26
--------------------------------------------------------------------------------------------------------------------------------------------------------


Table VI.28--Manufacturer Impact Analysis for Metal Halide Ballasts--Preservation of Operating Profit Markup and
                                              Low-Shipment Scenario
----------------------------------------------------------------------------------------------------------------
                                                                            Trial standard level
                                    Units       Base case ------------------------------------------------------
                                                               1          2          3          4          5
----------------------------------------------------------------------------------------------------------------
INPV.........................  (2012$                 103         86         77         77         79         79
                                millions).
Change in INPV...............  (2012$           .........     (17.1)     (26.8)     (25.9)     (24.8)     (24.1)
                                millions).
                               (%)............  .........     -16.6%      -25.9      -25.0      -24.0      -23.3
Product Conversion Costs.....  (2012$           .........          9         12         13         14         20
                                millions).
Capital Conversion Costs.....  (2012$           .........         10         17         16         14          7
                                millions).
                                               -----------------------------------------------------------------
    Total Conversion Costs...  (2012$           .........         19         30         29         28         26
                                millions).
----------------------------------------------------------------------------------------------------------------

    TSL 1 is EL1 for all ten equipment classes (the 70 W indoor and 
outdoor, 150 W indoor and outdoor, 250 W indoor and outdoor, 400 W 
indoor and outdoor, and 1000 W indoor and outdoor fixtures). At TSL 1, 
DOE estimates impacts on INPV range from $0.8 million to -$17.1 
million, or a change in INPV of 0.7 percent to -16.6 percent. At TSL 1, 
industry free cash flow (operating cash flow minus capital 
expenditures) under the low-shipment scenario is estimated to decrease 
by approximately 68 percent to $3.4 million, compared to the base case 
value of $10.7 million in 2015. Under the high-shipment scenario, 
industry free cash flow is estimated to decrease by approximately 69 
percent to $3.3 million, compared to the base case value of $10.6 
million in 2015.
    Impacts on INPV are slightly positive to moderately negative at TSL 
1. TSL 1 requires the use of more efficient magnetic ballasts for the 
70 W indoor and outdoor, 150 W indoor and outdoor, 250 W indoor and 
outdoor, 400 W indoor and outdoor, and 1000 W indoor and outdoor 
equipment classes. DOE projects that in 2016 100 percent of 70 W indoor 
shipments, 5 percent of 150 W indoor shipments, 14 percent of 250 W 
indoor shipments, 23 percent of 400 W indoor shipments, 10 percent of 
1000 W indoor shipments, 30 percent of 70 W outdoor shipments, zero 
percent of 150 W outdoor shipments, 10 percent of 250 W outdoor 
shipments, 10 percent of 400 W outdoor, and 6 percent of 1000 W outdoor 
shipments would meet TSL 1 or higher in the base case.
    Conversion costs are expected to be moderate at TSL 1. DOE expects 
ballast manufacturers to incur $9 million in product conversion costs 
for model redesigns and testing and $10 million in capital conversion 
costs for equipment

[[Page 51527]]

such as stamping dies to process more efficient steel cores.
    At TSL 1, under the flat markup scenario the shipment-weighted 
average MPC increases by 25 percent relative to the base case MPC. 
Manufacturers are able to fully pass on this cost increase to customers 
under this scenario. Additionally, under the high-shipment scenario, 
shipments are 191 percent higher than shipments under the low-shipment 
scenario in the last year of the analysis period. Thus, manufacturers 
generate the most revenue under this combination (flat markup and high-
shipment) of scenarios. The moderate price increase applied to a large 
quantity of shipments mitigates the impact of the $19 million in 
conversion costs estimated at TSL 1, resulting in slightly positive 
impacts at TSL 1 under the flat markup and high-shipment scenarios.
    Under the `preservation of operating profit' markup scenario, 
manufacturers earn the same operating profit as would be earned in the 
base case in 2017, but manufacturers do not earn additional profit from 
their investments. The 22 percent MPC increase is outweighed by a lower 
average markup of 1.44 in the `preservation of operating profit' markup 
scenario (compared to the flat markup scenario markup of 1.47) and $19 
million in conversion costs, resulting in greater negative impacts at 
TSL 1 under this scenario. On a percentage basis, the low-shipment 
scenario exacerbates these impacts relative to the high-shipment 
scenario because the base case INPV against which the absolute change 
in INPV is compared is 16 percent lower in the low shipment scenario 
compared to the high shipment scenario.
    TSL 2 is EL2 for all ten equipment classes (the 70 W indoor and 
outdoor, 150 W indoor and outdoor, 250 W indoor and outdoor, 400 W 
indoor and outdoor, and 1000 W indoor and outdoor fixtures). At TSL 2, 
DOE estimates impacts on INPV to range from $3.3 million to -$26.8 
million, or a change in INPV of 2.7 percent to -25.9 percent. At this 
proposed level, industry free cash flow under the low-shipment scenario 
is estimated to decrease by approximately 106 percent to -$0.7 million, 
compared to the base case value of $10.7 million in 2015. Under the 
high-shipment scenario, industry free cash flow is estimated to 
decrease by approximately 108 percent to -$0.8 million, compared to the 
base case value of $10.6 million in 2015.
    TSL 2 is the highest efficiency level the engineering analysis 
assumes manufacturers can meet with magnetic ballasts for all equipment 
classes. DOE projects that in 2016, 100 percent of 70 W indoor 
shipments, 5 percent of 150 W indoor shipments, 10 percent of 250 W 
indoor, 15 percent of 400 W indoor, 5 percent of 1000 W indoor 
shipments, and 3 percent of 1000 W outdoor shipments would meet TSL 2 
or higher in the base case. No shipments from the 70 W outdoor, 150 W 
outdoor, 250 W outdoor, and 400 W outdoor equipment classes would meet 
TSL 2 or higher in the base case. At TSL 2, product conversion costs 
rise to $12 million and capital conversion costs rise to $17 million as 
manufacturers need to purchase additional equipment and tooling to 
upgrade magnetic production lines.
    At TSL 2, under the flat markup scenario the shipment-weighted 
average MPC increases 40 percent over the base case MPC. In this 
scenario INPV impacts are slightly positive because manufacturers' 
ability to pass on the higher equipment costs to customers outweighs 
the $30 million in conversion costs. Under the `preservation of 
operating profit' markup scenario, the 35 percent MPC increase is 
outweighed by a lower average markup of 1.42 and $30 million in 
conversion costs, resulting in moderately negative INPV impacts at TSL 
2.
    TSL 3 includes, for the first time, EL4 for two equipment classes 
(the 150 W indoor and outdoor fixtures) and EL2 for the other eight 
equipment classes (the 70 W indoor and outdoor, 250 W indoor and 
outdoor, 400 W indoor and outdoor, and 1000 W indoor and outdoor 
fixtures). At TSL 3, DOE estimates impacts on INPV to range from $4.5 
million to -$25.9 million, or a change in INPV of 3.7 percent to -25.0 
percent. At this proposed level, industry free cash flow under the low-
shipment scenario is estimated to decrease by approximately 102 percent 
to -$0.2 million, compared to the base case value of $10.7 million in 
2015. Under the high-shipment scenario, industry free cash flow is 
estimated to decrease by approximately 104 percent to -$0.4 million, 
compared to the base case value of $10.6 million in 2015.
    The technology changes from TSL 2 to TSL 3 are that manufacturers 
must use max tech level electronic ballasts for the 150 W indoor and 
outdoor equipment classes at TSL 3. This has a negligible effect on 
total conversion costs, which slightly decreases to $29 million. DOE 
projects that no 150 W indoor or outdoor shipments would meet TSL 3 or 
higher in 2016 in the base case. DOE expects product conversion costs 
to increase slightly to $13 million and capital conversion costs to 
decrease slightly to $16 million.
    At TSL 3, under the flat markup scenario the shipment-weighted 
average MPC increases 40 percent over the base case MPC. In this 
scenario the additional revenues earned from passing on these higher 
MPC costs outweigh the $29 million in conversion costs and higher 
working capital requirements, resulting in slightly positive INPV 
impacts. Under the `preservation of operating profit' markup scenario, 
the 35 percent MPC increase is outweighed by a lower average markup of 
1.42 and $29 million in conversion costs, resulting in INPV results 
remaining moderately negative at TSL 3.
    TSL 4 is EL4 for two equipment classes (the 150 W indoor and 
outdoor fixtures), EL3 for one equipment class (the 70 W outdoor 
fixtures), and EL2 for the remaining seven equipment classes (the 70 W 
indoor fixtures, 250 W indoor and outdoor fixtures, 400 W indoor and 
outdoor fixtures, and 1000 W indoor and outdoor fixtures). At TSL 4, 
DOE estimates impacts on INPV to range from $4.7 million to -$24.8 
million, or a change in INPV of 3.8 percent to -24.0 percent. At this 
proposed level, industry free cash flow under the low-shipment scenario 
is estimated to decrease by approximately 97 percent to $0.3 million, 
compared to the base case value of $10.7 million in 2015. Under the 
high-shipment scenario, industry free cash flow is estimated to 
decrease by approximately 98 percent to $0.2 million, compared to the 
base case value of $10.6 million in 2015.
    The technology changes from TSL 3 to TSL 4 are that manufacturers 
must use electronic ballasts for the 70 W outdoor equipment class at 
TSL 4. DOE projects that no 70 W outdoor shipments would meet TSL 4 or 
higher in 2016 in the base case. Total conversion costs decrease from 
$29 million at TSL 3 to $28 million at TSL 4, because of the 
flexibility of electronic ballast production within the lighting 
manufacturing industry.
    At TSL 4, under the flat markup scenario the shipment-weighted 
average MPC increases 39 percent over the base case MPC. In this 
scenario the additional revenues earned from passing on these higher 
MPC costs outweigh the $28 million in conversion costs, resulting in 
slightly positive impacts on INPV. Under the `preservation of operating 
profit' markup scenario, the 34 percent MPC increase is outweighed by a 
lower average markup of 1.42 and $28 million in conversion costs, 
resulting in INPV results remaining moderately negative at TSL 4.
    TSL 5 is EL4 for eight equipment classes (the 70 W indoor and 
outdoor fixtures, 150 W indoor and outdoor fixtures, 250 W indoor and 
outdoor

[[Page 51528]]

fixtures, and 400 W indoor and outdoor fixtures) and EL2 for two 
equipment classes (the 1000 W indoor and outdoor fixtures). At TSL 5, 
DOE estimates impacts on INPV to range from $36.5 million to -$24.1 
million, or a change in INPV of 29.8 percent to -23.3 percent. At this 
proposed level, industry free cash flow under the low-shipment scenario 
is estimated to decrease by approximately 83 percent to $1.8 million, 
compared to the base case value of $10.7 million in 2015. Under the 
high-shipment scenario, industry free cash flow is estimated to 
decrease by approximately 84 percent to $1.7 million, compared to the 
base case value of $10.6 million in 2015.
    At TSL 5, the stringency of standards increases to max tech 
ballasts for the 70 W indoor and outdoor, 250 W indoor and outdoor, and 
400 W outdoor equipment classes compared to TSL 4. DOE projects that 1 
percent of 70 W indoor shipments would meet TSL 5 or higher in 2016 in 
the base case. No shipments from the 70 W outdoor, 250 W indoor or 
outdoor, and 400 W indoor or outdoor equipment classes would meet TSL 5 
or higher in the base case. As a result, product conversion costs 
increase to $20 million because of the need to redesign and test 
additional models, and capital conversion costs decrease to $7 million 
due to the flexibility of electronic ballast production.
    At TSL 5, under the flat markup scenario the shipment-weighted 
average MPC increases 76 percent over the base case MPC. In this 
scenario the additional revenues earned from passing on these higher 
MPC costs outweigh the decreased conversion costs of $26 million, 
resulting in a significantly positive impact on INPV. Under the 
`preservation of operating profit' markup scenario, the 67 percent MPC 
increase is outweighed by a lower average markup of 1.39 and $26 
million in conversion costs, resulting in INPV results remaining 
moderately negative at TSL 5.
Cash Flow Analysis Results by TSL for Metal Halide Lamp Fixtures
    DOE incorporated the same scenarios to represent the upper and 
lower bounds of industry impacts for metal halide lamp fixtures as for 
metal halide ballasts: The flat markup scenario with the high-shipment 
scenario and the `preservation of operating profit' markup scenario 
with the low-shipment scenario. Note that the TSLs below represent the 
same sets of efficiency levels as discussed above in the description of 
impacts on ballast manufacturers.

                    Table VI.29--Manufacturer Impact Analysis for Metal Halide Lamp Fixtures--Flat Markup and High-Shipment Scenario
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                  Trial standard level
                                                               Units                Base case ----------------------------------------------------------
                                                                                                   1           2           3           4           5
--------------------------------------------------------------------------------------------------------------------------------------------------------
INPV...........................................  (2012$ millions).................        630        667       694         695         703         741
Change in INPV.................................  (2012$ millions).................  .........       37.0        63.9        64.8        73.6       111.3
 (%)                                             .................................       5.9%       10.2        10.3        11.7        17.7
Product Conversion Costs.......................  (2012$ millions).................  .........          3         3           9          13          62
Capital Conversion Costs.......................  (2012$ millions).................  .........          0         0           6          10          75
                                                --------------------------------------------------------------------------------------------------------
    Total Conversion Costs.....................  (2012$ millions).................  .........          3         3          15          23         137
--------------------------------------------------------------------------------------------------------------------------------------------------------


   Table VI.30--Manufacturer Impact Analysis for Metal Halide Lamp Fixtures--Preservation of Operating Profit
                                        Markup and Low-Shipment Scenario
----------------------------------------------------------------------------------------------------------------
                                                                            Trial standard level
                                    Units       Base case ------------------------------------------------------
                                                               1          2          3          4          5
----------------------------------------------------------------------------------------------------------------
INPV.........................  (2012$                 540        534        532        523        516        423
                                millions).
Change in INPV...............  (2012$           .........      (6.1)      (8.1)     (17.3)     (23.8)    (116.9)
                                millions).
 (%)                           ...............      -1.1%       -1.5       -3.2       -4.4      -21.6
Product Conversion Costs.....  (2012$           .........          3          3          9         13         62
                                millions).
Capital Conversion Costs.....  (2012$           .........          0          0          6         10         75
                                millions).
                              ----------------------------------------------------------------------------------
    Total Conversion Costs...  (2012$           .........          3          3         15         23        137
                                millions).
----------------------------------------------------------------------------------------------------------------

    At TSL 1, DOE estimates impacts on INPV to range from $37.0 million 
to -$6.1 million, or a change in INPV of 5.9 percent to -1.1 percent. 
At TSL 1, industry free cash flow under the low-shipment scenario is 
estimated to decrease by approximately 2 percent to $58.7 million, 
compared to the base case value of $59.8 million in 2015. Under the 
high-shipment scenario, industry free cash flow is estimated to 
decrease by approximately 2 percent to $58.0 million, compared to the 
base case value of $59.1 million in 2015.
    DOE expects minimal conversion costs for fixture manufacturers at 
TSL 1. Fixture manufacturers would incur $3 million in product 
conversion costs for the testing of redesigned ballasts. Because the 
stack height of magnetic ballasts is not expected to change in response 
to the standards, fixture manufacturers would not incur any capital 
conversion costs at magnetic ballast levels such as TSL 1.
    At TSL 1, under the flat markup scenario the shipment-weighted 
average MPC increases by 12 percent from the base case MPC. In this 
scenario manufacturers maximize revenue since they are able to fully 
pass on this cost increase to customers. The moderate price increase 
applied to a large quantity of shipments outweighs the impact of the $3 
million in conversion costs for TSL 1, resulting in positive impacts at 
TSL 1 under the flat markup and high-shipment scenarios.
    Under the `preservation of operating profit' markup scenario, the 
10 percent MPC increase is outweighed by a lower average markup of 1.56 
(compared to the flat manufacturer markup of 1.58) and $3 million in 
conversion costs,

[[Page 51529]]

resulting in slightly negative impacts at TSL 1. These impacts increase 
on a percentage basis under the low-shipment scenario relative to the 
high-shipment scenario because the base case INPV against which changes 
are compared is 14 percent lower.
    At TSL 2, DOE estimates impacts on INPV to range from $63.9 million 
to -$8.1 million, or a change in INPV of 10.2 percent to -1.5 percent. 
At this proposed level, industry free cash flow under the low-shipment 
scenario is estimated to decrease by approximately 2 percent to $58.7 
million, compared to the base case value of $59.8 million in 2015. 
Under the high-shipment scenario, industry free cash flow is estimated 
to decrease by approximately 2 percent to $58.0 million, compared to 
the base case value of $59.1 million in 2015.
    At TSL 2, DOE expects conversion costs to remain low at $3 million 
for the testing of redesigned ballasts and catalog updates. Under the 
flat markup scenario the shipment-weighted average MPC increases 19 
percent over the base case MPC. In this scenario the INPV impacts are 
positive because the ability to pass on the higher equipment costs to 
customers outweighs the $3 million in estimated conversion costs. Under 
the `preservation of operating profit' markup scenario, the 15 percent 
MPC increase is outweighed by a lower average markup of 1.53 and $3 
million in conversion costs, resulting in slightly negative INPV 
impacts at TSL 2.
    At TSL 3, DOE estimates impacts on INPV to range from $64.8 million 
to -$17.3 million, or a change in INPV of 10.3 percent to -3.2 percent. 
At this proposed level, industry free cash flow under the low-shipment 
scenario is estimated to decrease by approximately 9 percent to $54.2 
million, compared to the base case value of $59.8 million in 2015. 
Under the high-shipment scenario, industry free cash flow is estimated 
to decrease by approximately 9 percent to $53.5 million, compared to 
the base case value of $59.1 million in 2015. DOE expects product 
conversion costs to increase to $9 million because of the additional 
cost of redesigning fixtures for thermal protection to accommodate 150 
W indoor and outdoor electronic ballasts. Manufacturers would also 
incur an estimated $6 million in capital costs for 150 W indoor fixture 
changes.
    At TSL 3, the electronic fixture cost increases for the 150 W 
indoor and outdoor equipment classes because of fixture adders for 
thermal protection and voltage transient protection. Under the flat 
markup scenario, the shipment-weighted average MPC increases 21 percent 
over the base case MPC. This increase in revenue outweighs the increase 
of $15 million in conversion costs, resulting in positive impacts at 
TSL 3. Under the `preservation of operating profit' markup scenario, 
the 17 percent MPC increase is outweighed by a lower average markup of 
1.53 and $15 million in conversion costs, resulting in slightly 
negative INPV impacts at TSL 3.
    At TSL 4, DOE estimates impacts on INPV to range from $73.6 million 
to -$23.8 million, or a change in INPV of 11.7 percent to -4.4 percent. 
At this proposed level, industry free cash flow under the low-shipment 
scenario is estimated to decrease by approximately 14 percent to $51.4 
million, compared to the base case value of $59.8 million in 2015. 
Under the high-shipment scenario, industry free cash flow is estimated 
to decrease by approximately 14 percent to $50.7 million, compared to 
the base case value of $59.1 million in 2015.
    The technology changes from TSL 3 to TSL 4 are that manufacturers 
must use electronic ballasts to meet the required efficiencies for the 
70 W outdoor fixture class at TSL 4. This increases the product 
conversion costs from $9 million at TSL 3 to $13 million at TSL 4 and 
increases the capital conversion costs from $6 million at TSL 3 to $10 
million at TSL 4.
    At TSL 4, under the flat markup scenario the shipment-weighted 
average MPC increases 26 percent over the base case MPC. In this 
scenario the additional revenue results in slightly more positive 
impacts on INPV at TSL 4 compared to TSL 3. Under the `preservation of 
operating profit' markup scenario the 21 percent MPC increase is 
outweighed by a lower average markup of 1.52 and $23 million in 
conversion costs, resulting in slightly more negative INPV impacts at 
TSL 4 compared to TSL 3.
    At TSL 5, DOE estimates impacts on INPV to range from $111.3 
million to -$116.9 million, or a change in INPV of 17.7 percent to -
21.6 percent. At this proposed level, industry free cash flow under the 
low-shipment scenario is estimated to decrease by approximately 89 
percent to $6.5 million, compared to the base case value of $59.8 
million in 2015. Under the high-shipment scenario, industry free cash 
flow is estimated to decrease by approximately 90 percent to $5.8 
million, compared to the base case value of $59.1 million in 2015.
    At TSL 5, product conversion costs significantly increase to $62 
million as manufacturers must redesign all equipment classes to 
accommodate the most efficient electronic ballasts. Capital conversion 
costs also significantly increase to $75 million because of the need 
for additional equipment and tooling, such as new castings, to 
incorporate thermal protection in all equipment classes.
    At TSL 5, DOE estimates impacts on INPV to range from $111.3 
million to -$116.9 million, or a change in INPV of 17.7 percent to -
21.6 percent. At this proposed level, industry free cash flow under the 
low-shipment scenario is estimated to decrease by approximately 89 
percent to $6.5 million, compared to the base case value of $59.8 
million in 2015. Under the high-shipment scenario, industry free cash 
flow is estimated to decrease by approximately 90 percent to $5.8 
million, compared to the base case value of $59.1 million in 2015.
    At TSL 5, product conversion costs significantly increase to $62 
million as manufacturers must redesign all equipment classes to 
accommodate the most efficient electronic ballasts. Capital conversion 
costs also significantly increase to $75 million because of the need 
for additional equipment and tooling, such as new castings, to 
incorporate thermal protection in all equipment classes.
    At TSL 5, under the flat markup scenario the shipment-weighted 
average MPC increases 57 percent over the base case MPC. In this 
scenario the revenue increase from TSL 4 to TSL 5 outweighs the 
increase in conversion costs of $137 million, resulting in greater 
positive impacts on INPV at TSL 5 compared to TSL 4. Under the 
`preservation of operating profit' markup scenario, the 46 percent MPC 
increase is outweighed by a lower average markup of 1.47 and $137 
million in conversion costs, resulting in significantly more negative 
INPV impacts at TSL 5 compared to TSL 4.
b. Impacts on Employment
    DOE quantitatively assessed the impacts of potential new and 
amended energy conservation standards on direct employment. DOE used 
the GRIM to estimate the domestic labor expenditures and number of 
domestic production workers in the base case and at each TSL from 2013 
to 2045. DOE used statistical data from the U.S. Census Bureau's 2009 
Annual Survey of Manufacturers (ASM), the results of the engineering 
analysis, and interviews with manufacturers to determine the inputs 
necessary to calculate industry-wide labor expenditures and domestic 
employment levels. Labor expenditures involved with the manufacture of 
the product are a function of the labor

[[Page 51530]]

intensity of the product, the sales volume, and an assumption that 
wages remain fixed in real terms over time.
    In the GRIM, DOE used the labor content of each product and the 
manufacturing production costs to estimate the annual labor 
expenditures in the industry. DOE used Census data and interviews with 
manufacturers to estimate the portion of the total labor expenditures 
that is attributable to domestic labor.
    The production worker estimates in this section cover only workers 
up to the line-supervisor level who are directly involved in 
fabricating and assembling a product within an OEM facility. Workers 
performing services that are closely associated with production 
operations, such as material handing with a forklift, are also included 
as production labor. DOE's estimates account for only production 
workers who manufacture the specific products covered by this 
rulemaking. For example, a worker on a fluorescent lamp ballast line 
would not be included with the estimate of the number of metal halide 
ballast or fixture workers.
    The employment impacts shown in the tables below represent the 
potential production employment that could result following 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 new and amended energy conservation 
standards when assuming that manufacturers continue to produce the same 
scope of covered equipment in the same production facilities. It also 
assumes that domestic production does not shift to lower-labor-cost 
countries. Because there is a real risk of manufacturers evaluating 
sourcing decisions in response to new and amended energy conservation 
standards, the lower bound of the employment results includes the 
estimated total number of U.S. production workers in the industry who 
could lose their jobs if all existing production were moved outside of 
the U.S. While the results present a range of employment impacts 
following 2016, the sections below also include qualitative discussions 
of the likelihood of negative employment impacts at the various TSLs. 
Finally, the employment impacts shown are independent of the employment 
impacts from the broader U.S. economy, which are documented in chapter 
14 of the NOPR TSD.
Employment Impacts for Metal Halide Ballasts
    Based on 2009 ASM data and interviews with manufacturers, DOE 
estimates that less than 40 domestic production workers would be 
involved in manufacturing metal halide ballasts in 2016, as the vast 
majority of metal halide ballasts are manufactured abroad. DOE's view 
is that manufacturers could face moderate positive impacts on domestic 
employment levels because increasing equipment costs at each TSL would 
result in higher labor expenditures per unit, causing manufacturers to 
hire more workers to meet demand for metal halide ballasts, assuming 
that production remains in domestic facilities. Many manufacturers, 
however, do not expect a significant change in total employment at 
their facilities. Although manufacturers are concerned that higher 
prices for metal halide ballasts will drive customers to alternate 
technologies, most manufacturers offer these alternate technologies and 
can shift their employees from metal halide ballast production to 
production of other technologies in their facilities. Most 
manufacturers believe that domestic employment will only be 
significantly adversely affected if customers shift to foreign imports, 
causing the total lighting market share of the major domestic 
manufacturers to decrease.
Employment Impacts for Metal Halide Lamp Fixtures
    Using 2009 ASM data and interviews with manufacturers, DOE 
estimates that approximately 60 percent of the metal halide lamp 
fixtures sold in the United States are manufactured domestically. With 
this assumption, DOE estimates that in the absence of new and amended 
energy conservation standards, there would be between 519 and 525 
domestic production workers involved in manufacturing metal halide lamp 
fixtures in 2016. The tables below show the range of the impacts of 
potential new and amended energy conservation standards on U.S. 
production workers in the metal halide lamp fixture industry.

                   Table VI.31--Potential Changes in the Total Number of Domestic Metal Halide Lamp Fixture Production Workers in 2016
                                                        [Flat markup and high-shipment scenario]
--------------------------------------------------------------------------------------------------------------------------------------------------------
 
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                Base case                                              Trial standard level
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                 1               2               3               4               5
--------------------------------------------------------------------------------------------------------------------------------------------------------
Total Number of Domestic Production Workers in 2016                  525             588             626             625             630             684
 (without changes in production locations)..............
--------------------------------------------------------------------------------------------------------------------------------------------------------
Potential Changes in Domestic Production Workers in 2016  ..............        63-(525)       101-(525)       100-(525)       105-(525)       159-(525)
 \*\....................................................
--------------------------------------------------------------------------------------------------------------------------------------------------------
* DOE presents a range of potential employment impacts. Numbers in parentheses indicate negative numbers


[[Page 51531]]


                   Table VI.32--Potential Changes in the Total Number of Domestic Metal Halide Lamp Fixture Production Workers in 2016
                                           [Preservation of operating profit markup and low-shipment scenario]
--------------------------------------------------------------------------------------------------------------------------------------------------------
 
--------------------------------------------------------------------------------------------------------------------------------------------------------
Base case                                                                              Trial standard level
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                 1               2               3               4               5
--------------------------------------------------------------------------------------------------------------------------------------------------------
Total Number of Domestic Production Workers in 2016                  519             581             619             618             623             676
 (without changes in production locations)..............
--------------------------------------------------------------------------------------------------------------------------------------------------------
Potential Changes in Domestic Production Workers in 2016  ..............        62-(519)       100-(519)        99-(519)       104-(519)       157-(519)
 \*\....................................................
--------------------------------------------------------------------------------------------------------------------------------------------------------

    At the upper end of the range, all examined TSLs show slight to 
moderate positive impacts on domestic employment levels. The increasing 
equipment cost at each higher TSL would result in higher labor 
expenditures per unit, causing manufacturers to hire more workers to 
meet demand levels of metal halide fixtures, assuming that production 
remains in domestic facilities. Many manufacturers, however, do not 
expect a significant change in total employment at their facilities. 
Although manufacturers are concerned that higher prices for metal 
halide lamp fixtures will drive customers to alternate technologies, 
most manufacturers offer these alternate technologies and can shift 
their employees from metal halide lamp fixture production to production 
of other technologies in their facilities. As with ballast 
manufacturers, most fixture manufacturers believe that domestic 
employment will only be significantly adversely affected if customers 
shift to foreign imports, causing the total lighting market share of 
the major domestic manufacturers to decrease. Because of the 
potentially high cost of shipping fixtures from overseas, many 
manufacturers believe that this shift is unlikely to occur. This is 
particularly true for the significant portion of the market served by 
small manufacturers, for whom the per-unit shipping costs of sourcing 
products would be even greater because of the lower volumes that they 
sell.
    Based on the above, DOE does not expect the proposed energy 
conservation standards for metal halide lamp fixtures, at TSL 3, to 
have a significant negative impact on direct domestic employment 
levels. DOE notes that domestic employment levels could be negatively 
affected in the event that small fixture businesses choose to exit the 
market due to standards. However, discussions with small manufacturers 
indicated that most small businesses will be able to adapt to new and 
amended regulations. The impacts on small businesses are discussed in 
section VII.B.
c. Impacts on Manufacturing Capacity
    Both ballast and fixture manufacturers stated that they do not 
anticipate any capacity constraints at efficiency levels that can be 
met with magnetic ballasts, which are the efficiency levels being 
proposed for eight of the 10 equipment classes in today's NOPR, the two 
exceptions are the 150W indoor and outdoor equipment classes. If the 
production of higher-efficiency magnetic ballasts decreases the 
throughput on production lines, manufacturers stated that they would be 
able to add shifts on existing lines and maintain capacity.
    At efficiency levels that require electronic ballasts, however, 
manufacturers are concerned about the current worldwide shortage of 
electrical components. The components most affected by this shortage 
are high-efficiency parts, for which demand would increase even further 
following new and amended energy conservation standards. The increased 
demand could exacerbate the component shortage, thereby impacting 
manufacturing capacity in the near term, according to manufacturers. 
The only equipment classes requiring electronic ballasts that are being 
proposed in today's NOPR are the 150W indoor and outdoor equipment 
classes. DOE does not anticipate a significant increase in demand for 
electric components due to today's proposed energy conservation 
standards. While DOE recognizes that the premium component shortage is 
currently a significant issue for manufacturers, DOE views it as a 
relatively short-term phenomenon to which component suppliers will 
ultimately adjust. According to several manufacturers, suppliers have 
the ability to ramp up production to meet ballast component demand by 
the compliance date of potential new standards, but those suppliers 
have hesitated to invest in additional capacity due to economic 
uncertainty and skepticism about the sustainability of demand. The 
state of the macroeconomic environment through 2016 will likely affect 
the duration of the premium component shortage. Potential mandatory 
standards, however, could create more certainty for suppliers about the 
eventual demand for these components. Additionally, the premium 
components at issue are not new technologies; rather, they have simply 
not historically been demanded in large quantities by ballast 
manufacturers.
d. Impacts on Subgroups of Manufacturers
    Using average cost assumptions to develop an industry cash-flow 
estimate may not be adequate for assessing differential impacts among 
manufacturer subgroups. Small manufacturers, niche equipment 
manufacturers, and manufacturers exhibiting cost structures 
substantially different from the industry average could be affected 
disproportionately. DOE analyzed the impacts to small businesses in 
section VII.B and did not identify any other adversely impacted 
subgroups for metal halide ballasts or fixtures for this rulemaking 
based on the results of the industry characterization.
e. Cumulative Regulatory Burden
    While any one regulation may not impose a significant burden on 
manufacturers, the combined effects of recent or impending regulations 
may have serious consequences for some manufacturers, groups of 
manufacturers, or an entire industry. Assessing the impact of a single 
regulation may overlook this cumulative regulatory burden. In addition 
to energy conservation standards, other regulations can significantly 
affect manufacturers' financial operations. Multiple regulations 
affecting the same manufacturer can strain profits and lead companies 
to abandon product lines or markets with lower expected future

[[Page 51532]]

returns than competing products. For these reasons, DOE conducts an 
analysis of cumulative regulatory burden as part of its rulemakings 
pertaining to appliance efficiency.
    During previous stages of this rulemaking, DOE identified a number 
of requirements, in addition to new and amended energy conservation 
standards for metal halide lamp fixtures, that manufacturers will face 
for products and equipment they manufacture approximately 3 years prior 
to and 3 years after the compliance date of the new and amended 
standards. The following section briefly addresses comments DOE 
received with respect to cumulative regulatory burden and summarizes 
other key related concerns that manufacturers raised during interviews.
    Several manufacturers expressed concern about the overall volume of 
DOE energy conservation standards with which they must comply. Most 
metal halide lamp fixture manufacturers also make a full range of 
lighting products and share engineering and other resources with these 
other internal manufacturing divisions for different products 
(including certification testing for regulatory compliance). 
Manufacturers worried that today's proposed standards could punish 
compliant manufacturers while potentially driving others to 
noncompliance, creating an unfair playing field. NEMA referenced 
general service fluorescent lamps, incandescent reflector lamps, 
fluorescent lamp ballasts, and high-intensity discharge lamps as other 
products subject to DOE regulation. (NEMA, No. 34 at p. 17) NEMA and 
Philips also raised concerns about other regulatory actions, including 
ENERGY STAR standards utilizing separate metrics from DOE's standards 
and potential outdoor lighting legislation. (NEMA, Public Meeting 
Transcript, No. 33 at p. 16; Philips, Public Meeting Transcript, No. 33 
at p. 132; NEMA, No. 34 at p. 17) Other regulations noted by 
manufacturers during interviews include California Title 20 and Title 
24.
    DOE discusses these and other requirements in chapter 13 of the 
NOPR TSD. DOE takes into account the cost of compliance with other 
published Federal energy conservation standards in weighing the 
benefits and burdens of today's proposed rulemaking. DOE does not 
describe the quantitative impacts of standards that have not yet been 
finalized because any impacts would be speculative. DOE also notes that 
certain standards, such as ENERGY STAR, are optional for manufacturers.
3. National Impact Analysis
a. Significance of Energy Savings
    For each TSL, DOE projected energy savings for metal halide lamp 
fixtures purchased in the 30-year period that begins in the year 2016, 
ending in the year 2045. The savings are measured over the entire 
lifetime of equipment purchased in the 30-year period. DOE quantified 
the energy savings attributable to each TSL as the difference in energy 
consumption between each standards case and the base case. Table VI.33 
presents the estimated primary energy savings for each TSL for the low- 
and high-shipment scenarios, which represent the minimum and maximum 
energy savings resulting from all the scenarios analyzed. Table VI.34 
presents the estimated FFC energy savings for each considered TSL. 
Chapter 11 of the NOPR TSD describes these estimates in more detail.

 Table VI.33--Cumulative National Primary Energy Savings for Metal Halide Lamp Fixture Trial Standard Levels for
                                             Units Sold in 2016-2045
----------------------------------------------------------------------------------------------------------------
                                                                           National Primary Energy Savings quads
                                                                         ---------------------------------------
           Trial standard level                    Equipment class           Low-shipments      High-shipments
                                                                               scenario            scenario
----------------------------------------------------------------------------------------------------------------
1.........................................  70 W........................                0.01                0.01
                                            150 W.......................                0.03                0.05
                                            250 W.......................                0.02                0.03
                                            400 W.......................                0.10                0.13
                                            1000 W......................                0.27                0.37
                                                                         ---------------------------------------
    Total.................................  ............................                0.44                0.58
2.........................................  70 W........................                0.05                0.06
                                            150 W.......................                0.06                0.09
                                            250 W.......................                0.04                0.06
                                            400 W.......................                0.20                0.27
                                            1000 W......................                0.31                0.42
                                                                         ---------------------------------------
    Total.................................  ............................                0.66                0.89
3.........................................  70 W........................                0.05                0.06
                                            150 W.......................                0.19                0.26
                                            250 W.......................                0.04                0.06
                                            400 W.......................                0.20                0.27
                                            1000 W......................                0.31                0.42
                                                                         ---------------------------------------
    Total.................................  ............................                0.79                1.06
4.........................................  70 W........................                0.15                0.19
                                            150 W.......................                0.19                0.26
                                            250 W.......................                0.04                0.06
                                            400 W.......................                0.20                0.27
                                            1000 W......................                0.31                0.42
                                                                         ---------------------------------------
    Total.................................  ............................                0.89                1.20
5.........................................  70 W........................                0.18                0.24
                                            150 W.......................                0.19                0.26
                                            250 W.......................                0.35                0.49
                                            400 W.......................                0.77                1.08

[[Page 51533]]

 
                                            1000 W......................                0.31                0.42
                                                                         ---------------------------------------
    Total.................................  ............................                1.80                2.49
----------------------------------------------------------------------------------------------------------------


  Table VI.34--Cumulative National Full-Fuel-Cycle Energy Savings for Metal Halide Lamp Fixture Trial Standard
                                       Levels for Units Sold in 2016-2045
----------------------------------------------------------------------------------------------------------------
                                                                             National FFC energy savings quads
                                                                         ---------------------------------------
           Trial standard level                    Equipment class           Low-shipments      High-shipments
                                                                               scenario            scenario
----------------------------------------------------------------------------------------------------------------
1.........................................  70 W........................                0.01                0.01
                                            150 W.......................                0.03                0.05
                                            250 W.......................                0.02                0.03
                                            400 W.......................                0.10                0.13
                                            1000 W......................                0.28                0.38
                                                                         ---------------------------------------
    Total.................................  ............................                0.45                0.59
2.........................................  70 W........................                0.05                0.06
                                            150 W.......................                0.06                0.09
                                            250 W.......................                0.04                0.06
                                            400 W.......................                0.21                0.28
                                            1000 W......................                0.31                0.42
                                                                         ---------------------------------------
    Total.................................  ............................                0.67                0.90
3.........................................  70 W........................                0.05                0.06
                                            150 W.......................                0.19                0.27
                                            250 W.......................                0.04                0.06
                                            400 W.......................                0.21                0.28
                                            1000 W......................                0.31                0.42
                                                                         ---------------------------------------
    Total.................................  ............................                0.80                1.08
4.........................................   70 W.......................                0.16                0.20
                                            150 W.......................                0.19                0.27
                                            250 W.......................                0.04                0.06
                                            400 W.......................                0.21                0.28
                                            1000 W......................                0.31                0.42
                                                                         ---------------------------------------
    Total.................................  ............................                0.91                1.22
5.........................................  70 W........................                0.19                0.24
                                            150 W.......................                0.19                0.27
                                            250 W.......................                0.36                0.50
                                            400 W.......................                0.78                1.10
                                            1000 W......................                0.31                0.42
                                                                         ---------------------------------------
    Total.................................  ............................                1.83                2.53
----------------------------------------------------------------------------------------------------------------

    Circular A-4 requires agencies to present analytical results, 
including separate schedules of the monetized benefits and costs that 
show the type and timing of benefits and costs. Circular A-4 also 
directs agencies to consider the variability of key elements underlying 
the estimates of benefits and costs. For this rulemaking, DOE undertook 
a sensitivity analysis using nine rather than 30 years of fixture 
shipments. The choice of a 9-year period is a proxy for the timeline in 
EPCA for the review of certain energy conservation standards and 
potential revision of and compliance with such revised standards.\57\ 
We would note that the review timeframe established in EPCA generally 
does not overlap with the equipment lifetime, equipment manufacturing 
cycles or other factors specific to metal halide lamp fixtures. Thus, 
this information is presented for informational purposes only and is 
not indicative of any change in DOE's analytical methodology. The NES 
results based on a 9-year analytical period are presented in Table 
VI.35. The impacts are counted over the lifetime of fixtures purchased 
in 2016-2024.
---------------------------------------------------------------------------

    \57\ EPCA requires DOE to review its standards at least once 
every 6 years, and requires, for certain products, a 3 year period 
after any new standard is promulgated before compliance is required, 
except that in no case may any new standards be required within 6 
years of the compliance date of the previous standards. While adding 
a 6-year review to the 3-year compliance period adds up to 9 years, 
DOE notes that it may undertake reviews at any time within the 6 
year period and that the 3-year compliance date may yield to the 6-
year backstop.

[[Page 51534]]



 Table VI.35--Cumulative National Primary Energy Savings for Metal Halide Lamp Fixture Trial Standard Levels for
                                             Units Sold in 2016-2024
----------------------------------------------------------------------------------------------------------------
                                                                           National primary energy savings quads
                                                                         ---------------------------------------
           Trial standard level                    Equipment class           Low-shipments      High-shipments
                                                                               scenario            scenario
----------------------------------------------------------------------------------------------------------------
1.........................................  70 W........................                0.01                0.01
                                            150 W.......................                0.02                0.02
                                            250 W.......................                0.01                0.01
                                            400 W.......................                0.06                0.07
                                            1000 W......................                0.15                0.16
                                                                         ---------------------------------------
    Total.................................  ............................                0.25                0.28
2.........................................  70 W........................                0.03                0.03
                                            150 W.......................                0.03                0.03
                                            250 W.......................                0.02                0.03
                                            400 W.......................                0.11                0.12
                                            1000 W......................                0.16                0.18
                                                                         ---------------------------------------
    Total.................................  ............................                0.36                0.40
3.........................................  70 W........................                0.03                0.03
                                            150 W.......................                0.09                0.10
                                            250 W.......................                0.02                0.03
                                            400 W.......................                0.11                0.12
                                            1000 W......................                0.16                0.18
                                                                         ---------------------------------------
    Total.................................  ............................                0.42                0.46
4.........................................  70 W........................                0.09                0.10
                                            150 W.......................                0.09                0.10
                                            250 W.......................                0.02                0.03
                                            400 W.......................                0.11                0.12
                                            1000 W......................                0.16                0.18
                                                                         ---------------------------------------
    Total.................................  ............................                0.48                0.53
5.........................................  70 W........................                0.11                0.12
                                            150 W.......................                0.09                0.10
                                            250 W.......................                0.17                0.19
                                            400 W.......................                0.36                0.40
                                            1000 W......................                0.16                0.18
                                                                         ---------------------------------------
    Total.................................  ............................                0.89                0.99
----------------------------------------------------------------------------------------------------------------

b. Net Present Value of Customer Costs and Benefits
    DOE estimated the cumulative NPV of the total costs and savings for 
customers that would result from the TSLs considered for metal halide 
lamp fixtures. In accordance with OMB's guidelines on regulatory 
analysis,\58\ DOE calculated the NPV using both a 7-percent and a 3-
percent real discount rate. The 7-percent rate is an estimate of the 
average before-tax rate of return on private capital in the U.S. 
economy, and reflects the returns on real estate and small business 
capital as well as corporate capital. This discount rate approximates 
the opportunity cost of capital in the private sector (OMB analysis has 
found the average rate of return on capital to be near this rate). The 
3-percent rate reflects the potential effects of standards on private 
consumption (e.g., through higher prices for products and reduced 
purchases of energy). This rate represents the rate at which society 
discounts future consumption flows to their present value. It can be 
approximated by the real rate of return on long-term government debt 
(i.e., yield on United States Treasury notes), which has averaged about 
3 percent for the past 30 years.
---------------------------------------------------------------------------

    \58\ OMB Circular A-4, section E (Sept. 17, 2003). Available at: 
www.whitehouse.gov/omb/circulars_a004_a-4.
---------------------------------------------------------------------------

    Table VI.36 shows the customer NPV results for each TSL DOE 
considered for metal halide lamp fixtures, using both 7-percent and 3-
percent discount rates. In each case, the impacts cover the lifetime of 
equipment purchased in 2016-2045. See chapter 11 of the NOPR TSD for 
more detailed NPV results.

[[Page 51535]]



           Table VI.36--Net Present Value of Customer Benefits for Metal Halide Lamp Fixture Trial Standard Levels for Units Sold in 2016-2045
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                  Net present value billion 2012$
                                                                         -------------------------------------------------------------------------------
                                                                                  Low-shipments scenario                  High-shipments scenario
           Trial standard level                    Equipment class       -------------------------------------------------------------------------------
                                                                          7-percent discount  3-percent discount  7-percent discount  3-percent discount
                                                                                 rate                rate                rate                rate
--------------------------------------------------------------------------------------------------------------------------------------------------------
1.........................................  70 W........................               0.039               0.068               0.042               0.073
                                            150 W.......................               0.036               0.094               0.044               0.124
                                            250 W.......................               0.009               0.065               0.012               0.084
                                            400 W.......................               0.009               0.109               0.014               0.140
                                            1000 W......................               0.596               1.292               0.728               1.680
                                                                         -------------------------------------------------------------------------------
    Total.................................  ............................               0.688               1.629               0.840               2.100
2.........................................  70 W........................               0.054               0.124               0.060               0.144
                                            150 W.......................               0.083               0.205               0.104               0.274
                                            250 W.......................               0.028               0.146               0.038               0.194
                                            400 W.......................               0.108               0.383               0.140               0.507
                                            1000 W......................               0.636               1.393               0.779               1.815
                                                                         -------------------------------------------------------------------------------
    Total.................................  ............................               0.909               2.251               1.121               2.933
3.........................................  70 W........................               0.054               0.124               0.060               0.144
                                            150 W.......................               0.125               0.408               0.162               0.558
                                            250 W.......................               0.028               0.146               0.038               0.194
                                            400 W.......................               0.108               0.383               0.140               0.507
                                            1000 W......................               0.636               1.393               0.779               1.815
                                                                         -------------------------------------------------------------------------------
    Total.................................  ............................               0.951               2.454               1.179               3.217
4.........................................  70 W........................               0.029               0.330               0.034               0.406
                                            150 W.......................               0.125               0.408               0.162               0.558
                                            250 W.......................               0.028               0.146               0.038               0.194
                                            400 W.......................               0.108               0.383               0.140               0.507
                                            1000 W......................               0.636               1.393               0.779               1.815
                                                                         -------------------------------------------------------------------------------
    Total.................................  ............................               0.927               2.660               1.153               3.479
5.........................................  70 W........................              -0.015               0.278              -0.018               0.344
                                            150 W.......................               0.125               0.408               0.162               0.558
                                            250 W.......................              -0.055               0.287              -0.050               0.430
                                            400 W.......................              -0.344               0.134              -0.394               0.256
                                            1000 W......................               0.636               1.393               0.779               1.815
                                                                         -------------------------------------------------------------------------------
    Total.................................  ............................               0.347               2.500               0.478               3.401
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The NPV results based on the afore-mentioned 9-year analytical 
period are presented in Table VI.37. The impacts are counted over the 
lifetime of fixtures purchased in 2016-2024. As mentioned previously, 
this information is presented for informational purposes only and is 
not indicative of any change in DOE's analytical methodology or 
decision criteria.

           Table VI.37--Net Present Value of Customer Benefits for Metal Halide Lamp Fixture Trial Standard Levels for Units Sold in 2016-2024
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                  Net present value billion 2012$
                                                                         -------------------------------------------------------------------------------
                                                                                  Low-shipments scenario                  High-shipments scenario
           Trial standard level                    Equipment class       -------------------------------------------------------------------------------
                                                                          7-percent discount  3-percent discount  7-percent discount  3-percent discount
                                                                                 rate                rate                rate                rate
--------------------------------------------------------------------------------------------------------------------------------------------------------
1.........................................  70 W........................               0.039               0.068               0.042               0.073
                                            150 W.......................               0.023               0.053               0.025               0.058
                                            250 W.......................               0.004               0.037               0.004               0.041
                                            400 W.......................               0.001               0.062               0.001               0.069
                                            1000 W......................               0.419               0.779               0.457               0.856
                                                                         -------------------------------------------------------------------------------
    Total.................................  ............................               0.485               0.999               0.530               1.097
2.........................................  70 W........................               0.047               0.099               0.051               0.107
                                            150 W.......................               0.053               0.113               0.059               0.124
                                            250 W.......................               0.013               0.078               0.015               0.086
                                            400 W.......................               0.061               0.206               0.068               0.227

[[Page 51536]]

 
                                            1000 W......................               0.445               0.834               0.486               0.916
                                                                         -------------------------------------------------------------------------------
    Total.................................  ............................               0.620               1.329               0.678               1.461
3.........................................  70 W........................               0.047               0.099               0.051               0.107
                                            150 W.......................               0.075               0.209               0.082               0.231
                                            250 W.......................               0.013               0.078               0.015               0.086
                                            400 W.......................               0.061               0.206               0.068               0.227
                                            1000 W......................               0.445               0.834               0.486               0.916
                                                                         -------------------------------------------------------------------------------
    Total.................................  ............................               0.642               1.426               0.702               1.567
4.........................................  70 W........................               0.024               0.216               0.025               0.236
                                            150 W.......................               0.075               0.209               0.082               0.231
                                            250 W.......................               0.013               0.078               0.015               0.086
                                            400 W.......................               0.061               0.206               0.068               0.227
                                            1000 W......................               0.445               0.834               0.486               0.916
                                                                         -------------------------------------------------------------------------------
    Total.................................  ............................               0.618               1.542               0.676               1.696
5.........................................  70 W........................              -0.010               0.178              -0.012               0.194
                                            150 W.......................               0.075               0.209               0.082               0.231
                                            250 W.......................              -0.063               0.099              -0.068               0.110
                                            400 W.......................              -0.280              -0.027              -0.305              -0.027
                                            1000 W......................               0.445               0.834               0.486               0.916
                                                                         -------------------------------------------------------------------------------
    Total.................................  ............................               0.166               1.292               0.183               1.424
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Finally, DOE evaluated the NPV results for both indoor and outdoor 
fixtures for each equipment class. Table VI.38 gives the NPV associated 
with each equipment class broken down into indoor and outdoor fixture 
environments.

           Table VI.38--Net Present Value of Customer Benefits for Metal Halide Lamp Fixture Trial Standard Levels for Units Sold in 2016-2045
                                                         [Low shipments, by fixture environment]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                 Net present value  billion 2012$
                                                                         -------------------------------------------------------------------------------
                                                                                      Indoor fixtures                        Outdoor fixtures
           Trial standard level                    Equipment class       -------------------------------------------------------------------------------
                                                                          7-percent discount  3-percent discount  7-percent discount  3-percent discount
                                                                                 rate                rate                rate                rate
--------------------------------------------------------------------------------------------------------------------------------------------------------
1.........................................  70 W........................               0.000               0.000               0.039               0.068
                                            150 W.......................               0.011               0.028               0.025               0.066
                                            250 W.......................               0.005               0.024               0.004               0.041
                                            400 W.......................               0.007               0.037               0.002               0.072
                                            1000 W......................               0.183               0.378               0.413               0.914
                                                                         -------------------------------------------------------------------------------
    Total.................................  ............................               0.205               0.468               0.483               1.161
2.........................................  70 W........................               0.000               0.000               0.054               0.124
                                            150 W.......................               0.025               0.059               0.058               0.146
                                            250 W.......................               0.012               0.048               0.017               0.098
                                            400 W.......................               0.036               0.115               0.072               0.268
                                            1000 W......................               0.197               0.411               0.439               0.981
                                                                         -------------------------------------------------------------------------------
    Total.................................  ............................               0.269               0.633               0.640               1.618
3.........................................  70 W........................               0.000               0.000               0.054               0.124
                                            150 W.......................               0.019               0.012               0.106               0.396
                                            250 W.......................               0.012               0.048               0.017               0.098
                                            400 W.......................               0.036               0.115               0.072               0.268
                                            1000 W......................               0.197               0.411               0.439               0.981
                                                                         -------------------------------------------------------------------------------
    Total.................................  ............................               0.263               0.586               0.688               1.868
4.........................................  70 W........................               0.000               0.000               0.029               0.330
                                            150 W.......................               0.019               0.012               0.106               0.396

[[Page 51537]]

 
                                            250 W.......................               0.012               0.048               0.017               0.098
                                            400 W.......................               0.036               0.115               0.072               0.268
                                            1000 W......................               0.197               0.411               0.439               0.981
                                                                         -------------------------------------------------------------------------------
    Total.................................  ............................               0.263               0.586               0.664               2.074
5.........................................  70 W........................              -0.012              -0.018              -0.003               0.296
                                            150 W.......................               0.019               0.012               0.106               0.396
                                            250 W.......................              -0.042              -0.120              -0.012               0.407
                                            400 W.......................              -0.148              -0.284              -0.196               0.418
                                            1000 W......................               0.197               0.411               0.439               0.981
                                                                         -------------------------------------------------------------------------------
    Total.................................  ............................               0.013               0.002               0.334               2.499
--------------------------------------------------------------------------------------------------------------------------------------------------------

c. Impacts on Employment
    DOE estimated the indirect employment impacts of potential 
standards on the economy in general, assuming that energy conservation 
standards for metal halide lamp fixtures will reduce energy bills for 
fixture users and the resulting net savings will be redirected to other 
forms of economic activity. DOE used an input/output model of the U.S. 
economy to estimate these effects, including the demand for labor as 
described in section V.H.
    The input/output model results suggest that today's proposed 
standards are likely to increase the net labor demand. The gains, 
however, would most likely be small relative to total national 
employment, and neither the BLS data nor the input/output model DOE 
uses includes the quality or wage level of the jobs. As shown in Table 
VI.39, DOE estimates that net indirect employment impacts from proposed 
fixture standards are small relative to the national economy.

               Table VI.39--Net Change in Jobs From Indirect Employment Effects Under Fixture TSLs
----------------------------------------------------------------------------------------------------------------
                                                                                Net national change in jobs
                                                                         ---------------------------------------
           Analysis period year                 Trial standard level         Low shipments      High shipments
                                                                           scenario, roll-up   scenario, roll-up
----------------------------------------------------------------------------------------------------------------
2017......................................  1...........................                  10                   8
                                            2...........................                 -30                 -36
                                            3...........................                  76                  73
                                            4...........................                 170                 168
                                            5...........................                 352                 346
2020......................................  1...........................                 376                 392
                                            2...........................                 511                 530
                                            3...........................                 791                 827
                                            4...........................               1,091               1,142
                                            5...........................               2,336               2,445
----------------------------------------------------------------------------------------------------------------

4. Impact on Utility or Performance of Equipment
    As presented in section V.B of this notice, DOE concluded that none 
of the TSLs that were analyzed would reduce the utility or performance 
of the products under consideration in this rulemaking. Furthermore, 
manufacturers of these products currently offer ballasts that meet or 
exceed the proposed standards. (42 U.S.C. 6295(o)(2)(B)(i)(IV))
5. Impact of Any Lessening of Competition
    DOE also considered any lessening of competition that is likely to 
result from new and amended energy conservation standards. The Attorney 
General determines the impact, if any, of any lessening of competition 
likely to result from a proposed standard, and transmits such 
determination to the Secretary, together with an analysis of the nature 
and extent of such impact. (42 U.S.C. 6295(o)(2)(B)(i)(V) and (B)(ii))
    To assist the Attorney General in making such determination, DOE 
has provided DOJ with copies of this notice and the TSD for review. DOE 
will consider DOJ's comments on the proposed rule in preparing the 
final rule, and DOE will publish and respond to DOJ's comments in that 
document.
6. Need of the Nation To Conserve Energy
    An improvement in the energy efficiency of the products subject to 
today's rule is likely to improve the security of the nation's energy 
system by reducing overall demand for energy. Reduced electricity 
demand may also improve the reliability of the electricity system. 
Reductions in national electric generating capacity estimated for each 
considered TSL are reported in chapter 14 of the NOPR TSD.
    Energy savings from new and amended energy conservation standards 
for fixtures could produce

[[Page 51538]]

environmental benefits in the form of reduced emissions of air 
pollutants and GHGs associated with electricity production. Table VI.40 
and Table VI.41 provide DOE's estimate of cumulative emissions 
reductions projected to result from the TSLs considered in this 
rulemaking, for the low and high shipment scenarios, respectively. The 
tables include both power sector emissions and upstream emissions. The 
upstream emissions were calculated using the multipliers discussed in 
section V.L. DOE reports annual emissions reductions for each TSL in 
the emissions analysis in chapter 16 the NOPR TSD.

       Table VI.40--Cumulative Emissions Reduction for Potential Standards for Metal Halide Lamp Fixtures
                                            [Low Shipments Scenario]
----------------------------------------------------------------------------------------------------------------
                                                               Trial standard level
                                 -------------------------------------------------------------------------------
                                         1               2               3               4               5
----------------------------------------------------------------------------------------------------------------
                                             Power Sector Emissions*
----------------------------------------------------------------------------------------------------------------
CO2 (million metric tons).......          25.90           38.85           46.04           52.32          104.72
NOX (thousand tons).............          17.39           26.22           31.20           35.41           71.71
Hg (tons).......................           0.06            0.09            0.11            0.12            0.24
N2O (thousand tons).............           0.48            0.72            0.86            0.98            2.00
CH4 (thousand tons).............           2.90            4.37            5.18            5.89           11.86
SO2 (thousand tons).............          36.23           54.37           64.42           73.25          146.53
----------------------------------------------------------------------------------------------------------------
                                               Upstream Emissions
----------------------------------------------------------------------------------------------------------------
CO2 (million metric tons).......           1.40            2.11            2.50            2.84            5.70
NOX (thousand tons).............          19.27           28.98           34.37           39.08           78.45
Hg (tons).......................           0.001           0.001           0.001           0.002           0.003
N2O (thousand tons).............           0.01            0.02            0.03            0.03            0.06
CH4 (thousand tons).............         116.89          175.81          208.58          237.15          476.16
SO2 (thousand tons).............           0.30            0.45            0.54            0.61            1.22
----------------------------------------------------------------------------------------------------------------
                                                 Total Emissions
----------------------------------------------------------------------------------------------------------------
CO2 (million metric tons).......          27.30           40.96           48.53           55.16          110.43
NOX (thousand tons).............          36.66           55.20           65.57           74.48          150.16
Hg (tons).......................           0.06            0.09            0.11            0.12            0.24
N2O (thousand tons).............           0.49            0.74            0.89            1.01            2.06
CH4 (thousand tons).............         119.79          180.18          213.76          243.04          488.01
SO2 (thousand tons).............          36.53           54.82           64.95           73.85          147.75
----------------------------------------------------------------------------------------------------------------


       Table VI.41--Cumulative Emissions Reduction for Potential Standards for Metal Halide Lamp Fixtures
                                            [High shipments scenario]
----------------------------------------------------------------------------------------------------------------
                                                               Trial standard level
                                 -------------------------------------------------------------------------------
                                         1               2               3               4               5
----------------------------------------------------------------------------------------------------------------
                                             Power Sector Emissions*
----------------------------------------------------------------------------------------------------------------
CO2 (million metric tons).......          33.93           51.48           61.61           69.58          143.59
NOX (thousand tons).............          23.50           35.86           43.14           48.58          101.88
Hg (tons).......................           0.08            0.12            0.14            0.16            0.34
N2O (thousand tons).............           0.66            1.01            1.22            1.37            2.90
CH4 (thousand tons).............           3.85            5.87            7.04            7.95           16.50
SO2 (thousand tons).............          47.41           71.94           86.07           97.26          200.46
----------------------------------------------------------------------------------------------------------------
                                               Upstream Emissions
----------------------------------------------------------------------------------------------------------------
CO2 (million metric tons).......           1.85            2.81            3.37            3.81            7.88
NOX (thousand tons).............          25.44           38.69           46.36           52.37          108.39
Hg (tons).......................           0.001           0.002           0.002           0.002           0.004
N2O (thousand tons).............           0.02            0.03            0.03            0.04            0.08
CH4 (thousand tons).............         154.45          234.93          281.50          317.98          658.29
SO2 (thousand tons).............           0.40            0.60            0.72            0.82            1.69
----------------------------------------------------------------------------------------------------------------
                                                 Total Emissions
----------------------------------------------------------------------------------------------------------------
CO2 (million metric tons).......          35.78           54.29           64.98           73.39          151.47
NOX (thousand tons).............          48.94           74.55           89.50          100.95          210.26
Hg (tons).......................           0.08            0.12            0.15            0.16            0.34
N2O (thousand tons).............           0.68            1.04            1.25            1.41            2.98
CH4 (thousand tons).............         158.30          240.80          288.54          325.92          674.79
SO2 (thousand tons).............          47.80           72.54           86.79           98.08          202.14
----------------------------------------------------------------------------------------------------------------


[[Page 51539]]

    As discussed in section V.L, DOE did not report SO2 
emissions reductions from power plants because there is uncertainty 
about the effect of energy conservation standards on the overall level 
of SO2 emissions in the United States due to new emissions 
standards for power plants under the MATS rule. DOE also did not 
include NOX emissions reductions from power plants in states 
subject to CAIRR because an energy conservation standard would not 
affect the overall level of NOX emissions in those states 
due to the emissions caps.
    As part the analysis for this proposed rule, DOE estimated monetary 
benefits likely to result from the reduced emissions of CO2 
and NOX that DOE estimated for each of the TSLs considered. 
As discussed in section V.M.1, DOE used values for the SCC developed by 
an interagency process. The interagency group selected four sets of SCC 
values for use in regulatory analyses. Three sets are based on the 
average SCC from three integrated assessment models, at discount rates 
of 2.5 percent, 3 percent, and 5 percent. The fourth set, which 
represents the 95th-percentile SCC estimate across all three models at 
a 3-percent discount rate, is included to represent higher-than-
expected impacts from temperature change further out in the tails of 
the SCC distribution. The four SCC values for CO2 emissions 
reductions in 2015, expressed in 2012$, are $12.9/ton, $40.8/ton, 
$62.2/ton, and $117.0/ton. These values for later years are higher due 
to increasing emissions-related costs as the magnitude of projected 
climate change increases.
    Table VI.42 and Table VI.43 present the global value of 
CO2 emissions reductions at each TSL for the low and high 
shipment scenarios, respectively. DOE calculated domestic values as a 
range from 7 percent to 23 percent of the global values, and these 
results are presented in chapter 17 of the NOPR TSD.

   Table VI.42--Global Present Value of CO2 Emissions Reduction for Potential Standards for Metal Halide Lamp
                                                    Fixtures
                                            [Low Shipments Scenario]
----------------------------------------------------------------------------------------------------------------
                                                                           SCC Scenario*
                                                 ---------------------------------------------------------------
                       TSL                                                                          3% discount
                                                    5% discount     3% discount    2.5% discount    rate, 95th
                                                   rate, average   rate, average   rate, average    percentile
----------------------------------------------------------------------------------------------------------------
                                                                           Million 2012$
----------------------------------------------------------------------------------------------------------------
                                             Power Sector Emissions
----------------------------------------------------------------------------------------------------------------
1...............................................           180.6           824.4         1,309.4         2,521.8
2...............................................           268.6         1,230.7         1,956.1         3,766.3
3...............................................           316.6         1,453.6         2,311.6         4,449.4
4...............................................           360.3         1,653.5         2,629.2         5,061.5
5...............................................           709.1         3,276.7         5,218.2        10,037.1
----------------------------------------------------------------------------------------------------------------
                                               Upstream Emissions
----------------------------------------------------------------------------------------------------------------
1...............................................             9.6            44.2            70.3           135.5
2...............................................            14.3            66.2           105.3           202.8
3...............................................            16.9            78.3           124.6           239.9
4...............................................            19.3            89.1           141.8           273.0
5...............................................            38.0           177.1           282.3           543.0
----------------------------------------------------------------------------------------------------------------
                                                 Total Emissions
----------------------------------------------------------------------------------------------------------------
1...............................................           190.2           868.7         1,379.7         2,657.2
2...............................................           283.0         1,296.9         2,061.5         3,969.1
3...............................................           333.5         1,531.9         2,436.2         4,689.3
4...............................................           379.5         1,742.6         2,771.0         5,334.5
5...............................................           747.2         3,453.8         5,500.6        10,580.1
----------------------------------------------------------------------------------------------------------------
\*\ For each of the four cases, the corresponding SCC value for emissions in 2015 is $12.9, $40.8, $62.2 and
  $117.0 per metric ton (2012$).


   Table VI.43--Global Present Value of CO2 Emissions Reduction for Potential Standards for Metal Halide Lamp
                                                    Fixtures
                                            [High shipments scenario]
----------------------------------------------------------------------------------------------------------------
                                                                           SCC Scenario*
                                                 ---------------------------------------------------------------
                       TSL                                                                          3% discount
                                                    5% discount     3% discount    2.5% discount    rate, 95th
                                                   rate, average   rate, average   rate, average    percentile
----------------------------------------------------------------------------------------------------------------
                                                                           Million 2012$
----------------------------------------------------------------------------------------------------------------
                                             Power Sector Emissions
----------------------------------------------------------------------------------------------------------------
1...............................................           226.5         1,052.4         1,678.3         3,225.1
2...............................................           340.4         1,587.8         2,534.4         4,868.3
3...............................................           404.3         1,891.8         3,021.8         5,802.1

[[Page 51540]]

 
4...............................................           458.2         2,141.2         3,418.9         6,566.6
5...............................................           924.3         4,359.1         6,975.4        13,379.6
----------------------------------------------------------------------------------------------------------------
                                               Upstream Emissions
----------------------------------------------------------------------------------------------------------------
1...............................................            12.2            56.9            90.9           174.7
2...............................................            18.3            86.1           137.6           264.4
3...............................................            21.8           102.8           164.3           315.5
4...............................................            24.7           116.3           185.9           357.1
5...............................................            50.1           237.6           380.6           730.0
----------------------------------------------------------------------------------------------------------------
                                                 Total Emissions
----------------------------------------------------------------------------------------------------------------
1...............................................           238.7         1,109.3         1,769.2         3,399.8
2...............................................           358.7         1,674.0         2,672.0         5,132.7
3...............................................           426.2         1,994.6         3,186.1         6,117.6
4...............................................           482.9         2,257.5         3,604.9         6,923.7
5...............................................           974.3         4,596.7         7,356.0        14,109.6
----------------------------------------------------------------------------------------------------------------
\*\ For each of the four cases, the corresponding SCC value for emissions in 2015 is $12.9, $40.8, $62.2 and
  $117.0 per metric ton (2012$).

    DOE is well aware that scientific and economic knowledge about the 
contribution of CO2 and other GHG emissions to changes in 
the future global climate and the potential resulting damages to the 
world economy continues to evolve rapidly. Thus, any value placed in 
this rulemaking on reducing CO2 emissions is subject to 
change. DOE, together with other Federal agencies, will continue to 
review various methodologies for estimating the monetary value of 
reductions in CO2 and other GHG emissions. This ongoing 
review will consider the comments on this subject that are part of the 
public record for this and other rulemakings, as well as other 
methodological assumptions and issues. However, consistent with DOE's 
legal obligations, and taking into account the uncertainty involved 
with this particular issue, DOE has included in this NOPR the most 
recent values and analyses resulting from the ongoing interagency 
review process.
    DOE also estimated a range for the cumulative monetary value of the 
economic benefits associated with NOX and Hg emissions 
reductions anticipated to result from amended metal halide lamp fixture 
standards. Estimated monetary benefits for CO2 and 
NOX emission reductions are detailed in chapter 17 of the 
NOPR TSD.
    The NPV of the monetized benefits associated with emissions 
reductions can be viewed as a complement to the NPV of the customer 
savings calculated for each TSL considered in this proposed rulemaking. 
The dollar-per-ton values that DOE used are discussed in section V.M. 
Table VI.44 presents the present value of cumulative NOX 
emissions reductions for each TSL calculated using the average dollar-
per-ton values and 7-percent and 3-percent discount rates.

  Table VI.44--Present Value of NOX Emissions Reduction for Potential Standards for Metal Halide Lamp Fixtures
----------------------------------------------------------------------------------------------------------------
                                                      Low shipments scenario         High  shipments  scenario
                                                 ---------------------------------------------------------------
                       TSL                          3% discount     7% discount     3% discount     7% discount
                                                       rate            rate            rate            rate
----------------------------------------------------------------------------------------------------------------
                                                                           million 2012$
----------------------------------------------------------------------------------------------------------------
                                             Power Sector Emissions
----------------------------------------------------------------------------------------------------------------
1...............................................            24.4            12.3            30.9            14.7
2...............................................            36.3            18.1            46.5            21.8
3...............................................            42.8            21.2            55.4            25.7
4...............................................            48.7            24.1            62.7            29.1
5...............................................            96.3            46.6           127.3            57.2
----------------------------------------------------------------------------------------------------------------
                                               Upstream Emissions
----------------------------------------------------------------------------------------------------------------
1...............................................            27.2            13.6            34.1            16.2
2...............................................            40.5            20.0            51.3            24.0
3...............................................            47.7            23.4            60.9            28.3
4...............................................            54.3            26.6            69.0            32.1

[[Page 51541]]

 
5...............................................           106.9            51.4           139.1            63.0
----------------------------------------------------------------------------------------------------------------
                                                 Total Emissions
----------------------------------------------------------------------------------------------------------------
1...............................................            51.6            25.9            65.0            30.9
2...............................................            76.8            38.1            97.8            45.8
3...............................................            90.6            44.6           116.3            53.9
4...............................................           103.0            50.8           131.7            61.2
5...............................................           203.2            98.1           266.4           120.3
----------------------------------------------------------------------------------------------------------------

    The NPV of the monetized benefits associated with emissions 
reductions can be viewed as a complement to the NPV of the customer 
savings calculated for each TSL considered in this rulemaking. Table 
VI.45 and Table VI.46 present the NPV values that result from adding 
the estimates of the potential economic benefits resulting from reduced 
CO2 and NOX emissions in each of four valuation 
scenarios to the NPV of customer savings calculated for each TSL 
considered in this rulemaking, at both a 7-percent and a 3-percent 
discount rate, and for the low and high shipment scenarios, 
respectively. The CO2 values used in the columns of each 
table correspond to the four scenarios for the valuation of 
CO2 emission reductions discussed above.

  Table VI.45--Metal Halide Lamp Fixture TSLs: Net Present Value of Customer Savings Combined With Net Present
                        Value of Monetized Benefits From CO2 and NOX Emissions Reductions
                                            [Low shipments scenario]
----------------------------------------------------------------------------------------------------------------
                                                           Customer NPV at 3% discount rate added with:
                                                 ---------------------------------------------------------------
                                                   SCC Value of    SCC Value of    SCC Value of    SCC Value of
                       TSL                         $12.9/metric    $40.8/metric    $62.2/metric    $117.0/metric
                                                   ton CO2* and    ton CO2* and    ton CO2* and    ton CO2* and
                                                   low value for   medium value    medium value   high value for
                                                       NOX**         for NOX**       for NOX**         NOX**
----------------------------------------------------------------------------------------------------------------
                                                                           billion 2012$
----------------------------------------------------------------------------------------------------------------
1...............................................           1.828           2.549           3.060           4.380
2...............................................           2.547           3.624           4.389           6.360
3...............................................           2.803           4.076           4.981           7.308
4...............................................           3.058           4.506           5.534           8.182
5...............................................           3.284           6.157           8.204          13.451
----------------------------------------------------------------------------------------------------------------
                                                           Customer NPV at 7% Discount Rate added with:
----------------------------------------------------------------------------------------------------------------
                                                                           billion 2012$
----------------------------------------------------------------------------------------------------------------
1...............................................           0.883           1.583           2.094           3.393
2...............................................           1.199           2.244           3.008           4.947
3...............................................           1.293           2.528           3.432           5.722
4...............................................           1.315           2.720           3.749           6.354
5...............................................           1.112           3.899           5.946          11.106
----------------------------------------------------------------------------------------------------------------
\*\ These label values represent the global SCC in 2015, in 2012$. The present values have been calculated with
  scenario-consistent discount rates.
\**\ Low Value corresponds to $468 per ton of NOX emissions. Medium Value corresponds to $2,639 per ton of NOX
  emissions. High Value corresponds to $4,809 per ton of NOX emissions.


[[Page 51542]]


  Table VI.46--Metal Halide Lamp Fixture TSLs: Net Present Value of Customer Savings Combined With Net Present
                        Value of Monetized Benefits From CO2 and NOX Emissions Reductions
                                            [High shipments scenario]
----------------------------------------------------------------------------------------------------------------
                                                           Customer NPV at 3% discount rate added with:
                                                 ---------------------------------------------------------------
                                                   SCC Value of    SCC Value of    SCC Value of    SCC Value of
                       TSL                         $12.9/metric    $40.8/metric    $62.2/metric    $117.0/metric
                                                   ton CO2* and    ton CO2* and    ton CO2* and    ton CO2* and
                                                   low value for   medium value    medium value   high value for
                                                       NOX**         for NOX**       for NOX**         NOX**
----------------------------------------------------------------------------------------------------------------
                                                                           billion 2012$
----------------------------------------------------------------------------------------------------------------
1...............................................           2.351           3.275           3.935           5.619
2...............................................           3.309           4.705           5.703           8.244
3...............................................           3.664           5.328           6.520           9.547
4...............................................           3.985           5.868           7.215          10.642
5...............................................           4.423           8.264          11.023          17.996
                                                 ---------------------------------------------------------------
                                                           Customer NPV at 7% Discount Rate added with:
----------------------------------------------------------------------------------------------------------------
                                                                           billion 2012$
----------------------------------------------------------------------------------------------------------------
1...............................................           1.085           1.981           2.641           4.297
2...............................................           1.488           2.841           3.839           6.337
3...............................................           1.614           3.227           4.419           7.395
4...............................................           1.647           3.472           4.819           8.188
5...............................................           1.474           5.195           7.955          14.807
----------------------------------------------------------------------------------------------------------------
\*\ These label values represent the global SCC in 2015, in 2012$. The present values have been calculated with
  scenario-consistent discount rates.
\**\ Low Value corresponds to $468 per ton of NOX emissions. Medium Value corresponds to $2,639 per ton of NOX
  emissions. High Value corresponds to $4,809 per ton of NOX emissions.

    Although adding the value of customer savings to the values of 
emission reductions provides a valuable perspective, the following 
should be considered: (1) The national customer savings are domestic 
U.S. customer monetary savings found in market transactions, while the 
values of emissions reductions are based on estimates of marginal 
social costs, which, in the case of CO2, are based on a 
global value; and (2) the assessments of customer savings and 
emissions-related benefits are performed with different computer 
models, leading to different time frames for analysis. For fixtures, 
the present value of national customer savings is measured for the 
period in which units shipped in 2016-2045 continue to operate. The SCC 
values, on the other hand, reflect the present value of future climate-
related impacts resulting from the emission of one metric ton of 
CO2 in each year. These impacts continue well beyond 2100.

C. Proposed Standards

    DOE is subject to the EPCA requirement that any new or amended 
energy conservation standard for any type (or class) of covered 
equipment be designed to achieve the maximum improvement in energy 
efficiency that the Secretary determines is technologically feasible 
and economically justified. (42 U.S.C. 6295(o)(2)(A)) In determining 
whether a standard is economically justified, the Secretary must 
determine whether the benefits of the standard exceed its burdens to 
the greatest extent practicable, in light of the seven statutory 
factors discussed previously. (42 U.S.C. 6295(o)(2)(B)(i)) The new or 
amended standard must also result in a significant conservation of 
energy. (42 U.S.C. 6295(o)(3)(B))
    DOE considered the impacts of MHLF standards at each trial standard 
level, beginning with the max tech level, to determine whether that 
level met the evaluation criteria. If the max tech level was not 
justified, DOE then considered the next most efficient level and 
undertook the same evaluation until it reached the highest efficiency 
level that is both technologically feasible and economically justified 
and saves a significant amount of energy.
    DOE discusses the benefits and/or burdens of each trial standard 
level in the following sections based on the quantitative analytical 
results for each trial standard level (presented in section VI.A) such 
as national energy savings, net present value (discounted at 7 and 3 
percent), emissions reductions, industry net present value, life-cycle 
cost, and customers' installed price increases. Beyond the quantitative 
results, DOE also considers other burdens and benefits that affect 
economic justification, including how technological feasibility, 
manufacturer costs, and impacts on competition may affect the economic 
results presented.
    To aid the reader as DOE discusses the benefits and burdens of each 
trial standard level, DOE has included the following tables (Table 
VI.47 and Table VI.48) that summarize DOE's quantitative analysis for 
each TSL. In addition to the quantitative results presented in the 
tables, DOE also considers other burdens and benefits that affect 
economic justification. Section VI.B.1 presents the estimated impacts 
of each TSL for the LCC subgroup analysis.

[[Page 51543]]



                                             Table VI.47--Summary of Results for Metal Halide Lamp Fixtures
                                                                [Low-shipments scenario]
--------------------------------------------------------------------------------------------------------------------------------------------------------
              Category                        TSL 1                   TSL 2                  TSL 3                  TSL 4                  TSL 5
--------------------------------------------------------------------------------------------------------------------------------------------------------
National Energy Savings (quads)....  0.45..................  0.67..................  0.80.................  0.91.................  1.83
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                         NPV of Customer Benefits (2012 billion)
--------------------------------------------------------------------------------------------------------------------------------------------------------
3% discount rate...................  1.63..................  2.25..................  2.45.................  2.66.................  2.50
7% discount rate...................  0.69..................  0.91..................  0.95.................  0.93.................  0.35
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                    Industry Impacts*
--------------------------------------------------------------------------------------------------------------------------------------------------------
Ballast + Fixture Industry NPV       620...................  609...................  600..................  595..................  502
 (2012 $ million).
(Base Case Industry NPV of $643
 million).
Ballast + Fixture Industry NPV       (23.2)................  (34.9)................  (43.2)...............  (48.6)...............  (141.0)
 (change in 2012$ million).
Ballast + Fixture Industry NPV (%    -3.6%.................  -5.4%.................  -6.7%................  -7.6%................  -21.9%
 change).
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                             Cumulative Emissions Reduction
--------------------------------------------------------------------------------------------------------------------------------------------------------
CO2 (Mt)...........................  27.30.................  40.96.................  48.53................  55.16................  110.43
SO2 (kt)...........................  36.53.................  54.82.................  64.95................  73.85................  147.75
NOX (kt)...........................  36.66.................  55.20.................  65.57................  74.48................  150.16
Hg (t).............................  0.06..................  0.09..................  0.11.................  0.12.................  0.24
CH4 (kt)...........................  119.79................  180.18................  213.76...............  243.04...............  488.01
N2O (kt)...........................  0.49..................  0.74..................  0.89.................  1.01.................  2.06
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                         Value of Cumulative Emissions Reduction
--------------------------------------------------------------------------------------------------------------------------------------------------------
CO2 (2012$ billion) **.............  0.2 to 2.7............  0.3 to 4.0............  0.3 to 4.7...........  0.4 to 5.3...........  0.7 to 10.6
NOX--3% discount rate (2012$         51.6..................  76.8..................  90.6.................  103.0................  203.2
 million) **.
NOX--7% discount rate (2012$         25.9..................  38.1..................  44.6.................  50.8.................  98.1
 million) **.
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                      Mean LCC Savings (and Percent Customers Experiencing Net Benefit) *** (2012$)
--------------------------------------------------------------------------------------------------------------------------------------------------------
50to100W--Ind--OtherV ****[dagger]   32.84 (100)...........  38.41 (100)...........  38.41 (100)..........  38.41 (100)..........  -26.16 (72)
 (magnetic baseline).
50to100W--Outd--OtherV (magnetic     39.50 (100)...........  46.44 (100)...........  46.44 (100)..........  69.59 (58)...........  63.77 (57)
 baseline).
50to100W--Ind--OtherV..............  ......................  ......................  .....................  .....................  -8.48 (4)
(electronic baseline)..............
50to100W--Outd--OtherV (electronic   ......................  ......................  .....................  .....................  -5.82 (16)
 baseline).
100to150W--Ind--OtherV[Dagger].....  18.50 (99)............  39.68 (100)...........  10.14 (77)...........  10.14 (77)...........  10.14 (77)
100to150W--Outd--OtherV............  20.66 (100)...........  44.70 (100)...........  112.51 (74)..........  112.51 (74)..........  112.51 (74)
150to250W--Ind--OtherV[Dagger].....  6.55 (64).............  13.12 (69)............  13.12 (69)...........  13.12 (69)...........  -59.44 (56)
150to250W--Outd--OtherV............  6.73 (80).............  13.75 (85)............  13.75 (85)...........  13.75 (85)...........  46.08 (46)
250to500W--Ind--OtherV.............  9.10 (60).............  28.23 (82)............  28.23 (82)...........  28.23 (82)...........  -99.07 (39)
250to500W--Outd--OtherV............  9.16 (78).............  30.47 (93)............  30.47 (93)...........  30.47 (93)...........  26.49 (37)
500to2000W--Ind--OtherV............  471.20 (100)..........  502.21 (100)..........  502.21 (100).........  502.21 (100).........  502.21 (100)
500to2000W--Outd--OtherV...........  385.18 (100)..........  409.02 (100)..........  409.02 (100).........  409.02 (100).........  409.02 (100)
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Median PBP (years)
--------------------------------------------------------------------------------------------------------------------------------------------------------
50to100W--Ind--OtherV (magnetic      0.5...................  4.2...................  4.2..................  4.2..................  5.4
 baseline).
50to100W--Outd--OtherV (magnetic     0.6...................  4.4...................  4.4..................  12.8.................  14.6
 baseline).
50to100W--Ind--OtherV (electronic    ......................  ......................  .....................  .....................  32.3
 baseline).
50to100W--Outd--OtherV (electronic   ......................  ......................  .....................  .....................  44.7
 baseline).
100to150W--Ind--OtherV[Dagger].....  7.2...................  5.8...................  4.7..................  4.7..................  4.7
100to150W--Outd--OtherV............  8.3...................  6.6...................  10.5.................  10.5.................  10.5
150to250W--Ind--OtherV[Dagger].....  12.4..................  11.8..................  11.8.................  11.8.................  11.5
150to250W--Outd--OtherV............  14.8..................  14.0..................  14.0.................  14.0.................  21.4
250to500W--Ind--OtherV.............  12.8..................  10.5..................  10.5.................  10.5.................  16.2

[[Page 51544]]

 
250to500W--Outd--OtherV............  15.4..................  12.3..................  12.3.................  12.3.................  24.4
500to2000W--Ind--OtherV............  1.8...................  2.0...................  2.0..................  2.0..................  2.0
500to2000W--Outd--OtherV...........  2.7...................  3.0...................  3.0..................  3.0..................  3.0
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Employment Impacts
--------------------------------------------------------------------------------------------------------------------------------------------------------
Direct Employment Impacts..........  41-(502)..............  97-(502)..............  96-(502).............  101-(502)............  152[n<>dash](502)
Indirect Domestic Jobs [Verbar]....  376...................  511...................  791..................  1,091................  2,336
--------------------------------------------------------------------------------------------------------------------------------------------------------
* INPV results are shown under the preservation of operating profit markup scenario.
** Range of the economic value of CO2 reductions is based on estimates of the global benefit of reduced CO2 emissions. Economic value of NOX reductions
  is based on estimates at $2,636/ton.
*** For LCCs, a negative value means an increase in LCC by the amount indicated.
**** ``Indoor'' and ``outdoor'' as defined in section V.A.2.
[dagger] Equipment class abbreviations in the form of 50to100W--Ind--OtherV refers to the equipment class of fixtures with (1) a rated lamp wattage of
  50 W to 100 W, (2) an indoor operating location, and (3) a tested input voltage other than 480 V. See section V.A.2 for more detail on equipment class
  distinctions.
[Dagger] The >100 W and <=150 W equipment classes include 150 W fixtures exempted by EISA 2007, which are fixtures rated only for 150 watt lamps that
  are also rated for use in wet locations, as specified by the National Electrical Code 2002, section 410.4(A) and contain a ballast that is rated to
  operate at ambient air temperatures above 50 [deg]C, as specified by UL 1029-2001. The >=150 W and <=250 W equipment classes contain all other covered
  fixtures that are rated only for 150 watt lamps.
[Verbar] Changes in 2020.


                                             Table VI.48--Summary of Results for Metal Halide Lamp Fixtures
                                                                [High-shipments scenario]
--------------------------------------------------------------------------------------------------------------------------------------------------------
              Category                        TSL 1                   TSL 2                  TSL 3                  TSL 4                  TSL 5
--------------------------------------------------------------------------------------------------------------------------------------------------------
National Energy Savings (quads)....  0.59..................  0.90..................  1.08.................  1.22.................  2.53
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                        NPV of Customer Benefits (2012$ billion)
--------------------------------------------------------------------------------------------------------------------------------------------------------
3% discount rate...................  2.10..................  2.93..................  3.22.................  3.48.................  3.40
7% discount rate...................  0.84..................  1.12..................  1.18.................  1.15.................  0.48
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                    Industry Impacts
--------------------------------------------------------------------------------------------------------------------------------------------------------
Ballast + Fixture Industry NPV       790...................  820...................  822..................  831..................  900
 (2012$ million) (Base Case
 Industry NPV of $752 million).
Ballast + Fixture Industry NPV       37.8..................  67.3..................  69.2.................  78.3.................  147.9
 (change in 2012$ million).
Ballast + Fixture Industry NPV (%    5.0%..................  8.9%..................  9.2%.................  10.4%................  19.7%
 change).
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                             Cumulative Emissions Reduction
--------------------------------------------------------------------------------------------------------------------------------------------------------
CO2 (Mt)...........................  35.78.................  54.29.................  64.98................  73.39................  151.47
SO2 (kt)...........................  47.80.................  72.54.................  86.79................  98.08................  202.14
NOX (kt)...........................  48.94.................  74.55.................  89.50................  100.95...............  210.26
Hg (t).............................  0.08..................  0.12..................  0.15.................  0.16.................  0.34
CH4 (kt)...........................  158.30................  240.80................  288.54...............  325.92...............  674.79
N2O (kt)...........................  0.68..................  1.04..................  1.25.................  1.41.................  2.98
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                         Value of Cumulative Emissions Reduction
--------------------------------------------------------------------------------------------------------------------------------------------------------
CO2 (2012$ billion) **.............  0.2 to 3.4............  0.4 to 5.1............  0.4 to 6.1...........  0.5 to 6.9...........  1.0 to 14.1
NOX--3% discount rate (2012$         65.0..................  97.8..................  116.3................  131.7................  266.4
 million) **.
NOX--7% discount rate (2012$         30.9..................  45.8..................  53.9.................  61.2.................  120.3
 million) **.
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                      Mean LCC Savings (and Percent Customers Experiencing Net Benefit) ** (2012$)
--------------------------------------------------------------------------------------------------------------------------------------------------------
50to100W--Ind--OtherV **** [dagger]  32.84 (100)...........  38.41 (100)...........  38.41 (100)..........  38.41 (100)..........  -26.16 (72)
 (magnetic baseline).
50to100W--Outd--OtherV (magnetic     39.50 (100)...........  46.44 (100)...........  46.44 (100)..........  69.59 (58)...........  63.77 (57)
 baseline).

[[Page 51545]]

 
50to100W--Ind--OtherV (electronic    ......................  ......................  .....................  .....................  -8.48 (4)
 baseline).
50to100W--Outd--OtherV (electronic   ......................  ......................  .....................  .....................  -5.82 (16)
 baseline).
100to150W--Ind--OtherV[Dagger].....  18.50 (99)............  39.68 (100)...........  10.14 (77)...........  10.14 (77)...........  10.14 (77)
100to150W--Outd--OtherV............  20.66 (100)...........  44.70 (100)...........  112.51 (74)..........  112.51 (74)..........  112.51 (74)
150to250W--Ind--OtherV[Dagger].....  6.55 (64).............  13.12 (69)............  13.12 (69)...........  13.12 (69)...........  -59.44 (56)
150to250W--Outd--OtherV............  6.73 (80).............  13.75 (85)............  13.75 (85)...........  13.75 (85)...........  46.08 (46)
250to500W--Ind--OtherV.............  9.10 (60).............  28.23 (82)............  28.23 (82)...........  28.23 (82)...........  -99.07 (39)
250to500W--Outd--OtherV............  9.16 (78).............  30.47 (93)............  30.47 (93)...........  30.47 (93)...........  26.49 (37)
500to2000W--Ind--OtherV............  471.20 (100)..........  502.21 (100)..........  502.21 (100).........  502.21 (100).........  502.21 (100)
500to2000W--Outd--OtherV...........  385.18 (100)..........  409.02 (100)..........  409.02 (100).........  409.02 (100).........  409.02 (100)
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Median PBP (years)
--------------------------------------------------------------------------------------------------------------------------------------------------------
50to100W--Ind--OtherV (magnetic      0.5...................  4.2...................  4.2..................  4.2..................  5.4
 baseline).
50to100W--Outd--OtherV (magnetic     0.6...................  4.4...................  4.4..................  12.8.................  14.6
 baseline).
50to100W--Ind--OtherV (electronic    ......................  ......................  .....................  .....................  32.3
 baseline).
50to100W--Outd--OtherV (electronic   ......................  ......................  .....................  .....................  44.7
 baseline).
100to150W--Ind--OtherV[Dagger].....  7.2...................  5.8...................  4.7..................  4.7..................  4.7
100to150W--Outd--OtherV............  8.3...................  6.6...................  10.5.................  10.5.................  10.5
150to250W--Ind--OtherV[Dagger].....  12.4..................  11.8..................  11.8.................  11.8.................  11.5
150to250W--Outd--OtherV............  14.8..................  14.0..................  14.0.................  14.0.................  21.4
250to500W--Ind--OtherV.............  12.8..................  10.5..................  10.5.................  10.5.................  16.2
250to500W--Outd--OtherV............  15.4..................  12.3..................  12.3.................  12.3.................  24.4
500to2000W--Ind--OtherV............  1.8...................  2.0...................  2.0..................  2.0..................  2.0
500to2000W--Outd--OtherV...........  2.7...................  3.0...................  3.0..................  3.0..................  3.0
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Employment Impacts
--------------------------------------------------------------------------------------------------------------------------------------------------------
Direct Employment Impacts..........  41-(508)..............  98-(508)..............  97-(508).............  102-(508)............  154-(508)
Indirect Domestic Jobs               392...................  530...................  827..................  1,142................  2,445
 .
--------------------------------------------------------------------------------------------------------------------------------------------------------
* INPV results are shown under the -flat markup scenario.
** Range of the economic value of CO2 reductions is based on estimates of the global benefit of reduced CO2 emissions. Economic value of NOX reductions
  is based on estimates at $2,636/ton.
*** For LCCs, a negative value means an increase in LCC by the amount indicated.
**** ``Indoor'' and ``outdoor'' as defined in section V.A.2.
[dagger] Equipment class abbreviations in the form of 50to100W--Ind--OtherV refers to the equipment class of fixtures with (1) a rated lamp wattage of
  50 W to 100 W, (2) an indoor operating location, and (3) a tested input voltage other than 480 V. See section V.A.2 for more detail on equipment class
  distinctions.
[Dagger] The >100 W and <=150 W equipment classes include 150 W fixtures exempted by EISA 2007, which are fixtures rated only for 150 watt lamps that
  are also rated for use in wet locations, as specified by the National Electrical Code 2002, section 410.4(A) and contain a ballast that is rated to
  operate at ambient air temperatures above 50 [deg]C, as specified by UL 1029-2001. The >=150 W and <=250 W equipment classes contain all other covered
  fixtures that are rated only for 150 watt lamps.
[Verbar] Changes in 2020.

    As discussed in previous DOE standards rulemakings and the February 
2011 NODA (76 FR 9696, (Feb. 22, 2011)), DOE also notes that the 
economics literature provides a wide-ranging discussion of how 
customers trade off upfront costs and energy savings in the absence of 
government intervention. Much of this economics literature attempts to 
explain why customers appear to undervalue energy efficiency 
improvements.
    This undervaluation suggests that regulation promoting energy 
efficiency can produce significant net private gains (as well as 
producing social gains by, for example, reducing pollution). There is 
evidence that customers undervalue future energy savings as a result of 
(1) a lack of information, (2) a lack of sufficient savings to warrant 
accelerating or altering purchases (e.g., an inefficient ventilation 
fan in a new building or the delayed replacement of a water pump), (3) 
inconsistent weighting of future energy cost savings relative to 
available returns on other investments, (4) computational or other 
difficulties associated with the evaluation of relevant tradeoffs, and 
(5) a divergence in incentives (e.g., renter versus owner; builder vs. 
purchaser). Other literature indicates that with less-than-perfect 
foresight and a high degree of uncertainty about the future, it may be 
rational for customers to trade off these types of investments at a 
higher-than-expected rate between current consumption and uncertain 
future energy cost savings. Some studies suggest that this seeming 
undervaluation may be explained in certain circumstances by differences 
between tested and actual energy savings, or by uncertainty and 
irreversibility of energy investments. There may also be ``hidden'' 
welfare losses to customers if newer energy efficient products are 
imperfect substitutes for the less efficient products they replace, in 
terms of performance or other attributes that customers value. In the 
abstract, it may be difficult to say how a welfare gain from correcting

[[Page 51546]]

potential under-investment in energy conservation compares in magnitude 
to the potential welfare losses associated with no longer purchasing a 
machine or switching to an imperfect substitute, both of which still 
exist in this framework.
    The mix of evidence in the empirical economics literature suggests 
that if feasible, analysis of regulations mandating energy-efficiency 
improvements should explore the potential for both welfare gains and 
losses and move toward a fuller economic framework where all relevant 
changes can be quantified.\59\ While DOE is not prepared at present to 
provide a fuller quantifiable framework for this discussion, DOE seeks 
comments on how to assess these possibilities.\60\ In particular, DOE 
requests comment on whether there are features or attributes of the 
more energy efficient ballasts that manufacturers would produce to meet 
the standards in this proposed rule that might affect the welfare, 
positively or negatively, of consumers who purchase MHLFs. One example 
of such an effect might result from the use of electronic ballasts in 
outdoor applications, which DOE's analysis models for compliance with 
TSL3 for 150 watt fixtures. In TSL4, electronic ballasts are also 
modeled for outdoor applications for 70 watt fixtures. As discussed 
above, currently magnetic ballasts are generally favored over 
electronic ballasts for outdoor applications, but there are some 
commercially available fixtures using electronic ballasts that are 
designed for outdoor applications. DOE requests comment specifically on 
whether the more widespread use of electronic ballasts would involve 
any performance or reliability effects for either 70-watt or 150-watt 
fixtures, and how any such effects should be weighed in the choice of 
standards for these two wattage categories for the final rule.
---------------------------------------------------------------------------

    \59\ A good review of the literature related to this issue can 
be found in Gillingham, K., R. Newell, K. Palmer. (2009). ``Energy 
Efficiency Economics and Policy,'' Annual Review of Resource 
Economics, 1: 597-619; and Tietenberg, T. (2009). ``Energy 
Efficiency Policy: Pipe Dream or Pipeline to the Future?'' Review of 
Environmental Economics and Policy. Vol. 3, No. 2: 304-320.
    \60\ A draft paper, ``Notes on the Economics of Household Energy 
Consumption and Technology Choice,'' proposes a broad theoretical 
framework on which an empirical model might be based and is posted 
on the DOE Web site along with this notice at www.eere.energy.gov/buildings/appliance_standards.
---------------------------------------------------------------------------

1. Trial Standard Level 5
    DOE first considered the most efficient level, TSL 5, which would 
save an estimated total of 1.8 to 2.5 quads of energy for fixtures 
shipped in 2016-2045--a significant amount of energy. For the nation as 
a whole, TSL 5 would have a net savings of $0.35 billion-$0.48 billion 
at a 7-percent discount rate, and $2.5 billion-$3.4 billion at a 3-
percent discount rate. The emissions reductions at TSL 5 are estimated 
to be 110-151 million metric tons (Mt) of CO2, 148-202 kt of 
SO2, 150-210 kt of NOX, and 0.24-0.34 tons of Hg. 
As seen in section VI.B.1, for over half of the representative 
equipment classes, customers have available designs that result in 
positive mean LCC savings, ranging from $10.14-$502.21, at TSL 5. The 
equipment classes with positive mean LCC savings at TSL 5 are outdoor 
70 W fixtures \56\ (for the magnetic ballast baseline), indoor and 
outdoor 150 W fixtures, outdoor 250 W fixtures, outdoor 400 W fixtures, 
and indoor and outdoor 1000 W fixtures. However, DOE's NPV analysis 
indicates (see Table VI.38) that most equipment classes experience a 
negative NPV at TSL 5. The equipment classes that have negative NPV at 
TSL 5 are indoor and outdoor 70 W, 250 W, and 400 W fixtures. The 
equipment classes with positive NPV at TSL 5 are indoor and outdoor 150 
W and 1000 W fixtures. The projected change in industry value for metal 
halide ballast manufacturers would range from an increase of $36.5 
million to a decrease of $24.1 million, or a net gain of 29.8 percent 
to a net loss of 23.3 percent in INPV. The projected change in industry 
value for metal halide lamp fixture manufacturers would range from an 
increase of $111.3 million to a decrease of $116.9 million, or a net 
gain of 17.7 percent to a net loss of 21.6 percent in INPV.
    DOE based TSL 5 on the most efficient commercially available 
equipment for each representative equipment class analyzed. This TSL 
corresponds to a commercially available low-frequency electronic 
ballast for indoor and outdoor 70 W, 150 W, 250 W fixtures, a 
commercially available high-frequency electronic ballast for indoor and 
outdoor 400 W fixtures, and a commercially available magnetic ballast 
in 1000 W fixtures. DOE notes that there is limited compatibility 
between the high-frequency electronic ballasts required for indoor and 
outdoor 400W fixtures and high efficiency CMH lamps. This could 
potentially limit energy savings opportunities through the use of CMH 
lamps. See section V.C.8 for additional detail. TSL 5 also prohibits 
the use of probe-start ballasts in new 1000 W fixtures.
    After considering the analysis, the comments that DOE received on 
the preliminary analysis, and the benefits and burdens of TSL 5, the 
Secretary has reached the following tentative conclusion: The benefits 
of energy savings, emissions reductions (both in physical reductions 
and the monetized value of those reductions), and positive net economic 
savings to the nation are outweighed by negative NPV experienced in 
some equipment classes at both a 3-percent and 7-percent discount rate, 
the negative mean LCC savings experienced in some equipment classes, 
and the potential decrease in INPV for manufacturers. Consequently, the 
Secretary has tentatively concluded that trial standard level 5 is not 
economically justified.
2. Trial Standard Level 4
    DOE then considered TSL 4, which would save an estimated total of 
0.91 to 1.2 quads of energy for fixtures shipped in 2016-2045--a 
significant amount of energy. For the nation as a whole, TSL 4 would 
have a net savings of $0.93 billion-$1.2 billion at a 7-percent 
discount rate, and $2.7 billion-$3.5 billion at a 3-percent discount 
rate. The emissions reductions at TSL 4 are estimated to be 55-73 Mt of 
CO2, 74-98 kt of SO2, 74-101 kt of 
NOX, and 0.12-0.16 tons of Hg. As seen in section VI.B.1, 
for all representative equipment classes, customers have available 
designs that result in positive mean LCC savings, ranging from $10.14-
$502.21, at TSL 4. DOE's NPV analysis indicates (see Table VI.38) that 
each equipment class has a positive NPV at TSL 4. The projected change 
in industry value for metal halide ballast manufacturers would range 
from an increase of $4.7 million to a decrease of $24.8 million, or a 
net gain of 3.8 percent to a net loss of 24.0 percent in INPV. The 
projected change in industry value for metal halide lamp fixture 
manufacturers would range from an increase of $73.6 million to a 
decrease of $23.8 million, or a net gain of 11.7 percent to a net loss 
of 4.4 percent in INPV.
    TSL 4 represents the maximum energy savings achievable with 
positive NPV for each representative equipment class, considering 
indoor and outdoor fixtures separately. This TSL corresponds to a 
modeled magnetic ballast in indoor 70 W fixtures, indoor and outdoor 
250 W fixtures and indoor and outdoor 400 W fixtures; a commercially 
available low-frequency electronic ballast in outdoor 70 W fixtures and 
indoor and outdoor 150 W fixtures; and a commercially available 
magnetic ballast in indoor and outdoor 1000 W fixtures. TSL 4 sets 
different standards for 70 W fixtures for the indoor versus outdoor 
equipment classes. TSL 4 also prohibits the use of probe-start ballasts 
in new 1000 W fixtures.

[[Page 51547]]

    Setting different standards for the indoor versus outdoor fixtures 
of the same wattage has the potential for certification issues and lost 
energy savings. Indoor 70 W fixtures require EL2 magnetic ballasts 
while outdoor 70 W fixtures require electronic ballasts. Because the 
indoor magnetic ballast can provide the features necessary for outdoor 
operation, there is potential for indoor fixtures to be used outdoors 
in applications where moisture is a smaller concern. For example, a 
parking garage or other semi-covered structure is less likely to 
sustain direct water contact. Additionally, the indoor EL2 magnetically 
ballasted fixtures are less expensive than the outdoor EL3 
electronically ballasted fixtures. This creates an economic incentive 
for outdoor customers to use the indoor EL2 fixtures. This substitution 
could decrease the expected energy savings, and could reduce the 
reliability and lifetime of the misapplied indoor fixtures. 
Furthermore, setting different standards for indoor versus outdoor 
equipment classes increases compliance, certification, and enforcement 
costs for manufacturers. Fixture manufacturers would use different 
ballasts for indoor and outdoor fixtures of the same wattage, 
complicating fixture-ballast matching and increasing the number of 
basic models.
    After considering the analysis, the comments that DOE received on 
the preliminary analysis, and the benefits and burdens of TSL 4, the 
Secretary has reached the following tentative conclusion: At TSL 4, the 
benefits of energy savings, emissions reductions (both in physical 
reductions and the monetized value of those reductions), and positive 
net economic savings to the nation would be outweighed by the potential 
for certification issues and lost energy savings resulting from setting 
different standards for the indoor versus outdoor fixtures of the same 
wattage, and the potential decrease in INPV for manufacturers. 
Consequently, the Secretary has tentatively concluded that trial 
standard level 4 is not economically justified.
3. Trial Standard Level 3
    DOE then considered TSL 3, which would save an estimated total of 
0.80 to 1.1 quads of energy for fixtures shipped in 2016-2045--a 
significant amount of energy. For the nation as a whole, TSL 3 would 
have a net savings of $0.95 billion-$1.2 billion at a 7-percent 
discount rate, and $2.5 billion-$3.2 billion at a 3-percent discount 
rate. The emissions reductions at TSL 3 are estimated to be 49-65 Mt of 
CO2, approximately 65-87 kt of SO2, 66-90 kt of 
NOX, and 0.11-0.15 tons of Hg. As seen in section VI.B.1, 
for all representative equipment classes, customers have available 
designs that result in positive mean LCC savings, ranging from $10.14-
$502.21, at TSL 3. DOE's NPV analysis indicates (see Table VI.38) that 
each equipment class has a positive NPV at TSL 3. The projected change 
in industry value for metal halide ballast manufacturers would range 
from an increase of $4.5 million to a decrease of $25.9 million, or a 
net gain of 3.7 percent to a net loss of 25.0 percent in INPV. The 
projected change in industry value for metal halide lamp fixture 
manufacturers would range from an increase of $64.8 million to a 
decrease of $17.3 million, or a net gain of 10.3 percent to a net loss 
of 3.2 percent in INPV.
    TSL 3 represents the maximum positive NPV (when comparing the total 
NPV associated with TSL 3 to all other TSLs) and sets the same 
efficiency levels for fixtures operating indoors and outdoors be 
analyzed. This TSL corresponds to a modeled magnetic ballast in 70 W, 
250 W, and 400 W fixtures; a commercially available low-frequency 
electronic ballast in 150 W fixtures; and a commercially available 
magnetic ballast in 1000 W fixtures. TSL 3 also prohibits the use of 
probe-start ballasts in new 1000 W fixtures. Because the 150 W fixtures 
are subject to a more stringent standard (EL4, max tech) than other 
equipment classes (EL2), there is potential for customers to switch to 
the higher wattage fixtures to avoid the more stringent standards. This 
customer behavior could reduce the energy savings associated with TSL 
3.
    After considering the analysis, the comments that DOE received on 
the preliminary analysis, and the benefits and burdens of TSL 3, the 
Secretary has reached the following tentative conclusion: TSL 3 offers 
the maximum improvement in efficiency that is technologically feasible 
and economically justified, and will result in significant conservation 
of energy. The benefits of energy savings, emissions reductions (both 
in physical reductions and the monetized value of those reductions), 
positive net economic savings (NPV) at discount rates of 3-percent and 
7-percent at each representative equipment class would outweigh the 
potential reduction in INPV for manufacturers. Therefore, DOE today 
proposes to adopt energy conservation standards for metal halide lamp 
fixtures at TSL 3. DOE seeks comment on its proposal of adopting energy 
conservation standards for metal halide lamp fixtures at TSL 3. DOE 
will consider the comments and information received in determining the 
final energy conservation standards.

D. Backsliding

    As discussed in section II.A, EPCA contains what is commonly known 
as an ``anti-backsliding'' provision, which mandates that the Secretary 
not prescribe any amended standard that either increases the maximum 
allowable energy use or decreases the minimum required energy 
efficiency of a covered product. (42 U.S.C. 6295(o)(1)) DOE is 
evaluating amended standards in terms of ballast efficiency, which is 
the same metric that is currently used in energy conservation 
standards. Therefore, DOE compared the existing standards to the 
proposed amendments to confirm that none of the proposals constituted 
backsliding.
    The existing standards for ballast efficiency for metal halide lamp 
fixtures, set by EISA 2007, mandated that ballasts rated at wattages 
>=150 W and <=500 W operate at a minimum of 88 percent efficiency if 
pulse-start, 94 percent if probe-start magnetic, 90 percent if 
nonpulse-start electronic >=150 W and <=250 W, and 92 percent if 
nonpulse-start electronic >250 W and <=500 W. These standards excluded 
fixtures with regulated-lag ballasts, fixtures that use 480 V 
electronic ballasts, and fixtures that (1) are only rated for use with 
150 W lamps; (2) are rated for use in wet locations; and (3) contain a 
ballast that is rated to operate above 50 [deg]C. This rulemaking is 
proposing to cover fixtures with ballasts rated at >=50 W and <=2000 W, 
retain the exemptions for fixtures with regulated lag ballasts or 480 V 
electronic ballasts, and remove the exemption for 150 W fixtures used 
in wet locations with ballasts rated that operate above 50 [deg]C.
    As presented in the following table, DOE is not proposing any 
efficiency standards that would qualify as backsliding. In the >=50 W 
and <150 W \61\ range, there are no existing federal efficiency 
standards. Thus, any standard set by DOE in this rulemaking would not 
be backsliding, as it would be prescribing a standard where there 
previously was not one. The 150 W ballasts currently exempt by EISA 
(those only rated for use with 150 W lamps, rated for wet locations, 
and rated to operate at temperatures greater than 50 [deg]C) are not 
covered by any existing

[[Page 51548]]

federal energy conservation standards, so amended standards set for 
such ballasts would likewise not be subject to backsliding. Similarly, 
in the >500 W and <=2000 W range, there are no existing federal energy 
conservation standards, so standards proposed in this rulemaking would 
not backslide. Finally for the >=150 W \62\ and <=500 W range (not 
including the exempt 150 W fixtures), EISA currently prescribes 
standards. DOE is also proposing standards for fixtures in this wattage 
range. The proposed standard changes with wattage, but always requires 
ballasts in new fixtures to be at least 88 percent efficient (88 
percent efficiency for pulse-start ballasts is the least stringent of 
the various EISA 2007 requirements). If the efficiency standard 
proposed by DOE is lower than the standard prescribed by EISA for any 
ballast types or wattages (e.g., 94 percent efficiency requirement for 
probe-start ballasts), then the EISA standard will take precedence and 
prevent any potential backsliding.
---------------------------------------------------------------------------

    \61\ This wattage range contains those fixtures that are rated 
only for 150 watt lamps that are also rated for use in wet 
locations, as specified by the National Electrical Code 2002, 
section 410.4(A); and contain a ballast that is rated to operate at 
ambient air temperatures above 50 [deg]C, as specified by UL 1029-
2001.
    \62\ This wattage range contains all covered fixtures that are 
rated only for 150 watt lamps that are not also rated for use in wet 
locations, as specified by the National Electrical Code 2002, 
section 410.4(A); and do not also contain a ballast that is rated to 
operate at ambient air temperatures above 50 [deg]C, as specified by 
UL 1029-2001.
---------------------------------------------------------------------------

    On the basis of this section, the standards proposed in this NOPR 
are either higher than the existing standards, primarily because they 
set standards for previously unregulated fixtures, or if the EISA 
standards are higher than those proposed in this NOPR then the EISA 
standard is given precedence. As such, the proposed standards do not 
decrease the minimum required energy efficiency of the covered 
equipment and, therefore, do not violate the anti-backsliding provision 
in EPCA.

              Table VI.49--Existing Federal Efficiency Standards and Proposed Efficiency Standards
----------------------------------------------------------------------------------------------------------------
                                                                                                    Proposed
                                Indoor/ outdoor     Test input         Existing standards          efficiency
      Rated lamp wattage              ***            voltage              (efficiency)             standards/
                                                     [Dagger]                                      equations %
----------------------------------------------------------------------------------------------------------------
>=50 W and <=100 W............  Indoor.........  480 V..........  N/A.........................  99.4/
                                                                                                 (1+2.5*P[caret]
                                                                                                 (-0.55))
                                                                                                 [dagger].
>=50 W and <=100 W............  Indoor.........  All others.....  N/A.........................  100/
                                                                                                 (1+2.5*P[caret]
                                                                                                 (-0.55)).
>=50 W and <=100 W............  Outdoor........  480 V..........  N/A.........................  99.4/
                                                                                                 (1+2.5*P[caret]
                                                                                                 (-0.55)).
>=50 W and <=100 W............  Outdoor........  All others.....  N/A.........................  100/
                                                                                                 (1+2.5*P[caret]
                                                                                                 (-0.55)).
>100 W and <150 W *...........  Indoor.........  480 V..........  N/A.........................  99.4/
                                                                                                 (1+0.36*P[caret
                                                                                                 ](-0.30)).
>100 W and <150 W *...........  Indoor.........  All others.....  N/A.........................  100/
                                                                                                 (1+0.36*P[caret
                                                                                                 ](-0.30)).
>100 W and <150 W *...........  Outdoor........  480 V..........  N/A.........................  99.4/
                                                                                                 (1+0.36*P[caret
                                                                                                 ](-0.30)).
>100 W and <150 W *...........  Outdoor........  All others.....  N/A.........................  100/
                                                                                                 (1+0.36*P[caret
                                                                                                 ](-0.30)).
>=150 W ** and <=250 W........  Indoor.........  480 V..........  Varies from 88% to 94%        For >=150 W and
                                                                   depending on ballast type.    <=200 W: 88.0.
                                                                                                For >200 W and
                                                                                                 <=250 W:
                                                                                                 6.0*10[caret](-
                                                                                                 2)*P + 76.0.
>=150 W ** and <=250 W........  Indoor.........  All others.....  Varies from 88% to 94%        For >=150 W and
                                                                   depending on ballast type.    <=200 W: 88.0.
                                                                                                For >200 W and
                                                                                                 <=250 W:
                                                                                                 7.0*10[caret](-
                                                                                                 2)*P + 74.0.
>=150 W ** and <=250 W........  Outdoor........  480 V..........  Varies from 88% to 94%        For >=150 W and
                                                                   depending on ballast type.    <=200 W: 88.0.
                                                                                                For >200 W and
                                                                                                 <=250 W:
                                                                                                 6.0*10[caret](-
                                                                                                 2)*P + 76.0.
>=150 W ** and <=250 W........  Outdoor........  All others.....  Varies from 88% to 94%        For >=150 W and
                                                                   depending on ballast type.    <=200 W: 88.0.
                                                                                                For >200 W and
                                                                                                 <=250 W:
                                                                                                 7.0*10[caret](-
                                                                                                 2)*P + 74.0.
>250 W and <=500 W............  Indoor.........  480 V..........  Varies from 88% to 94%        91.0.
                                                                   depending on ballast type.
>250 W and <=500 W............  Indoor.........  All others.....  Varies from 88% to 94%        91.5.
                                                                   depending on ballast type.
>250 W and <=500 W............  Outdoor........  480 V..........  Varies from 88% to 94%        91.0.
                                                                   depending on ballast type.
>250 W and <=500 W............  Outdoor........  All others.....  Varies from 88% to 94%        91.5.
                                                                   depending on ballast type.
>500 W and <=2000 W...........  Indoor.........  480 V..........  N/A.........................  For >500 W to
                                                                                                 <1000 W:
                                                                                                 0.994*(3.2*10[c
                                                                                                 aret](-3)*P +
                                                                                                 89.9).
                                                                                                For >=1000 W to
                                                                                                 <=2000 W: 92.5.
>500 W and <=2000 W...........  Indoor.........  All others.....  N/A.........................  For >500 W to
                                                                                                 <1000 W:
                                                                                                 3.2*10[caret](-
                                                                                                 3)*P + 89.9.
                                                                                                For >=1000 W to
                                                                                                 <=2000 W: 93.1.
>500 W and <=2000 W...........  Outdoor........  480 V..........  N/A.........................  For >500 W to
                                                                                                 <1000 W:
                                                                                                 0.994*(3.2*10[c
                                                                                                 aret](-3)*P +
                                                                                                 89.9).
                                                                                                For >=1000 W to
                                                                                                 <=2000 W: 92.5.
>500 W and <=2000 W...........  Outdoor........  All others.....  N/A.........................  For >500 W to
                                                                                                 <1000 W:
                                                                                                 3.2*10[caret](-
                                                                                                 3)*P + 89.9.
                                                                                                For >=1000 W to
                                                                                                 <=2000 W: 93.1.
----------------------------------------------------------------------------------------------------------------
* Includes 150 W fixtures exempted by EISA 2007, which are fixtures rated only for 150 watt lamps; rated for use
  in wet locations, as specified by the National Electrical Code 2002, section 410.4(A); and containing a
  ballast that is rated to operate at ambient air temperatures above 50 [deg]C, as specified by UL 1029-2001.
** Excludes 150 W fixtures exempted by EISA 2007, which are fixtures rated only for 150 watt lamps; rated for
  use in wet locations, as specified by the National Electrical Code 2002, section 410.4(A); and containing a
  ballast that is rated to operate at ambient air temperatures above 50 [deg]C, as specified by UL 1029-2001.
*** DOE's proposed definitions for ``indoor'' and ``outdoor'' metal halide lamp fixtures are described in
  section V.A.2.
[dagger] P is defined as the rated wattage of the lamp the fixture is designed to operate.

[[Page 51549]]

 
[Dagger] Input voltage for testing would be specified by the test procedures. Ballasts rated to operate lamps
  less than 150 W would be tested at 120 V, and ballasts rated to operate lamps >=150 W would be tested at 277
  V. Ballasts not designed to operate at either of these voltages would be tested at the highest voltage the
  ballast is designed to operate.

VII. Procedural Issues and Regulatory Review

A. Review Under Executive Orders 12866 and 13563

    Section 1(b)(1) of E.O. 12866, ``Regulatory Planning and Review,'' 
58 FR 51735 (Oct. 4, 1993), requires each agency to identify the 
problem that it intends to address, including, where applicable, the 
failures of private markets or public institutions that warrant new 
agency action, as well as to assess the significance of that problem. 
The problems addressed by today's standards are as follows:
    (1) There is a lack of customer information and/or information-
processing capability about energy-efficiency opportunities in the 
commercial equipment market.
    (2) There is asymmetric information (one party to a transaction has 
more and better information than the other) and/or high transaction 
costs (costs of gathering information and affecting exchanges of goods 
and services).
    (3) There are external benefits resulting from improved energy 
efficiency of metal halide lamp fixtures that are not captured by the 
users of such equipment. These benefits include externalities related 
to environmental protection and energy security that are not reflected 
in energy prices, such as reduced emissions of greenhouse gases.
    In addition, DOE has determined that today's regulatory action is 
an ``economically significant regulatory action'' under section 3(f)(1) 
of E.O. 12866. Accordingly, section 6(a)(3) of the E.O. requires that 
DOE prepare a regulatory impact analysis (RIA) on today's proposed rule 
and that the Office of Information and Regulatory Affairs (OIRA) in the 
Office of Management and Budget (OMB) review this proposed rule. DOE 
presented to OIRA for review the draft rule and other documents 
prepared for this rulemaking, including the RIA, and has included these 
documents in the rulemaking record. The assessments prepared pursuant 
to E.O. 12866 can be found in the technical support document for this 
rulemaking.
    DOE has also reviewed this regulation pursuant to E.O. 13563, 
issued on January 18, 2011 (76 FR 3281 (Jan. 21, 2011)). E.O. 13563 is 
supplemental to and explicitly reaffirms the principles, structures, 
and definitions governing regulatory review established in E.O. 12866. 
To the extent permitted by law, agencies are required by E.O. 13563 to: 
(1) Propose or adopt a regulation only upon a reasoned determination 
that its benefits justify its costs (recognizing that some benefits and 
costs are difficult to quantify); (2) tailor regulations to impose the 
least burden on society, consistent with obtaining regulatory 
objectives, taking into account, among other things, and to the extent 
practicable, the costs of cumulative regulations; (3) select, in 
choosing among alternative regulatory approaches, those approaches that 
maximize net benefits (including potential economic, environmental, 
public health and safety, and other advantages; distributive impacts; 
and equity); (4) to the extent feasible, specify performance 
objectives, rather than specifying the behavior or manner of compliance 
that regulated entities must adopt; and (5) identify and assess 
available alternatives to direct regulation, including providing 
economic incentives to encourage the desired behavior, such as user 
fees or marketable permits, or providing information upon which choices 
can be made by the public.
    DOE emphasizes, as well, that E.O. 13563 requires agencies to use 
the best available techniques to quantify anticipated present and 
future benefits and costs as accurately as possible. In its guidance, 
OIRA has emphasized that such techniques may include identifying 
changing future compliance costs that might result from technological 
innovation or anticipated behavioral changes. For the reasons stated in 
the preamble, DOE believes that today's NOPR is consistent with these 
principles, including the requirements that, to the extent permitted by 
law, benefits justify costs and net benefits are maximized.

B. Review Under the Regulatory Flexibility Act

    The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) requires 
preparation of an initial regulatory flexibility analysis (IRFA) for 
any rule that, by law, must be proposed for public comment, unless the 
agency certifies that the rule, if promulgated, will not have a 
significant economic impact on a substantial number of small entities. 
As required by E. O. 13272, ``Proper Consideration of Small Entities in 
Agency Rulemaking,'' (67 FR 53461 (Aug. 16, 2002)), DOE published 
procedures and policies on February 19, 2003, to ensure that the 
potential impacts of its rules on small entities are properly 
considered during the rulemaking process. (68 FR 7990) DOE has made its 
procedures and policies available on the Office of the General 
Counsel's Web site (http://energy.gov/gc/office-general-counsel). DOE 
reviewed the potential standard levels considered in today's NOPR under 
the provisions of the Regulatory Flexibility Act and the procedures and 
policies published on February 19, 2003.
    As a result of this review, DOE has prepared an IRFA for metal 
halide ballasts and metal halide lamp fixtures, a copy of which DOE 
will transmit to the Chief Counsel for Advocacy of the SBA for review 
under 5 U.S.C 605(b). As presented and discussed below, the IRFA 
describes potential impacts on small metal halide ballast and metal 
halide lamp fixture manufacturers and discusses alternatives that could 
minimize these impacts.
    A statement of the reasons for the proposed rule, and the 
objectives of and legal basis for the proposed rule, are set forth 
elsewhere in the preamble and not repeated here.
1. Description and Estimated Number of Small Entities Regulated
a. Methodology for Estimating the Number of Small Entities
    For manufacturers of metal halide ballasts and metal halide lamp 
fixtures, 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. (65 FR 
30836, 30850 (May 15, 2000), as amended at 65 FR 53533, 53545 (Sept. 5, 
2000) and codified at 13 CFR part 121). The size standards are listed 
by North American Industry Classification System (NAICS) code and 
industry description and are available at http://www.sba.gov/sites/default/files/files/Size_Standards_Table.pdf. Metal halide ballast 
manufacturing is classified under NAICS 335311, ``Power, Distribution 
and Specialty Transformer Manufacturing.'' The SBA sets a threshold of 
750 employees or less for an entity to be considered as a small 
business for this category. Metal halide lamp fixture manufacturing is 
classified under NAICS 335122, ``Commercial, Industrial, and 
Institutional Electric Lighting Fixture Manufacturing.'' The SBA sets a 
threshold of 500 employees

[[Page 51550]]

or less for an entity to be considered as a small business for this 
category.
    To estimate the number of companies that could be small business 
manufacturers of equipment covered by this rulemaking, DOE conducted a 
market survey using all available public information to identify 
potential small manufacturers. DOE's research involved industry trade 
association membership directories (including NEMA), individual company 
Web sites, and market research tools (e.g., Dun and Bradstreet reports 
and Hoovers reports) to create a list of every company that 
manufactures or sells metal halide ballasts or metal halide lamp 
fixtures covered by this rulemaking. DOE also asked stakeholders and 
industry representatives if they were aware of any other small 
manufacturers during manufacturer interviews and at previous DOE public 
meetings. DOE contacted companies on its list, as necessary, to 
determine whether they met the SBA's definition of a small business 
manufacturer of covered equipment. DOE screened out companies that did 
not offer equipment covered by this rulemaking, did not meet the 
definition of a ``small business,'' or were foreign owned and operated.
    DOE initially identified at least 25 potential manufacturers of 
metal halide ballasts sold in the U.S. DOE reviewed publicly available 
information on these 25 potential manufacturers and determined that 13 
were either large manufacturers, manufacturers that were foreign owned 
and operated, or did not manufacture ballasts covered by this 
rulemaking. DOE then attempted to contact the remaining 12 companies 
that were potential small business manufacturers. DOE was able to 
determine that five companies meet the SBA's definition of a small 
business and likely manufacture ballasts covered by this rulemaking.
    For metal halide lamp fixtures sold in the U.S., DOE initially 
identified at least 134 potential manufacturers. DOE reviewed publicly 
available information on these 134 potential manufacturers and 
determined that 66 were large manufacturers, manufacturers that were 
foreign owned and operated, or did not sell fixtures covered by this 
rulemaking. DOE then attempted to contact the remaining 68 companies 
that were potential small business manufacturers. Though many companies 
were unresponsive, DOE was able to determine that approximately 54 meet 
the SBA's definition of a small business and likely manufacture 
fixtures covered by this rulemaking.
    NEMA stated that small manufacturers may be significantly burdened 
by energy conservation standards because they have limited resources at 
their disposal to redesign products. (NEMA, No. 34 at p. 16) DOE agrees 
that there is potential for small manufacturers to be 
disproportionately burdened by regulations and outlines its conclusions 
on the potential impacts of standards on small businesses in the 
sections that follow.
b. Manufacturer Participation
    Before issuing this NOPR, DOE attempted to contact the small 
business manufacturers of metal halide ballasts and metal halide lamp 
fixtures it had identified. One small ballast manufacturer and two 
small fixture manufacturers consented to being interviewed. DOE also 
obtained information about small business impacts while interviewing 
large manufacturers.
c. Metal Halide Ballast and Fixture Industry Structure
    Ballasts. Five major ballast manufacturers with limited domestic 
production supply the vast majority of the metal halide ballast market. 
None of the five major manufacturers is a small business. The remaining 
market share is held by a few smaller domestic companies, only one of 
which has significant market share. Nearly all metal halide ballast 
production occurs abroad.
    Fixtures. The majority of the metal halide lamp fixture market is 
supplied by six major manufacturers with sizeable domestic production. 
None of these major manufacturers is a small business. The remaining 
market share is held by several smaller domestic and foreign 
manufacturers. Most of the small domestic manufacturers produce 
fixtures in the U.S. Although none of the small businesses holds a 
significant market share individually, collectively these small 
businesses account for a third of the market. See chapter 3 of the NOPR 
TSD for further details on the metal halide ballast and metal halide 
lamp fixture markets.
d. Comparison Between Large and Small Entities
    Ballasts. The five large ballast manufacturers typically offer a 
much wider range of designs of metal halide ballasts than small 
manufacturers do. Ballasts can vary by start method, input voltage, 
wattage, and design. Often large ballast manufacturers will offer 
several different ballast options for each lamp wattage. Small 
manufacturers generally specialize in manufacturing only a handful of 
different ballast types and do not have the volume to support as wide a 
range of products as large manufacturers do. Three of the five small 
ballast manufacturers specialize in high-efficiency electronic ballasts 
and do not offer any magnetic ballasts. Some small ballast 
manufacturers offer a wide variety of lighting products, but others 
focus exclusively on metal halide ballasts.
    Fixtures. The six large fixture manufacturers typically serve 
large-scale commercial lighting markets, while small fixture 
manufacturers tend to operate in niche lighting markets such as 
architectural and designer lighting. Small fixture manufacturers also 
frequently fill custom orders that are much smaller in volume than 
large fixture manufacturers' typical orders are. Because small 
manufacturers typically offer specialized products and cater to 
individual customers' needs, they can command higher markups than most 
large manufacturers. Like large ballast manufacturers, large fixture 
manufacturers offer a wider range of metal halide lamp fixtures than 
small fixture manufacturers. A small fixture manufacturer may offer 
fewer than 50 models, while a large manufacturer may typically offer 
several hundred models. Almost all small fixture manufacturers offer a 
variety of lighting products in addition to those covered by this 
rulemaking, such as fluorescent, incandescent, and LED fixtures.
2. Description and Estimate of Compliance Requirements
    Ballasts. Because three of the five small metal halide ballast 
manufacturers offer only electronic ballasts that already meet the 
standards at TSL 3, the level proposed in today's notice, DOE does not 
expect any product or capital conversion costs for these small ballast 
manufacturers. The fourth small ballast manufacturer offers a wide 
range of magnetic and electronic ballasts, so DOE does not expect this 
manufacturer's conversion costs to differ significantly from those of 
the large manufacturers. The fifth small ballast manufacturer currently 
offers a large variety of lighting products, but only two models of 
metal halide ballasts. Because it would likely invest in other parts of 
its business, this manufacturer stated to DOE that this rulemaking is 
unlikely to significantly affect it.
    Fixtures. As stated above, DOE identified approximately 54 small 
metal halide lamp fixture businesses affected by this rulemaking. Based 
on interviews with two of these manufacturers and examinations of 
product offerings on company Web sites, DOE believes that approximately 
one-fourth of these small businesses will not face any conversion

[[Page 51551]]

costs because they offer very few metal halide lamp fixture models and 
would, therefore, focus on more substantial areas of their business. Of 
the remaining small businesses DOE identified, nearly two-thirds 
primarily serve the architectural or specialty lighting markets. 
Because these products command higher prices and margins compared to 
the typical products offered by a large manufacturer, DOE believes that 
these small fixture manufacturers will be able to pass on any necessary 
conversion costs to their customers without significantly impacting 
their businesses.
    The remaining small fixture manufacturers (roughly 14 in number) 
could be differentially impacted by today's proposed standards. These 
manufacturers operate partially in industrial and commoditized markets 
in which it may be more difficult to pass on any disproportionate costs 
to their customers. The impacts could be relatively greater for a 
typical small manufacturer because of the far lower production volumes 
and the relatively fixed nature of the R&D and capital resources 
required per fixture family.
    Based on interviews, however, DOE anticipates that small 
manufacturers would take steps to mitigate the costs required to meet 
new and amended energy conservation standards. At TSL 3, DOE believes 
that under the proposed standards, small fixture businesses would 
likely selectively upgrade existing product lines to offer products 
that are in high demand or offer strategic advantage. Small 
manufacturers could then spread out further investments over a longer 
time period by not upgrading all product lines prior to the compliance 
date.
    Additionally, DOE does not expect that small fixture manufacturers 
would be burdened by compliance requirements. As discussed in section 
IV.A, the standards proposed in this NOPR provide simplifying 
amendments to the current testing and reporting procedures. One of 
DOE's goals in this rulemaking was to have minimal, if any, increase in 
testing and reporting burden on manufacturers. DOE is only mandating 
testing at a single input voltage for metal halide lamp fixtures. Other 
options considered would have increased testing to either two or four 
input voltages per fixture. Because DOE selected the least burdensome 
input voltage option, DOE concludes that regulations in this NOPR would 
not have an adverse impact on the testing burden of small 
manufacturers.
    The existing test procedures already dictate that testing for 
certification requires a sample of at least four fixtures for 
compliance. DOE is not proposing to change this minimum sample size, 
and as such, does not find an increased testing burden on small 
manufacturers.
    As discussed in section IV.A, DOE is amending the test procedures 
to mandate the equipment with which high-frequency electronic ballasts 
are to be tested, since existing test procedures prescribe test 
instrumentation only for magnetic and low-frequency electronic 
ballasts. DOE proposes that equipment be permitted for testing the 
output frequency of the ballast. Once it is determined that a fixture's 
output frequency is greater than or equal to 1000 Hz, the frequency at 
which DOE proposes to define high-frequency electronic ballasts, the 
test procedures would require equipment to consist of (1) a power 
analyzer that conforms to ANSI C82.6-2005 with a maximum of 100 pF 
capacitance to ground and frequency response between 40 Hz and 1 MHz, 
(2) a current probe compliant with ANSI C82.6-2005 that is galvanically 
isolated and has a frequency response between 40 Hz and 20 MHz, and (3) 
a lamp current measurement device where its full transducer ratio is 
set in the power analyzer to match the current probe to the analyzer. 
DOE finds that these test requirements do not affect small 
manufacturers, noting that the equipment described above is the same 
equipment that is already required for the testing of fluorescent lamp 
ballasts. Because many lighting companies that manufacture or sell 
metal halide ballasts also manufacture or sell fluorescent lamp 
ballasts, this proposed change to the test procedures should not affect 
manufacturers' testing burden or costs. In addition, DOE believes that 
the equipment specified for high-frequency electronic ballast testing 
is representative of typical high-quality equipment currently used by 
manufacturers in the business of designing and selling these ballasts.
    DOE seeks comment on the potential impacts of new and amended 
standards on the small metal halide ballast and metal halide lamp 
fixture manufacturers.
3. Duplication, Overlap, and Conflict With Other Rules and Regulations
    DOE is not aware of any rules or regulations that duplicate, 
overlap, or conflict with the rule being considered today.
4. Significant Alternatives to the Proposed Rule
    The discussion above analyzes impacts on small businesses that 
would result from the other TSLs DOE considered. Though TSLs lower than 
the proposed TSLs are expected to reduce the impacts on small entities, 
DOE is required by EPCA to establish standards that achieve the maximum 
improvement in energy efficiency that are technically feasible and 
economically justified, and result in significant conservation of 
energy. Thus, DOE rejected the lower TSLs.
    In addition to the other TSLs being considered, the NOPR TSD 
includes a regulatory impact analysis in chapter 18. For metal halide 
lamp fixtures, this report discusses the following policy alternatives: 
(1) No standard, (2) customer rebates, (3) customer tax credits, (4) 
manufacturer tax credits, and (5) early replacement. DOE does not 
intend to consider these alternatives further because they are either 
not feasible to implement, or not expected to result in energy savings 
as large as those that would be achieved by the standard levels under 
consideration.
    DOE continues to seek input from businesses that would be affected 
by this rulemaking and will consider comments received in the 
development of any final rule.

C. Review Under the Paperwork Reduction Act

    Manufacturers of metal halide lamp fixtures must certify to DOE 
that their equipment complies with any applicable energy conservation 
standard. In certifying compliance, manufacturers must test their 
equipment according to the DOE test procedures for metal halide lamp 
fixtures, including any amendments adopted for those test procedures. 
DOE has established regulations for the certification and recordkeeping 
requirements for all covered customer products and commercial 
equipment, including metal halide lamp fixtures. 76 FR 12422 (March 7, 
2011). The collection-of-information requirement for certification and 
recordkeeping is subject to review and approval by OMB under the 
Paperwork Reduction Act (PRA). This requirement has been approved by 
OMB under OMB control number 1910-1400. Public reporting burden for the 
certification is estimated to average 20 hours per response, including 
the time for reviewing instructions, searching existing data sources, 
gathering and maintaining the data needed, and completing and reviewing 
the collection of information.
    Notwithstanding any other provision of the law, no person is 
required to respond to, nor shall any person be subject to a penalty 
for failure to comply with, a collection of information subject to the 
requirements of the PRA, unless

[[Page 51552]]

that collection of information displays a currently valid OMB Control 
Number.

D. Review Under the National Environmental Policy Act of 1969

    Pursuant to the National Environmental Policy Act (NEPA) of 1969, 
DOE has determined that the proposed rule fits within the category of 
actions included in Categorical Exclusion (CX) B5.1 and otherwise meets 
the requirements for application of a CX. See 10 CFR part 1021, 
appendix. B, B5.1(b); 1021.410(b) and appendix B, B(1)-(5). The 
proposed rule fits within the category of actions because it is a 
rulemaking that establishes energy conservation standards for consumer 
products or industrial equipment, and for which none of the exceptions 
identified in CX B5.1(b) apply. Therefore, DOE has made a CX 
determination for this rulemaking, and DOE does not need to prepare an 
Environmental Assessment or Environmental Impact Statement for this 
proposed rule. CX determination for this proposed rule is available at 
http://cxnepa.energy.gov.

E. Review Under Executive Order 13132

    Executive Order 13132, ``Federalism,'' 64 FR 43255 (Aug. 10, 1999), 
imposes certain requirements on Federal agencies formulating and 
implementing policies or regulations that preempt state law or that 
have Federalism implications. The E.O. requires agencies to examine the 
constitutional and statutory authority supporting any action that would 
limit the policymaking discretion of the states and to carefully assess 
the necessity for such actions. The E.O. also requires agencies to have 
an accountable process to ensure meaningful and timely input by state 
and local officials in the development of regulatory policies that have 
Federalism implications. On March 14, 2000, DOE published a statement 
of policy describing the intergovernmental consultation process it will 
follow in the development of such regulations. 65 FR 13735. EPCA 
governs and prescribes Federal preemption of state regulations as to 
energy conservation for the products that are the subject of today's 
proposed rule. States can petition DOE for exemption from such 
preemption to the extent, and based on criteria, set forth in EPCA. (42 
U.S.C. 6297) No further action is required by E.O. 13132.

F. Review Under Executive Order 12988

    With respect to the review of existing regulations and the 
promulgation of new regulations, section 3(a) of E.O. 12988, ``Civil 
Justice Reform,'' imposes on Federal agencies the general duty to 
adhere to the following requirements: (1) Eliminate drafting errors and 
ambiguity; (2) write regulations to minimize litigation; and (3) 
provide a clear legal standard for affected conduct rather than a 
general standard and promote simplification and burden reduction. 61 FR 
4729 (Feb. 7, 1996). Section 3(b) of E.O.12988 specifically requires 
that Executive agencies make every reasonable effort to ensure that the 
regulation: (1) Clearly specifies the preemptive effect, if any; (2) 
clearly specifies any effect on existing Federal law or regulation; (3) 
provides a clear legal standard for affected conduct while promoting 
simplification and burden reduction; (4) specifies the retroactive 
effect, if any; (5) adequately defines key terms; and (6) addresses 
other important issues affecting clarity and general draftsmanship 
under any guidelines issued by the Attorney General. Section 3(c) of 
E.O. 12988 requires Executive agencies to review regulations in light 
of applicable standards in section 3(a) and section 3(b) to determine 
whether they are met or it is unreasonable to meet one or more of them. 
DOE has completed the required review and determined that, to the 
extent permitted by law, this proposed rule meets the relevant 
standards of E.O. 12988.

G. Review Under the Unfunded Mandates Reform Act of 1995

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) 
requires each Federal agency to assess the effects of Federal 
regulatory actions on state, local, and tribal governments and the 
private sector. Public Law 104-4, sec. 201 (codified at 2 U.S.C. 1531). 
For a proposed regulatory action likely to result in a rule that may 
cause the expenditure by state, local, and tribal governments, in the 
aggregate, or by the private sector of $100 million or more in any one 
year (adjusted annually for inflation), section 202 of UMRA requires a 
Federal agency to publish a written statement that estimates the 
resulting costs, benefits, and other effects on the national economy. 
(2 U.S.C. 1532(a), (b)) UMRA also requires a Federal agency to develop 
an effective process to permit timely input by elected officers of 
state, local, and tribal governments on a proposed ``significant 
intergovernmental mandate,'' and requires an agency plan for giving 
notice and opportunity for timely input to potentially affected small 
governments before establishing any requirements that might 
significantly or uniquely affect small governments. On March 18, 1997, 
DOE published a statement of policy on its process for 
intergovernmental consultation under UMRA. 62 FR 12820. DOE's policy 
statement is also available at www.gc.energy.gov.
    Although today's proposed rule does not contain a Federal 
intergovernmental mandate, it may require expenditures of $100 million 
or more on the private sector. Specifically, the proposed rule will 
likely result in a final rule that could require expenditures of $100 
million or more. Such expenditures may include: (1) Investment in 
research and development and capital expenditures by metal halide lamp 
fixture manufacturers in the years between the final rule and the 
compliance date for the new standards, and (2) incremental additional 
expenditures by customers to purchase higher-efficiency metal halide 
lamp fixtures, starting at the compliance date for the applicable 
standard.
    Section 202 of UMRA authorizes a Federal agency to respond to the 
content requirements of UMRA in any other statement or analysis that 
accompanies the proposed rule. (2 U.S.C. 1532(c)) The content 
requirements of section 202(b) of UMRA relevant to a private-sector 
mandate substantially overlap with the economic analysis requirements 
that apply under section 325(o) of EPCA and E.O. 12866. The 
SUPPLEMENTARY INFORMATION section of this NOPR and the ``Regulatory 
Impact Analysis'' section of the NOPR TSD for this proposed rule 
respond to those requirements.
    Under section 205 of UMRA, the Department is obligated to identify 
and consider a reasonable number of regulatory alternatives before 
promulgating a rule for which a written statement under section 202 is 
required. (2 U.S.C. 1535(a)) DOE is required to select from those 
alternatives the most cost-effective and least-burdensome alternative 
that achieves the objectives of the proposed rule unless DOE publishes 
an explanation for doing otherwise, or the selection of such an 
alternative is inconsistent with law. As required by 42 U.S.C. 6295(d), 
(f), and (o), 6313(e), and 6316(a), today's proposed rule would 
establish energy conservation standards for metal halide lamp fixtures 
that are designed to achieve the maximum improvement in energy 
efficiency that DOE has determined to be both technologically feasible 
and economically justified. A full discussion of the alternatives 
considered by DOE is presented in the ``Regulatory Impact Analysis'' 
section of the NOPR TSD for today's proposed rule.

[[Page 51553]]

H. Review Under the Treasury and General Government Appropriations Act, 
1999

    Section 654 of the Treasury and General Government Appropriations 
Act, 1999 (Pub. L. 105-277) requires Federal agencies to issue a Family 
Policymaking Assessment for any rule that may affect family well-being. 
This rule would not have any impact on the autonomy or integrity of the 
family as an institution. Accordingly, DOE has concluded that it is not 
necessary to prepare a Family Policymaking Assessment.

I. Review Under Executive Order 12630

    DOE has determined, under E.O. 12630, ``Governmental Actions and 
Interference with Constitutionally Protected Property Rights'' 53 FR 
8859 (Mar. 18, 1988), that this regulation would not result in any 
takings that might require compensation under the Fifth Amendment to 
the U.S. Constitution.

J. Review Under the Treasury and General Government Appropriations Act, 
2001

    Section 515 of the Treasury and General Government Appropriations 
Act, 2001 (44 U.S.C. 3516, note) provides for Federal agencies to 
review most disseminations of information to the public under 
guidelines established by each agency pursuant to general guidelines 
issued by OMB. OMB's guidelines were published at 67 FR 8452 (Feb. 22, 
2002), and DOE's guidelines were published at 67 FR 62446 (Oct. 7, 
2002). DOE has reviewed today's NOPR under the OMB and DOE guidelines 
and has concluded that it is consistent with applicable policies in 
those guidelines.

K. Review Under Executive Order 13211

    Executive Order 13211, ``Actions Concerning Regulations That 
Significantly Affect Energy Supply, Distribution, or Use'' 66 FR 28355 
(May 22, 2001), requires Federal agencies to prepare and submit to OIRA 
at OMB, a Statement of Energy Effects for any proposed significant 
energy action. A ``significant energy action'' is defined as any action 
by an agency that promulgates or is expected to lead to promulgation of 
a final rule, and that: (1) Is a significant regulatory action under 
E.O. 12866, or any successor order; and (2) is likely to have a 
significant adverse effect on the supply, distribution, or use of 
energy, or (3) is designated by the Administrator of OIRA as a 
significant energy action. For any proposed significant energy action, 
the agency must give a detailed statement of any adverse effects on 
energy supply, distribution, or use should the proposal be implemented, 
and of reasonable alternatives to the action and their expected 
benefits on energy supply, distribution, and use.
    DOE has tentatively concluded that today's regulatory action, which 
sets forth energy conservation standards for metal halide lamp 
fixtures, is not a significant energy action because the proposed 
standards are not likely to have a significant adverse effect on the 
supply, distribution, or use of energy, nor has it been designated as 
such by the Administrator at OIRA. Accordingly, DOE has not prepared a 
Statement of Energy Effects on the proposed rule.

L. Review Under the Information Quality Bulletin for Peer Review

    On December 16, 2004, OMB, in consultation with the Office of 
Science and Technology Policy (OSTP), issued its Final Information 
Quality Bulletin for Peer Review (the Bulletin). 70 FR 2664 (Jan. 14, 
2005). The Bulletin establishes that certain scientific information 
shall be peer reviewed by qualified specialists before it is 
disseminated by the Federal Government, including influential 
scientific information related to agency regulatory actions. The 
purpose of the bulletin is to enhance the quality and credibility of 
the Government's scientific information. Under the Bulletin, the energy 
conservation standards rulemaking analyses are ``influential scientific 
information,'' which the Bulletin defines as ``scientific information 
the agency reasonably can determine will have or does have a clear and 
substantial impact on important public policies or private sector 
decisions.'' 70 FR 2667.
    In response to OMB's Bulletin, DOE conducted formal in-progress 
peer reviews of the energy conservation standards development process 
and analyses and has prepared a Peer Review Report pertaining to the 
energy conservation standards rulemaking analyses. Generation of this 
report involved a rigorous, formal, and documented evaluation using 
objective criteria and qualified and independent reviewers to make a 
judgment as to the technical/scientific/business merit, the actual or 
anticipated results, and the productivity and management effectiveness 
of programs and/or projects. The ``Energy Conservation Standards 
Rulemaking Peer Review Report'' dated February 2007 has been 
disseminated and is available at the following Web site: 
www1.eere.energy.gov/buildings/appliance_standards/peer_review.html.

VIII. Public Participation

A. Attendance at the Public Meeting

    The time, date, and location of the public meeting are listed in 
the DATES and ADDRESSES sections at the beginning of this notice. If 
you plan to attend the public meeting, please notify Ms. Brenda Edwards 
at (202) 586-2945 or Brenda.Edwards@ee.doe.gov. As explained in the 
ADDRESSES section, foreign nationals visiting DOE Headquarters are 
subject to advance security screening procedures.
    In addition, you can attend the public meeting via webinar. Webinar 
registration information, participant instructions, and information 
about the capabilities available to webinar participants will be 
published on DOE's Web site at: www1.eere.energy.gov/buildings/appliance_standards/product.aspx/productid/49. Participants are 
responsible for ensuring that their systems are compatible with the 
webinar software.

B. Procedure for Submitting Prepared General Statements For 
Distribution

    Any person who has plans to present a prepared general statement 
may request that copies of his or her statement be made available at 
the public meeting. Such persons may submit requests, along with an 
advance electronic copy of their statement in PDF (preferred), 
Microsoft Word or Excel, WordPerfect, or text (ASCII) file format, to 
the appropriate address shown in the ADDRESSES section at the beginning 
of this notice. The request and advance copy of statements must be 
received at least one week before the public meeting and may be 
emailed, hand-delivered, or sent by mail. DOE prefers to receive 
requests and advance copies via email. Please include a telephone 
number to enable DOE staff to make follow-up contact, if needed.

C. Conduct of the Public Meeting

    DOE will designate a DOE official to preside at the public meeting 
and may also use a professional facilitator to aid discussion. The 
meeting will not be a judicial or evidentiary-type public hearing, but 
DOE will conduct it in accordance with section 336 of EPCA (42 U.S.C. 
6306). A court reporter will be present to record the proceedings and 
prepare a transcript. DOE reserves the right to schedule the order of 
presentations and to establish the procedures governing the conduct of 
the public meeting. After the public meeting, interested parties may 
submit further comments on the proceedings as well as on any aspect of 
the rulemaking until the end of the comment period.

[[Page 51554]]

    The public meeting will be conducted in an informal, conference 
style. DOE will present summaries of comments received before the 
public meeting, allow time for prepared general statements by 
participants, and encourage all interested parties to share their views 
on issues affecting this rulemaking. Each participant will be allowed 
to make a general statement (within time limits determined by DOE), 
before the discussion of specific topics. DOE will allow, as time 
permits, other participants to comment briefly on any general 
statements.
    At the end of all prepared statements on a topic, DOE will permit 
participants to clarify their statements briefly and comment on 
statements made by others. Participants should be prepared to answer 
questions by DOE and by other participants concerning these issues. DOE 
representatives may also ask questions of participants concerning other 
matters relevant to this rulemaking. The official conducting the public 
meeting will accept additional comments or questions from those 
attending, as time permits. The presiding official will announce any 
further procedural rules or modification of the above procedures that 
may be needed for the proper conduct of the public meeting.
    A transcript of the public meeting will be included in the docket, 
which can be viewed as described in the Docket section at the beginning 
of this notice. In addition, any person may buy a copy of the 
transcript from the transcribing reporter.

D. Submission of Comments

    DOE will accept comments, data, and information regarding this 
proposed rule before or after the public meeting, but no later than the 
date provided in the DATES section at the beginning of this proposed 
rule. Interested parties may submit comments, data, and other 
information using any of the methods described in the ADDRESSES section 
at the beginning of this notice.
    Submitting comments via regulations.gov. The regulations.gov Web 
page will require you to provide your name and contact information. 
Your contact information will be viewable to DOE Building Technologies 
staff only. Your contact information will not be publicly viewable 
except for your first and last names, organization name (if any), and 
submitter representative name (if any). If your comment is not 
processed properly because of technical difficulties, DOE will use this 
information to contact you. If DOE cannot read your comment due to 
technical difficulties and cannot contact you for clarification, DOE 
may not be able to consider your comment.
    However, your contact information will be publicly viewable if you 
include it in the comment itself or in any documents attached to your 
comment. Any information that you do not want to be publicly viewable 
should not be included in your comment, nor in any document attached to 
your comment. Otherwise, persons viewing comments will see only first 
and last names, organization names, correspondence containing comments, 
and any documents submitted with the comments.
    Do not submit to regulations.gov information for which disclosure 
is restricted by statute, such as trade secrets and commercial or 
financial information (hereinafter referred to as Confidential Business 
Information (CBI)). Comments submitted through regulations.gov cannot 
be claimed as CBI. Comments received through the Web site will waive 
any CBI claims for the information submitted. For information on 
submitting CBI, see the Confidential Business Information section 
below.
    DOE processes submissions made through regulations.gov before 
posting. Normally, comments will be posted within a few days of being 
submitted. However, if large volumes of comments are being processed 
simultaneously, your comment may not be viewable for up to several 
weeks. Please keep the comment tracking number that regulations.gov 
provides after you have successfully uploaded your comment.
    Submitting comments via email, hand delivery/courier, or mail. 
Comments and documents submitted via email, hand delivery, or mail also 
will be posted to regulations.gov. If you do not want your personal 
contact information to be publicly viewable, do not include it in your 
comment or any accompanying documents. Instead, provide your contact 
information in a cover letter. Include your first and last names, email 
address, telephone number, and optional mailing address. The cover 
letter will not be publicly viewable as long as it does not include any 
comments
    Include contact information each time you submit comments, data, 
documents, and other information to DOE. Email submissions are 
preferred. If you submit via mail or hand delivery/courier, please 
provide all items on a CD, if feasible. It is not necessary to submit 
printed copies. No facsimiles (faxes) will be accepted.
    Comments, data, and other information submitted to DOE 
electronically should be provided in PDF (preferred), Microsoft Word or 
Excel, WordPerfect, or text (ASCII) file format. Provide documents that 
are not secured, that are written in English, and that are free of any 
defects or viruses. Documents should not contain special characters or 
any form of encryption and, if possible, they should carry the 
electronic signature of the author.
    Campaign form letters. Please submit campaign form letters by the 
originating organization in batches of between 50 to 500 form letters 
per PDF or as one form letter with a list of supporters' names compiled 
into one or more PDFs. This reduces comment processing and posting 
time.
    Confidential Business Information. According to 10 CFR 1004.11, any 
person submitting information that he or she believes to be 
confidential and exempt by law from public disclosure should submit via 
email, postal mail, or hand delivery/courier two well-marked copies: 
One copy of the document marked confidential including all the 
information believed to be confidential, and one copy of the document 
marked non-confidential with the information believed to be 
confidential deleted. Submit these documents via email or on a CD, if 
feasible. DOE will make its own determination about the confidential 
status of the information and treat it according to its determination.
    Factors of interest to DOE when evaluating requests to treat 
submitted information as confidential include: (1) A description of the 
items; (2) whether and why such items are customarily treated as 
confidential within the industry; (3) whether the information is 
generally known by or available from other sources; (4) whether the 
information has previously been made available to others without 
obligation concerning its confidentiality; (5) an explanation of the 
competitive injury to the submitting person which would result from 
public disclosure; (6) when such information might lose its 
confidential character due to the passage of time; and (7) why 
disclosure of the information would be contrary to the public interest.
    It is DOE's policy that all comments may be included in the public 
docket, without change and as received, including any personal 
information provided in the comments (except information deemed to be 
exempt from public disclosure).

E. Issues on Which DOE Seeks Comment

    Although DOE welcomes comments on any aspect of this proposal, DOE 
is particularly interested in receiving comments and views of 
interested parties concerning the following issues:

[[Page 51555]]

    1. The appropriateness of continuing the exemption of regulated-lag 
ballasts;
    2. The exclusion of dedicated 480 V electronic ballasts in the 
scope of this rulemaking;
    3. The inclusion of ballasts that are rated only for used with 150 
W lamps, use in wet locations, and operation in ambient air temperature 
higher than 50 [deg]C in the scope of this rulemaking;
    4. The expansion of coverage of this rulemaking to include metal 
halide lamp fixtures that operate lamps rated greater than or equal to 
50 W and less than or equal to 150 W, and fixtures that operate lamps 
rated greater than 500 W and less than or equal to 2000 W;
    5. The decision that fixtures above 1000 W are available for 
general lighting applications and are thus covered by this rulemaking;
    6. The appropriateness of setting efficiency standards for metal 
halide lamp fixtures based on ballast efficiency;
    7. The appropriateness of the proposed amendments to the testing 
procedure, especially the specification of input voltage, high-
frequency test instrumentation, and rounding requirements;
    8. The appropriateness of DOE testing metal halide lamp fixtures at 
a single input voltage, based on the lamp wattage operated by the 
ballast;
    9. The appropriateness of placing indoor and outdoor fixtures into 
separate equipment classes;
    10. How to best combine the HID lamp and MHLF energy conservation 
standards;
    11. The technological feasibility of the max tech levels selected, 
specifically data on the potential change in efficiency, the design 
options employed, and the associated change in cost;
    12. Any technological barriers to an improvement in efficiency 
above the max tech efficiency levels for all or certain types of 
ballasts;
    13. The appropriateness of separate equipment classes for ballasts 
tested at 480 V (in accordance with the test procedures);
    14. The appropriateness of not dividing equipment classes by 
electronic configuration or circuit type;
    15. The suitability of defining equipment class by the rated lamp 
wattage ranges >=50 W to <=100 W, >100 W to <=150 W, >=150 W to <=250 
W, >250 W to <=500 W, and >500 W to <=2000 W, specially the inclusion 
of 150 W fixtures previously exempted by EISA 2007 in the >100 W and 
<=150 W range, and 150 W fixtures subject to EISA 2007 standards in the 
>=150 W to <=250 W range;
    16. The appropriateness of the equipment classes proposed in this 
NOPR;
    17. The assumption that there will be no lessening of utility or 
performance such that the physical size, including footprint, stack 
height, and weight, would be adversely affected for the magnetic 
ballast efficiencies associated with efficiency levels based on modeled 
ballasts;
    18. The appropriateness of the design options selected by the 
screening analysis presented in this NOPR;
    19. The possibility of setting a standard that requires a high-
frequency ballast;
    20. The issue of operating a lamp at wattages greater or less than 
its rating and its effect on ballast efficiency or lamp efficacy;
    21. The analysis method of applying a 5.5 percent increase when 
calculating the representative input power of magnetic ballasts to 
account for the increase in wattage over a ballast's lifetime;
    22. The addition of the electronic 70 W baseline ballast;
    23. The possibility of high-frequency electronic ballasts requiring 
additional thermal and transient protection relative to low-frequency 
electronic ballasts and, if so, the technical reasons for this 
difference and whether ballast or fixture redesigns can overcome these 
barriers;
    24. The appropriateness of the efficiency levels proposed in this 
NOPR and whether or not an adjustment is needed for sources of 
variation not currently captured by the methodology;
    25. The proposal to apply a scaling factor of 0.6 percent to the 
efficiency levels for quad-volt ballasts to determine the appropriate 
values for 480 V ballasts;
    26. The determination to include a design standard that would 
prohibit the sale of probe-start ballasts in newly sold fixtures, the 
proposed methods of analyzing these levels, and the potential for any 
lessening of the utility or the performance through the prohibition of 
the sale of probe-start ballasts in newly sold fixtures;
    27. The applicability and appropriateness of the adder to MPC of 
electronic ballasts for 120 V auxiliary power functionality and the 
adders to the MPC of fixtures with electronic ballasts for thermal 
management and transient protection;
    28. The appropriateness of the derived MSPs presented in this NOPR;
    29. Methods to improve DOE's energy use analysis, as well as any 
data supporting alternate operating hour estimates or assumptions 
regarding fixture dimming;
    30. The impact and feasibility of a compliance date of January 1, 
2015;
    31. The assumptions and methodology for estimating annual operating 
hours, which were based on data from the 2010 U.S. Lighting Market 
Characterization, and assumed to be 3,615 hours per year in the 
commercial sector, 6,113 hours per year in the industrial sector, and 
4,493 hours per year for the outdoor stationary sector;
    32. Methods to improve DOE's fixture price projections beyond the 
assumption of constant real prices, as well as any data supporting 
alternate methods;
    33. The reasonableness of assuming a zero percent rebound effect 
(the tendency for customers to increase MHLF usage in response to life-
cycle cost savings associated with more efficient ballasts used in new 
fixtures);
    34. Whether the shipment scenarios under various policy scenarios 
are reasonable and likely to occur;
    35. The impediments that prevent users of metal halide lamp 
fixtures from switching to LED lighting to garner further energy 
savings;
    36. The expected impact of new and revised standards on the rate at 
which MHLF customers transition to non-MHLF technology;
    37. The methodology applied to determine the product and capital 
conversion costs;
    38. The degree to which the manufacturers' ability to recoup 
investment, combined with the opportunity cost of investment, would 
encourage manufacturers to exit the metal halide lamp fixture market;
    39. The appropriateness of proposed trial standard levels;
    40. The presence of features or attributes of the more energy 
efficient ballasts used in new fixtures that manufacturers would 
produce to meet the standards in this proposed rule that might affect 
the welfare, positively or negatively, of customers who purchase metal 
halide lamp fixtures;
    41. The possibility that the more widespread use of electronic 
ballasts would involve any performance or reliability effects for 
either 70-watt or 150-watt fixtures, and how any such effects should be 
weighed in the choice of standards for these two wattage categories for 
the final rule;
    42. The appropriateness of choosing TSL 3 energy conservation 
standards; and
    43. The potential impacts of new and amended standards on the small 
metal halide ballast and metal halide lamp fixture manufacturers.

[[Page 51556]]

IX. Approval of the Office of the Secretary

    The Secretary of Energy has approved publication of today's 
proposed rule.

List of Subjects in 10 CFR Part 431

    Administrative practice and procedure, Confidential business 
information, Energy conservation, Reporting and recordkeeping 
requirements.

    Issued in Washington, DC, on August 13, 2013.
David T. Danielson,
Assistant Secretary, Energy Efficiency and Renewable Energy.

    For the reasons set forth in the preamble, DOE proposes to amend 
part 431 of Chapter II, subchapter D of title 10 of the Code of Federal 
Regulations, as set forth below:

PART 431--ENERGY EFFICIENCY PROGRAM FOR CERTAIN COMMERCIAL AND 
INDUSTRIAL EQUIPMENT

0
1. The authority citation for part 431 continues to read as follows:

    Authority:  42 U.S.C. 6291-6317.

0
2. Section 431.322 is amended by adding in alphabetical order 
definitions for ``general lighting application,'' ``high-frequency 
electronic metal halide ballast,'' and ``nonpulse-start electronic 
ballast,'' to read as follows:


Sec.  431.322  Definitions concerning metal halide ballasts and 
fixtures.

* * * * *
    General lighting application means lighting that provides an 
interior or exterior area with overall illumination.
    High-frequency electronic metal halide ballast means an electronic 
ballast that operates a lamp at an output frequency of 1000 Hz or 
greater.
* * * * *
    Nonpulse-start electronic ballast means an electronic ballast with 
a starting method other than pulse-start.
* * * * *
0
3. Section 431.324 is amended by:
0
a. Revising paragraphs (b)(1)(i), (b)(3) and (c)(1); and
0
b. Adding paragraphs (b)(1)(iii), and (b)(1)(iv).
    The additions and revisions read as follows:


Sec.  431.324  Uniform test method for the measurement of energy 
efficiency and standby mode energy consumption of metal halide 
ballasts.

* * * * *
    (b) * * *
    (1) * * *
    (i) Test Conditions. The power supply, ballast test conditions 
(with the exception of input voltage), lamp position, lamp 
stabilization, and test instrumentation except as specified in 
paragraph (b)(1)(iii) of this section shall all conform to the 
requirements specified in section 4.0, ``General Conditions for 
Electrical Performance Tests,'' of ANSI C82.6 (incorporated by 
reference; see Sec.  431.323). Ambient temperatures for the testing 
period shall be maintained at 25 [deg]C  5 [deg]C. Airflow 
in the room for the testing period shall be <=0.5 meters/second. The 
ballast shall be operated until equilibrium. Lamps used in the test 
shall conform to the general requirements in section 4.4.1 of ANSI 
C82.6 and be seasoned for a minimum of 100 hours prior to use in 
ballast tests. Basic lamp stabilization shall conform to the general 
requirements in section 4.4.2 of ANSI C82.6, and stabilization shall be 
reached when the lamp's electrical characteristics vary by no more than 
3-percent in three consecutive 10- to 15-minute intervals measured 
after the minimum burning time of 30 minutes. After the stabilization 
process has begun, the lamp shall not be moved or repositioned until 
after the testing is complete. In order to avoid heating up the test 
ballast during lamp stabilization, which could cause resistance changes 
and result in unrepeatable data, it is necessary to warm up the lamp on 
a standby ballast. This standby ballast should be a commercial ballast 
of a type similar to the test ballast in order to be able to switch a 
stabilized lamp to the test ballast without extinguishing the lamp. 
Fast-acting or make-before-break switches are recommended to prevent 
the lamps from extinguishing during switchover.
* * * * *
    (iii) Instrumentation for High-Frequency Electronic Metal Halide 
Ballasts. If the output frequency of the ballast (frequency of power 
supplied to the lamp) is greater than 1000 Hz, the testing 
instrumentation shall conform to the following paragraphs 
(b)(1)(iii)(A), (b)(1)(iii)(B), and (b)(1)(iii)(C) of this section. 
Instrumentation for determination of the output frequency shall be 
compliant with section 4.0 of ANSI C82.6 (incorporated by reference; 
see Sec.  431.323).
    (A) Power Analyzer. In addition to the specifications in ANSI 
C82.6, the power analyzer shall have a maximum 100 pF capacitance to 
ground and frequency response between 40 Hz and 1 MHz.
    (B) Current Probe. In addition to the specifications in ANSI C82.6, 
the current probe shall be galvanically isolated and have frequency 
response between 40 Hz and 20 MHz.
    (C) Lamp Current. For the lamp current measurement, the full 
transducer ratio shall be set in the power analyzer to match the 
current probe to the power analyzer.
    Full Transducer Ratio =
    [GRAPHIC] [TIFF OMITTED] TP20AU13.070
    
Where:

Iin is current through the current transducer
Vout is the voltage out of the transducer
Rin is the power analyzer impedance
Rs is the current probe output impedance.

    (iv) Input Voltage for Tests. For ballasts designed to operate 
lamps rated less than 150 W that have 120 V as an available input 
voltage, testing shall be performed at 120 V. For ballasts designed to 
operate lamps rated less than 150 W that do not have 120 V as an 
available voltage, testing shall be performed at the highest available 
input voltage. For ballasts designed to operate lamps rated greater 
than or equal to 150 W that have 277 V as an available input voltage, 
testing shall be conducted at 277 V. For ballasts designed to operate 
lamps rated greater than or equal to 150 W that do not have 277 V as an 
available input voltage, testing shall be conducted at the highest 
available input voltage.
* * * * *
    (3) Efficiency Calculation. The measured lamp output power shall be 
divided by the ballast input power to determine the percent efficiency 
of the ballast under test to the nearest tenth of a percent.
    (i) A fractional number at or above the midpoint between two 
consecutive decimal places shall be rounded up to the higher of the two 
decimal places; or
    (ii) A fractional number below the midpoint between two consecutive 
decimal places shall be rounded down to the lower of the two decimal 
places.
    (c) * * *
    (1) Test Conditions. (i) The power supply, ballast test conditions 
with the exception of input voltage, and test instrumentation with the 
exception of high-frequency electronic ballasts shall all conform to 
the requirements specified in section 4.0, ``General Conditions for 
Electrical Performance Tests,'' of the ANSI C82.6 (incorporated by 
reference; see Sec.  431.323). Ambient temperatures for the testing 
period shall be maintained at 25 [deg]C  5 [deg]C. Send a 
signal to the ballast instructing it to have zero light output using 
the appropriate ballast communication protocol or system for the 
ballast being tested.

[[Page 51557]]

    (ii) Input Voltage for Tests. For ballasts less than 150 W that 
have 120 V as an available input voltage, ballasts are to be tested at 
120 V. For ballasts less than 150 W that do not have 120 V as an 
available voltage, ballasts are to be tested at the highest available 
input voltage. For ballasts greater than or equal to 150 W and less 
than or equal to 2000 W that have 277 V as an available input voltage, 
ballasts are to be tested at 277 V. For ballasts greater than or equal 
to 150 W and less than or equal to 2000 W that do not have 277 V as an 
available input voltage, ballasts are to be tested at the highest 
available input voltage.
    (iii) Instrumentation for High-Frequency Electronic Metal Halide 
Ballasts. If the output frequency of the ballast (frequency of power 
supplied to the lamp) is greater than 1000 Hz, the testing 
instrumentation shall conform to paragraphs (b)(1)(iii)(A), 
(b)(1)(iii)(B), and (b)(1)(iii)(C) of this section. Instrumentation for 
determination of the output frequency shall be compliant with section 
4.0 of ANSI C82.6 (incorporated by reference; see Sec.  431.323).
    (A) Power Analyzer. In addition to the specifications in ANSI 
C82.6, the power analyzer shall have a maximum 100 pF capacitance to 
ground and frequency response between 40 Hz and 1 MHz.
    (B) Current Probe. In addition to the specifications in ANSI C82.6, 
the current probe shall be galvanically isolated and have frequency 
response between 40 Hz and 20 MHz.
    (C) Lamp Current. For the lamp current measurement, the full 
transducer ratio shall be set in the power analyzer to match the 
current probe to the power analyzer.
    Full Transducer Ratio =
    [GRAPHIC] [TIFF OMITTED] TP20AU13.071
    
Where:
Iin is current through the current transducer
Vout is the voltage out of the transducer
Rin is the power analyzer impedance
Rs is the current probe output impedance.
* * * * *
0
4. Section 431.326 is amended by adding paragraphs (c), (d), and (e) to 
read as follows:


Sec.  431.326  Energy conservation standards and their effective dates.

* * * * *
    (c) Except when the requirements of paragraph (a) of this section 
are more stringent (i.e., require a larger minimum efficiency value) or 
as provided by paragraph (e) of this section, each metal halide lamp 
fixture manufactured on or after January 1, 2015 shall contain a metal 
halide ballast with an efficiency not less than the value determined 
from the appropriate equation in the following table:

------------------------------------------------------------------------
                                   Tested input
      Rated lamp wattage             voltage          Minimum standard
                                 [Dagger][Dagger]        equation %
------------------------------------------------------------------------
>=50 W and <=100 W............  Tested at 480 V..  99.4/(1 + 2.5 * P
                                                    [caret] (-0.55))
                                                    [dagger][dagger].
>=50 W and <=100 W............  All others.......  100/(1 + 2.5 * P
                                                    [caret] (-0.55)).
>100 W and <150 [dagger]. W...  Tested at 480 V..  99.4/(1 + 0.36 * P
                                                    [caret] (-0.30)).
>100 W and <150 [dagger] W....  All others.......  100/(1 + 0.36 * P
                                                    [caret] (-0.30)).
>=150 [Dagger] W and <=250 W..  Tested at 480 V..  For >=150 W and <=200
                                                    W: 88.0.
                                                   For >200 W and <=250
                                                    W:
                                                   6.0 * 10 [caret] (-2)
                                                    * P + 76.0.
>=150 [Dagger] W and <=250 W..  All others.......  For >=150 W and <=200
                                                    W: 88.0.
                                                   For >200 W and <=250
                                                    W:
                                                   7.0 * 10 [caret] (-2)
                                                    * P + 74.0.
>250 W and <=500 W............  Tested at 480 V..  91.0.
>250 W and <=500 W............  All others.......  91.5.
>500 W and <=2000 W...........  Tested at 480 V..  For >500 W to <1000
                                                    W:
                                                   0.994 * (3.2 * 10
                                                    [caret] (-3) * P +
                                                    89.9).
                                                   For >=1000 W to
                                                    <=2000 W: 92.5.
>500 W and <=2000 W...........  All others.......  For >500 W to <1000
                                                    W:
                                                   3.2 * 10 [caret] (-3)
                                                    * P + 89.9.
                                                   For >=1000 W to
                                                    <=2000 W: 93.1.
------------------------------------------------------------------------
[dagger] Includes 150 W fixtures specified in paragraph (b)(3) of this
  section, which are fixtures rated only for 150 watt lamps; rated for
  use in wet locations, as specified by the National Electrical Code
  2002, section 410.4(A); and containing a ballast that is rated to
  operate at ambient air temperatures above 50 [deg]C, as specified by
  UL 1029-2001.
[Dagger] Excludes 150 W fixtures specified in paragraph (b)(3) of this
  section, which are fixtures rated only for 150 watt lamps; rated for
  use in wet locations, as specified by the National Electrical Code
  2002, section 410.4(A); and containing a ballast that is rated to
  operate at ambient air temperatures above 50 [deg]C, as specified by
  UL 1029-2001.
[dagger][dagger] P is defined as the rated wattage of the lamp the
  fixture is designed to operate.
[Dagger][Dagger] Tested input voltage is specified in 10 CFR 431.324.

    (d) Except as provided in paragraph (e) of this section, metal 
halide lamp fixtures manufactured on or after January 1, 2015 that 
operate lamps with rated wattage >500 W to <=2000 W shall not contain a 
probe-start metal halide ballast.
    (e) The standards described in paragraphs (c) and (d) of this 
section do not apply to--
    (1) Metal halide lamp fixtures with regulated-lag ballasts; and
    (2) Metal halide lamp fixtures that use electronic ballasts that 
operate at 480 volts.

[FR Doc. 2013-20006 Filed 8-19-13; 8:45 am]
BILLING CODE 6450-01-P