[Federal Register Volume 79, Number 68 (Wednesday, April 9, 2014)]
[Rules and Regulations]
[Pages 19464-19467]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-07739]



16 CFR Part 305

RIN 3084-AB15

Energy and Water Use Labeling for Consumer Products Under the 
Energy Policy and Conservation Act (``Energy Labeling Rule'')

AGENCY: Federal Trade Commission (FTC or Commission).

ACTION: Final rule.


SUMMARY: The Commission issues conforming amendments to the Energy 
Labeling Rule (``Rule'') to require a new Department of Energy (DOE) 
test procedure for televisions and establish data reporting 
requirements for those products.

DATES: The amendments are effective on May 9, 2014.

ADDRESSES: Requests for copies of this document should be sent to: 
Public Reference Branch, Room 130, Federal Trade Commission, 600 
Pennsylvania Avenue NW., Washington, DC 20580. The complete record of 
this proceeding is also available at that address. Relevant portions of 
the proceeding, including this document, are available at http://www.ftc.gov.

FOR FURTHER INFORMATION CONTACT: Hampton Newsome, (202) 326-2889, 
Attorney, Division of Enforcement, Bureau of Consumer Protection, 
Federal Trade Commission, 600 Pennsylvania Avenue NW., Washington, DC 


I. Background

    The Commission's Energy Labeling Rule (Rule) (16 CFR part 305), 
issued pursuant to the Energy Policy and Conservation Act (EPCA), 
requires energy labeling for major household appliances and other 
consumer products to help consumers compare competing models. When 
first published in 1979, the Rule applied to eight product categories: 
refrigerators, refrigerator-freezers, freezers, dishwashers, water 
heaters, clothes washers, room air conditioners, and furnaces. The 
Commission has since expanded the Rule's coverage to include central 
air conditioners, heat pumps, plumbing products, lighting products, 
ceiling fans, certain types of water heaters, and televisions.
    The Rule requires manufacturers to attach yellow EnergyGuide labels 
on many of these products, and prohibits retailers from removing the 
labels or rendering them illegible. In addition, the Rule directs 
sellers, including retailers, to post label information on

[[Page 19465]]

Web sites and in paper catalogs from which consumers can order 
products. EnergyGuide labels for covered appliances must contain three 
key disclosures: estimated annual energy cost (for most products); a 
product's energy consumption or energy efficiency rating as determined 
from DOE test procedures; and a comparability range displaying the 
highest and lowest energy costs or efficiency ratings for all similar 
models.\1\ For energy cost calculations, the Rule specifies national 
average costs for applicable energy sources (e.g., electricity, natural 
gas, oil) as calculated by DOE. The Rule sets a five-year schedule for 
updating range of comparability and average unit energy cost 
information.\2\ The Commission updates the range information based on 
manufacturer data submitted pursuant to the Rule's reporting 

    \1\ Where no ``applicable'' DOE test exists for televisions, 
EPCA authorizes the Commission to use ``adequate non-Department of 
Energy test procedures'' to obtain information for energy 
disclosures. 42 U.S.C. 6294(a)(2)(I)(ii). During FTC's television 
labeling proceeding, DOE announced plans to develop a new test 
procedure. 74 FR 53640, 53641 (Oct. 20, 2009).
    \2\ 16 CFR 305.10.

II. Final Amendments

    The Commission issues conforming amendments to revise the Rule's 
television testing and reporting requirements in response to a new DOE 
television test procedure published on October 25, 2013 (78 FR 63823). 
The Commission proposed these amendments in a Notice published on 
December 26, 2013 (78 FR 78305) and received two comments.\3\ These 
amendments will ensure the Rule's television labeling requirements are 
consistent with EPCA, which mandates that FTC labels reflect applicable 
DOE test procedures.\4\

    \3\ The comments can be found at http://www.ftc.gov/policy/public-comments/initiative-539.
    \4\ 42 U.S.C. 6294(c).

    Background: When the Commission first issued labeling requirements 
for televisions in 2011 (76 FR 1038 (Jan. 6, 2011)), no DOE test 
procedure existed for such products. Accordingly, the FTC required 
manufacturers to use the Environmental Protection Agency's (EPA's) 
ENERGY STAR test procedure to measure television energy use. However, 
as discussed in several previous Federal Register documents, the 
Commission anticipated that amendments would be necessary after 
completion of the DOE test procedure.\5\ DOE recently completed its 
test procedure, which manufacturers must begin using on April 23, 

    \5\ For example, the Commission explained in 2011 that ``[w]hen 
DOE completes its own rulemaking to develop a television test 
procedure for use in that agency's efficiency standards program, the 
Commission will issue conforming amendments consistent with EPCA's 
requirements that the labels use information from DOE test 
procedures when such procedures are available.'' 76 FR 1038, 1040 
(Jan. 6, 2011). See also 78 FR 43974, 43975 (July 23, 2013); 78 FR 
1779, 1780 (Jan. 9, 2013).
    \6\ Any energy representation, including those made on a label, 
for a covered product must fairly reflect the results of a new DOE 
test procedure 180 days after that test's issuance. See 42 U.S.C. 
6293(c)(2). In its October 25, 2013 Rule, DOE identified April 23, 
2014 as the date for revised representations.

    To conform the labeling rule to the new DOE test procedure, the 
Commission proposed three amendments. First, it proposed removing the 
Rule's reference to the ENERGY STAR test in section 305.5 and replacing 
it with the DOE procedure.\7\ Second, the Commission proposed a new 
reporting requirement for televisions consistent with requirements for 
most other labeled products, such as refrigerators and clothes 
washers.\8\ Manufacturers would be allowed to submit their new 
television data through the DOE's web-based reporting tool, the 
Compliance and Certification Management System (CCMS).\9\ To ensure 
adequate time after April 23, 2014 for the first round of data reports, 
the Commission proposed to set a May 1 date for annual submissions 
(section 305.8). After the Commission reviews the new data, it will 
consider issuing updated comparability ranges for television 
labels.\10\ Finally, the amendments update the definition of 
``television'' in section 305.3 to incorporate DOE's definition of that 
term and to limit labeling coverage to the scope of DOE's test 
procedure. For the most part, DOE's definition of ``television'' and 
the coverage of its test procedure are consistent with FTC's current 
rule. However, DOE determined not to cover very small models with 
screen sizes of 15 inches or less in its procedure because consumers 
often do not use such devices as typical televisions.\11\

    \7\ EPCA gives Commission no discretion to retain the ENERGY 
STAR procedure. 42 U.S.C. 6294(a)(2)(I).
    \8\ The new DOE test procedure triggers EPCA's reporting 
provisions, which require manufacturers to submit energy reports to 
the Commission derived from DOE test procedures for all new models 
and annually for models in current production. 42 U.S.C. 6296(b)(1) 
and (4). Consistent with the Rule's required reports for other 
covered products, the content for the television reports in the 
final amendments include brand name; model number; screen size 
(diagonal in inches); power (in watts) consumed in on mode, standby-
passive mode, in standby-active mode, low mode, and off mode; and 
annual energy consumption (kWh/year) for each basic model in current 
production. Currently, DOE rules do not contain reporting provisions 
for televisions.
    \9\ See https://www.regulations.doe.gov/ccms.
    \10\ Section 305.17 contains the television ranges.
    \11\ See 10 CFR 430.2 and App. H, sec. 1; 78 FR at 63825-26. The 
amendments also delete obsolete subparagraph 305.17(h), which 
contains specific labeling directions for televisions of nine inches 
or fewer.

    Comments: The commenters did not oppose the amendments. However, 
they raised three minor issues.\12\ First, CEA and Panasonic asked 
whether models discontinued in the previous year should be included in 
the initial 2014 data report. Second, Panasonic asked whether 
manufacturers may report energy use figures that are more conservative 
(i.e., showing higher energy use) than the test values. Finally, CEA, 
though recognizing EPCA's mandate to tie television labeling to the DOE 
test procedure, noted that the DOE test procedure may not keep pace 
with the market and thus may pose challenges to the quality and 
credibility of the EnergyGuide and ENERGY STAR programs in the future.

    \12\ CEA also provided comments on two issues they had raised 
before the Commission earlier as part of the ongoing regulatory 
review. See CEA Comments (560957-00012). In particular, the 
commenters urged the Commission to allow electronic (i.e., 
paperless) labeling and to eliminate ranges of comparability on 

    Discussion: The Commission issues the final amendments mostly as 
proposed in the December 26, 2013 Proposed Rule. However, to ensure 
manufacturers have adequate time to submit reports this year, the 
Commission has set the annual reporting date for June 1, instead of May 
1. In response to comments, the Commission advises that the initial 
2014 data submissions need only include models currently in production, 
and manufacturers should not include test data for models already 
discontinued. In addition, as discussed in a final rule last year, the 
Commission concurs with DOE guidance allowing manufacturers to rate 
models more conservatively than the tested performance.\13\ Finally, 
while the FTC is obligated to require the DOE test procedure, the FTC 
staff will work with DOE to identify the need for possible test 
procedure changes should they become necessary in the future.\14\

    \13\ See 78 FR 2200, 2201 (Jan. 10, 2013) (FTC guidance); 76 FR 
12422, 12429 (Mar. 7, 2011) (DOE policy); and 10 CFR 429.14(a)(2)(i) 
(DOE rules).
    \14\ The Commission will address the CEA's broader concerns 
about electronic labeling and comparability ranges separately as 
part of the ongoing regulation review.

III. Paperwork Reduction Act

    The current Rule contains recordkeeping, disclosure, testing, and 
reporting requirements that constitute information collection 
requirements as

[[Page 19466]]

defined by 5 CFR 1320.3(c), the definitional provision within the 
Office of Management and Budget (OMB) regulations that implement the 
Paperwork Reduction Act (PRA). OMB has approved the Rule's existing 
information collection requirements through February 29, 2016 (OMB 
Control No. 3084-0069). The Commission accounted for the burden of 
testing and labeling televisions when it first issued the labeling 
requirements (76 FR 1038 (Jan. 6, 2011)). However, the new DOE test 
procedure triggers EPCA's requirement that manufacturers retest their 
televisions for any energy representations made 180 days after DOE 
publishes the test, including those on the FTC label. This creates an 
additional, one-time burden. Accordingly, the Commission is submitting 
these amendments to OMB for review.
    In issuing the television labels, FTC staff estimated that 2,000 
basic models exist in the marketplace, that manufacturers test two 
units per model, and that testing requires one hour per unit tested. 
Using these estimates, the Commission expects the new testing will 
require a one-time burden of 4,000 additional hours of burden. 
Annualized over a 3-year PRA clearance cycle, this one-time burden 
amounts to 1,333 hours. Assuming further that this testing will be 
implemented by electrical engineers, and applying an associated hourly 
wage rate of $44.14 per hour, labor costs for testing would annualized 
total of $58,839.\15\ In addition, the amendments would increase the 
Rule's reporting requirements. Staff estimates that the average 
reporting burden for these manufacturers is approximately two minutes 
per basic model to enter information into DOE's online database. Based 
on this estimate, multiplied by an estimated total of 2,000 basic 
television models, the annual reporting burden for manufacturers is an 
estimated 67 hours (2 minutes x 2,000 models / 60 minutes per hour). 
Assuming further that these filing requirements will be implemented by 
data entry workers at an hourly wage rate of $15.11 per hour, the 
associated labor cost for recordkeeping would be approximately $1,012 
per year.\16\ Any non-labor costs associated with the amendments are 
likely to be minimal.

    \15\ See Bureau of Labor Statistics, U.S. Department of Labor, 
Occupational Employment and Wages--May 2012, Table 1 (National 
employment and wage data from the Occupational Employment Statistics 
survey by occupation, May 2012), available at: http://www.bls.gov/news.release/ocwage.t01.htm.
    \16\ See id.

IV. Regulatory Flexibility Act

    The Regulatory Flexibility Act (RFA), 5 U.S.C. 601-612, requires 
that the Commission provide an Initial Regulatory Flexibility Analysis 
(IRFA) with a Proposed Rule and a Final Regulatory Flexibility Analysis 
(FRFA), if any, with the Final Rule, unless the Commission certifies 
that the Rule will not have a significant economic impact on a 
substantial number of small entities.\17\

    \17\ 5 U.S.C. 603-605.

    The Commission does not anticipate that the Final Rule will have a 
significant economic impact on a substantial number of small entities. 
Consistent with past analysis (76 FR at 1049), the Commission estimates 
that these new requirements will apply to about 30 product 
manufacturers. Out of these companies, the Commission expects that no 
manufacturers qualify as small businesses.\18\ Furthermore, the 
Commission does not expect that the requirements specified in the Final 
Rule will have a significant economic impact on these entities.

    \18\ See also 78 FR at 63838 (DOE's conclusion that no 
television manufacturers qualify as small businesses).

    Although the Commission certified under the RFA that the amendments 
would not, if promulgated, have a significant economic impact on a 
substantial number of small entities, the Commission has determined, 
nonetheless, that it is appropriate to publish an FRFA in order to 
explain the impact of the amendments on small entities as follows:

A. Statement of the Need for, and Objectives of, the Amendments

    The Commission is proposing amendments to conform the Rule to a 
recently published DOE test procedure for televisions.

B. Issues Raised by Comments in Response to the IRFA

    The Commission did not receive any comments specifically related to 
the impact of the final amendments on small businesses. The Commission 
did not receive any comments from the Small Business Administration in 
response to the proposed rule.

C. Estimate of Number of Small Entities to Which the Amendments Will 

    Under the Small Business Size Standards issued by the Small 
Business Administration, television manufacturers qualify as small 
businesses if they have fewer than 1,000 employees (for other household 
appliances the figure is 500 employees) or if their sales are less than 
$8.0 million annually. The Commission believes that no manufacturers 
subject to the Final Rule qualify as small businesses.

D. Projected Reporting, Recordkeeping, and Other Compliance 

    The Commission recognizes that the Final Rule will involve some 
increased costs related to reporting these products, and maintaining 
test records. All of these burdens and the skills required to comply 
are discussed in the previous section of this document, regarding the 
Paperwork Reduction Act, and there should be no difference in that 
burden as applied to small businesses.

E. Alternatives

    The Commission sought comments on alternatives to the Proposed 
Rule, including a delay in the effective dates for the amendments. 
However, no commenters suggested any changes to the proposed 
amendments. Accordingly, the Commission issues the amendments as 

Final Rule

List of Subjects in 16 CFR Part 305

    Advertising, Energy conservation, Household appliances, Labeling, 
Reporting and recordkeeping requirements.

    For the reasons set out above, the Commission amends 16 CFR part 
305 as follows:


1. The authority citation for part 305 continues to read as follows:

    Authority:  42 U.S.C. 6294.

2. In Sec.  305.3, revise paragraph (y) to read as follows:

Sec.  305.3  Description of covered products.

* * * * *
    (y) Television means a product that is designed to produce dynamic 
video, contains an internal TV tuner encased within the product 
housing, and is capable of receiving dynamic visual content from wired 
or wireless sources including but not limited to: broadcast and similar 
services for terrestrial, cable, satellite, and/or broadband 
transmission of analog and/or digital signals; and/or display-specific 
data connections, such as HDMI, Component video, S-video, Composite 
video; and/or media storage devices such as a USB flash drive, memory 
card, or a DVD; and/or network

[[Page 19467]]

connections, usually using Internet Protocol, typically carried over 
Ethernet or Wi-Fi. The requirements of this part are limited to those 
televisions for which the Department of Energy has adopted and 
published test procedures for measuring energy use.

3. In Sec.  305.5, revise paragraph (d) and remove paragraph (e), as 

Sec.  305.5  Determinations of estimated annual energy consumption, 
estimated annual operating cost, and energy efficiency rating, water 
use rate, and other required disclosure content.

* * * * *
    (d) Representations for ceiling fans under Sec.  305.13 and 
televisions under Sec.  305.17 must be derived from applicable 
procedures in 10 CFR parts 429, 430, and 431.

4. In Sec.  305.8, revise paragraphs (a)(1) and (3), add new paragraph 
(a)(4), and revise paragraph (b)(1) to read as follows:

Sec.  305.8  Submission of data.

    (a)(1) Except as provided in paragraphs (a)(2) through (4) of this 
section, each manufacturer of a covered product subject to the 
disclosure requirements of this part and subject to Department of 
Energy certification requirements in 10 CFR part 429 shall submit 
annually a report for each model in current production containing the 
same information that must be submitted to the Department of Energy 
pursuant to 10 CFR part 429 for that product, and that the Department 
has identified as public information pursuant to 10 CFR part 429. In 
lieu of submitting the required information to the Commission as 
required by this section, manufacturers may submit such information to 
the Department of Energy via the CCMS at https://regulations.doe.gov/ccms as provided by 10 CFR 429.12.
* * * * *
    (3) Manufacturers of televisions shall submit annually a report 
containing the brand name; model number; screen size (diagonal in 
inches); power (in watts) consumed in on mode, standby-passive mode, in 
standby-active mode, low mode, and off mode; and annual energy 
consumption (kWh/year) for each basic model in current production. The 
report should also include a starting serial number, date code, or 
other means of identifying the date of manufacture with the first 
submission for each basic model. In lieu of submitting the required 
information to the Commission as required by this section, 
manufacturers may submit such information to the Department of Energy 
via the Compliance and Certification Management System (CCMS) at 
https://regulations.doe.gov/ccms as provided by 10 CFR 429.12.
    (4) This section does not require reports for general service 
light-emitting diode (LED or OLED) lamps.
    (b)(1) All data required by Sec.  305.8(a) except serial numbers 
shall be submitted to the Commission annually, on or before the 
following dates:

                                                   Deadline for data
               Product category                        submission
Refrigerators................................  Aug. 1.
Refrigerators-freezers.......................  Aug. 1.
Freezers.....................................  Aug. 1.
Central air conditioners.....................  July 1.
Heat pumps...................................  July 1.
Dishwashers..................................  June 1.
Water heaters................................  May 1.
Room air conditioners........................  July 1.
Furnaces.....................................  May 1.
Pool heaters.................................  May 1.
Clothes washers..............................  Oct. 1.
Fluorescent lamp ballasts....................  Mar. 1.
Showerheads..................................  Mar. 1.
Faucets......................................  Mar. 1.
Water closets................................  Mar. 1.
Ceiling fans.................................  Mar. 1.
Urinals......................................  Mar. 1.
Metal halide lamp fixtures...................  Sept. 1.
General service fluorescent lamps............  Mar. 1.
Medium base compact fluorescent lamps........  Mar. 1.
General service incandescent lamps...........  Mar. 1.
Televisions..................................  June 1.

* * * * *

Sec.  305.17--[Amended]  

5. In Sec.  305.17, remove paragraph (h).

    By direction of the Commission.
Donald S. Clark,
[FR Doc. 2014-07739 Filed 4-8-14; 8:45 am]