Evolving Energy Efficiency Regulations For HVACR 10 New US DOERuleChanges

Evolving Energy Efficiency Regulations for HVACR
US Department of Energy Rule Changes
Evolving Energy Efficiency

Regulations for HVACR
US Department of Energy (DOE)
Recent Rule Changes & Implications
www.intertek.com/HVACR

Table of Contents
Introduction.3
DOE Regulatory Process...3 5
Recent DOE Activity and Rule Changes5 10
2014 Federal Registry Notifications..5
Residential Air Conditioners and Heat Pumps..6 7
Commercial Air Conditioners and Heat Pumps7 8
Space Heating Equipment .8
Water Heating Equipment..9
Commercial and Industrial Refrigeration..9 10
Changes from the Environmental Protection Agency10 11
How to Move Forward.11
About Intertek...11 12

Introduction
The U.S. Department of Energy (DOE) has been busy in 2014. DOE energy policy and
standards aim to serve the countrys energy demands and promote conservation, and, for
product manufacturers, navigating this regulatory landscape can sometimes be a challenge. As
of November 2014, the DOE has published more than 116 notices for the year, including 34
new Energy Conservation Standards (ECS), 31 Test Procedures, and 15 Direct Final Rules
concerning the energy consumption and energy efficiency of affected products.
Of these numerous DOE activities for 2014, there are 12 ECS changes, 15 Test Procedure
changes, and 10 Direct Final Rule changes that affect the Heating, Ventilation, Air Conditioning,
and Refrigeration (HVACR) product market. In this white paper, the focus will be on addressing
Direct Final Rule changes and what they mean for HVACR manufacturers, including impacts on
product testing and the regulation of components, as well as a look to the future impact these
Direct Final Rules may have on the HVAC industry overall. To begin, this paper will also discuss
the DOE regulation process.
DOE Regulatory Process

The DOE is authorized to establish standards for 19 covered consumer HVACR products and
11 types of HVACR covered commercial and industrial equipment. Additionally, the DOE can
determine that other HVACR products and equipment are covered under its standards if the
products meet certain criteria, and products covered by DOE standards may change as
manufacturers incorporate new features and designs. If test procedures dont accurately reflect
actual energy use as a result of these changes, the DOE will consider petitions for waivers of
test procedures. In addition to developing energy conservation standards and test procedures,
the DOE also issues regulations to assure the correct implementation, certification, and
enforcement of energy conservation standards, as well as defines the ability to apply for
exceptions or exemptions. It also works jointly with the Federal Trade Commission (FTC) on
prescribing labeling rules for HVACR equipment.
For the purposes of this white paper, the focus will be on standards and test procedures
development and revisions, and well as the implementation, certification, and enforcement of
these standards and procedures.
Regarding the development and revisions of standards and test procedures, the DOE is
required to review the standards once every six years to set them at levels that achieve a
maximum improvement in energy efficiency that is technically feasible and economically
justified. Each rulemaking takes about three years to complete and usually consists of four
phases:

Framework
o Outlines analytical and procedural approach
Preliminary Analysis
o Document technical, economic and preliminary determinations
Notice of Proposed Rule (NOPR)
o Initial release of determinations made including public comments
Final Rule
o Final determinations after public comment period.
At each phase, a notice is published in the Federal Register and all supporting documents and
comments are made available in the rulemaking docket in regulations.gov. After each of the first
three notices, there is a public comment period, and during that period there is typically a public
meeting and a webinar, where stakeholders are encouraged to get involved.
In the Framework phase, the DOE publishes a framework document that presents the basic
analytical and procedural principles and legal authority that will guide the rulemaking. The
framework document also typically solicits feedback from stakeholders on specific questions. In
the Preliminary Analysis phase, the DOE gathers available data and information about the
product's technical, economic, and market characteristics and makes preliminary determinations
concerning methods of improving efficiencies and the impacts of doing so. The DOE then
publishes this analysis and solicits public input. Next, in the Notice of Proposed Rulemaking
(NOPR) phase, the DOE considers public input from the Preliminary Analysis phase, revises its
analysis, and proposes to the public an efficiency level it has determined would result in the
maximum improvement in energy efficiency that is both technologically feasible and
economically justified. In the Final Rule phase, the DOE considers public input from the NOPR
phase, further revises its analysis, and issues the Final Rule, which establishes any mandatory
minimum energy conservation standard. Typically, the rule requires manufacturers must comply
with the new standard within three to five years, providing time to make any investments or
changes required.
In its capacity to implement, certify, and enforce these standards and test procedures, the DOE
follows specific protocols as well. For certification, certification reports are required for all basic
models sold in the United States for regulated products, and they are submitted via the DOE
Compliance Certification Reporting System (CCMS) in preformatted, standardized, productspecific Excel templates. The CCMS allows manufacturers, importers, and third-party
representatives to create, submit, and track their certification reports in the database, as well as
allows the DOE to review and assess compliance and certification information effectively and
efficiently. Regarding enforcement, tests are conducted to ensure products are compliant with
energy conservation standards. Products can be selected at random, as a result of a compliant,

or as part of the DOE Energy Star Verification Testing Program. As the DOE ramps up its focus
on energy efficiency, the Office of Enforcement within the DOE's General Counsel's Office is
stepping up enforcement and verification efforts to ensure products sold in the U.S. meet the
energy and water conservation standards.
Recent DOE Activity and Rule Changes

As discussed in the Introduction, multiple new DOE rules have been put in place or are being
proposed that dramatically reduce the energy consumption of a variety of HVACR products. The
DOE has been attempting to jumpstart the regulatory process for a number of product
categories, and many of these changes reflect those efforts.
2014 Federal Registry Notifications
The following chart shows the 10 Direct Final Rule changes from the DOE that impact the
HVACR industry. While there is some overlap in the product categories, there are different
implications on how the process will change. For instance, while the product category may be
the same, the rules impact various products differentlysome products may require simply
retooled testing while others may require up to an entire redesign of the product.

The HVACR industry is diverse, and there can be gray areas; for example, whats an appliance
vs. a refrigerated case, or whats an HVACR component vs. an industrial pump. When subject
to regulation, it is up to what the DOE decides, and the DOE defines HVACR as anything that
deals with space or water heating or cooling, any component used to pump air or water in use of
space heating or cooling, and any product that uses the refrigeration cycle. It is important to
understand exactly how products and components are classified in order to know what products
are impacted by what rules.
For this white paper, five hot topic product categories have been targeted: Residential Air
Conditioners and Heat Pumps, Commercial Air Conditioners and Heat Pumps, Space Heating
Equipment (residential furnaces and furnace fans, in particular), Water Heating Equipment, and
Commercial and Industrial Refrigeration, with a particular look at walk-in refrigeration.
Residential Air Conditioners and Heat Pumps
On June 27, 2011, the DOE issued amended standards for residential central air conditioner
and heat pump products manufactured on or after January 1, 2015. Split system AC units
installed in Alabama, Arkansas, Delaware, Florida, Georgia, Hawaii, Kentucky, Louisiana,
Maryland, Mississippi, North Carolina, Oklahoma, South Carolina, Tennessee, Texas, Virginia,
and the District of Columbia will require a Seasonal Energy Efficiency Ratio (SEER) of not less
than 14. Previously, the value was 13.
Regional standards are increasing Heating Seasonal Performance Factor (HSPF) to 8.2 for split
systems (up from 7.7), and to 8.0 for single package systems (also up from 7.7), as well. Off
Mode Power Consumption limits also have been decreased, to 30W in air conditioning units and
to 33W in heat pumps. All this is effective for residential central air conditioner and heat pump
products manufactured on or after January 1, 2015.
Manufacturers have invested significant time and resources into product development, retooling
processes, production, and marketing in order to comply with these changes, and they will
continue to need to allocate resources to this effort through 2017. If you arent ready to comply
with these revised standards for these products, it will likely mean you will be unable to offer
those products in the U.S. Additionally, this energy reduction demand will potentially influence
model offerings by manufacturers and in the industry as a whole, having a significant potential
impact on the number of products offered in HVACR.
Also in residential central air conditioner and heat pump regulatory standards, on October 31,
2014, the DOE initiated an Energy Conservation Standards (ECS) rulemaking to amend current
limits by making a request for information. They also formed a working group to discuss

enforcement processes for the regional standards described above, with a proposed
implementation date of November 30, 2015.
Regarding these developments, HVACR manufacturers should continue to allocate resources to
providing objective evidence to the DOE on the attainability of higher efficiency levels. In this
instance, industry participation in the working groups is critical in the success of reaching a
consensus that would be technologically feasible and economically justified.
Commercial Air Conditioners and Heat Pumps
The mandatory six-year standards review is coming due for the Energy Conservation Standards
(ECS) for these products, and thus, the DOE issued a Notice of Proposed Rule (NOPR) on
September 30, 2014, as well as held a public meeting on November 6, 2014. The focus here is
changing the efficiency metrics from a single-point EER (Energy Efficiency Ratio) metric to an
integrated energy efficiency ratio, or IEER (Integrated EER).
If manufacturers are not already testing for IEER, as well as capable of testing part-load
efficiencies and calculating IEERs based on the configuration of their units, now is the time to
start updating laboratory testing protocols. Additionally, small, large, and very large air-cooled
commercial package system manufacturers, including manufacturers of those units that are
three-phase, should engage in the regulatory process.
There is another Final Direct Rule change that also affects commercial air conditioners and heat
pumps. Between April 30, 2013 and August 28, 2013, the Commercial Certification Working
Group held nine meetings in which 69 companies were represented, and a consensus was
reached regarding Alternative Energy Determination Method (AEDM) validation and verification
testing. That working group negotiated the process the DOE would use, through third-party
testing, to verify a given basic model's certified rating when they are established by an AEDM,
and the DOE codified this process in the December 31, 2013 AEDM final rule.
Under this approach, DOE will first select a single unit of a given basic model for testing, either
from retail or, if not available from retail, by obtaining a sample from the manufacturer. The DOE
will then test the unit at an independent, third-party testing facility of the Department's choosing,
unless no third-party laboratory is capable of testing the equipment, in which case it may be
tested at a manufacturer's facility. For some equipment, the manufacturer may provide
additional information to the DOE for test set-up or testing by uploading a PDF file as part of
their certification report. The DOE will provide this information to the test facility as long as the
additional instructions do not conflict with the DOE test procedure or an applicable DOE test
procedure waiver. The test facility may not use any additional information during the testing
process that has not been approved by the DOE or shipped in the packaging of the unit. If

needed, the test facility may request from the DOE additional information on test set-up,
installation, or the testing process.
During the May 15, 2014 and May 28, 2014 working group meetings, manufacturer discussions
of verification testing indicated set-up may be the most problematic part of a verification test and
that manufacturers would be more confident with test results if they had a representative
present at the set-up. The Air-Conditioning, Heating, and Refrigeration Institute (AHRI) offered
that if a manufacturer was able to confirm that a unit was set up properly, then the manufacturer
could determine if the test results were accurate or anomalous by reviewing the test data.
The DOE issued a supplemental NOPR (or SNOPR) for Energy Conservation Standards (ECS)
on September 26, 2014, which addressed remaining issues from the Commercial Certification
Working Group, AEDM in relation to basic model groups, and manufacturer involvement in
AEDM verification testing process. The AEDM rule was approved by the DOE, but the DOE also
kept the authority to validate AEDMs through testing. Certified ratings generated by AEDM are
to be verified by third party labs, and manufacturers can witness up to 10% of the selected
verification tests. This means there will likely be more transparency in the test set-ups and
methodology.
Space Heating Equipment
Pertaining to residential furnaces, and furnace fans specifically, the DOE proposed a new
Annual Fuel Utilization Efficiency (AFUE) for several product categories, with compliance dates
ranging from January 1 to November 19, 2015. The DOE issued a notice of public meeting on
October 30, 2014 to meet and discuss showing the process and the data for how these new
AFUE standards were created.
As background for this activity, the DOE had been sued for violating the regulatory process, and
the U.S. Court of Appeals issued a settlement agreement on the case on April 24, 2014. This
new AFUE activity from the DOE is in response to that settlement agreement.
HVACR manufacturers will have the opportunity to review the analytical tools used to come up
with this new AFUE process, as well as the chance to provide feedback. Also, while the lawsuit
may have slowed the process for the new AFUE standards, the DOE is actively working to fulfill
its obligations regarding this effort in order to get this rule moving ahead. Manufacturers need to
make sure theyre constantly ensuring compliance to current standards, as well as working
toward future requirements, as those future requirements are likely still coming.

Water Heating Equipment

On November 4, 2013, the DOE issued a notice of proposed rulemaking (NOPR) to amend its
test procedures established under the Energy Policy and Conservation Act for residential water
heaters and certain commercial water heaters. Following the regulatory process, the effective
date of this rule is July 13, 2015. Compliance will be mandatory starting one year after the
publication in the Federal Register of a mathematical conversion factor to convert from the
existing efficiency ratings to the new efficiency ratings under the test procedure adopted by this
final rule, or December 31, 2015, whichever is later.
Through this final rule, which was issued on July 11, 2014, the DOE is amending its test
procedure for residential water heaters and certain commercial water heaters. The amendments
will modify the test procedure to be more representative of conditions encountered in the field
(including modifications to the test conditions and the draw patterns) and expand the scope of
the test procedure to apply to certain commercial water heaters and certain residential water
heaters that are not covered by the current test procedure.
Now, in addition to ensuring products are in compliance, manufacturers must also ensure their
labs also are able to effectively handle the updated testing procedure and protocols. This could
mean potential retooling to testing processes and reporting methods in order to accommodate
the changes. Resources will need to be allocated to ensure the new efficiencies are consistent.
Additionally, the DOE initiated a rulemaking on October 21, 2014 to amend the current energy
conservation standards (ECS) applicable to commercial water heating equipment by publishing
a Federal Register request for information. The initial comment period for this rulemaking ended
November 20, 2014. Looking ahead, this could potentially lead to the need to redesign products
for new ECS requirements for 2018, depending on how the regulatory process moves forward
with this change.
Commercial and Industrial Refrigeration
Specifically for commercial refrigeration, there have been significant ECS changes from the
DOE, and because commercial refrigeration is a very mature market that encompasses a
diverse range of products, there can be some challenge in figuring out how the applicable
standards and requirements pertain to each specific product.
The DOE issued a Direct Final Rule for ECS on March 28, 2014 that saw the Maximum Daily
Energy Conservation requirements (MDECs) reduced by 30% for some categories and 60% for
others, depending on how the new definition is applied to particular products. It is important to
note here that these new MDEC requirements are more efficient than the current Energy Star
requirements. This likely means considerable investment in the redesign, design, and R&D

phases of many self-contained commercial refrigeration products, as well as some open-case

commercial refrigeration products.
This is a significant increase that is going to have to occur in product efficiency, and in addition
to the needs and changes addressing that development requires, the other thing manufacturers
should be focused on is, when changing out componentry, the products still need to be in
compliance with UL and IEC safety testing requirements and NSF sanitation requirements.
Before Energy Star requirements can be met, those safety and sanitation requirements need to
be met as well.
Regarding walk-in refrigeration, these products typically include components such as the cooler,
the door, and the panels in addition to the refrigeration system, and traditionally for walk-in
refrigeration there has been a test procedure that has been in place that many have seen as
fairly difficult to run. To help address this, in 2014 the DOE submitted regulation that creates
new efficiency standards for walk-ins, called AWEF (Average Walk-In Energy Factor). AWEF is
measured as yearly average refrigeration output versus energy input. The purpose of this ruling
is to focus on the installation and the refrigeration elements of the product. Compliance will be
required by 2017.
This ruling had previously seen several pushbacks due to complications in the regulatory steps,
as well as lack of information, but it is now targeted to move ahead. This likely means significant
testing and evaluation will be needed over the next few years to understand and verify
compliance needs, including understanding what the AWEF numbers are, as well as how the
test is conducted for all products under its purview, and how the standards will be applied to
different products. There is much data gathering that still must occur.
Changes from the Environmental Protection Agency

The Environmental Protection Agency (EPA) has been operating a program called SNAP
(Significant New Alternatives Policy) for some time that aims to minimize the impact of
refrigerants on the environment. This is done, partly, via work to reduce the use of Global
Warming Potential (GWP) and Ozone Depletion (ODP) refrigerants and regulating the nonallowance of higher GWP and ODP options. It also approves new alternative refrigerants.
A new rule for SNAP, called Rule 20, was issued on July 9, 2014, and it directly impacts all
refrigeration products. The target implementation of this rule is 2016, and the motivation for this
rule is that the EPA is working to drive HVACR manufacturers away from the traditional
refrigerants and toward newer alternative refrigerants. Some alternative options include natural
refrigerants, such as CO2 and propane.
10

This can mean, in addition to the DOE regulations that require HVACR products to meet new
energy minimum standards, HVACR manufacturers may also have to change to new
refrigerants as well. Changing refrigerants can mean changing operating pressures, which could
potentially result in a change in product design. This may also require changes in production,
and all this likely means additional costs and capital investments for HVACR manufacturers.
Future refrigerant changes are a large driver in the HVACR industry, and it is a trend HVACR
manufacturers must keep up on. The timeline for the SNAP Rule 20 from the EPA is extremely
tight, and manufacturers must start moving now in order to stay ahead of the curve.
How to Move Forward

Clearly, these new DOE and EPA rules likely have a significant impact on many manufacturers
in the HVACR industry, and, as members of the industry, manufacturers should get involved in
this regulatory process. The DOE is required to follow the process and procedures for rules
development and changes, and engaging in the process and aiding in the creation of the rules
helps influence energy standards, test procedures, and more affecting the HVACR business.
Being an active part of the industry also means knowing the DOE and EPA rules. Changes that
have already passed into law or are being debated now are open to the public, and it is in
manufacturers best interest to read them, understand them, and know them well, including what
products and components they impact. Additionally, disagreement with or ignorance of the rules
is not a reason for HVACR manufacturers to not comply. If there are issues or challenges with
the standards and rules, manufacturers need to voice their concerns on why it is difficult to
comply. It is also unwise to rely on of lack of enforcement to foster noncompliance.
As many HVACR products will be affected by these rules and standards that are coming into
effect in 2015, 2016, and beyond, the changes can represent a significant investment for
HVACR manufacturersand not just in regulatory costs, but also in engineering, as redesign
and retooling products and production may be needed. The best way to deal with changes is to
be ready. Ensure all affected parties understand what is happening and are prepared to make
the needed changes. Early design changes and testing are critical to success.
About Intertek
Intertek is a leading quality solutions provider to industries worldwide. From auditing and
inspection, to testing, training, advisory, quality assurance, and certification, Intertek adds value
for its customers by helping improve the quality and safety of their products, assets, and
11

processes. With a network of more than 1,000 laboratories and offices and over 36,000 people
in more than 100 countries, Intertek supports companies success in the global marketplace by
helping customers to meet end users expectations for safety, sustainability, performance,
integrity, and desirability in virtually any market worldwide. Visit www.intertek.com.
To connect with an expert on this topic, or to discuss a new project, contact your local Intertek at
1-800-WORLDLAB (967-5352), via email at icenter@intertek.com, or visit
This publication is copyright Intertek and may not be reproduced or transmitted in any form in whole or in part without the
prior written permission of Intertek. While due care has been taken during the preparation of this document, Intertek cannot
be held responsible for the accuracy of the information herein or for any consequence arising from it. Clients are encouraged
to seek Interteks current advice on their specific needs before acting upon any of the content.
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