[Federal Register Volume 64, Number 120 (Wednesday, June 23, 1999)]
[Proposed Rules]
[Pages 33431-33435]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-16020]


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DEPARTMENT OF ENERGY

Office of Energy Efficiency and Renewable Energy

10 CFR Part 432

[Docket Number EE-TP-98-550]


Energy Conservation Program: Test Procedures for Distribution 
Transformers

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

ACTION: Notice of availability of documents and limited reopening of 
the record and opportunity for public comment.

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SUMMARY: The Department of Energy previously published a Notice of 
Proposed Rulemaking to adopt test procedures for measuring the energy 
efficiency of distribution transformers under the Energy Policy and 
Conservation Act, as amended, 42 U.S.C. 6317(a). Since the time that 
Notice appeared, the Department has received documents and comments 
containing new information concerning National Electrical Manufacturers 
Association (NEMA) TP 2, the sampling plan, and transformers to be 
covered by the rulemaking. In addition, DOE has concerns regarding the 
definition of a basic model. The Department is reopening the record of 
its rulemaking to provide an opportunity for additional public comment 
on the validity of this new information and its implications regarding 
the proposed test procedures and the policy options now under 
consideration by the Department.

DATES: The Department will accept comments, data, and information 
regarding the proposed rule and this reopening notice no later than 
July 23, 1999.

ADDRESSES: Please submit 10 copies (no faxes) to: Kathi Epping, U.S. 
Department of Energy, Office of Energy Efficiency and Renewable Energy, 
``Energy Conservation Program: Test Procedures for Distribution 
Transformers, Docket No. EE-RM-S-97-700'', EE-43, 1000 Independence 
Avenue, SW, Washington, DC 20585-0121. In addition, the Department 
requests that an electronic copy (3\1/2\'' diskette) of the comments on 
WordPerfectTM 6.1 be provided.
    Pursuant to the provisions of 10 CFR 1004.11, any person submitting 
information which he or she believes to be confidential and exempt by 
law from public disclosure should submit one complete copy of the 
document and ten (10) copies, if possible, from which the information 
believed to be confidential has been deleted. The Department of Energy 
will make its own determination with regard to the confidential status 
of the information and treat it according to its determination.
    Copies of the National Electrical Manufacturers Association 
Standard TP 2-1998, ``Guide for Determining Energy Efficiencies for 
Distribution Transformers'' (NEMA TP 2), the National Institute of 
Standards and Technology Technical Note 1427, ``An Analysis of 
Efficiency Testing under the Energy Policy and Conservation Act: A Case 
Study with Application to Distribution Transformers'' (NIST TN 1427), 
and other correspondence related to this rulemaking are available for 
public inspection and copying at the Freedom of Information Reading 
Room, U.S. Department of Energy, Forrestal Building, Room 1E-190, 1000 
Independence Avenue, SW, Washington, DC 20585, (202) 586-3142, between 
the hours of 9:00 a.m. and 4:00 p.m., Monday through Friday, except 
Federal holidays.

FOR FURTHER INFORMATION CONTACT: Kathi Epping, U.S. Department of 
Energy, Office of Energy Efficiency and Renewable Energy, EE-43, 1000 
Independence Avenue, S.W., Washington, D.C. 20585-0121, (202) 586-7425, 
email: Kathi.E[email protected], or Edward Levy, Esq., U.S. Department 
of Energy, Office of General Counsel, GC-72, 1000 Independence Avenue, 
S.W., Washington, D.C. 20585, (202) 586-9507, email: 
Edward.L[email protected]

SUPPLEMENTARY INFORMATION: Pursuant to section 346(a) of the Energy 
Policy and Conservation Act, as amended (EPCA), 42 U.S.C. 6317(a), the 
Department of Energy (DOE or the Department) proposed in a Notice of 
Proposed Rulemaking (``NOPR'' or ``Notice'') to adopt a new regulation, 
10 CFR Part 432. 63 FR 63360 (November 12, 1998). The regulation (the 
``proposed rule'') would include test procedures for measuring the 
energy efficiency of distribution transformers; several definitions 
regarding the test procedure, including the definition of a 
distribution transformer and the definition of a basic model; and a 
sampling plan for minimizing test burden. DOE held a public hearing on 
January 6, 1999, and received 9 written comments on the proposed rule. 
After reviewing the hearing transcript and comments, DOE concluded that 
a number of significant issues had been raised that required additional 
analysis. These issues include: (1) the adequacy of stakeholder 
opportunity to review NEMA TP 2; (2) the suitability of NEMA TP 2 to be 
adopted as the DOE test procedure; (3) transformers covered under the 
definition of ``distribution transformer''; (4) the appropriateness of 
proposed sampling plans for demonstrating compliance; and (5) the 
suitability of the definition of ``basic model'' for the purpose of 
grouping transformers to limit test burden.

1. Availability of Documents

    In the Notice, DOE stated it was proposing incorporation by 
reference either ANSI/IEEE standards C57.12.90 and C57.12.91 or NEMA 
standard TP 2. In the Notice, the Department stated its concern over 
whether TP 2 had undergone broad-based scrutiny, and DOE stated that, 
in order to accept TP 2, DOE would need sufficient evidence that all 
users and stakeholders have had an opportunity to review TP 2. In 
comments on the proposed rule, some stakeholders expressed concern that 
they had not been given the opportunity to Review NEMA TP 2. (ERMCO, 
No. 13 at 1; Dynapower, No. 17 at 1; and Howard Industries, No. 18 at 
2.) 1 Because the DOE wants to ensure that all stakeholders 
have an opportunity to review TP 2, the Department has sent copies of 
NEMA TP 2 to the parties on its Distribution Transformer Stakeholder 
mailing list. In addition, the National Institute of Standards and 
Technology (NIST) issued Technical Note 1427 entitled ``An Analysis of 
Efficiency Testing under the Energy Policy and Conservation Act: A Case 
Study with

[[Page 33432]]

Application to Distribution Transformers.'' (NIST TN 1427) The 
Department has also sent this report, which analyzes the sampling plans 
contained in proposed 10 CFR Part 432 and in NEMA TP 2 and compares 
them to each other, to the parties on the Department's distribution 
transformer mailing list. Copies of both NIST TN 1427 and NEMA TP 2 are 
available for inspection in the DOE Freedom of Information Reading 
Room. For information and copies of NEMA TP 2, please contact Anthony 
Balducci of NEMA at (703) 841-3245. For copies or questions on NIST TN 
1427, please contact Ken Stricklett of NIST at (301) 975-3955.
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    \1\ Comments are identified by company name, followed by comment 
number in the docket at page number. For example, ``ERMCO, No. 13 at 
1'' means comment number 13, submitted by ERMCO, at page 1. Also 
note that comment number ``11 DD'' refers to the hearing transcript.
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2. NEMA TP 2

    On the subject of whether NEMA TP 2 is ready to be adopted as the 
national test procedure, the American Council for an Energy Efficient 
Economy (ACEEE) has indicated its support of NEMA TP 2, provided that 
both NEMA and non-NEMA industry representatives have had sufficient 
opportunity to review the standard, and there is wide support for it 
among these representatives. (ACEEE, No. 20 at 1.) ACEEE and Dynapower, 
Inc. both expressed concerns, however, that NEMA TP 2 may not be 
appropriate for all customers. For example, the loading conditions may 
not be representative of all applications. For these reasons, Dynapower 
believes further evaluation is necessary before the final rule is 
issued, and ACEEE suggested that DOE investigate whether a corollary 
test procedure to address those transformers that distribute power to 
industrial or large commercial customers may be necessary in addition 
to NEMA TP 2. (Dynapower, No. 17 at 1 and ACEEE, No. 20 at 1.)
    Howard Industries believes having all the requirements in a single 
standard is NEMA TP 2's predominant advantage, and therefore Howard 
Industries tentatively supported the adoption of NEMA TP 2, pending a 
more thorough review. (Howard Industries, No. 18 at 1.)
    At the January hearing, ERMCO stated that it could not comment on 
NEMA TP 2 at that time, but that it did support the American National 
Standards Institute (ANSI) approval process. (ERMCO, No. 11 DD at 18-
23.) At the same hearing, Edison Electric Institute (EEI) indicated its 
preference for ANSI standards. (EEI, No. 11 DD at 31.)
    In its comments on the NOPR, NEMA indicated that NEMA TP 2 has been 
submitted to ANSI's accreditation standards committee C57 for approval. 
NEMA further stated that it anticipated receiving ballots by the end of 
March 1999 and resolution of comments shortly thereafter, and that it 
should take approximately sixty days for ANSI to approve NEMA TP 2. 
(NEMA, No. 21 at 2.)
    Because of the controversy over the two options delineated in the 
proposed rule, the Department invites further comment on whether DOE 
should choose Option 1 (ANSI/IEEE standards C57.12.90 and C57.12.91) or 
Option 2 (NEMA TP 2), as described in the NOPR, for the final rule for 
test procedures. The Department also seeks comment on the subsidiary 
issue of the appropriateness of tying adoption of NEMA TP 2 to ANSI 
approval.
    In addition, the Department wants to ensure that the test 
procedures that DOE adopts are suitable for all distribution 
transformers that are being regulated under the statute. Because DOE is 
concerned that the loading factor in the test procedure may not be 
appropriate for all distribution transformers, DOE would consider the 
adoption of different loading factors for different types of 
distribution transformers in order to capture the loadings they 
typically carry and more accurately rate the efficiency level of each. 
DOE solicits comments on whether this course of action is appropriate. 
If several loading factors are selected, only the loading factors used 
in the calculations would change; the test procedure would remain the 
same. DOE realizes that, in developing the TP 2 loading factors, NEMA 
considered this issue, and the Department welcomes its comments as well 
as those of stakeholders not represented by NEMA.

3. Definition of Distribution Transformer

    Section 346 of EPCA directs the Department to address the 
development of energy efficiency requirements for ``distribution 
transformers.'' The statute provides no definition for ``distribution 
transformer.'' As part of the Notice, the Department proposed a 
definition, so as to delineate the transformers that EPCA requires to 
be evaluated for standards and, therefore, initially subject to the 
test procedures.
    The definition in the proposed rule is as follows: ``a transformer 
with a primary voltage of 480 V to 35 kV, a secondary voltage of 120 V 
to 600 V, a frequency of 55-65 Hz, and a capacity of either 10 kVA to 
2500 kVA for liquid-immersed transformers or 0.25 kVA to 2500 kVA for 
dry-type transformers, except for (1) converter and rectifier 
transformers with more than two windings per phase, and (2) 
transformers which are not designed to be continuously connected to a 
power distribution system as a distribution transformer. This second 
exception includes regulating transformers, machine tool transformers, 
welding transformers, grounding transformers, testing transformers, and 
other transformers which are not designed to transfer electrical energy 
from a primary distribution circuit, to a secondary distribution 
circuit, or within a secondary distribution circuit, or to a consumer's 
service circuit.'' 63 FR at 63370.
    The following are a list of areas of the definition in which there 
is disagreement among stakeholders:

a. Low Voltage Transformers

    In oral, as well as written, comments on the proposed rule, NEMA 
stated that the definition of ``distribution transformer'' in the 
proposed rule was too broad and should not include low voltage (600 
Volts and below) transformers. (NEMA, No. 21 at 2 and No. 11 DD at 63.) 
In NEMA's view, these low voltage transformers are considered ``general 
purpose transformers,'' which NEMA says are defined as ``specialty 
transformers,'' not ``distribution transformers.'' NEMA quoted the 
ANSI/IEEE C57.12.80 definition of ``distribution transformer'' as ``a 
transformer for transferring electrical energy from a primary 
distribution circuit to a secondary distribution circuit or consumer's 
service circuit. NOTE: Distribution transformers are usually rated in 
the order of 5-500 kVA.'' NEMA also noted that the IEEE Dictionary 
defines ``primary distribution circuit'' as ``an alternating current 
circuit that supplies the primary of a distribution transformer from a 
generator, a substation, or a distribution bus.'' NEMA stated further 
that the IEEE Power Engineering Society does not consider low voltage 
transformers to be distribution transformers. However, NEMA 
acknowledged that in IEEE standard 241, the Industry Application 
Society (IAS) defines low voltage transformers as indoor distribution 
transformers, but went on to observe that the IAS consists of 
transformer installers, not manufacturers. (NEMA, No. 21 at 2-4.) Naval 
Facilities Engineering Command Atlantic Division (NAVFAC LANTDIV) 
indicated support of NEMA's comments regarding low voltage 
transformers. (NAVFAC LANTDIV, No. 22 at 1.)
    Howard Industries commented that it suspects the definition of 
distribution transformer in the NOPR is too broad and suggested DOE 
perform a further review. (Howard Industries, No. 18 at 2-3.)

[[Page 33433]]

    Tony Dell'arciprete, an Electrical Engineer for Electrical Design 
and Construction Projects for GSA, stated that indoor distribution 
transformers are distribution transformers. He also sited ANSI/IEEE 
Standard 241 (``the Gray Book''). He stated that he considers a 480 
volt primary and a 120/208 volt secondary to be a distribution level 
voltage. Furthermore, he indicated that excluding these transformers by 
calling them ``general purpose transformers'' or ``specialty 
transformers'' is a ``play on words.'' (Dell'arciprete, No. 23 at 1.)
    In its comments on the proposed rule, ACEEE noted that ANSI/IEEE 
Standard 241 defines ``indoor distribution transformer'' as one for 
which ``both primaries and secondaries are 600 volts and below (the 
most common ratio is 480-208Y/120V),'' and that these transformers 
offer the greatest potential energy savings. ACEEE also recommended 
that, given the ambiguity of the definition of the term ``distribution 
transformer,'' the Department should ``err on the side of a broader 
interpretation--particularly at this stage of the process, before 
standard setting has begun-- to ensure energy savings opportunities are 
not lost.'' (ACEEE, No. 20 at 2.)
    The Department is inclined to agree with ACEEE. Furthermore, the 
Department does not believe the definition of ``distribution 
transformer'' found in ANSI/IEEE standard C57.12.80 precludes the 
coverage of low voltage transformers. The Department believes an 
alternating current circuit that supplies the primary of a distribution 
transformer from a 277/480 volt distribution bus would fall within the 
definition of ``primary distribution circuit'' that NEMA provided from 
the IEEE dictionary. Consequently, the Department believes that these 
low voltages are covered under the ANSI/IEEE definition of 
``distribution transformers.''
    The Department also is inclined to disagree with NEMA's 
interpretation that because low voltage and ``indoor distribution 
transformers'' are also referred to as ``general purpose transformers'' 
or ``specialty transformers,'' they are not distribution transformers. 
In fact, next to the terms ``general purpose transformers'' and 
``specialty transformers'' in the IEEE dictionary are the words 
``(power and distribution transformers).'' The Department believes 
these words indicate that the authors of the dictionary consider these 
transformers to be a subset of distribution transformers. Hence, it 
appears to the Department that the ``indoor distribution transformers'' 
defined in ANSI/IEEE standard 241, are merely a subset of 
``distribution transformers.'' The Department questions NEMA's 
implication that the Industry Application Society (IAS) IEEE standard 
is less valid because the IAS consists of installers of transformers, 
not manufacturers. In addition, several manufacturers, including Acme 
Electric Corporation, Jefferson Electric, Cutler-Hammer, Falvo 
Electrical Supply, and PowerSmiths International Corporation, 
identified these low voltage transformers as ``distribution 
transformers'' in their product literature/web pages. Web pages for 
Delta Transformer and Hammond Manufacturing Transformer Group used the 
words ``General Purpose Transformers (distribution)'' and ``General 
purpose distribution transformers,'' respectively, indicating that the 
terms ``general purpose transformer'' and ``distribution transformer'' 
are not exclusive. (Product literature, No. 24.)
    In the proposed rule's definition of distribution transformer, as 
well as in the notice announcing its determination as to the 
distribution transformers for which standards appear to be warranted, 
62 FR 54809 (October 27, 1997), (``Determination Notice''), the 
Department construed the term ``distribution transformer'' in EPCA as 
including low voltage transformers. The Department does not find 
persuasive the comments discussed above that advocate a contrary 
approach. Thus, the Department intends to adopt, in the final rule, the 
proposed rule's inclusion of low voltage transformers in the definition 
of distribution transformer, unless it receives information that 
justifies exclusion of these transformers.

b. Capacity/Power Ratings

    NEMA commented that units with fractional power ratings are not 
defined as distribution transformers, and NEMA recommended a capacity 
(power rating) limit of 15 kVA for dry-type distribution transformers. 
NEMA also provided a comment noting that ANSI C57.12.50 identifies a 
range of 1-500 kVA for dry-type distribution transformers. (NEMA, No. 
21 at 4.)
    The Department is inclined to agree with NEMA regarding fractional 
power ratings. Consequently, DOE does not intend to include 
transformers with kVA ratings less than one in the distribution 
transformer definition and intends in the final rule to increase the 
proposed rule's 0.25 kVA lower capacity limit for distribution 
transformers. However, the Department is undecided as to whether this 
limit for dry-type distribution transformers should be 1 kVA 
(consistent with ANSI C57.12.50), 5 kVA (consistent with ANSI 
C57.12.80), 10 kVA (consistent with the lower limit for liquid-filled 
transformers), or 15 kVA (consistent with NEMA TP 2). The Department 
requests further comments on the appropriate lower limit for the power 
ratings of distribution transformers.

c. Liquid-filled Distribution Transformers

    Edison Electric Institute (EEI) requested that liquid-filled 
transformers be excluded from the rulemaking, because the utility 
market already drives these transformers to be efficient, within the 
limits of cost effectiveness. EEI stated that utilities already apply 
total owning cost methodologies in its purchasing decisions, and, 
therefore, it is unnecessary and counterproductive for the Department 
to mandate energy efficiency standards for liquid-filled transformers. 
However, EEI conceded that it would not object to DOE compiling and 
comparing test methods approved by standards setting bodies such as 
IEEE and ANSI. EEI also voiced support for the EPA's voluntary Energy 
Star program. (EEI, No. 19 at 1-5.)
    In the Determination Notice, the Department concluded that 
standards are warranted for liquid-filled distribution transformers. 62 
FR 54816. Thus, they were included in the proposed rule. Because the 
final rule addresses test procedures only, and not whether efficiency 
standards are warranted, the Department intends to include liquid-
filled transformers as outlined in the proposed rule. During the 
efficiency standards rulemaking, the Department will reevaluate its 
determination of the transformers for which standards are warranted. 62 
FR 54817.

d. Rectifier and Converter Transformers

    NEMA, Mr. Kline, and Howard Industries stated their belief that 
rectifier and converter transformers are not distribution transformers. 
(Kline, No. 14 at 1-2; Howard Industries, No. 18 at 3; and NEMA, No. 15 
at 1-2 and No. 21 at 4-5.) As a result of these comments and discussion 
at the public hearing, the Department is inclined to exclude from the 
``distribution transformer'' definition all rectifier and converter 
transformers if they are built and labeled as such.

e. Autotransformers and Transformers with Tap Ranges Greater Than 15%

    NEMA and Howard Industries requested that transformers with tap 
ranges greater than 15 percent and autotransformers be excluded from 
the

[[Page 33434]]

rulemaking. (Howard Industries, No. 18 at 3 and NEMA, No. 15 at 2 and 
No. 21 at 5.) The Department is inclined to believe few of these 
transformers exist in the distribution system, little energy would be 
saved by regulating them, and excluding them would be unlikely to 
create loopholes in the regulation. Consequently, the Department is 
inclined to exclude these transformers from this rulemaking.

f. Sealed/Non-Ventilated Transformers and Special Impedance and 
Harmonic Transformers

    NEMA and Howard Industries requested that sealed/non-ventilated 
transformers and special impedance and harmonic transformers be 
excluded from the rulemaking. (Howard Industries, No. 18 at 3 and NEMA, 
No. 15 at 2 and No. 21 at 5.) However, NEMA's justification for their 
exclusion is the inability of these transformers to meet the TP 1 
efficiency levels. NEMA provided no other reasons why these 
transformers should not be covered by the test procedure.
    These transformers were included in the proposed rule's definition 
of distribution transformer, 63 FR 63370, as well as in the 
Determination Notice, 62 FR 54811. The Department does not find 
persuasive the comments discussed above that advocate exclusion of 
these products. Thus, the Department intends to include sealed/non-
ventilated transformers and special impedance and harmonic transformers 
in the test procedures final rule, unless it receives information that 
justifies exclusion of these transformers from the test procedures. The 
appropriate efficiency levels, if any, for these and other classes of 
distribution transformers will be evaluated during the efficiency 
standards rulemaking.

g. Retrofit Transformers

    NEMA and Howard Industries indicated that while they do not 
recommend excluding all retrofit transformers, some currently operating 
transformers fit tightly into their locations or enclosures, making it 
impossible to replace them with more efficient transformers, which are 
generally larger or configured differently. (NEMA, No. 21 at 5 and 
Howard Industries, No. 18 at 3.) The Department is contemplating 
whether this situation calls for exclusion of these transformers from 
this rulemaking or for consideration of a separate class in a future 
standards rulemaking. In either case, the Department needs further 
information in order to define and treat these transformers 
appropriately. The Department is therefore soliciting further comments 
on how to distinguish these from other transformers and on the 
dimensional restrictions imposed on them.

4. Sampling Plans

    In the NOPR, the Department proposed a methodology--a sampling 
plan--that a manufacturer would be required to use to establish the 
efficiency of a basic model of distribution transformers based on tests 
of sample units of that basic model. 63 FR at 63366-67, 63371. In its 
comments on the proposed rule, Howard Industries expressed concern that 
a large amount of testing and record-keeping may add unnecessary costs 
to its products. The company believes that the statistical approaches 
used in 10 CFR Part 430, upon which the proposed rule was based, are 
suitable for highly standardized products, while distribution 
transformers are very specialized products often produced in very low 
volumes. Howard Industries stated that certain sizes may be produced in 
quantities of less than five per year, and some may not even be 
produced at all for a whole year. The company strongly recommended that 
the approach adopted by DOE minimize the number of units that must be 
tested to satisfy both compliance and enforcement, and it suggested 
that basic models of which fewer than 5 units are produced in a 180 day 
period be exempt from the rule for this period of time and no testing 
be performed. Howard Industries believes the impact of energy loss due 
to this small quantity of units is so small it can be neglected. The 
company also supports the eight percent tolerance used in the NEMA 
sampling plan. (Howard Industries, No. 18 at 4.)
    Southern Transformer Company commented that it will be difficult 
for small companies to assemble, calibrate, and certify test sets to 
comply with the proposed rule's testing requirements. Southern 
Transformer Company suggested that DOE provide a grant to NIST to 
assist small companies in this effort. (Southern Transformer, No. 12 at 
1.)
    In its comments on the proposed rule, NEMA urged the Department to 
use the sampling plan for compliance found in Section 7 of NEMA TP 2. 
(NEMA, No. 11 DD at 174, No. 15 at 3-4; and No. 21 at 6-8.) NEMA also 
stated that the 8 percent loss tolerance (throw-away limit) in the TP 2 
sampling plan compels manufacturers to design their products to at 
least the minimum average efficiency standard. NEMA also stated that it 
would consider adopting, in Section 7 of NEMA TP 2, subdivisions of its 
globalized aggregation into the following possible categories: Low 
Voltage Dry, Medium Voltage Dry, Liquid-Filled 500 kVA and below, and 
Liquid-Filled above 500 kVA. (NEMA, No. 21 at 7.)
    ACEEE supports a sampling plan that minimizes the testing burden, 
provided that a small sample can provide a high degree of confidence 
that efficiency levels reported by manufacturers are accurate. ACEEE 
believes the burden of proof is on the industry to prove NEMA TP 2 
satisfies these conditions. ACEEE believes the sampling plan in the 
NOPR is satisfactory. (ACEEE, No. 20 at 3.)
    The Department still has concerns regarding the aggregation of 
basic models used in NEMA TP 2. Nonetheless, the Department recognizes 
the aggregation and 100% testing method in the NEMA TP 2 sampling plan 
does have merit, particularly for limited production models. However, 
the Department doubts that any basic models of which there are at least 
50 units produced per 180 days would need to be aggregated with other 
basic models. The Department is inclined to believe that 100% testing 
of smaller, limited production models, coupled with the assurance that 
any individual unit that is 8% below a standard would be eliminated, 
renders it likely that these units would be designed to meet any 
applicable minimum standard efficiency.
    For the final rule, the Department, however, is considering 
adoption of one or some combination of the following sampling plan 
options:
    (1) Variation on NEMA TP 2:
    (a) Basic models for which all units are tested because the 
manufacturer chooses to do so, because of customer's specifications, 
requirements to comply with other standards, or other such reasons: \2\
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    \2\ For basic models that have sufficiently large numbers of 
units to minimize the statistical likelihood of error, this approach 
provides evidence, based on direct measurements, that each basic 
model meets or exceeds the efficiency standard. For basic models 
with limited production (< 50 per 180 days), the aggregation of both 
large and small production models reduces the risk of rejecting the 
limited production models due to the relatively high statistical 
possibility of erroneously estimating the mean of a population from 
a small sample.
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     Demonstrate the compliance of aggregations of basic models 
to the aggregate standard as described in TP-2 Section 7.2.1.
     Additionally, demonstrate the compliance of each basic 
model for which 50 or more units have been manufactured during 180 
calendar days.
     Discard all units whose losses exceed 8% of the rated 
value for that basic model, as required by TP 2.

[[Page 33435]]

    (b) Basic models which consist of units of identical design and are 
tested on a sampling basis:
     Per NEMA TP 2 Section 7.2.2, take a sample of at least 
five units of each basic model per month over a 180 calendar day period 
and compute from the test results the estimated mean of each basic 
model from the sample.
     Demonstrate the compliance of the aggregate as in TP 2.
     Additionally, demonstrate the compliance of each basic 
model for which 50 or more units have been manufactured during 180 
calendar days.
     Discard all units whose losses exceed 8% of the rated 
value for the basic model as required by TP 2.
    For small population basic models of fewer than 5 units, all units 
must be tested.
    (2) A sampling plan similar to that in the NOPR, allowing some form 
of aggregation for small production basic models.
    (3) The requirement of a certification of compliance or compliance 
statement only, in which the manufacturer would provide a written 
explanation of how it has demonstrated, verified, and certified 
compliance. In the written material accompanying the certificate, the 
manufacturer must demonstrate the basic premise for compliance.
    A sampling plan would be included in the final test procedures rule 
primarily for the purpose of demonstrating compliance with possible 
future standards. The Department acknowledges that a sampling plan is 
not necessary for the test procedure itself. However, the sampling plan 
might be used in the evaluation of possible future standards. The 
Department also recognizes that although some of the sampling plans 
under consideration may be adequate to demonstrate compliance with a 
minimum efficiency standard, these plans may not be adequate to address 
the question of efficiency representations. The Department is 
deliberating over whether labeling of particular efficiency values is 
appropriate for this product. The issue of representations will need to 
be addressed at a future time.

5. Definition of ``Basic Model''

    ERMCO, Howard industries, ACEEE, and NEMA supported the definition 
of ``basic model'' in the proposed rule. (ERMCO, No. 13 at 2; Howard 
Industries, No. 18 at 3; ACEEE, No. 20 at 2-3; and NEMA, No. 21 at 6.) 
ACEEE also suggested that industry sources provide guidance for 
ensuring manufacturers do not intentionally design some high efficiency 
models to counterbalance other low efficiency models within the same 
basic model. (ACEEE, No. 20 at 2-3.)
    After further examination, the Department believes the definition 
of basic model in the proposed rule may be problematic. As set forth in 
the NOPR, a basic model is intended to be a group of models, produced 
by a given manufacturer, that have performance, design, mechanical, 
functional, and electrical characteristics that are essentially 
identical, and do not have refinements that affect energy consumption. 
63 FR 63365. The general Part 430 definition of basic model was 
modified for distribution transformers in the proposed rule (Part 432). 
63 FR at 63365-66, 63369. However, the proposed Part 432 definition of 
basic model may need some further modification.
    All products within the same basic model should be in the same 
product class. (In its standards rulemakings, the Department 
establishes a separate ``class'' with its own efficiency standard for a 
product when the record indicates that the product includes a utility 
or performance-related feature that affects energy efficiency.) The 
following is an example depicting how the proposed basic model 
definition may be problematic:
    A special impedance distribution transformer model, because of its 
inherently inferior efficiency, would likely be in a class separate 
from regular distribution transformers. The proposed basic model 
definition specifies that the following characteristics must be used to 
group different models of distribution transformers in a basic model: 
output power rating, voltage range, insulation type, and number of 
phases. These features of a special impedance distribution transformer, 
however, could be the same as for a regular distribution transformer. 
Consequently, under the proposed definition of basic model, these two 
transformers could be within the same basic model even though they 
would have significantly different efficiencies. This example 
illustrates that the current definition of basic model will likely 
categorize, within the same basic model, transformers that should be in 
different classes.
    The Department would appreciate comments on how the Department 
should deal with this problem. The Department realizes that 
manufacturers would prefer special classes of distribution transformers 
to be exempted from regulation. However, as previously stated, the 
Department does not find that solution to be appropriate in this test 
procedures rulemaking.
    In grouping transformers into basic models, we have to look at all 
the features, and the ones that have widely differing effects on 
efficiency should not be grouped together. In the final rule, the 
Department is considering adding some other features that affect 
efficiency (such as physical material of the windings and core, 
physical size, and impedance range) to the definition of basic model. 
The Department is open to suggestions as to what other features should 
be considered for the basic model definition, so that we do not have 
the problem outlined above. The Department also is considering adding 
the words ``and the other features of which have comparable effect on 
efficiency'' to the proposed definition of ``basic model'' to alleviate 
this problem.

    Issued in Washington, D.C., on June 17, 1999.
Dan W. Reicher,
Assistant Secretary, Energy Efficiency and Renewable Energy.
[FR Doc. 99-16020 Filed 6-22-99; 8:45 am]
BILLING CODE 6450-01-P