[Federal Register Volume 74, Number 133 (Tuesday, July 14, 2009)]
[Rules and Regulations]
[Pages 34080-34179]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-15710]



[[Page 34079]]

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Part II





Department of Energy





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10 CFR Part 430



Energy Conservation Program: Energy Conservation Standards and Test 
Procedures for General Service Fluorescent Lamps and Incandescent 
Reflector Lamps; Final Rule

  Federal Register / Vol. 74, No. 133 / Tuesday, July 14, 2009 / Rules 
and Regulations  

[[Page 34080]]


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DEPARTMENT OF ENERGY

10 CFR Part 430

[Docket Number EE-2006-STD-0131]
RIN 1904-AA92


Energy Conservation Program: Energy Conservation Standards and 
Test Procedures for General Service Fluorescent Lamps and Incandescent 
Reflector Lamps

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

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: The Department of Energy (DOE) is announcing that pursuant to 
the Energy Policy and Conservation Act (EPCA), it is amending the 
energy conservation standards for certain general service fluorescent 
lamps and incandescent reflector lamps. DOE is also adopting new energy 
conservation standards and amendments to its test procedures for 
certain general service fluorescent lamps not currently covered by 
standards. Additionally, DOE is amending the definitions of certain 
terms found in the general provisions. It has determined that energy 
conservation standards for these products would result in significant 
conservation of energy, and are technologically feasible and 
economically justified.

DATES: The effective date of this rule is September 14, 2009. 
Compliance with the standards established in today's final rule is 
required starting on July 14, 2012. The incorporation by reference of 
certain publications listed in this rule was approved by the Director 
of the Federal Register on September 14, 2009.

ADDRESSES: For access to the docket to read background documents, the 
technical support document, transcripts of the public meetings in this 
proceeding, or comments received, visit the U.S. Department of Energy, 
Resource Room of the Building Technologies Program, 950 L'Enfant Plaza, 
SW., 6th Floor, Washington, DC 20024, (202) 586-2945, between 9 a.m. 
and 4 p.m., Monday through Friday, except Federal holidays. Please call 
Ms. Brenda Edwards at the above telephone number for additional 
information regarding visiting the Resource Room. You may also obtain 
copies of certain previous rulemaking documents in this proceeding 
(i.e., framework document, advance notice of proposed rulemaking, 
notice of proposed rulemaking), draft analyses, public meeting 
materials, and related test procedure documents from the Office of 
Energy Efficiency and Renewable Energy's Web site at: http://www1.eere.energy.gov/buildings/appliance_standards/residential/incandescent_lamps.html.

FOR FURTHER INFORMATION CONTACT:
    Ms. Linda Graves, 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) 586-1851. E-mail: [email protected].
    Mr. Eric Stas, U.S. Department of Energy, Office of the General 
Counsel, GC-72, 1000 Independence Avenue, SW., Washington, DC 20585-
0121. Telephone: (202) 586-9507. E-mail: [email protected].

SUPPLEMENTARY INFORMATION:

Table of Contents

I. Summary of the Final Rule
    A. The Standard Levels
    B. Current Federal Standards for General Service Fluorescent 
Lamps and Incandescent Reflector Lamps
    C. Benefits and Burdens to Purchasers of General Service 
Fluorescent Lamps and Incandescent Reflector Lamps
    D. Impact on Manufacturers
    E. National Benefits
    F. Conclusion
II. Introduction
    A. Authority
    B. Background
    1. Current Standards
    2. History of Standards Rulemaking for General Service 
Fluorescent Lamps, Incandescent Reflector Lamps, and General Service 
Incandescent Lamps
III. Issues Affecting the Scope of This Rulemaking
    A. Additional General Service Fluorescent Lamps for Which DOE is 
Adopting Standards
    1. Scope of EPCA Requirement that DOE Consider Standards for 
Additional Lamps
    2. Determination of the Additional Lamps to Which Standards Will 
Apply
    a. Four-Foot Medium Bipin Lamps
    b. Two-Foot Medium Bipin, U-Shaped Lamps
    c. Eight-Foot Recessed, Double-Contact Lamps
    d. Eight-Foot Single Pin Slimline Lamps
    e. Very High Output Straight-Shaped Lamps
    f. T5 Lamps
    g. Various Other Fluorescent Lamps
    3. Summary of GSFL for Which DOE Has Adopted Standards
    B. Incandescent Reflector Lamp Scope of Coverage
    1. Covered Wattage Range
    2. Exempted Incandescent Reflector Lamps
    3. Museum Lighting
    C. Amended Definitions
    1. ``Rated Wattage''
    2. ``Colored Fluorescent Lamp''
    D. Off Mode and Standby Mode Energy Consumption Standards
    E. Color Rendering Index Standards for General Service 
Fluorescent Lamps
IV. General Discussion
    A. Test Procedures
    B. Technological Feasibility
    1. General
    2. Maximum Technologically Feasible Levels
    C. Energy Savings
    D. Economic Justification
    1. Specific Criteria
    a. Economic Impact on Consumers and Manufacturers
    b. Life-Cycle Costs
    c. Energy Savings
    d. Lessening of Utility or Performance of Products
    e. Impact of Any Lessening of Competition
    f. Need of the Nation To Conserve Energy
    g. Other Factors
    2. Rebuttable Presumption
V. Methodology and Discussion of Comments on Methodology
    A. Market and Technology Assessment
    1. Product Classes
    a. General Service Fluorescent Lamps
    i. Modified-Spectrum Fluorescent Lamps
    ii. 25 Watt 4-Foot MBP Lamps
    iii. Summary of GSFL Product Classes
    b. Incandescent Reflector Lamps
    i. Modified-Spectrum Lamps
    ii. Lamp Diameter
    iii. Voltage
    iv. IRL Summary
    B. Engineering Analysis
    1. Approach
    2. Representative Product Classes
    3. Baseline Models
    4. Efficacy Levels
    a. GSFL Compliance Reports
    b. 4-Foot MiniBP Efficacy Levels
    c. IRL Manufacturing Variability
    5. Scaling to Product Classes Not Analyzed
    a. 2-Foot U-Shaped Lamps
    b. Lamps With Higher CCTs
    c. Modified Spectrum IRL
    d. Small Diameter IRL
    e. IRL With Rated Voltages Greater Than or Equal to 125 Volts
    C. Life-Cycle Cost and Payback Period Analysis
    1. Consumer Product Price
    2. Sales Tax
    3. Annual Operating Hours
    4. Electricity Prices and Electricity Price Trends
    5. Ballast Lifetime
    6. Lamp Lifetime
    7. Discount Rates
    8. Residential Fluorescent Lamp Analysis
    9. Rebuttable Payback Period Presumption
    D. National Impact Analysis--National Energy Savings and Net 
Present Value Analysis
    1. Overview of NIA Changes in This Notice
    2. Shipments Analysis
    3. Macroeconomic Effects on Growth
    4. Reflector Market Growth
    5. Penetration of R-CFLs and Emerging Technologies
    6. Building Codes
    7. GSFL Shipments Growth
    8. Residential Installed GSFL Stock
    9. GSFL Lighting Expertise Scenarios
    10. IRL Product Substitution Scenarios
    11. Discount Rates
    E. Consumer Sub-Group Analysis
    F. Manufacturer Impact Analysis

[[Page 34081]]

    G. Employment Impact Analysis
    H. Utility Impact Analysis
    I. Environmental Assessment
    J. Monetizing Carbon Dioxide and Other Emissions Impacts
VI. Discussion of Other Key Issues and Comments
    A. Sign Industry Impacts
    B. Max-Tech IRL
    1. Treatment of Proprietary Technologies
    2. Other Technologies
    a. High-Efficiency IR Coatings
    b. Silverized Reflectors
    c. Integrally-Ballasted Low-Voltage IRL
    3. Lamp Lifetime
    C. IRL Lifetime
    1. Baseline Lifetime Scenario
    2. Minimum Lamp Lifetime Requirement
    3. 6,000-Hour-Lifetime Lamps
    D. Impact on Competition
    1. Manufacturers
    2. Suppliers
    E. Xenon
    F. IRL Hot Shock
    G. Rare Earth Phosphors
    H. Product and Performance Feature Availability
    1. Dimming Functionality
    2. GSFL Product Availability
    I. Alternative Standard Scenarios
    1. Tiered Standard
    2. Delayed Effective Date
    3. Residential Exemption
    4. Conclusions Regarding Alternative Standard Scenarios
    J. Benefits and Burdens
VII. Analytical Results and Conclusions
    A. Trial Standard Levels
    1. General Service Fluorescent Lamps
    2. Incandescent Reflector Lamps
    B. Significance of Energy Savings
    C. Economic Justification
    1. Economic Impact on Consumers
    a. Life-Cycle Costs and Payback Period
    i. General Service Fluorescent Lamps
    ii. Incandescent Reflector Lamps
    b. Consumer Subgroup Analysis
    2. Economic Impact on Manufacturers
    a. Industry Cash-Flow Analysis Results for the IRL Lifetime 
Sensitivity
    b. Cumulative Regulatory Burden
    c. Impacts on Employment
    d. Impacts on Manufacturing Capacity
    e. Impacts on Manufacturers That Are Small Businesses
    3. National Net Present Value and Net National Employment
    4. Impact on Utility or Performance of Products
    5. Impact of Any Lessening of Competition
    6. Need of the Nation To Conserve Energy
    7. Other Factors
    D. Conclusion
    1. General Service Fluorescent Lamps Conclusion
    a. Trial Standard Level 5
    b. Trial Standard Level 4
    2. Incandescent Reflector Lamps Conclusion
    a. Trial Standard Level 5
    b. Trial Standard Level 4
VIII. Procedural Issues and Regulatory Review
    A. Review Under Executive Order 12866
    B. Review Under the Regulatory Flexibility Act
    C. Review Under the Paperwork Reduction Act
    D. Review Under the National Environmental Policy Act
    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 of 1999
    I. Review Under Executive Order 12630
    J. Review Under the Treasury and General Government 
Appropriations Act of 2001
    K. Review Under Executive Order 13211
    L. Review Under the Information Quality Bulletin for Peer Review
    M. Congressional Notification
IX. Approval of the Office of the Secretary

Acronyms and Abbreviations

ACEEE American Council for an Energy Efficient Economy
ACG Applied Coatings Group
ADLT Advanced Lighting Technologies, Inc.
AEO Annual Energy Outlook
ANOPR advance notice of proposed rulemaking
ANSI American National Standards Institute
ASAP Appliance Standards Awareness Project
BEF ballast efficacy factor
BF ballast factor
BR bulged reflector (reflector lamp shape)
BT Building Technologies Program
Btu British thermal units
CAIR Clean Air Interstate Rule
CAMR Clean Air Mercury Rule
CBECS Commercial Buildings Energy Consumption Survey
CCT correlated color temperature
CEC California Energy Commission
CEE Consortium for Energy Efficiency
CFR Code of Federal Regulations
CFL compact fluorescent lamp
CIE International Commission on Illumination
CO2 carbon dioxide
CRI color rendering index
CSL candidate standard level
DOE U.S. Department of Energy
DOJ U.S. Department of Justice
E26 Medium screw-base (incandescent lamp base type)
EEI Edison Electric Institute
EIA Energy Information Administration
EISA 2007 Energy Independence and Security Act of 2007
EL efficacy level
E.O. Executive Order
EPA U.S. Environmental Protection Agency
EPACT 1992 Energy Policy Act of 1992
EPACT 2005 Energy Policy Act of 2005
EPCA Energy Policy and Conservation Act
ER elliptical reflector (reflector lamp shape)
EU European Union
EuP Energy-Using Product
FEMP Federal Energy Management Program
FR Federal Register
FTC U.S. Federal Trade Commission
GE General Electric Lighting and Industrial
GRIM Government Regulatory Impact Model
GSFL general service fluorescent lamp
GSIL general service incandescent lamp
GW gigawatt
Hg mercury
HID high-intensity discharge
HIR halogen infrared reflector
HO high output
HVAC heating, ventilating and air-conditioning
IALD International Association of Lighting Designers
IESNA Illuminating Engineering Society of North America
ImSET Impact of Sector Energy Technologies
INPV industry net present value
IPCC Intergovernmental Panel on Climate Change
I-O input-output
IR infrared
IRL incandescent reflector lamp
K Kelvin
kt kilotons
LCC life-cycle cost
LED light-emitting diode
lm lumens
LMC U.S. Lighting Market Characterization Volume I
lm/W lumens per watt
MBP medium bipin
MECS Manufacturer Energy Consumption Survey (MECS)
MIA manufacturer impact analysis
miniBP miniature bipin
MMt million metric tons
Mt metric tons
MW megawatts
NAICS North American Industry Classification System
NEEP Northeast Energy Efficiency Partnership
NEMA National Electrical Manufacturers Association
NEMS National Energy Modeling System
NEMS-BT National Energy Modeling System--Building Technologies
NES national energy savings
NIA national impact analysis
NIST National Institute of Standards and Technology
NOPR notice of proposed rulemaking
NOX nitrogen oxides
NPV net present value
NRDC Natural Resources Defense Council
NVLAP National Voluntary Laboratory Accreditation Program
OEM original equipment manufacturer
OIRA Office of Information and Regulatory Affairs
OMB U.S. Office of Management and Budget
PAR parabolic aluminized reflector (reflector lamp shape)
PBP payback period
PG&E Pacific Gas and Electric
PSI Product Stewardship Institute
quad quadrillion (1015) Btu
R reflector (reflector lamp shape)
R-CFL reflector compact fluorescent lamp
R&D research and development
RDC recessed double contact
RECS Residential Energy Consumption Survey
RIA regulatory impact analysis
SBA U.S. Small Business Administration
SO standard output
SO2 sulfur dioxide
SP single pin

[[Page 34082]]

T5, T8, T10, T12 tubular fluorescent lamps, diameters of 0.625, 1, 
1.25 or 1.5 inches, respectively
TSD technical support document
TSL trial standard level
TWh terawatt-hour
UMRA Unfunded Mandates Reform Act
U.S.C. United States Code
UV ultraviolet
V volts
VHO very high output
W watts

I. Summary of the Final Rule

A. The Standard Levels

    The Energy Policy and Conservation Act, as amended (42 U.S.C. 6291 
et seq.; EPCA), provides that any new or amended energy conservation 
standard that the Department of Energy prescribes for covered consumer 
and/or commercial products, including general service fluorescent lamps 
(GSFL) and incandescent reflector lamps (IRL), must be designed to 
``achieve the maximum improvement in energy efficiency * * * which the 
Secretary determines is technologically feasible and economically 
justified.'' (42 U.S.C. 6295(o)(2)(A)) Furthermore, the new or amended 
standard must ``result in significant conservation of energy.'' (42 
U.S.C. 6295(o)(3)(B)) The energy conservation standards in today's 
final rule, which apply to certain types of types of GSFL and IRL, 
satisfy these requirements, as well as all other applicable statutory 
provisions discussed in this notice.
    Table I.1 and Table I.2 present the energy conservation standard 
levels DOE is adopting today. These standards will apply to GSFL and 
IRL listed in those tables that are manufactured for sale in the United 
States, or imported into the United States, on or after July 14, 2012.

  Table I.1--Summary of the Amended Energy Conservations Standards for
                    General Service Fluorescent Lamps
------------------------------------------------------------------------
                                                             Energy
           Lamp type               Correlated color       conservation
                                     temperature        standard  (lm/W)
------------------------------------------------------------------------
4-Foot Medium Bipin...........  <=4,500K.............                 89
                                >4,500K and <=7,000K.                 88
2-Foot U-Shaped...............  <=4,500K.............                 84
                                >4,500K and <=7,000K.                 81
8-Foot Slimline...............  <=4,500K.............                 97
                                >4,500K and <=7,000K.                 93
8-Foot High Output............  <=4,500K.............                 92
                                >4,500K and <=7,000K.                 88
4-Foot Miniature Bipin          <=4,500K.............                 86
 Standard Output.
                                >4,500K and <=7,000K.                 81
4-Foot Miniature Bipin High     <=4,500K.............                 76
 Output.
                                >4,500K and <=7,000K.                 72
------------------------------------------------------------------------


            Table I.2--Summary of the Energy Conservation Standards for Incandescent Reflector Lamps
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                                                                                                     Energy
            Lamp wattage                     Lamp type            Diameter         Voltage        conservation
                                                                  (inches)                      standard  (lm/W)
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40W-205W............................  Standard Spectrum......            >2.5           >=125          6.8*P0.27
                                                                                         <125          5.9*P0.27
                                                                        <=2.5           >=125          5.7*P0.27
                                                                                         <125          5.0*P0.27
40W-205W............................  Modified Spectrum......            >2.5           >=125          5.8*P0.27
                                                                                         <125          5.0*P0.27
                                                                        <=2.5           >=125          4.9*P0.27
                                                                                         <125          4.2*P0.27
----------------------------------------------------------------------------------------------------------------
Note 1: P is equal to the rated lamp wattage, in watts.
Note 2: Standard Spectrum means any incandescent reflector lamp that does not meet the definition of ``modified
  spectrum'' in 430.2.

B. Current Federal Standards for General Service Fluorescent Lamps and 
Incandescent Reflector Lamps

    Table I.3 and Table I.4 present the current statutorily-prescribed 
Federal energy conservation standards for GSFL and IRL. The standards 
set requirements for minimum efficacy and color rendering index (CRI) 
levels for certain GSFL, and minimum efficacy levels for certain IRL. 
(42 U.S.C. 6295(i)(1); 10 CFR 430.32(n))

                                    Table I.3--EPCA Standard Levels for GSFL
----------------------------------------------------------------------------------------------------------------
                                                                Nominal lamp                    Minimum average
                          Lamp type                                wattage       Minimum CRI    efficacy (lm/W)
----------------------------------------------------------------------------------------------------------------
4-Foot Medium Bipin..........................................            >35W              69               75.0
                                                                        <=35W              45               75.0
2-Foot U-Shaped..............................................            >35W              69               68.0
                                                                        <=35W              45               64.0
8-Foot Slimline..............................................            >65W              69               80.0
                                                                        <=65W              45               80.0

[[Page 34083]]

 
8-Foot High Output...........................................           >100W              69               80.0
                                                                       <=100W              45               80.0
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                 Table I.4--EPCA Standard Levels for IRL
------------------------------------------------------------------------
                                                              Minimum
                                                              average
                         Wattage                          efficacy  (lm/
                                                                W)
------------------------------------------------------------------------
40-50...................................................            10.5
51-66...................................................            11.0
67-85...................................................            12.5
86-115..................................................            14.0
116-155.................................................            14.5
156-205.................................................            15.0
------------------------------------------------------------------------

C. Benefits and Burdens to Purchasers of General Service Fluorescent 
Lamps and Incandescent Reflector Lamps

    In the April 2009 notice of proposed rulemaking (NOPR), DOE 
considered the impacts on consumers of several trial standard levels 
(TSLs) related to the efficiency of GSFL and IRL. 74 FR 16920 (April 
13, 2009). In the April 2009 NOPR, DOE tentatively concluded that the 
economic impacts on most consumers (i.e., the average life-cycle cost 
(LCC) savings) of amended standards for GSFL and IRL would be positive. 
DOE has reached the same conclusion in today's final rule, as explained 
below.
    The economic impacts on consumers, i.e., the average life-cycle 
cost savings, are generally positive in this final rule. DOE's analyses 
indicate that on average residential and commercial consumers would see 
benefits from the proposed standards. DOE expects that under the 
standards presented in this final rule, the purchase price of high-
efficacy GSFL would be higher (up to thirteen times higher, including 
the purchase of new lamps and a new ballast) than the average price of 
these products today; the energy efficiency gains, however, would 
result in lower energy costs that more than offset such higher costs 
for the majority of consumers analyzed in this final rule. When the 
potential savings due to efficiency gains are summed over the lifetime 
of the high-efficacy products, consumers would be expected to save up 
to $67.06 (depending on the lamp type), on average, compared to their 
expenditures over the lives of today's baseline GSFL. The results of 
DOE's analyses for IRL follow a similar pattern. Although DOE expects 
the purchase price of the higher-efficacy IRL to be 47 to 64 percent 
higher than the average price of these products today, the energy 
efficiency gains would result in lower energy costs that more than 
offset the higher costs for the majority of consumers analyzed in this 
final rule. When these potential savings due to efficiency gains are 
summed over the lifetime of the higher-efficacy IRL, it is estimated 
that consumers would save up to $7.95 per lamp (depending on the 
wattage and operating sector), on average, compared to their 
expenditures over the lives of today's baseline IRL.

D. Impact on Manufacturers

    Using a real corporate discount rate of 10.0 percent, DOE estimates 
the net present value (NPV) of the GSFL and IRL industries to be $527-
639 million and $221-301 million in 2008$, respectively. DOE expects 
the impact of today's standards on the industry net present value 
(INPV) of manufacturers of GSFL to be between a 0.6 percent loss and a 
30.7 percent loss (-$4 million to -$162 million), and between a 6.8 
percent loss and a 44.4 percent loss (-$21 million to -$98 million) for 
IRL manufacturers. Based on DOE's interviews with GSFL and IRL 
manufacturers, DOE expects minimal plant closings or loss of employment 
as a result of the standards.

E. National Benefits

    DOE estimates the GSFL standards will save approximately 3.83 to 
9.94 quads (quadrillion (10\15\) British thermal units (Btu)) of energy 
over 30 years (2012-2042). Over the same time period, DOE estimates IRL 
standards will save approximately 0.94 to 2.39 quads. By 2042, DOE 
expects the energy savings from the GSFL and IRL standards to eliminate 
the need for approximately 1.8 to 6.2 and 0.2 to 1.1 gigawatts of 
generating capacity, respectively.
    These energy savings from GSFL will result in cumulative 
(undiscounted) greenhouse gas emission reductions of 175 to 488 million 
tons (Mt) of carbon dioxide (CO2); for IRL, DOE estimates 
these reductions will be 44 to 106 million tons (Mt) of CO2. 
Cumulative for GSFL and IRL, DOE estimates that the range of the 
monetized value of CO2 emission reductions is between $0.2 
billion to $24.8 billion, at a 7-percent discount rate, and between 
$0.5 billion to $49.8 billion at a 3-percent discount rate. The mid-
range of the CO2 value (using $33 per ton) is $3.9 to $10.2 
billion and $7.6 to $20.6 billion at 7-percent and 3-percent discount 
rates, respectively.
    Additionally, the GSFL standards will help alleviate air pollution 
by resulting in between approximately 11,000 to 36,780 tons (11.0 and 
36.8 kilotons (kt)) of nitrogen oxides (NOX) cumulative 
emission reductions from 2012 through 2042; the IRL standards will 
result in NOX cumulative emission reductions of 6.4 to 8.4 
kt. Mercury (Hg) cumulative emissions reductions over the same time 
period will be reduced by up to 7.3 metric tons due to GSFL standards 
and 1.65 metric tons from IRL standards. The monetized values of these 
emissions reductions, cumulative for both GSFL and IRL, are estimated 
at $6.0 to $131.5 million for NOX and up to $82.6 million 
for Hg at a 7-percent discount rate. Using a 3-percent discount rate, 
the monetized values of these emission reductions are $6.9 to $162.3 
million for NOX and up to $153.7 million for Hg.
    The national NPV of the GSFL and IRL standards is between $10.02 
and $26.31 billion and $1.83 and $9.06 billion, respectively, using a 
7-percent discount rate cumulative from 2012 to 2042 in 2008$. Using a 
3-percent discount rate, the national NPV of the GSFL and IRL standards 
is between $21.84 and $53.53 billion and $3.78 and $17.81 billion, 
respectively, cumulative from 2012 to 2042 in 2008$. This is the 
estimated total value of future savings minus the estimated increased 
costs of purchasing GSFL and IRL, discounted to 2009.
    The benefits and costs of today's final rule can also be expressed 
in terms of annualized 2008$ values over the forecast period 2012 
through 2042. Using a 7-percent discount rate for the annualized cost 
analysis, the cost of the standards established in today's final rule 
is $700 million per year in increased product and installation costs, 
while the annualized benefits are $2.95 billion per year in reduced 
product operating costs. Using a 3-percent discount rate, the cost of 
the standards established in today's final rule is $531 million per 
year, while the benefits of today's standards are $3.12 billion per 
year. The following tables depict these annualized benefits and costs 
for the adopted standards for GSFL and IRL.

[[Page 34084]]



                                                    Table I.5--Annualized Benefits and Costs for GSFL
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                  Units
                                                                                                                ----------------------------------------
              Category                    Primary estimate           Low estimate            High estimate                         Disc       Period
                                                                                                                  Year  dollars    (%)        covered
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                        Benefits
--------------------------------------------------------------------------------------------------------------------------------------------------------
Annualized Monetized $millions/year.  2302...................  1329...................  3275...................            2008        7              31
                                      2420...................  1387...................  3452...................            2008        3              31
Annualized Quantified...............  10.48 CO2 (Mt).........  5.76 CO2 (Mt)..........  15.2 CO2 (Mt)..........  ..............        7              31
                                      1.78 NOX (kt)..........  1.03 NOX (kt)..........  2.54 NOX (kt)..........  ..............        7              31
                                      0.11 Hg (t)............  0 Hg (t)...............  0.22 Hg (t)............  ..............        7              31
                                      10.6 CO2 (Mt)..........  5.69 CO2 (Mt)..........  15.52 CO2 (Mt).........  ..............        3              31
                                      1.19 NOX (kt)..........  0.63 NOX (kt)..........  1.76 NOX (kt)..........  ..............        3              31
                                      0.11 Hg (t)............  0 Hg (t)...............  0.23 Hg (t)............  ..............        3              31
Qualitative
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                          Costs
--------------------------------------------------------------------------------------------------------------------------------------------------------
Annualized Monetized $millions/year.  582....................  378....................  786....................            2008        7              31
                                      425....................  230....................  621....................            2008        3              31
Qualitative
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Net Benefits/Costs
--------------------------------------------------------------------------------------------------------------------------------------------------------
Annualized Monetized $millions/year.  1720...................  951....................  2489...................            2008        7              31
                                      1994...................  1158...................  2831...................            2008        3              31
Qualitative
--------------------------------------------------------------------------------------------------------------------------------------------------------


                                                    Table I.6--Annualized Benefits and Costs for IRL
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                  Units
                                                                                                                ----------------------------------------
              Category                    Primary estimate           Low estimate            High estimate                         Disc       Period
                                                                                                                  Year  dollars    (%)        covered
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                        Benefits
--------------------------------------------------------------------------------------------------------------------------------------------------------
Annualized Monetized $millions/year.  650....................  406....................  894....................            2008        7              31
                                      696....................  424....................  968....................            2008        3              31
Annualized Quantified...............  2.39 CO2 (Mt)..........  1.51 CO2 (Mt)..........  3.28 CO2 (Mt)..........  ..............        7              31
                                      0.51 NOX (kt)..........  0.45 NOX (kt)..........  0.58 NOX (kt)..........  ..............        7              31
                                      0.02 Hg (t)............  0 Hg (t)...............  0.05 Hg (t)............  ..............        7              31
                                      2.4 CO2 (Mt)...........  1.45 CO2 (Mt)..........  3.35 CO2 (Mt)..........  ..............        3              31
                                      0.35 NOX (kt)..........  0.31 NOX (kt)..........  0.4 NOX (kt)...........  ..............        3              31
                                      0.02 Hg (t)............  0 Hg (t)...............  0.05 Hg (t)............  ..............        3              31
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                          Costs
--------------------------------------------------------------------------------------------------------------------------------------------------------
Annualized Monetized $millions/year.  118....................  227....................  9......................            2008        7              31
                                      106....................  218....................  -6.....................            2008        3              31
--------------------------------------------------------------------------------------------------------------------------------------------------------
Qualitative
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Net Benefits/Costs
--------------------------------------------------------------------------------------------------------------------------------------------------------
Annualized Monetized $millions/year.  532....................  179....................  885....................            2008        7              31
                                      590....................  207....................  973....................            2008        3              31
--------------------------------------------------------------------------------------------------------------------------------------------------------

F. Conclusion

    DOE has evaluated the benefits (energy savings, consumer LCC 
savings, positive national NPV, and emissions reductions) to the Nation 
of today's new and amended energy conservation standards for certain 
GSFL and IRL, as well as the costs (loss of manufacturer INPV and 
consumer LCC increases for some users of GSFL and IRL). Based upon all 
available information, DOE has determined that the benefits to the 
Nation of the standards for GSFL and IRL outweigh their costs. Today's 
standards also represent the maximum improvement in energy efficiency 
that is technologically feasible and economically justified, and will 
result

[[Page 34085]]

in significant energy savings. At present, GSFL and IRL that meet the 
new standard levels are commercially available.

II. Introduction

A. Authority

    Title III of EPCA sets forth a variety of provisions designed to 
improve energy efficiency. Part A\1\ of Title III (42 U.S.C. 6291-6309) 
provides for the Energy Conservation Program for Consumer Products 
Other Than Automobiles. The program covers consumer products and 
certain commercial products (all of which are referred to hereafter as 
``covered products''), including GSFL and IRL. (42 U.S.C. 6292(a)(14) 
and 6292(i)) DOE publishes today's final rule pursuant to Part A of 
Title III, which provides for test procedures, labeling, and energy 
conservation standards for GSFL and IRL and certain other types of 
products, and authorizes DOE to require information and reports from 
manufacturers. The test procedures for GSFL and IRL appear at title 10 
of the Code of Federal Regulations (CFR) part 430, subpart B, appendix 
R.
---------------------------------------------------------------------------

    \1\ This part was originally titled Part B; however, it was 
redesignated Part A after Part B was repealed by Public Law 109-58.
---------------------------------------------------------------------------

    The scope of coverage of these provisions for GSFL and IRL is 
dictated by EPCA's definitions of these and related terms, as further 
discussed below. EPCA defines ``general service fluorescent lamp'' as 
follows:

* * * [F]luorescent lamps which can be used to satisfy the majority 
of fluorescent applications, but does not include any lamp designed 
and marketed for the following non-general lighting applications:
    (i) Fluorescent lamps designed to promote plant growth.
    (ii) Fluorescent lamps specifically designed for cold 
temperature installations.
    (iii) Colored fluorescent lamps.
    (iv) Impact-resistant fluorescent lamps.
    (v) Reflectorized or aperture lamps.
    (vi) Fluorescent lamps designed for use in reprographic 
equipment.
    (vii) Lamps primarily designed to produce radiation in the 
ultra-violet region of the spectrum.
    (viii) Lamps with a color rendering index of 87 or greater.

(42 U.S.C. 6291(30)(B))

    EPCA defines ``incandescent reflector lamp'' as follows:

* * * [A] lamp in which light is produced by a filament heated to 
incandescence by an electric current * * * [and] (commonly referred 
to as a reflector lamp) which is not colored or designed for rough 
or vibration service applications, that contains an inner reflective 
coating on the outer bulb to direct the light, an R, PAR, ER, BR, 
BPAR, or similar bulb shapes with E26 medium screw bases, a rated 
voltage or voltage range that lies at least partially within 115 and 
130 volts, a diameter which exceeds 2.25 inches, and has a rated 
wattage that is 40 watts or higher.

(42 U.S.C. 6291(30)(C), (C)(ii) and (F))

    EPCA further clarifies this definition of IRL by defining lamp 
types excluded from the definition, including ``rough service lamp,'' 
``vibration service lamp,'' and ``colored incandescent lamp.'' (42 
U.S.C. 6291(30)(X), (AA), and (EE)) EPCA prescribes specific energy 
conservation standards for certain GSFL and IRL. (42 U.S.C. 6295(i)(1)) 
The statute further directs DOE to conduct two cycles of rulemakings to 
determine whether to amend these standards, and to initiate a 
rulemaking to determine whether to adopt standards for additional types 
of GSFL. (42 U.S.C. 6295(i)(3)-(5)) This rulemaking represents the 
first round of amendments to the GSFL and IRL energy conservation 
standards as directed by 42 U.S.C. 6295(i)(3), and it also implements 
the requirement for DOE to consider energy conservation standards for 
additional GSFL under 42 U.S.C. 6295(i)(5). The advance notice of 
proposed rulemaking (ANOPR) in this proceeding, 73 FR 13620, 13622, 
13625, 13628-29 (March 13, 2008) (the March 2008 ANOPR), the notice of 
proposed rulemaking (NOPR) in this proceeding, 74 FR 16920, 16924-26 
(April 13, 2009) (the April 2009 NOPR), and subsections II.B.2 and 
III.B.2 below provide additional detail on the nature and statutory 
history of EPCA's requirements for GSFL and IRL.
    EPCA provides criteria for prescribing new or amended standards for 
covered products, including GSFL and IRL. As indicated above, any such 
new or amended standard 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)) Further, DOE may not 
prescribe an amended or new standard if DOE determines by rule that 
such standard would not result in ``significant conservation of 
energy,'' or ``is not technologically feasible or economically 
justified.'' (42 U.S.C. 6295(o)(3)(B)) Additionally, DOE may not 
prescribe an amended or new standard for any GSFL or IRL for which DOE 
has not established a test procedure. (42 U.S.C. 6295(o)(3)(A))
    EPCA also provides that in deciding whether such a standard is 
economically justified for covered products, DOE must, after receiving 
comments on the proposed standard, determine whether the benefits of 
the standard exceed its burdens 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 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 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 conservation; and
    (7) Other factors the Secretary considers relevant.

(42 U.S.C. 6295(o)(2)(B)(i))

    In addition under (42 U.S.C. 6295(o)(2)(B)(iii)), EPCA, as amended, 
establishes a rebuttable presumption that a standard for covered 
products 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, and as applicable, water, savings during the first 
year that the consumer will receive as a result of the standard, as 
calculated under the test procedure * * *'' in place for that standard.
    EPCA also contains what is commonly known as an ``anti-
backsliding'' provision. (42 U.S.C. 6295(o)(1)) This provision 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. EPCA further provides 
that the Secretary may not prescribe an amended or new standard if 
interested persons have established by a preponderance of the evidence 
that the standard is ``likely to result in the unavailability in the 
United States of any product type (or class) with 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))

[[Page 34086]]

    Section 325(q)(1) of EPCA sets forth additional requirements 
applicable to promulgating standards for any type or class of covered 
product that has two or more subcategories. (42 U.S.C. 6295(q)(1)) 
Under this provision, DOE must specify a different standard level than 
that which applies generally to such type or class of product ``for any 
group of covered products which have the same function or intended use, 
if * * * 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'' than applies or will 
apply to the other products. (42 U.S.C. 6295(q)(1)(A) and (B)) In 
determining whether a performance-related feature justifies such a 
different standard for a group of products, DOE must ``consider such 
factors as the utility to the consumer of such a feature'' and other 
factors DOE deems appropriate. (42 U.S.C. 6295(q)(1)) Any rule 
prescribing such a standard must include an explanation of the basis on 
which DOE established such higher or lower level. (42 U.S.C. 
6295(q)(2))
    Federal energy conservation requirements for covered products 
generally supersede State laws or regulations concerning energy 
conservation testing, labeling, and standards. (42 U.S.C. 6297(a)-(c)) 
DOE can, however, grant waivers of Federal preemption for particular 
State laws or regulations, in accordance with the procedures and other 
provisions of section 327(d) of EPCA. (42 U.S.C. 6297(d))

 B. Background

 1. Current Standards
    The energy conservation standards that EPCA prescribes for GSFL and 
IRL, and that are currently in force, set efficacy levels and color 
rendering index (CRI) levels for certain GSFL, and efficacy standards 
for certain IRL. (42 U.S.C. 6295(i)(1); 10 CFR 430.32(n)) These 
standard levels are set forth in Table I.3 and Table I.4 above.
2. History of Standards Rulemaking for General Service Fluorescent 
Lamps, Incandescent Reflector Lamps, and General Service Incandescent 
Lamps
    This rulemaking represents the first round of amendments to these 
GSFL and IRL standards, and it also addresses the adoption of standards 
for additional GSFL, as directed by 42 U.S.C. 6295(i)(3) and (5), 
respectively. Initially, this rulemaking also included consideration of 
energy conservation standards for general service incandescent lamps 
(GSIL). However, as explained in the April 2009 NOPR, amendments to 
EPCA in the Energy Independence and Security Act of 2007 \2\ (EISA 
2007) eliminated DOE's authority to regulate additional GSIL and 
statutorily prescribed standards for GSIL; therefore this rulemaking no 
longer addresses GSIL. 74 FR 16920, 16926 (April 13, 2009).
---------------------------------------------------------------------------

    \2\ Public Law 110-140 (enacted Dec. 19, 2007).
---------------------------------------------------------------------------

    DOE commenced this rulemaking on May 31, 2006, by publishing its 
framework document for the rulemaking, and by giving notice of a public 
meeting and of the availability of the document for review and public 
comment. 71 FR 30834 (May 31, 2006). The framework document described 
the procedural and analytical approaches DOE anticipated using and 
issues to be resolved in the rulemaking. DOE held a public meeting on 
June 15, 2006, to present the framework document, describe the analyses 
DOE planned to conduct during the rulemaking, obtain public comment on 
these subjects, and facilitate the public's involvement in the 
rulemaking. DOE also allowed the submission of written statements after 
the public meeting, and in response received 10 written statements.
    On February 21, 2008, DOE issued the March 2008 ANOPR in this 
proceeding. 73 FR 13620 (March 13, 2008). In the March 2008 ANOPR, DOE 
described and sought comment on the analytical framework, models, and 
tools that DOE was using to analyze the impacts of energy conservation 
standards for the two appliance products. In conjunction with issuance 
of the March 2008 ANOPR, DOE published on its Web site the complete 
ANOPR technical support document (TSD), which included the results of 
DOE's various preliminary analyses in this rulemaking. In the March 
2008 ANOPR, DOE requested oral and written comments on these results, 
and on a range of other issues. DOE held a public meeting in 
Washington, DC, on March 10, 2008, to present the methodology and 
results of the ANOPR analyses, and to receive oral comments from those 
who attended. In the March 2008 ANOPR, DOE invited comment in 
particular on the following issues: (1) Consideration of additional 
GSFL; (2) amended definitions; (3) product classes; (4) scaling to 
product classes not analyzed; (5) screening of design options; (6) lamp 
operating hours; (7) energy consumption of GSFL; (8) LCC calculation; 
(9) installation costs; (10) base-case market-share matrices; (11) 
shipment forecasts; (12) base-case and standards-case forecasted 
efficiencies; (13) trial standard levels; and (14) period for lamp 
production equipment conversion. 73 FR 13620, 13686-88 (March 13, 
2008). In addition, subsequent to the public meeting and the close of 
the ANOPR comment period, DOE and the National Electrical Manufacturers 
Association (NEMA) met on June 26, 2008 at NEMA's request to discuss 
appropriate standards for high correlated color temperature (CCT) 
fluorescent lamps. 74 FR 16920, 16926 (April 13, 2009). DOE addressed 
in detail the comments it received in response to the ANOPR, including 
NEMA's presentation at the June 2008 meeting, in the April 2009 NOPR.
    In the April 2009 NOPR, DOE proposed amended and new energy 
conservation standards for GSFL and IRL. In conjunction with the NOPR, 
DOE also published on its Web site the complete TSD for the proposed 
rule, which incorporated the final analyses DOE conducted and technical 
documentation for each analysis. The TSD included the engineering 
analysis spreadsheets, the LCC spreadsheet, the national impact 
analysis spreadsheet, and the MIA spreadsheet-all of which are 
available on DOE's Web site.\3\ The proposed standards were as shown in 
Table II.1 and Table II.2, as presented in the April 2009 NOPR. 74 FR 
16920, 17027 (April 13, 2009).
---------------------------------------------------------------------------

    \3\ The Web site address for all the spreadsheets developed for 
this rulemaking proceeding are available at: http://www1.eere.energy.gov/buildings/appliance_standards/residential/incandescent_lamps.html.

      Table II.1--Proposed GSFL Standard Levels in April 2009 NOPR
------------------------------------------------------------------------
                                      Correlated color   Proposed level
              Lamp type                  temperature         (lm/W)
------------------------------------------------------------------------
4-Foot Medium Bipin.................          <=4,500K                84
                                               >4,500K                78

[[Page 34087]]

 
2-Foot U-Shaped.....................          <=4,500K                78
                                               >4,500K                73
8-Foot Slimline.....................          <=4,500K                95
                                               >4,500K                91
8-Foot High Output..................          <=4,500K                88
                                               >4,500K                84
4-Foot Miniature Bipin Standard               <=4,500K               103
 Output.............................
                                               >4,500K                97
4-Foot Miniature Bipin High Output..          <=4,500K                89
                                               >4,500K               85
------------------------------------------------------------------------
* For these product classes, EPCA has different efficacy standards for
  lamps with wattages less than 35W and greater than or equal to 35W.


                              Table II.2--Proposed IRL Standards in April 2009 NOPR
----------------------------------------------------------------------------------------------------------------
                                                                     Diameter                     Proposed level
                            Lamp type                                (inches)         Voltage         (lm/W)
----------------------------------------------------------------------------------------------------------------
Standard Spectrum 40W-205W......................................            >2.5           <=125     7.1P \0.27\
                                                                                            <125     6.2P \0.27\
                                                                           <=2.5           >=125     6.3P \0.27\
                                                                                            <125     5.5P \0.27\
Modified Spectrum 40W-205W......................................            >2.5           >=125     5.8P \0.27\
                                                                                            <125     5.0P \0.27\
                                                                           <=2.5           >=125     5.1P \0.27\
                                                                                            <125     4.4P \0.27\
----------------------------------------------------------------------------------------------------------------
Note: P is equal to the rated lamp wattage, in watts.

    DOE held a public meeting in Washington, DC, on February 3, 2009, 
to hear oral comments on and solicit information relevant to the 
proposed rule. At the public meeting and in the April 2009 NOPR, DOE 
invited comment in particular on the following issues: (1) The scope of 
covered products; (2) the amended definition of ``colored fluorescent 
lamp''; (3) product classes for IRL; (4) product classes for T5 lamps; 
(5) the 4-foot MBP residential engineering analysis; (6) performance 
characteristics of model lamps used in the engineering analysis; (7) 
the efficacy levels for IRL; (8) the efficacy levels for GSFL; (9) 
scaling to product classes not analyzed; (10) ballast operating hours 
in all sectors and GSFL operating hours in the residential sector; (11) 
growth rates and market penetration in the shipments analysis; (12) 
base-case and standards-case market-share matrices; (13) the 
manufacturer impact analysis; (14) the determination of environmental 
impacts; (15) the selected trial standard levels; (16) the proposed 
standard levels; (17) alternative scenarios to achieve greater energy 
savings for GSFL; (18) other technology pathways to meet IRL TSL5. 74 
FR 16920, 17025-26 (April 13, 2009). The April 2009 NOPR also included 
additional background information on the history of this rulemaking. 74 
FR 16920, 16925-26 (April 13, 2009).

III. Issues Affecting the Scope of This Rulemaking

A. Additional General Service Fluorescent Lamps for Which DOE Is 
Adopting Standards

1. Scope of EPCA Requirement That DOE Consider Standards for Additional 
Lamps
    As discussed above, EPCA established energy conservation standards 
for certain general service fluorescent lamps (42 U.S.C. 6295(i)(1)) 
and directed the Secretary to ``initiate a rulemaking procedure to 
determine if the standards in effect for fluorescent lamps * * * should 
be amended so that they would be applicable to additional general 
service fluorescent [lamps] * * *.'' (42 U.S.C. 6295(i)(5)) Thus, EPCA 
directs DOE to consider whether to adopt energy efficacy standards for 
additional GSFL beyond those already covered by standards prescribed in 
the statute.
    However, as set forth in greater detail in the March 2008 ANOPR and 
the April 2009 NOPR, although many GSFL not currently subject to 
standards are potential candidates for coverage, it could be argued 
that EPCA's definitions of ``general service fluorescent lamp'' and 
``fluorescent lamp'' conflict with (and negate) the requirement of 42 
U.S.C. 6295(i)(5) that DOE consider standards for additional GSFL. 73 
FR 13620, 13628-29 (March 13, 2008); 74 FR 16920, 16920, 16926-27 
(April 13, 2009). Specifically, EPCA defines ``general service 
fluorescent lamp'' as ``fluorescent lamps'' that can satisfy the 
majority of fluorescent lamp applications and that are not designed and 
marketed for certain specified, nongeneral lighting applications. (42 
U.S.C. 6291(30)(B)) Furthermore, EPCA defines ``fluorescent lamp'' as 
``a low pressure mercury electric-discharge source in which a 
fluorescing coating transforms some of the ultraviolet energy generated 
by the mercury discharge into light,'' and as including ``only'' the 
four enumerated types of fluorescent lamps for which EPCA already 
prescribes standards. (42 U.S.C. 6291(30)(A); 42 U.S.C. 6295(i)(1)(B)) 
Thus, to construe ``general service fluorescent lamp'' in 42 U.S.C. 
6295(i)(5) as being limited by all elements of the EPCA definition of 
``fluorescent lamp,'' would mean there are no GSFL that are not already 
subject to standards, and hence, there would be no ``additional'' GSFL 
for which DOE could consider standards. Such an interpretation would 
conflict with the directive in 42 U.S.C. 6295(i)(5) that DOE consider 
standards for ``additional'' GSFL, thereby rendering that provision a 
nullity.
    For the reasons below, DOE has concluded that the term ``additional 
general service fluorescent lamps'' in 42 U.S.C. 6295(i)(5) should be 
construed as

[[Page 34088]]

not being limited to the four enumerated lamp types specified in the 
EPCA definition of ``fluorescent lamp,'' thereby giving effect to the 
directive in 42 U.S.C. 6295(i)(5) that DOE consider standards for 
additional GSFL. First, DOE added this directive to EPCA at the same 
time it added the definitions for ``general service fluorescent lamps'' 
and ``fluorescent lamps,'' as part of the Energy Policy Act of 1992 
(EPACT 1992; Pub. L. 102-486). DOE does not believe Congress would 
intentionally insert a legislative provision that, when read in 
conjunction with simultaneously added definitions, amounts to a 
nullity. Second, reading the definition of ``fluorescent lamp'' to 
preclude consideration of standards for additional GSFL would run 
counter to the energy-saving purposes of EPCA. It is reasonable to 
assume that, when Congress incorporated this directive into EPCA, it 
sought to have DOE consider whether standards would be warranted for 
generally available products for which EPCA did not prescribe 
standards. Also, it is assumed that Congress would not have intended 
for DOE to limit itself to consideration of energy conservation 
standards only for those products utilizing technologies available in 
1992, but instead, it would seek to cast a broader net that would 
achieve energy efficiency improvements in lighting products 
incorporating newer technologies.
    In addition, DOE understands that the industry routinely refers to 
``fluorescent lamps'' as including products in addition to the four 
enumerated in the statutory definition of that term. In fact, in the 
March 2008 ANOPR, DOE presented its plan for including additional GSFL 
for coverage, and DOE did not receive adverse comment. 73 FR 13620, 
13628-29 (March 13, 2008)
    For these reasons, and as further explained in the March 2008 
ANOPR, 73 FR 13620, 13629 (March 13, 2008), and in the April 2009 NOPR, 
74 FR 16920, 16926-27 (April 13, 2009), DOE has concluded that, in 
addressing general service fluorescent lamps in 42 U.S.C. 6295(i)(5), 
Congress intended to refer to ``fluorescent lamps'' in a broader, more 
generic sense than as expressed in the EPCA definition for that term. 
Consequently, as set forth in the April 2009 NOPR, 74 FR 16920, 16927 
(April 13, 2009), DOE views ``additional'' GSFL, as that term is used 
in 42 U.S.C. 6295(i)(5), as lamps that: (1) Meet the technical portion 
of the statutory definition of ``fluorescent lamp'' (i.e., a low-
pressure mercury electric-discharge source in which a fluorescing 
coating transforms some of the ultraviolet energy generated by the 
mercury discharge into light) (42 U.S.C. 6291(30)(A)) without 
restriction to the four lamp types specified in that definition; (2) 
can be used to satisfy the majority of fluorescent lighting 
applications (42 U.S.C. 6291(30)(B)); (3) are not within the exclusions 
from the definition of GSFL specified in 42 U.S.C. 6291(30)(B); and (4) 
are ones for which EPCA does not prescribe standards. Such an 
interpretation does not alter the existing statutory provision or 
standards for ``fluorescent lamps,'' but it does permit DOE to give 
effect to section 6295(i)(5) of EPCA by adopting energy conservation 
standards for a wide variety of GSFL that are not currently covered by 
standards. DOE notes that it received no adverse comments on this 
interpretation in response to the April 2009 NOPR.
2. Determination of the Additional Lamps to Which Standards Will Apply
    To determine the additional GSFL to which energy conservation 
standards should apply, DOE first comprehensively reviewed the 
fluorescent lighting market and identified the following types of lamps 
as ``additional'' GSFL for consideration pursuant to 42 U.S.C. 6295 
(i)(5), based on the four criteria above:
     4-foot, medium bipin (MBP), straight-shaped lamps, rated 
wattage of less than 28W;
     2-foot, medium bipin, U-shaped lamps, rated wattage of 
less than 28W;
     8-foot, recessed double contact (RDC), rapid start, high-
output (HO) lamps not defined in ANSI Standard C78.1-1991 \4\ or with 
current other than 0.800 nominal amperes;
---------------------------------------------------------------------------

    \4\ Titled ``for Fluorescent Lamps--Rapid-Start Types--
Dimensional and Electrical Characteristics.''
---------------------------------------------------------------------------

     8-foot single pin (SP), instant start, slimline lamps with 
a rated wattage greater than or equal to 52, not defined in ANSI 
Standard C78.3-1991; \5\
---------------------------------------------------------------------------

    \5\ Titled ``for Fluorescent Lamps--Instant-Start and Cold-
Cathode Types--Dimensional and Electrical Characteristics''
---------------------------------------------------------------------------

     Very high output (VHO) straight-shaped lamps;
     T5 \6\ miniature bipin (miniBP) straight-shaped lamps;
---------------------------------------------------------------------------

    \6\ T5, T8, T10, and T12 are nomenclature used to refer to 
tubular fluorescent lamps with diameters of 0.625, 1, 1.25, and 1.5 
inches respectively.
---------------------------------------------------------------------------

     Additional straight-shaped and U-shaped lamps other than 
those listed above (e.g., alternate lengths, diameters, or bases); and
     Additional fluorescent lamps with alternate shapes (e.g., 
circline lamps and pin-based compact fluorescent lamps (CFL)).

73 FR 13620, 13630 (March 13, 2008); 74 FR 16920, 16927-28 (April 13, 
2009).

    For each of these categories of GSFL, DOE assessed whether 
standards had the potential to result in energy savings. For each 
category for which it appeared that standards could save significant 
amounts of energy, DOE then performed a preliminary analysis of whether 
potential standards appeared to be technologically feasible and 
economically justified. Finally, for GSFL that met that test, DOE did 
an in-depth analysis of whether, and at what levels, standards would be 
warranted under the EPCA criteria in 42 U.S.C. 6295(o), pertaining to 
energy savings, technological feasibility, economic justification, and 
certain other factors. Based on this analysis, as summarized in the 
April 2009 NOPR, DOE proposed to cover the following additional GSFL:
     2-foot, medium bipin U-shaped lamps with a rated wattage 
greater than or equal to 25 and less than 28;
     4-foot, medium bipin lamps with a rated wattage greater 
than or equal to 25 and less than 28;
     4-foot T5, miniature bipin, straight-shaped, standard 
output lamps with rated wattage greater than or equal to 26;
     4-foot T5, miniature bipin, straight-shaped, high output 
lamps with rated wattage >=51;
     8-foot recessed double contact, rapid start, HO lamps 
other than those defined in ANSI Standard C78.1-1991;
     8-foot recessed double contact, rapid start, HO lamps 
(other than 0.800 nominal amperes) defined in ANSI Standard C78.1-1991; 
and
     8-foot single pin instant start slimline lamps, with a 
rated wattage greater than or equal to 52, not defined in ANSI Standard 
C78.3-1991

74 FR 16920, 16930 (April 13, 2009).

    DOE received several comments regarding the additional GSFL 
proposed for coverage. In terms of methodology, the Green Lighting 
Campaign questioned the criteria DOE used in determining whether to 
include additional fluorescent lamps in coverage. Specifically, the 
Green Lighting Campaign argued that just because a product is low-
volume, and, therefore, does not represent significant energy savings, 
does not indicate that it should not be subject to standards. According 
to the commenter, many low-volume products are some of the least-
efficient products on the market. (Green Lighting Campaign, No. 74 at 
p. 3)
    In response, as described in more detail for each lamp described 
below for which coverage was not extended, DOE concluded that coverage 
was inappropriate given the small market share of these lamps. DOE 
emphasizes that it will vigilantly monitor the market

[[Page 34089]]

shares and other relevant information for these lamps and consider 
whether to extend coverage in a future rulemaking.
    NEMA and EEI agreed with the scope of coverage proposed in the 
April 2009 NOPR. (NEMA, Public Meeting Transcript, No. 38.4 at p. 43; 
EEI, No. 45 at p. 3) However, the Green Lighting Campaign disagreed 
with DOE's proposed scope of coverage, expressing concern that DOE's 
proposed standards in the April 2009 NOPR would allow a significant 
amount of outdated lighting equipment to be sold in the U.S. even 
though more efficient replacement technologies exist. Specifically, the 
Green Lighting Campaign requested that two-pin compact fluorescent 
lamps, high-intensity discharge (HID) lamps, ballasts, luminaires, and 
fluorescent lamps of other shapes and sizes be included in coverage. 
(Green Lighting Campaign, No. 74 at pp. 1-4)
    In response, DOE considered two-pin compact fluorescent lamps and 
fluorescent lamps of other shapes and sizes for coverage but concluded 
that they did not meet the statutory criteria defined by EPCA, because 
these lamps represent relatively small market shares and do not possess 
the ability to serve as substitutes for most covered GSFL. See section 
III.A.2.g for more details. Additionally, this rulemaking only amends 
standards for GSFL and IRL, as described in section III. DOE is 
addressing standards for ballasts and HID lamps in separate 
rulemakings, and DOE currently does not have the authority to set 
energy conservation standards for luminaires. Please consult the Web 
site of DOE's Appliances and Commercial Equipment Standards Program for 
further detail.\7\
---------------------------------------------------------------------------

    \7\ Available at: http://www1.eere.energy.gov/buildings/appliance_standards/index.html.
---------------------------------------------------------------------------

    Earthjustice and the Green Lighting Campaign disagreed with DOE's 
proposed covered wattage ranges. In the April 2009 NOPR, DOE determined 
the wattage range for covered products based on commercially-available 
products. 74 FR 16920, 16929-30 (April 13, 2009). This approach allowed 
DOE to confirm that an energy conservation standard would be 
technologically feasible and economically justified for any covered 
product. In comments on the March 2008 ANOPR, stakeholders stated that 
instead of determining a covered wattage range based on commercially-
available products, DOE should substantially lower covered wattage 
ranges and use narrowly-drawn exemptions for those products that did 
not meet the EPCA criteria for inclusion as a covered product. 74 FR 
16920, 16929-30 (April 13, 2009). The stakeholders believed that this 
approach ensured that energy conservation standards would achieve 
largest potential energy savings. DOE responded in the April 2009 NOPR 
and agreed that current covered wattage ranges should be extended when 
commercially-available product exists, but disagreed that they should 
be extended when no products are available. DOE is required to consider 
energy conservation standards that are technologically feasible. If a 
lower wattage lamp does not yet exist, DOE cannot confirm that it would 
be technologically feasible or economically justified for such a lamp 
to meet a set energy conservation standard. Furthermore, DOE encourages 
the introduction of lamps at lower wattages. Thus, DOE decided to only 
lower the wattage range of a covered product if a commercially 
available product existed at a lower wattage. 74 FR 16920, 16929-30 
(April 13, 2009).
    In commenting on the April 2009 NOPR, Earthjustice again disagreed 
with DOE's approach and urged DOE to be proactive in extending the 
standards' covered wattage range so as to eliminate potential 
loopholes. Earthjustice argued that DOE should cover all wattages of 
the designated product classes that are lower than the existing covered 
wattage range unless DOE can prove that standards are not 
technologically feasible or economically justified. In not doing so, 
Earthjustice claims DOE is not meeting its obligations under EPCA to 
consider standards for all GSFL, including those that do not currently 
exist, but might be popular at the time the standard takes effect. 
(Earthjustice, No. 60 at p. 4) The Green Lighting Campaign asserted 
that the covered wattage ranges proposed in the April 2009 NOPR ``seem 
arbitrary and unjustified,'' commenting that the European Union's (EU) 
energy efficiency standards for lighting cover a much larger range of 
rated wattages. (Green Lighting Campaign, No. 74 at pp. 2-3)
    In seeking to advance the energy-saving goals of EPCA, DOE 
understands stakeholders' concerns that new products may emerge that 
are outside of the covered wattage range. However, in setting up the 
statutory structure, Congress was very careful to ensure that any 
standards set would be based upon the best available data, particularly 
in terms of what standards would be technologically feasible and 
economically justified. Furthermore, given the anti-backsliding 
provision of 42 U.S.C. 6295(o)(1), DOE must exercise great care so as 
to set an appropriate standard in the first instance. Contrary to 
EPCA's direction that DOE set standards for products that the data show 
to be technologically feasible and economically justified, Earthjustice 
would have DOE broaden coverage without data, unless DOE can prove a 
negative (i.e., that such standards are not economically feasible and 
economically justified). DOE concludes that such an approach would 
violate the statute. Accordingly, DOE maintains that it is 
inappropriate to lower the covered wattage range to include products 
that do not exist. Without knowing the performance characteristics of a 
lamp, DOE cannot know how energy conservation standards will affect it. 
It is not possible for DOE to set standards for lower-wattage lamps 
that currently do not exist because DOE cannot prove that standards for 
such lamps are technologically feasible and economically justified. 
Therefore, DOE maintains the covered wattage range proposed in the 
April 2009 NOPR in this final rule. It is further noted that if low-
wattage products do subsequently enter the market, DOE would address 
the appropriateness of energy conservation standards for such products 
in considering periodic amendments to the GSFL and IRL standards 
pursuant to 42 U.S.C. 6295(m).
    In response to comments on the EU's lighting efficiency standards, 
DOE notes that these standards are not directly comparable, because 
they are applied to a larger scope of products than what is covered in 
this rulemaking. Thus, the cited EU standards encompass a broader range 
of covered wattages (i.e., include lower wattage levels) than those 
proposed by DOE, because the EU standard covers lamps with shorter 
lengths.
    ACEEE and the CA Stakeholders suggested that DOE should lower the 
wattage range of covered products by one watt in order to account for 
imprecision in how lamps are rated. (ACEEE, Public Meeting Transcript, 
No. 38.4 at p. 44-45; CA Stakeholders, No. 63 at p. 11) ACEEE argued 
that because a lamp's rated wattage and its ``actual'' wattage often 
differ, lowering the wattage range would prevent manufacturers from 
circumventing standards by rating lamps at artificially low wattages. 
For example, a manufacturer could rerate a 25 watt lamp as a 24 watt 
lamp, which would then not be covered by standards.
    While DOE understands the stakeholders' concerns, DOE believes that 
the definition of ``rated wattage'' sufficiently addresses the issue of 
potential circumvention. As discussed in further detail in section 
III.C.1 below,

[[Page 34090]]

for lamps currently commercially-available and listed in ANSI C78.81-
2005 or ANSI C78.901-2005, ``rated wattage'' (as defined in amended 10 
CFR 430.2) is specified for each lamp on its corresponding datasheet in 
the same industry standard. Therefore, for these lamps, manufacturers 
may not arbitrarily lower the rated wattage of lamps listed in the ANSI 
standards. However, due to the emergence of new products on the market 
after publication of the ANSI standards, not all currently 
commercially-available lamps are listed in ANSI C78.81-2005 or ANSI 
C78.901-2005. For lamps not listed in either standard, the rated 
wattage corresponds to the wattage measured when operating the lamp on 
an appropriate ballast, as specified by part 1(iii) of the revised 
definition of ``rated wattage.'' In such a case, the ``actual'' wattage 
would be equivalent to the rated wattage, thereby preventing 
circumvention of the standard. Thus, for all covered lamps, DOE 
believes that the definition of ``rated wattage'' adopted in this final 
rule prevents manufacturers from artificially raising or lowering the 
rated wattage of a lamp, thereby addressing any potential loopholes.
    The following sections discuss each additional GSFL category DOE 
considered throughout this rulemaking and summarize the analysis 
performed to determine to which lamps DOE should extend coverage.
a. Four-Foot Medium Bipin Lamps
    DOE found that there are no 4-foot medium bipin lamps with a rated 
wattage below 25W currently on the market, but that manufacturers do 
market and sell 25W 4-foot medium bipin T8 fluorescent lamps as 
replacements for higher-wattage 4-foot bipin T8 lamps. Thus, DOE 
initially concluded that standards for these lamps that are 25W or 
higher, but less than 28W, would mitigate the risk of unregulated 25W 
lamps becoming a loophole, and would maximize potential energy savings. 
In addition, because the technology and incremental costs associated 
with increased efficacy of 25W lamps are similar to their already 
regulated 28W counterparts, DOE tentatively concluded that standards 
for these lamps would be technologically feasible and economically 
justified. 73 FR 13620, 13630 (March 13, 2008) and 74 FR 16920, 16928 
(April 13, 2009). As explained in the April 2009 NOPR and as set forth 
below in section VII, DOE has now determined that standards for 4-foot 
medium bipin lamps with a rated wattage at or above 25W, and below 28W, 
would save significant amounts of energy and are technologically 
feasible and economically justified, and includes such standards in 
today's rule. DOE has not, however, pursued standards for 4-foot medium 
bipin lamps with a rated wattage below 25W. The lack of existence of 
such lamps precludes DOE from assessing whether standards for them are 
technologically feasible and economically justified, and the inability 
to make such an assessment could also result in the adoption of 
standards that would reduce the utility of such a product or even 
preclude its development. 74 FR 16920, 16929-30 (April 13, 2009). 
Therefore, in this final rule, DOE extends coverage to 4-foot medium 
bipin lamps with a rated wattage greater than or equal to 25W and less 
than 28W.
b. Two-Foot Medium Bipin, U-Shaped Lamps
    DOE initially decided not to consider standards for 2-foot U-shaped 
lamps less than 28W, based on its understanding that no such products 
are commercially available. NEMA provided information, however, that 
such lamps have been introduced at 25W. Therefore, consistent with its 
approach just described for 4-foot medium bipin lamps, DOE evaluated 
for standards 2-foot U-shaped lamps of 25W or more, but less than 28W. 
74 FR 16920, 16929-30 (April 13, 2009). As set forth below in section 
VII, DOE has now determined that standards for these lamps would save 
significant amounts of energy and are technologically feasible and 
economically justified, and includes such standards in today's rule. In 
addition, DOE has not pursued standards for 2-foot U-shaped lamps with 
a rated wattage below 25W, for the same reasons that it has declined to 
pursue standards for 4-foot medium bipin lamps with a rated wattage 
below 25W. Therefore, in this final rule, DOE extends coverage to 2-
foot U-shaped lamps with a rated wattage greater than or equal to 25W 
and less than 28W.
c. Eight-Foot Recessed, Double-Contact Lamps
    As indicated above, DOE examined 8-foot recessed double-contact 
(RDC) rapid-start HO lamps, including those not defined in ANSI 
Standard C78.1-1991 as well as those defined in ANSI Standard C78.1-
1991, but with other than 0.800 nominal amperes. These are T8 8-foot 
lamps, and neither is currently subject to standards. DOE concluded 
that these lamps serve or could serve as substitutes for GSFL currently 
subject to standards, and, therefore, coverage of these lamps would 
maximize energy savings from standards. DOE also tentatively concluded 
that energy conservation standards for these T8 lamps would be: (1) 
Technologically feasible because they use technologies similar to the 
technologies used by their already-regulated T12 counterparts; and (2) 
economically justified because preliminary analysis indicated such 
standards would result in substantial economic savings. 73 FR 13620, 
13630-31 (March 13, 2008) and 74 FR 16920, 16928 (April 13, 2009). As 
set forth below in section VII, DOE has now determined that standards 
for these lamps would save significant amounts of energy and are 
technologically feasible and economically justified, and includes such 
standards in today's rule. Therefore, in this final rule, DOE extends 
coverage to the following 8-foot recessed double contact, rapid start, 
HO lamps: (1) Ones other than those defined in ANSI Standard C78.1-
1991; and (2) those defined in ANSI Standard C78.1-1991 with other than 
0.800 nominal amperes.
d. Eight-Foot Single Pin Slimline Lamps
    As with 8-foot recessed double contact, rapid start, HO lamps, DOE 
concluded that 8-foot, single pin, instant start, slimline lamps not 
included in ANSI Standard C78.3-1991, with a rated wattage greater than 
or equal to 52W, could serve as substitutes for GSFL currently subject 
to standards. Therefore, DOE tentatively concluded that regulation of 
these lamps has the potential to achieve substantial energy savings. 
DOE's preliminary analysis also indicated that energy conservation 
standards for these 8-foot single pin lamps would be: (1) 
Technologically feasible because they use technologies similar to the 
technologies used by their already-regulated T12 counterparts; and (2) 
economically justified because preliminary analysis indicated such 
standards would result in substantial economic savings. 73 FR 13620, 
13631-32 (March 13, 2008) and 74 FR 16920, 16929 (April 13, 2009). As 
set forth below in section VII, DOE has now determined that standards 
for these lamps would save significant amounts of energy and are 
technologically feasible and economically justified, and includes such 
standards in today's rule. Therefore, in this final rule, DOE extends 
coverage to 8-foot single pin instant start slimline lamps, with a 
rated wattage greater than or equal to 52W that are not defined in ANSI 
Standard C78.3-1991.
e. Very High Output Straight-Shaped Lamps
    Although individual VHO T12 lamps consume relatively large amounts 
of

[[Page 34091]]

energy, they are commonly used in outdoor applications where high-
intensity discharge (HID) lamps are rapidly gaining market share, and 
shipments of VHO lamps are declining rapidly. Therefore, the total 
energy savings that would result from standards for these lamps would 
be small and would likely decrease over time. In response to the April 
2009 NOPR, DOE received no adverse comment regarding its decision to 
not cover VHO lamps. Accordingly, DOE has not pursued standards for VHO 
lamps and does not extend them coverage in this final rule. 73 FR 
13620, 13632 (March 13, 2008) and 74 FR 16920, 16928 (April 13, 2009). 
As emphasized above, DOE will vigilantly monitor the market shares and 
other relevant information for these lamps and consider whether to 
extend coverage in a future rulemaking.
f. T5 Lamps
    DOE initially decided not to consider standards for T5 lamps 
because it believed that standards for these lamps would have limited 
potential to result in energy savings. First, these lamps have a 
relatively small market share. Second, although T5 lamps can substitute 
for T8 or T12 lamps, T5 lamps tend to have higher efficacies than T8s 
or T12s. Therefore, DOE inferred that a lack of standards for T5 lamps 
would be unlikely to undermine energy savings resulting from a T12 and 
T8 standard, even if the standard caused increased sales of T5 systems. 
73 FR 13620, 13632 (March 13, 2008).
    However, after receiving comments on this issue in response to the 
March 2008 ANOPR, including comments advocating energy conservation 
standards for T5 lamps, DOE decided it should reconsider whether such 
standards are warranted. Specifically, DOE concluded that, absent 
standards for T5 lamps, less-efficient T5 lamps could enter the market 
and be substituted for T8 and T12 lamps that are subject to standards. 
Thus, a lack of standards for T5 lamps could potentially reduce the 
energy savings that could result from the standards for T8 and T12 
lamps. Accordingly, in the NOPR, DOE tentatively concluded that 
regulation of T5 lamps has the potential to achieve substantial energy 
savings. Furthermore, DOE research indicated that: (1) The primary 
driver of T5 market share growth is substitution for currently 
regulated 4-foot MBP lamps; (2) standard-output (approximately 28W) and 
high-output (approximately 54W) lamps are the highest volume T5 
miniature bipin lamps; and (3) reduced-wattage versions of these lamps 
(26W and 51W, respectively) are available. Therefore, DOE evaluated for 
standards 4-foot nominal, straight-shaped, T5 miniature bipin standard 
output lamps with rated wattages >=26W and 4-foot nominal, straight-
shaped, T5 miniature bipin high output lamps with rated wattages >=51W, 
as they present the greatest potential for energy savings. DOE also 
tentatively concluded that energy conservation standards for these T5 
lamps would be: (1) Technologically feasible because higher-efficacy 
versions of some of these lamps are already present in the market; and 
(2) economically justified because preliminary analysis indicated such 
standards would result in substantial economic savings. 74 FR 16920, 
16929 (April 13, 2009). Both NEMA and ACEEE supported the extension of 
coverage to T5 lamps. (NEMA, Public Meeting Transcript, No. 38.4 at p. 
43; ACEEE, Public Meeting Transcript, No. 38.4 at p. 44; NEMA, No. 81 
at p. 7)
    Since the publication of the NOPR, DOE has learned that a 49W T5 
miniature bipin high-output lamp has been introduced to the market. As 
this lamp is very similar to a 51W T5 miniature bipin high-output lamp, 
DOE concludes that standards for these lamps would be technologically 
feasible and economically justified for the reasons listed above. 
Therefore, as set forth in more detail in section VII, DOE has 
determined that standards for T5 lamps would save significant amounts 
of energy and are technologically feasible and economically justified. 
Thus, in this final rule, DOE extends coverage to 4-foot T5, miniature 
bipin, straight-shaped, standard output lamps with rated wattage 
greater than or equal to 26W and 4-foot T5, miniature bipin, straight-
shaped, high output lamps with rated wattage greater than or equal to 
49W.
g. Various Other Fluorescent Lamps
    In addition to the GSFL already covered by standards and those just 
discussed, there exist straight-shaped and U-shaped fluorescent lamps 
that have, for example, alternate lengths, diameters, or bases, as well 
as fluorescent lamps with alternative shapes (e.g., circline lamps and 
pin-based compact fluorescent lamps (CFL)). In this rulemaking, DOE has 
not pursued standards for these additional fluorescent lamps. The GSFL 
already covered and those DOE included in this rulemaking represent a 
significant majority of the GSFL market, and, thus, the bulk of the 
potential energy savings from amended or new standards. Furthermore, 
there is limited potential for lamps with miscellaneous lengths and 
bases to grow in market share, given the constraints of fixture lengths 
and socket compatibility. 73 FR 13620, 13632 (March 13, 2008) and 74 FR 
16920, 16928 (April 13, 2009). Given the relatively low shipments and 
limited potential for growth in shipments, DOE does not extend coverage 
to GSFL with alternate lengths, diameters, bases, or shapes. DOE again 
emphasizes that it will vigilantly monitor the market shares and other 
relevant information for these lamps and consider whether to extend 
coverage in a future rulemaking.
    Magnaray, a luminaire manufacturer, commented that the amended 
standards should not eliminate existing ``twin T5'' fluorescent lamps 
from the market. Magnaray stated that ``twin T5'' lamps have 
demonstrated significant energy savings relative to their replacements. 
The luminaire manufacturer further requested that DOE recommend these 
lamps for use in all outdoor lighting applications. (Magnaray, No. 58 
at p. 1) DOE research indicates that ``twin T5'' lamps are actually 
high-lumen-output single-ended twin-tube T5 pin-based CFL. In general, 
these lamps are offered with wattages between 18W and 80W, CCTs between 
3000K and 5000K, lengths between 9 and 22.6 inches, and CRIs of 82. As 
discussed above, based on their relatively low market-share and the low 
potential energy savings associated with their regulation, DOE is not 
extending coverage to pin-based CFL. DOE reiterates that it will 
vigilantly monitor the market shares and other relevant information for 
these lamps and consider whether to extend coverage in a future 
rulemaking. In addition, it should be noted that DOE does not endorse 
particular products or recommend that consumers adopt particular 
technologies in the energy conservation standards rulemaking.
3. Summary of GSFL for Which DOE Has Adopted Standards
    DOE has determined that energy conservation standards are 
technologically feasible and economically justified, and would result 
in significant energy savings, for all of the ``additional'' GSFL for 
which DOE proposed standards in the April 2009 NOPR. Therefore, DOE is 
adopting standards today for the following additional GSFL:
     2-foot, medium bipin U-shaped lamps with a rated wattage 
greater than or equal to 25 and less than 28;
     4-foot, medium bipin lamps with a rated wattage greater 
than or equal to 25 and less than 28;
     4-foot T5, miniature bipin, straight-shaped, standard 
output lamps with rated wattage greater than or equal to 26;

[[Page 34092]]

     4-foot T5, miniature bipin, straight-shaped, high output 
lamps with rated wattage greater than or equal to 49;
     8-foot recessed double contact, rapid start, HO lamps 
other than those defined in ANSI Standard C78.1-1991;
     8-foot recessed double contact, rapid start, HO lamps 
(other than 0.800 nominal amperes) defined in ANSI Standard C78.1-1991; 
and
     8-foot single pin instant start slimline lamps, with a 
rated wattage greater than or equal to 52, not defined in ANSI Standard 
C78.3-1991.

B. Incandescent Reflector Lamp Scope of Coverage

    The April 2009 NOPR proposed amended energy conservations standards 
for incandescent reflector lamps with a rated wattage from 40W to 205W, 
other than those exempted from standards under 42 U.S.C. 6295(i)(1)(C). 
74 FR 16920, 16924-25, 16930-31, 17017-18 (April 13, 2009) In response 
to the April 2009 NOPR, DOE received several comments regarding the 
proposed incandescent reflector lamp scope coverage. These comments are 
discussed below.
1. Covered Wattage Range
    In response to the April 2009 NOPR, the Edison Electric Institute 
(EEI) expressed concern that the scope of coverage for IRL is too 
limited, specifically with regard to the proposed covered wattage range 
(i.e., 40W-205W). EEI suggested that manufacturers could easily produce 
lamps at 39W or 206W to circumvent energy conservation standards. 
Because IRL exist in the market at wattages as low as 35W and as high 
as 500W, EEI recommended that the covered wattage range for IRL be 
extended to include lamps as low as 20W and as high as 505W. (EEI, No. 
45 at p. 2)
    In amending energy conservation standards for IRL, DOE is limited 
to the definition prescribed by EISA 2007, which defines IRL as a lamp 
that ``has a rated wattage that is 40 watts or higher.'' (42 U.S.C. 
6291(30)(C), (C)(ii), and (F)) Given this definition, DOE does not have 
the authority to decrease the lower wattage limit of covered IRL below 
40W. DOE does, however, have the authority to alter the upper limit of 
the wattage range for covered IRL. In response to EEI's comment, DOE 
analyzed commercially-available product in manufacturer catalogs to 
assess the prevalence of products with wattages greater than 205W. 
Based on this research, DOE believes that IRL with rated wattages 
greater than 205W comprise a very small portion of the market and, 
therefore, do not represent substantial potential energy savings. For 
these reasons, DOE has decided, in this final rule, to adopt standards 
for IRL with a rated wattage greater than or equal to 40W and less than 
or equal to 205W.
2. Exempted Incandescent Reflector Lamps
    As discussed in more detail in the April 2009 NOPR, 74 FR 16920, 
16930 (April 13, 2009), section 332(b) of EISA 2007 amended EPCA to 
expand its definition of ``incandescent reflector lamp'' to include 
lamps with a diameter between 2.25 and 2.75 inches, as well as ER, BR, 
BPAR, or similar bulb shapes (42 U.S.C. 6291(30)(C)(ii)) and also to 
exempt certain of these lamps from EPCA's standards for IRL (42 U.S.C. 
6295(i)(1)(C)). As discussed in section II.B.2, DOE issued and posted 
on its Web site the January 2009 NOPR in which DOE adhered to its 
conclusion that these exemptions, read in conjunction with other 
language in 42 U.S.C. 6295(i)(1)(C) and 42 U.S.C. 6295(i)(3), precluded 
DOE from adopting energy conservation standards for lamps covered by 
the exemptions. DOE subsequently held a public meeting where 
stakeholders commented on the contents of the January 2009 NOPR.
    At the February 3, 2009 NOPR public meeting, NEMA stated its 
agreement with DOE's interpretation of the statute regarding the 
exempted IRL. (NEMA, Public Meeting Transcript, No. 38.4 at p. 323) 
However, stakeholders presented comments disagreeing with DOE's 
conclusion and urging DOE to set standards for the exempted lamps. 
Several commenters stated that exempted lamps comprise a substantial 
portion of the market and, therefore, represent significant potential 
energy savings. (ASAP, Public Meeting Transcript, No. 38.4 at p. 27-28; 
EEI, No. 45 at p. 3; Woolsey, No. 46 at p. 1) Furthermore, ASAP argued 
that DOE's interpretation that these lamps are exempt from DOE 
regulation, does not accurately reflect what Congress intended when 
making these lamps covered products in EISA 2007. According to the 
commenter, because States are preempted from setting standards for 
covered products, these exempted IRL would remain beyond the reach of 
any energy conservation standards. Several stakeholders urged DOE to 
draft and publish a supplementary NOPR to address the exempted ER and 
BR lamps. (ASAP, Public Meeting Transcript, No. 38.4 at pp. 33, 52-53, 
322-323; Woolsey, No. 46 at p. 2)
    After carefully considering the testimony of the February 3, 2009 
NOPR public meeting and reexamining the ANOPR public comments on this 
issue, DOE has reexamined its authority under EPCA to amend standards 
for ER, BR, and small-diameter lamps and concluded that its earlier 
view may have been in error. As discussed in more detail in the April 
2009 NOPR, DOE is reconsidering whether, under 42 U.S.C 6295(i)(3), the 
directive to amend the standards in paragraph (1) encompasses both the 
statutory levels and the exemptions to those standards. Regardless of 
the outcome of that decision, DOE has not considered such lamps as part 
of the present rulemaking because it had not conducted the requisite 
analyses to adopt appropriate standard levels. At the same time, DOE 
did not wish to delay the present rulemaking (and the accompanying 
energy savings to the Nation) for the sole reason of considering this 
subset of ER, BR, and small-diameter lamps. Therefore, as explained in 
the April 2009 NOPR, DOE has decided to proceed with setting energy 
conservation standards for the lamps that are the subject of the 
present rulemaking and to commence a separate rulemaking for ER, BR, 
and small-diameter lamps. 74 FR 16920, 16930-31 (April 13, 2009).
    Following the publication of the April 2009 NOPR, several 
stakeholders supported DOE's decision to address the exempted lamps in 
a separate rulemaking and urged DOE to act quickly to set these new 
standards. (Earthjustice, No. 60 at p. 2; NEEP, No. 61 at p. 5; Joint 
Comment, No. 62 at pp. 2-3; ACEEE, No. 76 at p. 5; NRDC, No. 82 at p. 
4) Commenters encouraged DOE to establish energy conservation standards 
for the exempted lamps with the same effective date as those adopted in 
this rulemaking in order to minimize market distortions and potential 
shifting from regulated products to unregulated products. (EEI, No. 45 
at p. 3; NEEP, No. 61 at p. 5; EEI, No. 78 at p. 2) DOE will consider 
these comments in its separate rulemaking assessing energy conservation 
standards for the exempted ER, BR, and small diameter lamps.
3. Museum Lighting
    DOE received a comment from The J Paul Getty Museum requesting that 
museum lighting, and particularly art museum lighting, be exempt from 
standards. The comment stated that HIR lamps do not provide the same 
quality of light as the halogen lamps that would be eliminated by the 
proposed standard. (The J Paul Getty Museum, No. 56 at p. 1) In 
response, DOE is unaware of any

[[Page 34093]]

specific light quality of halogen lamps that would necessitate their 
usage instead of halogen infrared reflector lamps for museum 
applications. In addition, the commenter did not provide any further 
details on the unique utility of current lamps in museum settings that 
could not be provided by substitute lamps that would meet the 
requirements of the energy conservation standards under consideration. 
Although the infrared reflector coating causes a reduction in the 
infrared region of the electromagnetic spectrum, these wavelengths of 
light are largely invisible to the human eye. Therefore, DOE does not 
believe that halogen lamps represent a distinct utility. In addition, 
given the identical nature of halogen PAR lamps used in museum settings 
and non-museum settings, it would be potentially easy for any consumer 
to purchase and install a lamp meant for museum use. Accordingly, DOE 
is concerned that failure to regulate this type of lamp could 
significantly undermine the energy savings potential of the IRL 
standard. In light of this concern and the lack of information to 
substantiate a unique utility of halogen IRL, DOE has decided not to 
create an exemption from IRL standards for museum lighting.

C. Amended Definitions

1. ``Rated Wattage''
    To implement the expanded scope of EPCA's coverage of GSFL and IRL, 
and of standards adopted for GSIL in EISA 2007, DOE proposed to revise 
its definitions of ``rated wattage'' and ``colored fluorescent lamp.'' 
74 FR 16920, 16931-32 (April 13, 2009). As to ``rated wattage,'' one 
element of EPCA's definitions for both ``fluorescent lamp'' and 
``incandescent reflector lamp'' is a lamp's rated wattage. (42 U.S.C. 
6291(30)(A), (C)(ii), and (F)) Also, EPCA prescribes maximum rated 
wattages as part of its energy conservation standards for GSIL. (42 
U.S.C. 6295(i)(1)) Although EPCA does not define the term ``rated 
wattage,'' DOE's regulations do, but the current DOE definition covers 
only 4-foot medium bipin T8, T10, and T12 fluorescent lamps. 10 CFR 
430.2.
    Therefore, DOE proposed a revised and updated definition of ``rated 
wattage.'' This definition included references to the current versions 
of applicable ANSI standards, clarified and improved the definition, 
and applied it to those lamps for which rated wattage is a key 
characteristic but to which DOE's current definition does not apply. 74 
FR 16920, 16931 (April 13, 2009). DOE did not receive any comments in 
response to this proposed change. However, because ``electrical power'' 
is appropriately defined in paragraph 2.8 or Appendix R of Subpart B, 
DOE note that it has decided to replace the term ``wattage'' in parts 
(1)(ii) and (1)(iii) of the definition of ``rated wattage'' with 
``electrical power.'' Therefore, for the reasons explained above and in 
the April 2009 NOPR, DOE adopts the definition of ``rated wattage'' as 
set out in the regulatory text of this final rule.
2. ``Colored Fluorescent Lamp''
    With respect to the definition of ``colored fluorescent lamp,'' DOE 
first notes that EPCA defines general service fluorescent lamps as 
fluorescent lamps ``which can be used to satisfy the majority of 
fluorescent [lighting] applications,'' but which are not designed and 
marketed for certain specifically listed ``nongeneral lighting 
applications,'' including ``colored fluorescent lamps.'' (42 U.S.C. 
6291(30)(B)) As with ``rated wattage,'' EPCA does not define the term 
``colored fluorescent lamp,'' but DOE's regulations do. The DOE 
regulations currently define the term as ``a fluorescent lamp 
designated and marketed as a colored lamp'' and having a CRI less than 
40 or a CCT less than 2500 K or greater than 6600 K. 10 CFR 430.2. 
Because lamps meeting this definition are not GSFL under EPCA, they are 
not covered by the standards applicable to GSFL.
    After becoming aware of a lamp on the European market that is 
intended for general illumination applications but has a CCT of 17000 K 
and might meet DOE's definition of ``colored fluorescent lamp,'' DOE 
became concerned that some new products with general service 
applications might be excluded from the coverage of standards 
applicable to GSFL. 73 FR 13620, 13634 (March 13, 2008). To avoid this 
possibility, DOE considered adding the following phrase to its 
definition of ``colored fluorescent lamp'': ``* * * and not designed or 
marketed for general illumination applications.'' Id.
    Following publication of the March 2008 ANOPR, DOE obtained 
information indicating that, instead, it should amend the definition of 
``colored fluorescent lamp'' both to: (1) Exclude from the definition, 
and thereby place under energy conservation standards, lamps with CCTs 
from 6600 K to 7000 K; and (2) include in the definition, and thereby 
place outside the coverage of standards, all lamps with a CCT greater 
than 7000 K (i.e., regardless of how the lamp is designated and 
marketed). Although lamps with CCTs greater than 6600 K and less than 
or equal to 7000 K are not prevalent in the market, such lamps are 
commercially available and becoming increasingly popular. Furthermore, 
manufacturers would likely be able to produce a lamp at 7000 K using 
the same materials as a 6500 K lamp (a commonly sold lamp). Thus, DOE 
tentatively concluded that covering such lamps would maintain the 
coverage under DOE's energy conservation standards of GSFL serving 
general application purposes, and that the technological similarity 
between 6500 K and 7000 K lamps makes it possible to establish 
technologically feasible efficacy levels for 7000 K lamps. However, 
very few lamps with a CCT greater than 7000 K exist in the market, and 
the inherently ``blue'' color of these high-CCT lamps appears to 
prevent their widespread adoption as substitutes for standard CCT lamps 
(e.g., 4100 K). In addition, the materials used in the manufacture of 
such lamps, as well as the design trade-offs in developing them, would 
differ from those applicable to current products serving this market. 
Thus, DOE tentatively concluded that it could not determine whether a 
particular standard level would be technologically feasible for lamps 
with a higher CCT, and that these lamps would not be expected to be a 
potential loophole to standards it was considering in this rulemaking. 
For these reasons, which DOE discussed in greater detail in the April 
2009 NOPR, DOE proposed to modify the definition of ``colored 
fluorescent lamp'' by raising the upper CCT limit for lamps excluded 
from that term from 6600 K to 7000 K, and including in that term all 
lamps (regardless how the lamp is designated and marketed) with a CCT 
greater than 7000 K. 74 FR 16920, 16931-32 (April 13, 2009).
    Both EEI and NEMA agreed with the proposed definition of ``colored 
fluorescent lamp.'' (EEI, No. 45 at p. 2, NEMA, Public Meeting 
Transcript, No. 38.4 at p. 46-47; NEMA, No. 81 at p. 7) However, ACEEE 
pointed out that at an earlier stage of the rulemaking process, NEMA 
had identified an 8000 K lamp and claimed that lamps at high CCT values 
were capturing an increasing market share of general service 
applications. ACEEE argued that, if this is true, lamps with a CCT up 
through 8000 K should be included in coverage. (ACEEE, Public Meeting 
Transcript, No. 38.4 at p. 48). NEMA responded that it is not aware of 
an 8000 K lamp gaining market share in the general service lighting 
market because such a lamp would be too blue and not suitable for 
general service applications. (NEMA,

[[Page 34094]]

Public Meeting Transcript, No. 38.4 at pp. 49-50)
    ACEEE also suggested that DOE should reinsert the phrase ``and not 
designed or marketed for general illumination applications'' in the 
definition of ``colored fluorescent lamp'' to ensure that only 
specialty lamps are excluded from the definition of ``general service 
fluorescent lamp.'' (ACEEE, Public Meeting Transcript, No. 38.4 at pp. 
48-49; ACEEE, No. 76 at p. 4) In response, DOE agrees that the 
intention of the exemption for colored fluorescent lamps is to exclude 
only specialty lamps from standards. DOE believes that the amended 
definition of ``colored fluorescent lamp'' should not become a loophole 
for fluorescent lamps that are used in general service applications, 
and, therefore, should be subject to energy conservation standards. 
However, DOE also maintains that there are enough lamps available with 
CCTs greater than 7000 K to determine technologically feasible energy 
conservation standards. In addition, DOE believes that the inherently 
``blue'' color of these lamps may prevent widespread adoption as 
substitutes for standard CCT lamps (e.g., 4100 K).
    Therefore, in this final rule, DOE is modifying the definition of 
``colored fluorescent lamp'' as follows. DOE has decided to incorporate 
the phrase ``and not designed or marketed for general illumination 
applications'' into the definition of ``colored fluorescent lamp.'' 
This phrase will apply to those lamps with CCTs greater than 7000 K, as 
well as lamps with a CRI less than 40 and lamps with a CCT under 2500 
K. However, because DOE believes that there are insufficient data to 
determine whether amended standards for lamps with CCTs greater than 
7000 K would be technologically feasible, DOE is modifying the range of 
CCTs for which it is adopting standards. As a result, lamps referred to 
as possessing high CCTs in this standard-setting rulemaking are now 
being classified as those with a CCT greater than 4500 K and less than 
or equal to 7000 K (rather than simply greater than 4500 K).
    DOE is implementing these changes in this manner because of the 
anti-backsliding provision in EPCA. Because lamps with CCTs greater 
than 7000K that are not designated and marketed as colored lamps are 
currently subject to energy conservation standards, exempting all lamps 
with a CCT above 7000 K through inclusion in the definition of 
``colored fluorescent lamp'' would prescribe a standard which 
impermissibly ``decreases the minimum required energy efficiency, of a 
covered product.'' (42 U.S.C. 6295 (o)(1)) Thus, if lamps with CCTs 
greater than 7000 K are used in general service applications, they will 
not be covered by the standards adopted by this final rule, although 
they will continue to be subject to the existing energy conservation 
standards (which have not been eliminated, despite being superseded in 
terms of efficacy levels for most--but not all, as demonstrated here--
of those lamps upon the effective date of the updated GSFL standards). 
In conclusion, DOE adopts the following definition for ``colored 
fluorescent lamp'' as set out in the regulatory text of this final 
rule.

D. Off Mode and Standby Mode Energy Consumption Standards

    Section 310(3) of EISA 2007 amended EPCA to require energy 
conservation standards adopted for a covered product after July 1, 2010 
to address standby mode and off mode energy use. (42 U.S.C. 
6295(gg)(3)) Although the final rule in this standards rulemaking is 
scheduled for publication by June 2009 (i.e., before this statutory 
deadline), DOE nonetheless did a preliminary analysis of the potential 
for energy savings associated with the regulation of standby mode and 
off mode energy use in covered lamps. DOE tentatively determined that 
current technologies for the GSFL and IRL that are the subjects of this 
rulemaking do not use a standby mode or off mode, so it is neither 
feasible nor necessary to incorporate energy use in these modes into 
the energy conservation standards for GSFL and IRL. Therefore, DOE did 
not propose amendments to the standards to address lamp operation in 
such modes. 73 FR 13620, 13627 (March 13, 2008); 74 FR 16920, 16932-33 
(April 13, 2009). DOE did not receive any comments regarding this 
subject, so DOE concludes that standby mode and off mode are not 
applicable to these products. Therefore, in this final rule, DOE is not 
adopting provisions to address lamp operation in off mode or standby 
mode as part of the energy conservation standards that are the subject 
of this rulemaking.

E. Color Rendering Index Standards for General Service Fluorescent 
Lamps

    EPCA specifies minimum levels of both lumens per watt and CRI that 
GSFL must meet. (42 U.S.C. 6295(i)(1)) However, EPCA authorizes DOE to 
consider and adopt only energy conservation standards that consist of 
energy performance requirements. (42 U.S.C. 6291(6)) In the March 2008 
ANOPR, commenters suggested that it may be necessary for DOE to amend 
the existing CRI standards to prevent the possible emergence of 
loopholes in the product class structure and standards levels. In the 
April 2009 NOPR, DOE concluded that it does not have the authority to 
change the CRI standard because CRI is not a measure of energy 
consumption or efficacy, but rather a measure of the color quality of 
the light. 74 FR 16920, 16933 (April 13, 2009).
    In written comments, Earthjustice argued that DOE has the authority 
to amend EPCA's Color Rendering Index (CRI) for GSFL, stating that DOE 
ignored the context of the duties that Congress imposed in 42 U.S.C. 
Sec.  6295(i)(3). Earthjustice correctly noted that Congress included a 
table specifying both lamp efficacy and CRI standards for GSFL. (42 
U.S.C. 6295(i)(1)(B)). The commenter also correctly stated that 
Congress provided that all GSFL ``shall meet or exceed the [specified] 
lamp efficacy and CRI standards'' (42 U.S.C. 6295(i)(1)(B)), and 
directed DOE to ``determine if the standards in paragraph (1) should be 
amended.'' (42 U.S.C. 6295(i)(3)). From there, Earthjustice took the 
position that Congress did not intend to require DOE to assess only the 
``energy conservation standards'' established in 42 U.S.C. 6295(i)(1), 
but instead to review all ``standards'' established in that paragraph, 
which include both lamp efficacy and CRI standards. (Earthjustice, No. 
60 at pp. 3-4) The Green Lighting Campaign also argued that DOE should 
place restrictions on the CRI of covered GSFL because CRI can be used 
to enhance a lamp's visual acuity, thereby enabling substitution of 
lower-wattage lamps in a given lamp application without sacrificing 
utility. Therefore, the commenter argued that CRI affects energy 
efficiency and that DOE should screen out lamps with a CRI below 80. 
(Green Lighting Campaign, No. 74 at p. 2, 4)
    Furthermore, Earthjustice stated that the relevant discussion in 
the preamble of DOE's April 2009 NOPR did not clarify whether DOE 
believes that amendment of the CRI standards is foreclosed by EPCA's 
plain language (which Earthjustice disputed for the reasons above), or 
that is DOE's interpretation of an ``allegedly ambiguous provision'' 
(which Earthjustice asserted would be arbitrary and capricious). 
Earthjustice also commented that DOE's rationale on this point in the 
April 2009 NOPR explanation cannot be reconciled with the purposes of 
the statute and the intent of Congress, which enacted EPCA to 
``conserve energy supplies through energy conservation programs'' and 
``provide for improved energy efficiency of * * * consumer products.'' 
42 U.S.C.

[[Page 34095]]

6201(4) and (5). Finally, Earthjustice argued that DOE must consider 
amending EPCA's CRI standards if an efficacy-only standard is not 
sufficient to capture all technologically feasible and economically 
justified energy savings. (Earthjustice, No. 60 at pp. 3-4)
    In response, DOE disagrees with the Green Lighting Campaign and 
Earthjustice's interpretation of the relevant statutory language. 
Despite the overarching energy-savings purposes of EPCA, Congress 
promulgated a highly detailed statute (both initially and through 
subsequent amendments) with numerous provisions specifying (or 
restricting) DOE's authority. In general, Congress did not provide DOE 
unfettered discretion to set standards, but instead established 
detailed criteria, definitions, and other limitations on DOE's 
authority. Consequently, when DOE faces specific provisions which limit 
its authority, it seems clear that Congress did not intend the general 
energy-savings provisions of EPCA to override such limitations. 
Instead, DOE interprets its mandate as to maximize energy savings 
within the confines of its statutory authority. With that said, DOE 
continues to believe that it does not have the authority to regulate 
CRI standards for the reasons discussed in the NOPR. 74 FR 16920, 16933 
(April 13, 2009). That is, the language in the statute does not provide 
DOE with the authority to amend the CRI standard because it is not an 
energy performance standard. In implementing the amended standards 
rulemaking required under 42 U.S.C. 6295(i)(3), DOE must abide by the 
criteria for prescribing new or amended standards set forth in 42 
U.S.C. 6295(o). In relevant part, 42 U.S.C. 6295(o)(2)(A) provides that 
any new or amended ``energy conservation standard'' must be designed to 
achieve the maximum improvement in energy efficiency that is 
technologically feasible and economically justified. More specifically, 
as discussed in the NOPR, according to 42 U.S.C. 6291(6), ``energy 
conservation standard'' means either: (1) A performance standard which 
prescribes a minimum level of energy efficiency or a maximum quantity 
of energy use; or (2) a design requirement (only for specifically 
enumerated products). Although CRI is a performance requirement, it is 
not an energy performance requirement within the meaning of the term 
``energy conservation standard.'' Because, in the case of GSFL, DOE has 
the authority to regulate only energy conservation standards (i.e., 
energy performance requirements), DOE is not amending the existing 
minimum CRI requirements in this final rule.
    Even if DOE did have authority to amend the minimum CRI 
requirements, DOE does not believe any modification would have impacted 
the potential energy savings of this final rule. CRI does not affect 
energy consumption or efficacy and, therefore, would not affect any of 
the results of DOE's analysis that are summarized in section VII.

IV. General Discussion

A. Test Procedures

    DOE's test procedures for fluorescent and incandescent lamps are 
set forth at 10 CFR part 430, subpart B, appendix R.\8\ These test 
procedures provide detailed instructions for measuring GSFL and IRL 
performance, as well as performance attributes of GSIL, largely by 
incorporating several industry standards. As explained in the April 
2009 NOPR (74 FR 16920, 16933 (April 13, 2009)), DOE published a test 
procedure NOPR that proposed to update the current test procedure's 
references to industry standards for fluorescent and incandescent 
lamps, as well as to propose adoption of test procedure amendments to 
address lamps to which coverage was extended by EISA 2007 or to which 
DOE was considering extending coverage through rulemaking. 73 FR 13465, 
13467-68 (March 13, 2008)(the test procedure NOPR). The test procedure 
NOPR also proposed the following: (1) A small number of definitional 
and procedural modifications to the test procedure to accommodate 
technological migrations in the GSFL market and approaches DOE has 
considered in this standards rulemaking; (2) revision of the reporting 
requirements for GSFL, such that all covered lamp efficacies would be 
reported with an accuracy to the tenths decimal place; and (3) adoption 
of a testing and calculation method for measuring the CCT of 
fluorescent and incandescent lamps. Id. at 13472-74. The March 2008 
ANOPR also contains a detailed discussion of these proposals and 
related matters. 73 FR 13620, 13627-28 (March 13, 2008).
---------------------------------------------------------------------------

    \8\ ``Uniform Test Method for Measuring Average Lamp Efficiency 
(LE) and Color Rendering Index (CRI) of Electric Lamps.''
---------------------------------------------------------------------------

    In response to the test procedure NOPR, NEMA commented that it 
strongly opposed establishing test procedures for lamps to which 
coverage has not yet been extended by the energy conservation standards 
rulemaking. NEMA was concerned that specifying mandatory test 
conditions prior to inclusion of coverage would inadvertently prevent 
new, high-efficient lamp designs from entering the market. (NEMA, No. 
25 at p. 6-8) \9\ In response, in the June 2009 test procedure Final 
Rule previously published (hereafter the test procedure Final Rule)), 
DOE agreed with NEMA's suggestion and proceeded to finalize all other 
aspects of the lamps test procedure amendments but deferred 
consideration of test procedures for potentially new covered products 
until DOE establishes, by final rule, the lamps to which it is 
extending energy conservation standards coverage. Therefore, today's 
final rule simultaneously adopts both energy conservation standards and 
test procedures for these ``additional'' GSFL. In setting test 
procedures for these additional GSFL, DOE is also responding to the 
public comments on that topic submitted in response to the March 2008 
test procedure NOPR, as discussed below.
---------------------------------------------------------------------------

    \9\ Energy Conservation Program: Test Procedures for General 
Service Fluorescent Lamps, Incandescent Reflector Lamps, and General 
Service Incandescent Lamps; Docket No. EERE-2007-BT-TP-0013; RIN 
number 1904-AB72.
---------------------------------------------------------------------------

    As discussed in section III.A, DOE has decided to adopted standards 
for the following additional GSFL: (1) 2-foot U-shaped; (2) 4-foot MBP; 
(3) 8-foot SP slimline; (4) 8-foot RDC HO; (5) 4-foot MiniBP SO; and 
(6) 4-foot MiniBP HO lamps. For the additional 2-foot U-shaped and 4-
foot MBP lamps, 10 CFR part 430, subpart B, appendix R already contains 
adequate test procedures (either through existing test procedures or 
those newly adopted in the test procedure final rule). Therefore, in 
this final rule, DOE is not adopting new test procedures for those 
lamps. However, for the added 8-foot SP slimline, 8-foot RDC HO, 4-foot 
MiniBP SO, and 4-foot MiniBP HO lamps, DOE has determined that several 
new provisions need to be added to the existing test procedures for 
GSFL.
    These provisions pertain to the adoption of reference ballast 
settings for lamps not listed in ANSI C78.81-2005 nor in ANSI C78.901-
2005, as proposed in the test procedure NOPR. In response to that test 
procedure proposal, NEMA stated that instituting generic test 
conditions, particularly reference ballast settings, without knowing 
the specific GSFL to which the conditions may apply could have 
unexpected consequences. In particular, NEMA argued that such test 
procedures could constrain innovation by affecting the introduction of 
new lamps into the market. NEMA also committed to developing 
standardized test conditions that DOE could consider for several 
covered lamp types for which no test

[[Page 34096]]

conditions currently exist. (NEMA, No. 25 at p. 6-8) \10\
---------------------------------------------------------------------------

    \10\ Energy Conservation Program: Test Procedures for General 
Service Fluorescent Lamps, Incandescent Reflector Lamps, and General 
Service Incandescent Lamps; Docket No. EERE-2007-BT-TP-0013; RIN 
number 1904-AB72.
---------------------------------------------------------------------------

    DOE does not agree that imposing test conditions for future covered 
products would limit innovation in the lighting industry. DOE maintains 
a test procedure waiver process specifically for this reason. Under 10 
CFR 430.27, DOE's regulations state, ``Any interested person may submit 
a petition to waive for a particular basic model any requirements of 
Sec.  430.23, or of any appendix to this subpart, upon the grounds that 
the basic model contains one or more design characteristics which 
either prevent testing of the basic model according to the prescribed 
test procedures, or the prescribed test procedures may evaluate the 
basic model in a manner so unrepresentative of its true energy 
consumption characteristics, or water consumption characteristics (in 
the case of faucets, showerheads, water closets, and urinals) as to 
provide materially inaccurate comparative data.'' (10 CFR 430.27(a)(1)) 
This waiver process exists to avoid constraining innovation in the 
industry. Thus, DOE believes it is not preventing the introduction of 
future products into the market by specifying generic test conditions 
in this final rule.
    While DOE appreciates NEMA's offer to develop additional 
standardized test procedure provisions, the organization did not set a 
timeframe for developing the new test conditions, and DOE believes that 
this final rule needs to establish test conditions for all lamps 
subject to energy conservation standards. In addition, DOE believes 
that the test conditions set forth in the March 2008 NOPR are 
appropriate for most commercially-available lamps. DOE arrived at the 
ballast settings for these lamps by determining the appropriate lamp 
replacement that exists in the relevant industry standard and using the 
corresponding reference ballast settings for all lamps that fall into 
that category. However, if NEMA supplies test conditions for industry 
standards, DOE will consider incorporating them into its test procedure 
regulations in a subsequent rulemaking.
    Thus, in this final rule, DOE is adopting the following reference 
ballast settings for those additional GSFL for which it is setting 
standards, as proposed in the test procedure NOPR:
    For any 8-foot SP slimline lamp not listed in the updated ANSI 
C78.81-2005, the lamp should be tested using the following reference 
ballast settings:

T12 lamps: 625 volts, 0.425 amps, and 1280 ohms.
T8 lamps: 625 volts, 0.260 amps, and 1960 ohms.

    For any 8-foot RDC HO lamp not listed in the updated ANSI C78.81-
2005, the lamp should be tested using the following reference ballast 
settings:

T12 lamps: 400 volts, 0.800 amps, and 415 ohms. &
T8 lamps: 450 volts, 0.395 amps, and 595 ohms.

    For any 4-foot MiniBP standard output or high output lamp that is 
not listed in ANSI C78.81-2005, the lamp should be tested using the 
following reference ballast settings:

Standard Output: 329 volts, 0.170 amps, and 950 ohms.
High Output: 235 volts, 0.460 amps, and 255 ohms.

B. Technological Feasibility

1. General
    As stated above, any standards that DOE establishes for GSFL and 
IRL must be technologically feasible. (42 U.S.C. 6295(o)(2)(A) and 
(o)(3)(B)) DOE considers a design option to be technologically feasible 
if it is in use by the respective industry or if research has 
progressed to the development of a working prototype. ``Technologies 
incorporated in commercial products or in working prototypes will be 
considered technologically feasible.'' 10 CFR part 430, subpart C, 
appendix A, section 4(a)(4)(i).
    This final rule considers the same design options as those 
evaluated in the April 2009 NOPR. 74 FR 16920, 16933-34 (April 13, 
2009) As discussed in section VI.B.2.c, DOE additionally considers 
integrally-ballasted low voltage IRL as a design option to improve IRL 
efficacy. (See the final rule TSD accompanying this notice, chapter 3.) 
Except for trial standard level (TSL) 1 for IRL, products are 
commercially available in the market at all of the TSLs evaluated for 
today's rule. As to TSL1 for IRL, DOE used a design option (i.e., 
higher-efficiency gas fills) to model the performance of lamps that 
would meet this TSL, and received input from manufacturers to verify 
that such a design option is technologically feasible. Therefore, DOE 
determined that all of the efficacy levels evaluated in this notice are 
technologically feasible.
2. Maximum Technologically Feasible Levels
    As required under 42 U.S.C. 6295(p)(1), in developing the April 
2009 NOPR, DOE identified the efficacy levels that would achieve the 
maximum improvements in energy efficiency that are technologically 
feasible (max-tech levels) for GSFL and IRL. 74 FR 16920, 16933-35 
(April 13, 2009). (See chapter 5 of the TSD)
    For GSFL, DOE considered five TSLs in the April 2009 NOPR, with 
TSL5 being the most stringent level for which DOE performed full 
analyses. 74 FR 16920, 16979-82 (April 13, 2009). It is noted that DOE 
also considered the potential for a standard level beyond TSL5 that 
would require GSFL to use a higher-efficiency gas fill composition, 
which would have been the maximum technologically feasible level. 
Although more-efficient fill gases (often including higher molecular 
weight gases) are appropriate for and are currently used in some lamp 
applications, DOE is also aware employing this technology can cause 
lamp instability resulting in striations or flickering in some 
circumstances. DOE's research indicated that a potential standard level 
that would require the use of higher-efficiency fill gases would 
significantly reduce (or in some cases eliminate) the utility and 
performance of the covered GSFL, DOE concluded on this basis that a 
level with such an adverse impact on product utility would not be 
economically justified.\11\ (42 U.S.C. 6295(o)(2)(B)(i)(IV) and (3)(B)) 
Having made this determination, there was no need or benefits to 
performing additional analyses relevant to the other statutory 
criteria. (See section I.A.2 for additional detail.) Consequently, TSL5 
represents the most-efficient level analyzed for GSFL.
---------------------------------------------------------------------------

    \11\ DOE notes that it did not eliminate higher-efficiency fill 
gases from further consideration as a technology under the screening 
analysis, because that technology may be appropriate for low-wattage 
lamp applications.
---------------------------------------------------------------------------

    For IRL, as explained in the April 2009 NOPR, DOE believes that the 
maximum technologically feasible efficacy level incorporates the 
highest-efficiency technologically feasible reflector, halogen infrared 
coating, and filament design. Id. Combining all three of these high-
efficiency technologies simultaneously results in the maximum 
technologically feasible level. However, this level is dependent on the 
use of a silver reflector, which is a proprietary technology. Because 
DOE is unaware of any alternate technology pathways to achieve this 
efficacy level, DOE did not consider it in its analysis.
    Instead, in the April 2009 NOPR, DOE based the highest efficacy 
level analyzed for IRL on a commercially-available IRL which employs a 
silver reflector, an improved (but not most efficient) IR

[[Page 34097]]

coating, and a filament design that results in a lifetime of 4,200 
hours. Although this commercially-available lamp uses silver 
technology, DOE believes that there are alternate pathways to achieve 
this level. A combination of redesigning the filament to achieve higher 
temperature operation (and thus reducing lifetime to 3,000 hours), 
employing other non-proprietary high-efficiency reflectors, and 
applying a higher-efficiency IR coating has the potential to result in 
an IRL that meets an equivalent efficacy level (for more information 
regarding these technologies, see chapter 3 of the TSD). Therefore, in 
the April 2009 NOPR, DOE concluded that TSL5 is the maximum 
technologically feasible level for IRL that is not dependent on the use 
of a proprietary technology. Id.
    In response to the April 2009 NOPR, DOE received several comments 
on the efficiency levels analyzed and the maximum technologically 
feasible levels. For further discussion of these comments see section 
VI.B. For today's final rule, the max-tech levels are provided in Table 
IV.1 and Table IV.2 below.

                  Table IV.1--Max-Tech Levels for GSFL
------------------------------------------------------------------------
                                                             Max-tech
           Lamp type                       CCT             efficacy lm/W
------------------------------------------------------------------------
4-foot medium bipin............  <=4,500K...............              93
                                 >4,500K and <=7,000K...              92
2-foot U-shaped................  <=4,500K...............              87
                                 >4,500K and <=7,000K...              85
8-foot single pin slimline.....  <=4,500K...............              98
                                 >4,500K and <=7,000K...              94
8-foot recessed double contact   <=4,500K...............              95
 HO.
                                 >4,500K and <=7,000K...              91
4-foot T5 miniature bipin SO...  <=4,500K...............              90
                                 >4,500K and <=7,000K...              85
4-foot T5 miniature bipin HO...  <=4,500K...............              76
                                 >4,500K and <=7,000K...              72
------------------------------------------------------------------------


                                       Table IV.2--Max-Tech Levels for IRL
----------------------------------------------------------------------------------------------------------------
                                                                   Diameter (in                      Max-tech
             Lamp wattage                       Lamp type             inches)         Voltage      efficacy lm/W
----------------------------------------------------------------------------------------------------------------
40W-205W..............................  Standard-spectrum.......            >2.5          >=125V      7.4P\0.27\
                                                                                           <125V      6.4P\0.27\
                                                                           <=2.5          >=125V      6.2P\0.27\
                                                                                           <125V      5.4P\0.27\
40W-205W..............................  Modified-spectrum.......            >2.5          >=125V      6.3P\0.27\
                                                                                           <125V      5.4P\0.27\
                                                                           <=2.5          >=125V      5.3P\0.27\
                                                                                           <125V     4.6P\0.27\
----------------------------------------------------------------------------------------------------------------
Note 1: P is equal to the rated lamp wattage, in watts.
Note 2: Standard Spectrum means any incandescent reflector lamp that does not meet the definition of ``modified
  spectrum'' in 430.2.

 C. Energy Savings

    DOE forecasted energy savings in its national impact analysis (NIA) 
through the use of an NIA spreadsheet tool, as discussed in the April 
2009 NOPR. 74 FR 16920, 16935, 16958-72 (April 13, 2009).
    One of the criteria that governs DOE's adoption of standards for 
covered products is that the standard must result in ``significant 
conservation of energy.'' (42 U.S.C. 6295(o)(3)(B)) While EPCA does not 
define the term ``significant,'' a 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.'' 
DOE's estimates of the energy savings for energy conservation standards 
at each of the TSLs considered for GSFL and IRL for today's rule 
indicate that the energy savings each would achieve are nontrivial. 
Therefore, DOE considers these savings ``significant'' within the 
meaning of Section 325 of EPCA.

D. Economic Justification

1. Specific Criteria
    As noted earlier, EPCA provides seven factors to evaluate in 
determining whether an energy conservation standard for covered 
products is economically justified. (42 U.S.C. 6295(o)(2)(B)(i)) The 
following sections discuss how DOE has addressed each of those seven 
factors in evaluating efficiency standards for GSFL and IRL.
a. Economic Impact on Consumers and Manufacturers
    DOE considered the economic impact of potential standards on 
consumers and manufacturers of GSFL and IRL. For consumers, DOE 
measured the economic impact on consumers as the change in installed 
cost and life-cycle operating costs (i.e., the LCC). (See sections V.C 
and VII.C.1.a, and chapter 8 of the TSD accompanying this notice.) DOE 
investigated the impacts on manufacturers through the manufacturer 
impact analysis (MIA). (See section VII.C.2, and chapter 13 of the TSD 
accompanying this notice.) The MIA is discussed in detail in the April 
2009 NOPR. 74 FR 16920, 16972-77 (April 13, 2009).

[[Page 34098]]

b. Life-Cycle Costs
    DOE considered life-cycle costs of GSFL and IRL, as discussed in 
the April 2009 NOPR. 74 FR 16920, 16950-58 (April 13, 2009). DOE 
calculated the sum of the purchase price and the operating expense--
discounted over the lifetime of the equipment--to estimate the range in 
LCC benefits that consumers would expect to achieve due to standards.
c. Energy Savings
    Although significant conservation of energy is a separate statutory 
requirement for adopting an energy conservation standard, EPCA also 
requires DOE, in determining the economic justification of a proposed 
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 in the April 2009 NOPR (74 FR 16920, 16936 
(April 13, 2009)), for today's final rule DOE used the NIA spreadsheet 
results in its consideration of total projected savings that are 
directly attributable to the standard levels DOE considered.
d. Lessening of Utility or Performance of Products
    In considering standard levels, DOE sought to avoid new standards 
for GSFL and IRL that would lessen the utility or performance of such 
products. (42 U.S.C. 6295(o)(2)(B)(i)(IV)); 74 FR 16920, 16936 (April 
13, 2009)).
e. Impact of Any Lessening of Competition
    DOE considers any lessening of competition that is likely to result 
from standards. Accordingly, as discussed in the April 2009 NOPR (74 FR 
16920, 16936 (April 13, 2009)) and as required under EPCA, DOE 
requested that the Attorney General transmit to the Secretary a written 
determination of the impact, if any, of any lessening of competition 
likely to result from the standards proposed in the April 2009 NOPR, 
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)) Note also that the National 
Impact Analysis does not consider the possibility of lessened 
competition effects, and so, depending on their magnitude, such effects 
may negatively impact the Net Present Value of the standards.
    To assist the Attorney General in making such a determination, DOE 
provided the Department of Justice (DOJ) with copies of the April 2009 
NOPR and the TSD for review. The Attorney General's response is 
discussed in section VII.C.5 below, and is reprinted at the end of this 
rule. For IRLs, DOJ concluded that the proposed TSL 4 could adversely 
affect competition. DOJ requested that DOE consider the possibility of 
new technology for IRLs as it settles on standards in this field (DOJ, 
No. 77 at pp. 1-2). Although DOJ did not evaluate the impacts on 
competition of TSL 4 for GSFL, DOE believes that TSL 4 does not raise 
competitive issues.
f. Need of the Nation to Conserve Energy
    In considering standards for GSFL and IRL, the Secretary must 
consider the need of the Nation to conserve energy. (42 U.S.C. 
6295(o)(2)(B)(i)(VI)) The Secretary recognizes that energy conservation 
benefits the Nation in several important ways. The non-monetary 
benefits of standards are likely to be reflected in improvements to the 
security and reliability of the Nation's energy system. As discussed in 
the April 2009 NOPR and in section VII.C.6 of this final rule, DOE has 
considered these factors in considering whether to adopt standards for 
GSFL and IRL. 74 FR 16920, 16936 (April 13, 2009).
g. Other Factors
    The Secretary of Energy, in determining whether a standard is 
economically justified, considers any other factors that the Secretary 
deems to be relevant. (42 U.S.C. 6295(o)(2)(B)(i)(VII)) In adopting 
today's standards, the Secretary considered the potential for GSFL and 
IRL standards to adversely affect low-income consumers, institutions of 
religious worship, historical facilities, institutions that serve low-
income populations, and consumers of T12 electronic ballasts. In 
considering these subgroups, DOE analyzed variations on electricity 
prices, operating hours, discount rates, and baseline lamps. 74 FR 
16920, 16936 (April 13, 2009). The impact on these subgroups is 
summarized in section VII.C.1.b.
2. Rebuttable Presumption
    Section 325(o)(2)(B)(iii) of EPCA states that there is a rebuttable 
presumption that an energy conservation standard is economically 
justified if the increased installed cost for a product that meets the 
standard is less than three times the value of the first-year energy 
savings resulting from the standard, as calculated under the applicable 
DOE test procedure. (42 U.S.C. 6295(o)(2)(B)(iii)) DOE's LCC and 
payback period (PBP) analyses generate values that calculate the 
payback period for consumers of potential energy conservation 
standards, which includes, but is not limited to, the three-year 
payback period contemplated under the rebuttable presumption test 
discussed above. However, DOE routinely conducts a full economic 
analysis that considers the full range of impacts, including those to 
the consumer, manufacturer, Nation, and environment, as required under 
42 U.S.C. 6295(o)(2)(B)(i). The results of this analysis serve as the 
basis for DOE to definitively evaluate the economic justification for a 
potential standard level (thereby supporting or rebutting the results 
of any preliminary determination of economic justification).

V. Methodology and Discussion of Comments on Methodology

    DOE used several analytical tools that it developed previously and 
adapted for use in this rulemaking. One is a spreadsheet that 
calculates LCC and PBP. Another tool calculates national energy savings 
and national NPV that would result from the adoption of energy 
conservation standards. DOE also used the Government Regulatory Impact 
Model (GRIM), along with other methods, in its MIA to determine the 
impacts of standards on manufacturers in light of other cumulative 
regulatory requirements. Finally, DOE developed an approach using the 
National Energy Modeling System (NEMS) to estimate impacts of standards 
for GSFL and IRL on utilities and the environment. The April 2009 NOPR 
discusses each of these analytical tools in detail. 74 FR 16920, 16958, 
16972, 16978-79, 16982 (April 13, 2009).
    As a basis for this final rule, DOE has continued to use the 
spreadsheets and approaches explained in the April 2009 NOPR. DOE used 
the same general methodology as applied in the NOPR, but revised some 
of the assumptions and inputs for the final rule in response to public 
comments. The following paragraphs discuss these revisions.

A. Market and Technology Assessment

    When beginning an energy conservation standards rulemaking, DOE 
develops information that provides an overall picture of the market for 
the products concerned, including the purpose of the products, the 
industry structure, and market characteristics. This activity includes 
both quantitative and qualitative assessments based primarily on 
publicly available information. DOE presented various subjects in the 
market and technology assessment for this rulemaking. (See chapter 3 of 
the NOPR TSD.) These include product definitions, product classes, 
manufacturers, quantities and types of products sold and offered for

[[Page 34099]]

sale, retail market trends, and regulatory and nonregulatory programs. 
As discussed below, commenters raised a variety of issues related to 
the market and technology assessment, to which DOE responds in the 
following sections.
1. Product Classes
    In general, in evaluating and establishing energy conservation 
standards, DOE divides covered products into classes by the type of 
energy used, capacity, or other performance-related features that 
affect efficiency, and factors such as the utility of the product to 
users. (42 U.S.C. 6295(q))
a. General Service Fluorescent Lamps
    In the April 2009 NOPR, DOE proposed to establish product classes 
for GSFL based on the following three attributes that have differential 
utility and affect efficacy: (1) Physical constraints of lamps (i.e., 
lamp shape and length); (2) lumen package (i.e., standard versus high 
output); and (3) correlated color temperature. 74 FR 16920, 16936 
(April 13, 2009). Based on these criteria, DOE proposed to separate 
coverage into six lamp types: (1) 4-foot medium bipin; (2) 2-foot U-
shaped; (3) 8-foot single pin slimline; (4) 8-foot recessed double 
contact high output; (5) 4-foot miniature bipin T5 standard output; and 
(6) 4-foot miniature bipin T5 high output. DOE also proposed to 
establish separate product classes for those lamps with CCT less than 
or equal to 4,500 kelvin (K) and lamps with CCT greater than 4,500 K. 
In total, therefore, DOE proposed 12 product classes for GSFL. In 
general stakeholders expressed overall agreement with the GSFL product 
class structure proposed in the April 2009 NOPR. However, DOE did 
receive several comments requesting additional product classes for 
specific lamps or lamp types, as discussed below.
i. Modified-Spectrum Fluorescent Lamps
    In response to the April 2009 NOPR, GE commented that it is 
currently researching and developing a 4-foot MBP modified-spectrum 
fluorescent lamp that imitates the color quality of modified-spectrum 
incandescent lighting. Although not yet commercially-available, GE 
expects to release such a product before 2012, the effective date of 
the energy conservation standard that is being established by this 
final rule. Expecting that these lamps may not be able to meet minimum 
efficacy requirements as amended by this rulemaking, GE recommended 
that DOE either set separate lower efficacy standards for ``modified-
spectrum fluorescent lamps'' or exempt these lamps from standards 
altogether. (GE, No. 80 at pp. 3-6)
    In response, DOE believes that it does not have the authority to 
exempt modified spectrum fluorescent lamps from standards. Pursuant to 
42 U.S.C. 6295(o)(1), DOE cannot prescribe an amended standard which 
``decreases the minimum required energy efficiency, of a covered 
product.'' Although no such product currently exists, DOE notes that if 
they did, modified-spectrum fluorescent lamps fall under the definition 
of ``general service fluorescent lamp,'' so they would already be 
subject to the statutory minimum efficacy requirements. Therefore, if 
DOE were to exempt these lamps from any standards, this would 
constitute backsliding from the minimum efficacy requirements, which is 
impermissible, as noted above.
    With regard to setting lower minimum efficacy requirements for 
modified-spectrum fluorescent lamps, DOE generally sets separate 
efficiency standards for products deemed to be in separate product 
classes. While these lamps may in the future provide a distinct utility 
to consumers (a basis on which product classes may be established under 
42 U.S.C. 6295(q)), at this time, DOE has no evidence that this utility 
in fact exists or is even required of the general service fluorescent 
market, because there is no such product yet developed. Therefore, in 
this final rule, DOE is not establishing a separate product class for 
modified-spectrum fluorescent lamps. However, DOE notes that if the 
company successfully develops its modified-spectrum fluorescent lamp 
and believes that it warrants exemption from DOE's amended standards, 
it may be possible for GE to seek exception relief from DOE's Office of 
Hearings and Appeals (OHA) pursuant to 10 CFR Part 1003.
i. 25 Watt 4-Foot MBP Lamps
    In the April 2009 NOPR, DOE established one product class for 4-
foot MBP lamps (of a single CCT category) that spanned the full range 
of covered lamp wattages (i.e., greater than or equal to 25W). The 
effects of doing this were such that at TSL5, as considered in the 
NOPR, the 25W 4-foot MBP T8 lamp was expected to be eliminated from the 
market, as it would not meet the minimum efficacy requirements. In 
response to the April 2009 NORP, the California Stakeholders and ACEEE 
suggested DOE should establish a separate product class for the 25W 4-
foot T8 MBP because it represents a significant energy-savings 
opportunity. While DOE recognizes that the availability of the 25W 4-
foot T8 MBP lamp provides additional energy savings opportunities to 
consumers, DOE does not believe that this alone is a basis to establish 
a separate product class for this lamp. As noted above, DOE establishes 
product classes only when a product type either: (1) Consumes a 
different type of energy, or (2) has a capacity or other performance-
related feature which justifies a higher or lower standard level. In 
making such a determination, DOE considers whether there is a 
differential utility which affects efficacy. To DOE's knowledge, the 
25W 4-foot MBP lamp does not provide any additional utility over that 
which its 32W full-wattage counterpart provides. Therefore, DOE has not 
established a different product classes for 25W lamps.
ii. Summary of GSFL Product Classes
    Because DOE received no other comments on the GSFL product classes 
proposed in the April 2009 NOPR, DOE is not making any changes in this 
final rule related to GSFL product classes. Table V.1 summarizes the 
GSFL product classes for this final rule.

             Table V.1--Final Rule Product Classes for GSFL
------------------------------------------------------------------------
                         Lamp type                               CCT
------------------------------------------------------------------------
4-Foot Medium Bipin........................................     <=4500 K
                                                                 >4500 K
2-Foot U-Shaped............................................     <=4500 K
                                                                 >4500 K
8-Foot Single Pin Slimline.................................     <=4500 K
                                                                 >4500 K
8-Foot RDC HO..............................................     <=4500 K
                                                                 >4500 K
4-Foot Miniature Bipin SO..................................     <=4500 K
                                                                 >4500 K
4-Foot Miniature Bipin HO..................................     <=4500 K
                                                                 >4500 K
------------------------------------------------------------------------

b. Incandescent Reflector Lamps
    For incandescent reflector lamps, in the April 2009 NOPR, DOE 
proposed to base its product class structure on: (1) Lamp spectrum 
(modified versus standard spectrum); (2) lamp diameter (greater than 
2.5 inches or less than or equal to 2.5 inches); and (3) rated voltage 
(less than 125V or greater than or equal to 125V). DOE received several 
comments on these product classes. The following sections summarize and 
address those public comments.
i. Modified-Spectrum Lamps
    Modified-spectrum lamps provide a unique performance-related 
feature to consumers, in that they offer a different spectrum of light 
from the typical incandescent lamp. These lamps offer

[[Page 34100]]

benefits such as ensuring better color discrimination and often 
appearing more similar to natural daylight, possibly resulting in 
psychological benefits. In addition to providing a unique performance 
feature, DOE also understands that the technologies that modify the 
spectral emission from these lamps also decrease their efficacy, 
because a portion of the light emission is absorbed by the coating. 
Therefore, in the April 2009 NOPR, DOE proposed to establish a separate 
product class for modified-spectrum lamps based on their unique 
performance feature and the impact of this performance feature on 
product efficacy. 74 FR 16920, 16938-39 (April 13, 2009).
    NEMA supported DOE's proposal for separate product classes based on 
modified spectrum. (GE, Public Meeting Transcript, No. 38.4 at p. 60; 
NEMA, No. 81 at p. 12) Conversely, ASAP, ACEEE, and the California 
Stakeholders commented that separate product classes based on spectrum 
are unnecessary because existing technologies such as LEDs and 
phosphor-based lamps (e.g., CFLs) can deliver the same utility to 
consumers that modified-spectrum IRL offer. ASAP stated that DOE should 
evaluate the unique utility of a product rather than the technology 
providing it. (ASAP, Public Meeting Transcript, No. 38.4, at pp. 68-69; 
California Stakeholders, No. 63 at pp. 2, 25)
    In response, DOE agrees that other technologies could produce 
modified spectrum light. However, DOE reiterates the point it made in 
the NOPR that the governing statutory provision directs DOE to maintain 
performance-related features for a covered product type. (42 U.S.C. 
6295(o)(4)) If DOE were to regulate modified-spectrum lamps within the 
same product class as standard-spectrum lamps, this could result in an 
energy conservation standard that would eliminate the modified-spectrum 
utility from the IRL market. Furthermore, DOE believes some consumers 
may find a unique utility in modified-spectrum IRL that does not exist 
in CFL or LED lamps that emit modified spectra. For example, modified-
spectrum IRL have a higher CRI than many of their potential substitutes 
(e.g., CFL), thereby providing a different, and in some cases a 
preferable, quality of light. In addition, DOE cannot confirm that a 
full range of lumen outputs are currently commercially available from 
LED reflector lamps. This could potentially eliminate the modified 
spectrum utility for some consumers requiring specific lumen packages 
(e.g., high-lumen lamps).
    PG&E, NRDC, ASAP, and the California Stakeholders also commented 
that no efficacy allowance is necessary for modified-spectrum lamps for 
two main reasons. First, they argued that incandescent reflector 
technology that results in modified-spectrum efficacies greater that 
the highest standard-spectrum standard level (TSL5) already exists. 
They demonstrated these efficacies in prototypes utilizing advanced IR 
coatings and silver reflectors. Second, the stakeholders argued that 
there are other means (beyond the use of absorptive elements within the 
glass cover) to produce modified-spectrum lamps. They suggested that 
reflective coatings, similar to the infrared ones that already exist, 
could, in principle, be used to create a modified spectrum in a much 
more efficient way. (California Stakeholders, No. 63 at pp. 2, 25; 
PG&E, NRDC, ASAP, No. 59 at p. 15-16; NRDC, No. 82 at pp. 2, 4)
    DOE reiterates that it establishes product classes based on whether 
a given product has unique performance features that affect the 
efficacy of the product, not on whether it is technologically feasible 
for the product to meet another product class's efficacy levels. 
Therefore, the absolute efficacy of a given modified-spectrum IRL does 
not play a role in whether DOE should or should not establish a 
distinct product class. Then once it is determined that a separate 
class is appropriate under the statute, an appropriate level is set 
based upon examination of lamps within that class, rather than a 
comparison to different types of lamps. What is relevant is whether 
there is a change in efficacy that is caused by a unique performance 
feature. DOE maintains that at this time modified spectrum IRL cannot 
achieve an equivalent maximum technologically feasible level as 
standard-spectrum IRL. To this point, the stakeholders themselves 
acknowledge in their comments that lenses used to modify the spectrum 
of IRL result in at least a 10 percent decrease in efficacy as compared 
to standard-spectrum lamps. (PG&E, NRDC, ASAP, No. 59 at p. 2) Although 
the stakeholders have demonstrated that modified-spectrum IRL might 
potentially be able to achieve efficacies exceeding that of the highest 
efficacy level analyzed for standard-spectrum lamps, DOE believes that 
there is considerable uncertainty surrounding the efficacies of the 
prototypes provided. Therefore, DOE is not establishing minimum 
efficacy requirements based solely on these prototype efficacies. DOE 
further addresses its consideration of these prototype efficacies in 
section VI.B.2.
    On the stakeholders' second point, DOE agrees that, in principle, 
there may be other means of producing modified-spectrum lamps. However, 
at present, DOE is unaware of any commercially-available IRL or working 
IRL prototype using the alternative methods suggested by stakeholders. 
For all of the above reasons, DOE has decided to establish a separate 
product class for modified-spectrum incandescent reflector lamps.
    Also related to modified-spectrum IRL, Tailored Lighting, a 
specialty lighting company, commented that it produces specialty lamps 
that alter the spectrum, differently than modified-spectrum lamps, 
which the commenter claims better simulates daylight. Due to the 
different spectra of light that are filtered in Tailored Lighting's 
lamps relative to modified-spectrum lamps, Tailored Lighting argued 
that their product would not qualify under the statutory definition of 
``modified spectrum.'' Therefore, Tailored Lighting recommended that 
DOE should either specifically exempt their product from regulation or 
amend the definition of ``modified spectrum'' so as to include their 
products, thereby allowing them to have reduced minimum efficacy 
requirements. (Tailored Lighting, No. 73 at p. 11) Eiko Ltd, a 
manufacturer of Tailored Lighting's products supported the same 
amendments to the definition of ``modified spectrum.'' (Eiko, No. 79 at 
p. 1)
    While DOE acknowledges that many of Tailored Lighting's products 
may not fall under the definition of ``modified spectrum,'' DOE notes 
that ``modified spectrum'' is a statutory definition, defined by EISA 
2007 for incandescent lamps, which includes both general service 
incandescent lamps and incandescent reflector lamps. (42 U.S.C. 
6291(30)(W); 42 U.S.C. 6291(30)(F)) Therefore, DOE lacks the authority 
to amend the definition of ``modified spectrum.'' In addition, adopting 
Tailored Lighting's recommended amendment would not only affect minimum 
efficacy requirements for IRL, but would also result in an amendment to 
the general service incandescent lamp standards prescribed by Congress. 
For these reasons, DOE is leaving the definition of ``modified 
spectrum'' unchanged from that presented in the April 2009 NOPR.
    In addition, DOE notes that according to the comment, even though 
Tailored Lighting also sells 12-volt MR-16 lamps with these special 
daylight qualities, these lamps do not fall under the definition of 
``incandescent reflector lamp.'' Tailored Lighting requested an

[[Page 34101]]

exemption (or lowered minimum efficacy requirement) for its forthcoming 
PAR lamp, that would fall under the definition of ``incandescent 
reflector lamp'' and is currently under development. (Tailored 
Lighting, No. 73 at p. 4)) However, according to interviews and 
Tailored Lighting's Web site, this lamp is not yet for sale.
    In response, DOE generally sets separate efficiency standards for 
products deemed to be in separate product classes. While PAR-shaped 
Tailor Lighting lamps may in the future provide a distinct utility to 
consumers (a basis on which product classes are established), at this 
time, because there is no product yet developed, DOE has no evidence 
that this utility in fact exists or is even required of the 
incandescent reflector lamp (or PAR-shaped) market. Therefore, in this 
final rule, DOE is not establishing a separate product class for 
Tailored Lighting's products. However, DOE notes that if Tailored 
Lighting successfully develops its PAR lamp and believes that it 
warrants exemption from DOE's amended standards, it may be possible for 
Tailored Lighting to seek exception relief from DOE's OHA pursuant to 
10 CFR Part 1003.
ii. Lamp Diameter
    As mentioned above, DOE also proposed separate product classes for 
smaller-diameter lamps (i.e., lamps with a diameter less than or equal 
to 2.5 inches). Such lamps provide a distinct utility (such as the 
ability to be installed in smaller fixtures) which generally results in 
lower efficacy because they have an inherently lower optical efficiency 
than larger-diameter lamps of similar filament size. Both NEMA and the 
California Stakeholders supported DOE's proposal to establish a 
separate product class for small-diameter lamps. (NEMA, No. 81 at p. 7, 
p. 12; GE Lighting, Public Meeting Transcript, No. 38.4 at p. 60; 
California Stakeholders, No. 63 at p. 22) Because DOE received no other 
comments on this issue, DOE continues to set separate product classes 
for lamps of diameter less than or equal to 2.5 inches.
iii. Voltage
    Current DOE test procedures provide for lamps rated at 130 volts 
(V) to be tested at 130 V and for lamps rated at 120 V to be tested at 
120 V. However, DOE is aware that a large number of consumers actually 
operate 130 V lamps at 120 V, which results in longer lifetime but 
lower efficacy. With a single efficacy level for lamps rated at each 
voltage, this situation would effectively lead to a lower efficacy 
requirement for these 130 V lamps that are run at 120 V, compared to 
120 V lamps run at 120 V. These 130V lamps would not require the same 
level of technology as 120 V-rated lamps to meet the same standard, 
and, thus, they would be cheaper to produce. Therefore, setting higher 
standards for IRL without accounting for voltage differences could 
result in increased migration to the 130 V lamps and possible lost 
energy savings. For these reasons, in the April 2009 NOPR, DOE proposed 
to set separate standards for 130 V lamps. Specifically, DOE proposed 
to establish two separate product classes: (1) Lamps with a rated 
voltage less than 125 V, and (2) lamps with a rated voltage greater 
than or equal to 125 V. 74 FR 16920, 16940 (April 13, 2009). DOE also 
requested comment on the alternative approach of having all IRL be 
tested at 120 V, the most common application voltage in the market. Id.
    Philips commented that setting a 130 V-lamp efficacy level that was 
15 percent higher than the level for 120 V lamps, as DOE proposed in 
the NOPR, would drive 130 V lamps from the market because such a level 
would be technologically infeasible. In addition, Philips and GE stated 
that it is not uncommon for consumers to run lamps at 130 V in certain 
regions of the country. Therefore, NEMA and Philips stated, with 130 V 
lamps gone from the marketplace, some consumers may be forced to run 
120 V lamps at 130 V, which could cut lamp lifetime in half and cause a 
loss of utility for these consumers. For those reasons, manufacturers 
argued, there should be no separate product class for voltage. Instead, 
manufacturers argued that DOE should test IRL at their rated voltages 
and subject the lamps to the same standard. Supporting this idea, GE 
noted that even if one operates a 130 V lamp at 120 V, power is reduced 
proportionally, meaning there would be lower energy consumption. (GE 
and Philips, Public Meeting Transcript, No. 38.4 at pp. 61-62, 67; 
NEMA, No. 81 at pp. 4, 7-8)
    Conversely, the California Stakeholders, EEI and ACEEE argued that 
130 V lines are very rare. EEI stated that many utilities must follow 
agreements to maintain voltages in the residential sector within a 5 
percent range of 120 V (114 V to 126 V) and agreed with DOE's approach. 
The California Stakeholders commented that utilities are trending 
toward lower line voltage to minimize transmission losses. In addition, 
they stated that FTC labeling requirements already require 
manufacturers to provide power and light output for 120 V, even if the 
lamps are designed to be run at 130 V. Therefore, the California 
Stakeholders argued, all lamps should be regulated based on testing at 
120 V. (ACEEE and EEI, Public Meeting Transcript, No. 38.4 at pp. 63-
64, 66; EEI, No. 45 at p. 3; California Stakeholders, No. 63 at p. 25-
26)
    GE argued that while utilities do face line voltage regulation, 
there are cases in which the voltage is higher than that prescribed in 
ANSI C-84.1, ``American National Standard for Electric Power Systems 
and Equipment-Voltage Ratings (60 Hertz),'' (the source of the 
prescribed voltage range that EEI referenced in the above comment). 
Therefore, the 130 V lamps have utility for consumers in these cases. 
(GE, Public Meeting Transcript, No. 38.4 at p. 67)
    In response, DOE remains concerned that the operation of 130 V 
lamps at 120 V has the potential to significantly affect energy 
savings. As discussed above, when operated under 120 V conditions, 
lamps rated at 130 V and in compliance with existing IRL efficacy 
standards are generally less efficacious than lamps using equivalent 
technology rated at 120 V. Because of this inherent difference in 
efficacy, it may be less costly to manufacture a lamp rated and tested 
at 130 V that complies with a standard than a similar 120 V lamp 
complying with the same standard. If DOE does not establish a separate 
product class and standard for lamps rated at 130 V, more consumers may 
purchase 130 V lamps because they may be less expensive, as they would 
require less costly technology. When consumers operate these lamps at 
120 V, in order to obtain sufficient light output, they may migrate to 
higher wattages and use more energy than standards-compliant 120 V 
lamps.
    DOE also believes, as commenters pointed out, that 130 V conditions 
in the residential sector are very rare. Indeed, in many cases such 
sustained voltages would violate electrical codes. As NEMA commented 
earlier, 130 V lamps ``are almost always used by customers to achieve 
`double life' by operating them at 120 V, resulting in performance 
below 1992 EPACT levels.'' (NEMA, No. 21 at p. 16) DOE acknowledges 
that in very rare cases, some consumers with 130 V power may be forced 
to realize shorter lifetimes. However, based on stakeholder comments 
and research into electrical codes, DOE does not believe the rare 
instances of consumers with 130 V power experiencing shortened 
lifetimes offsets the benefit in energy savings from closing this 
potential loophole. In addition, as discussed in the April 2009 NOPR, 
because DOE considers lifetime

[[Page 34102]]

an economic issue rather than a utility issue, DOE does not believe it 
is eliminating any unique utility of feature from the market by setting 
increased efficacy requirements for lamps rated greater than or equal 
to 125 V. 74 FR 16920, 16939 (April 13, 2009)
    Finally, stakeholders have not provided any compelling arguments 
for why DOE should amend the test procedure to test all lamps at 120 V 
rather than set higher efficacy standards for these lamps. Therefore, 
in this final rule DOE is maintaining separate product classes for 
lamps with rated voltages less than 125 V and lamps with rated voltages 
greater than or equal to 125 V.
iv. IRL Summary
    In summary, DOE is not making any changes in this final rule 
related to IRL product classes from those proposed in the April 2009 
NOPR. 74 FR 16920, 17027 (April 13, 2009). Table V.2 summarizes the IRL 
product classes for this final rule.

              Table V.2--Final Rule Product Classes for IRL
------------------------------------------------------------------------
                                                     Diameter
                     Spectrum                          (in      Voltage
                                                     inches)
------------------------------------------------------------------------
Standard Spectrum.................................       >2.5    >=125 V
                                                                  <125 V
                                                        <=2.5    >=125 V
                                                                  <125 V
Modified Spectrum.................................       >2.5    >=125 V
                                                                  <125 V
                                                        <=2.5    >=125 V
                                                                  <125 V
------------------------------------------------------------------------

B. Engineering Analysis

    For each product class, the engineering analysis identifies 
potential, increasing efficacy levels above the level of the baseline 
model. Those technologies not eliminated in the screening analysis 
(design options) are inputs to this process. Design options consist of 
discrete technologies (e.g., infrared reflective coatings, rare-earth 
phosphor mixes). As detailed in the April 2009 NOPR, to ensure that 
efficacy levels analyzed are technologically feasible, DOE concentrated 
its efforts in the engineering analysis on developing product efficacy 
levels associated with ``lamp designs,'' based upon commercially-
available lamps that incorporate a range of design options. 74 FR 
16920, 16941 (April 13, 2009). However, when necessary, DOE 
supplemented commercially-available product information with an 
examination of the incremental costs and improved performance 
attributable to discrete technologies so that a substitute lamp at each 
efficacy level would be available for each baseline lamp.
    In energy conservation standard rulemakings for other products, DOE 
often develops cost-efficiency relationships in the engineering 
analysis. However, for this rulemaking, DOE derived efficacy levels in 
the engineering analysis and end-user prices in the product price 
determination. By combining the results of the engineering analysis and 
the product price determination, DOE derived typical inputs for use in 
the LCC and NIA. See chapter 7 of the TSD for further details on the 
product price determination.
1. Approach
    For the final rule, DOE is using the same methodology for the 
engineering analysis that was detailed in the April 2009 NOPR. 74 FR 
16920, 16941-47 (April 13, 2009). The following is a summary of the 
steps taken in the engineering analysis:
     Step 1: Select Representative Product Classes
     Step 2: Select Baseline Lamps
     Step 3: Identify Lamp or Lamp-and-Ballast Designs
     Step 4: Develop Efficacy Levels.
    A more detailed discussion of the methodology DOE followed to 
perform the engineering analysis can be found in the engineering 
analysis chapter of the TSD (chapter 5).
2. Representative Product Classes
    As discussed in section V.A.1 of this notice, DOE is establishing 
twelve product classes for GSFL and eight product classes for IRL. As 
detailed in the April 2009 NOPR, DOE did not analyze each and every 
product class. 74 FR 16920, 16941-42 (April 13, 2009). Instead, DOE 
selected certain product classes to analyze, and then scaled its 
analytical findings for those representative product classes to other 
product classes that were not analyzed. While DOE received several 
stakeholder comments regarding methods of scaling to product classes 
not analyzed (discussed in section V.C.7), DOE did not receive 
objections to the decision to scale to certain product classes or the 
representative product classes proposed in the April 2009 NOPR. Id. at 
16941-42. Therefore, for this final rule, DOE analyzed the same product 
classes proposed for direct analysis in the April 2009 NOPR.
    For GSFL, the analyzed product classes included 4-foot medium 
bipin, 8-foot single pin slimline, 8-foot recessed double-contact high 
output, 4-foot MiniBP standard output, and 4-foot MiniBP high output 
GSFL product classes, all with CCTs less than or equal to 4,500K. DOE 
did not explicitly analyze U-shaped lamps, but instead scaled the 
results of the 4-foot medium bipin class analysis, as discussed in 
section V.B.5.a. For IRL, the representative product class DOE analyzed 
was IRL with standard spectrum, voltage less than 125 V, and diameter 
greater than 2.5 inches. For further information on representative 
product classes, see chapter 5 of the TSD.
3. Baseline Models
    Once DOE identified the representative product classes for 
analysis, DOE selected the representative units for analysis (i.e., 
baseline lamps) from within each product class. These representative 
units are generally what DOE believes to be the most common, least 
efficacious lamps in their respective product classes. For further 
discussion on baseline lamps and lamp-and-ballast systems chosen for 
analysis, see the April 2009 NOPR (74 FR 16920, 16942-45 (April 13, 
2009)) and Chapter 5 of the TSD.
    In general, DOE decided to maintain the baseline models proposed in 
the April 2009 NOPR. However, DOE did receive a comment on its 
selection of the baseline model for 4-foot MiniBP lamps, as discussed 
and responded to below. In the April 2009 NOPR, DOE developed model T5 
halophosphor lamps as the baselines for the 4-foot MiniBP SO and 4-foot 
MiniBP HO product classes. To create these model T5 lamps, DOE used 
efficacy data from short halophosphor fluorescent T5 lamps currently 
available and developed a relationship between length and efficacy. DOE 
validated this relationship by comparing it to previous industry 
research and efficacies of other halophosphor lamps. DOE then used this 
relationship to determine the efficacies of a halophosphor 4-foot 
miniature bipin standard output lamp and a halophosphor 4-foot 
halophosphor T5 miniature bipin HO lamp. The resulting baseline 
efficacies for 4-foot MiniBP SO and 4-foot MiniBP HO lamps were 86.0 
lm/W and 76.6 lm/W. 74 FR 16920, 16943 (April 13, 2009)
    In response to the April 2009 NOPR, NEMA and GE commented that 
baseline efficacies and efficacy levels for 4-foot MiniBP lamps should 
reflect testing at an ambient temperature of 25 [deg]C rather than 35 
[deg]C, the temperature at which standards for 4-foot MiniBP lamps in 
the April 2009 NOPR were based. GE also stated that manufacturers test 
4-foot

[[Page 34103]]

MiniBP lamps at 25 [deg]C and then use a relative measurement to 
estimate performance at 35 [deg]C. This additional information is 
provided in catalogs because many T5 lamps are operated in higher-
temperature environments. (GE, Public Meeting Transcript, No. 38.4 at 
pp. 72-73, 76-78, NEMA, No. 81 at p. 3, 7, 8, 9, 22)
    DOE has confirmed that test procedures for 4-foot MiniBP lamps in 
fact specify that the test should be performed at 25 [deg]C. While DOE 
agrees that the minimum efficacy standards (and therefore efficacy 
levels) should be based on this testing condition, DOE believes that 
the efficacies and lumen outputs of lamps analyzed in the engineering 
analysis (and thus LCC and NIA) should reflect typical operating 
conditions. It is DOE's understanding that 4-foot MiniBP lamps most 
often operate at 35 [deg]C. Therefore DOE bases all lamp efficacies and 
lumen outputs used in the engineering, LCC, and national impacts 
analyses on this operating condition. DOE discusses its approach to 
establishing 4-foot MiniBP efficacy levels based on testing at 25 
[deg]C in section V.B.4.b.
    NEMA also commented that a more accurate and straightforward 
approach to modeling the 4-foot MiniBP halophosphor baseline lamp 
efficacies would be to base it on the ratio of halophosphor to 
triphosphor lamp efficacies in 4-foot T8 MBP lamps (0.78). (NEMA, No. 
81 at p. 9) DOE believes that NEMA's suggested approach is valid. 
However, when using efficacies of commercially-available 4-foot MBP 
halophosphor lamps (77.9 lm/W) and triphosphor lamps (95.4 lm/W), DOE 
calculated an efficacy ratio of 0.82. Applying this ratio to 35 [deg]C 
catalog lamp efficacies results in baseline efficacies of 4-foot MiniBP 
SO and 4-foot MiniBP HO lamps of 85.5 lm/W and 76.1 lm/W. Because these 
efficacies are within an acceptable margin of uncertainty relative to 
the baseline efficacies used in the April 2009 NOPR, DOE has not 
changed its 4-foot MiniBP baseline lamps.
    For more information about these and other baseline lamps, see 
chapter 5 and appendix 5B of the TSD.
 4. Efficacy Levels
a. GSFL Compliance Reports
    For the March 2008 ANOPR, DOE developed candidate standards levels 
for GSFL by dividing initial lumen output by the ANSI rated wattages of 
commercially-available lamps, thereby resulting in rated lamp 
efficacies.\12\ 74 FR 16920, 16945 (April 13, 2009). In response to the 
potential GSFL efficacy levels presented in the March 2008 ANOPR, NEMA 
commented on several reasons why the association believes that the 
efficacy levels need to be revised, including (1) the appropriateness 
of using ANSI rated wattages in the calculation of lumens per watt; (2) 
consideration of variability in production of GSFL; (3) manufacturing 
process limitations related to specialty products; (4) consideration of 
adjustments to photometry calibrations; and (5) the appropriateness of 
establishing efficacy levels to the nearest tenth of a lumen per watt. 
74 FR 16920, 16945-46 (April 13, 2009).
---------------------------------------------------------------------------

    \12\ DOE used rated wattages listed in ANSI C78.81-2005 to 
determine lamp efficacies. DOE proposed a definition of ``rated 
wattage'' in section III.C.1 that referred to an ANSI standard to 
prevent manufacturers from circumventing standards by rating lamps 
at artificially low wattages.
---------------------------------------------------------------------------

    After considering NEMA's comments, DOE agreed that tolerances 
incorporated into ANSI rated wattages and variability in production of 
GSFL warranted changes to the efficacy levels presented in the March 
2008 ANOPR. Therefore, in the April 2009 NOPR, DOE revised the efficacy 
levels for GSFL by using lamp efficacy values submitted to DOE over the 
past 10 years for the purpose of compliance with existing energy 
conservation standards. Using compliance reports as a basis for 
efficacy standards allowed DOE to more accurately characterize the 
tested performance of GSFL, by accounting for the measured wattage 
effects and wattage and lumen output variability. 74 FR 16920, 16946-47 
(April 13, 2009).
    DOE received several comments on its proposed efficacy levels in 
the NOPR. NEMA commented that the range of efficacy levels considered 
was appropriate. (NEMA, No. 81 at p. 21) Both ACEEE and NEMA supported 
DOE's usage of compliance reports to establish efficacy levels. 
However, NEMA commented that it has additional data on variability that 
has been observed in lamp production. (ACEEE, Public Meeting 
Transcript, No. 38.4 at p. 79-80; NEMA, Public Meeting Transcript, No. 
38.4 at pp. 89-90) NEMA recommended a slight lowering of certain GSFL 
efficacy levels so that an assessment of multiple lamps in a product 
line would find that the lamps were in conformance when tested under 
the DOE GSFL test procedure. (NEMA, Public Meeting Transcript, No. 38.4 
at pp. 90-91) NEMA also claimed that required adjustments to photometry 
facilities used for NIST and NVLAP testing over time have resulted in a 
reduction of reported lumens for some products, which DOE did not 
account for in the April 2009 NOPR. NEMA therefore advised DOE to use 
only ``sufficiently current'' compliance data to determine efficacy 
levels. (NEMA, Public Meeting Transcript, No. 38.4 at pp. 75-76; NEMA, 
No. 81 at p.10-11) To account for all of these factors, NEMA stated 
that DOE should adopt the efficacy levels NEMA recommended in response 
to the March 2008 ANOPR. These levels recommended by NEMA achieve the 
desired technology goals as outlined by DOE. (NEMA, No. 81 at pp. 1-2, 
10-11, 23) ACEEE opposed a further downward adjustment of the 
efficiency levels, as it would allow less-efficacious products to 
remain on the market. (ACEEE, Public Meeting Transcript, No. 38.4 at p. 
80)
    While DOE is aware that manufacturers may have additional data on 
production variability, NEMA has not provided such data to DOE. 
Therefore, DOE has maintained its approach (as presented in the April 
2009 NOPR) to develop GSFL efficacy levels. Additionally, DOE believes 
that by using the compliance reports it is accounting for variability 
in production as it exists today, for the reasons that follow. First, 
the product efficacy reported for compliance purposes is related to the 
lower limit of the 95-percent confidence interval. As explained in 
DOE's May 1997 lamps test procedure final rule, this interval 
represents variation over the whole population of production, not only 
the sample size. 62 FR 29222, 29230 (May 29, 1997). In addition, 
regarding any changes in calibration requirements that may have 
occurred that could affect reported lamp efficacy, DOE has reevaluated 
its efficacy levels based on the latest compliance reports, many of 
which were submitted to DOE after the NOPR analysis had been completed. 
Following the same methodology as presented in the April 2009 NOPR, DOE 
compared the efficacy values for each product class to all available 
compliance report data and assessed whether the April 2009 NOPR levels 
achieved the technology goals outlined in chapter 5 of the TSD. For 4-
foot MBP lamps, DOE determined that the efficacy levels proposed in the 
April 2009 NOPR must be revised to accurately represent those goals. 
For 4-foot MBP lamps with CCTs less than or equal to 4500K, DOE 
adjusted the efficacy values because new compliance reports: (1) 
Provided recent data for an existing basic model; (2) provided data for 
a new basic model; or (3) provided 12-month average production data 
whereas only initial data had been previously reported.

[[Page 34104]]

    NEMA also did not believe it was necessary to raise EL3 for 4-foot 
MBP lamps from their recommended 83 lumens per watt to 84 lumens per 
watt as proposed in the April 2009 NOPR. NEMA stated that this increase 
was not required to achieve the technology goal specified for TSL3 and, 
furthermore, would have significant consequences for the residential 
consumer because it eliminated nearly all T12 lamps. (NEMA, No. 81 at 
p. 2)
    In response, DOE reassessed its efficacy levels based compliance 
report data from 2008 and 2009. As a result of this analysis, DOE 
determined that the efficacy values for 4-foot MBP low CCT EL3 and EL5 
required adjustments. DOE also does not believe that the value for EL3 
will have significant consequences for the residential consumer. See 
section V.C.8 for a discussion of this topic.
    For 8-foot SP slimline lamps and 8-foot RDC HO lamps, DOE analyzed 
recent compliance reports and determined that not enough data existed 
in those reports to maintain all of the levels proposed in the April 
2009 NOPR. Therefore, DOE modified ELs 1, 2, and 5 for 8-foot SP 
Slimline lamps and EL2 for 8-foot RDC HO lamps to reflect the levels 
that NEMA recommended. The revised efficacy levels are shown in section 
VII.A.1.
b. 4-Foot MiniBP Efficacy Levels
    As discussed in the April 2009 NOPR, DOE established efficacy 
levels for 4-foot MiniBP SO and 4-foot MiniBP HO lamps based on catalog 
rated efficacies. 74 FR 16920, 16947 (April 13, 2009). Then, in order 
to account for manufacturer variation, DOE used the average reductions 
in efficacy values due to manufacturer variation calculated for the 
highest-efficacy 4-foot T8 medium bipin lamps, and applied those same 
reductions to the 4-foot miniature bipin rated efficacy values. DOE was 
unable to directly use 4-foot MiniBP lamp compliance data because these 
products have not been regulated in the past.
    As mentioned earlier, NEMA and GE commented that efficacy levels 
for these 4-foot MiniBP lamps should reflect testing at an ambient 
temperature of 25 [deg]C rather than 35 [deg]C, the temperature at 
which standards for 4-foot MiniBP lamps in the April 2009 NOPR were 
based. (NEMA, No. 81 at pp. 3, 7, 8, 9, 22; GE, Public Meeting 
Transcript, No. 38.4 at pp. 72-73) ACEEE agreed that 4-foot MiniBP 
lamps should be tested at 25 [deg]C. (ACEEE, Public Meeting Transcript, 
No. 38.4 at p. 79) As stated earlier, DOE agrees that 4-foot MiniBP 
efficacy levels should be based on testing at 25 [deg]C and notes that 
based on catalog data, efficacies at 25 [deg]C are 10 percent lower 
than efficacies at 35 [deg]C. Therefore, in this final rule, DOE has 
revised the efficacy levels for the 4-foot MiniBP product classes 
accordingly.
    In addition, NEMA commented that reductions applied to the 4-foot 
MiniBP efficacy levels in the April 2009 NOPR were insufficient to 
fully account for variability in production. (NEMA, No. 81 at pp. 3, 9, 
22) NEMA recommended that DOE adopt 86 lm/W and 76 lm/W as EL1 for the 
4-foot MiniBP SO and HO product classes, respectively. DOE recognizes 
that because it does not have compliance report information for 4-foot 
MiniBP lamps, it may not be able to accurately assess the manufacturing 
tolerance required for these lamps. Based on DOE's calculations, NEMA's 
recommended efficacy levels represent manufacturer tolerances within 
the range required by other lamp types. Therefore, in this final rule, 
DOE has revised EL1 for 4-foot MiniBP SO and HO lamps to be 86 lm/W and 
76 lm/W respectively. For consistency with those allowed manufacturer 
tolerances DOE has also revised EL2 for 4-foot MiniBP SO lamps to be 90 
lm/W. For the purposes of comparison, DOE estimates that 4-foot MiniBP 
SO and HO halophosphor lamps would have efficacies of 77 lm/W and 69 
lm/W when tested at 25 [deg]C. See Chapter 5 of the TSD for further 
detail on 4-foot MiniBP efficacy levels.
c. IRL Manufacturing Variability
    For incandescent reflector lamps, in the April 2009 NOPR, DOE 
established efficacy levels based on commercially-available and 
prototype IRL technologies. 73 FR 16920, 16944 (April 13, 2009). In 
response to those efficacy levels, Philips commented that DOE did not 
account for manufacturing variability when developing the efficacy 
levels for incandescent reflector lamps and stressed the importance of 
accounting for this variability when setting minimum efficacy 
standards. (Philips, Public Meeting Transcript, No. 38.4 at p. 102-103) 
Similarly, the International Association of Lighting Designers (IALD) 
wrote that there are currently IRL on the market that meet TSL4 but 
only by very small amounts; these products could be eliminated if TSL4 
is not carefully set. (IALD, No. 71 at p. 2) Philips also wrote that it 
is in support of TSL4 for IRL once it is lowered to account for 
manufacturing variability. (Philips, No. 75 at pp. 1-2) DOE supports 
the consideration of manufacturing variability in the development of 
efficacy requirements. In response, DOE examined IRL compliance reports 
submitted by manufacturers and discovered that reported efficacies of 
IRL do in fact vary from the catalog efficacies. Similar to GSFL, the 
efficacy reported for IRL product compliance is related to the lower 
limit of the 95-percent confidence interval. 62 FR 29222, 29230 (May 
29, 1997). Therefore, in some cases, given significant variability in 
production, the reported efficacy of IRL may be lower than the long-
term mean efficacy presented in lamp catalogs. The compliance reports 
also indicated that different efficacy levels (or technologies) require 
different efficacy reductions. Thus, similar to the approach taken in 
developing revised GSFL efficacy levels, DOE used IRL compliance report 
data to adjust the efficacy levels presented in the April 2009 NOPR 
downward to better reflect the observed efficacies of commercially-
available lamps that feature the described technologies of each EL as 
discussed in chapter 5 of the TSD. Table VII.2 shows the final rule 
coefficients A in the equation A*P[caret]0.27, which represents the 
efficacy level requirement for IRL. P is the rated wattage of the lamp. 
See chapter 5 of the TSD for further detail on the compliance reports 
used in the analysis.
5. Scaling to Product Classes Not Analyzed
a. 2-Foot U-Shaped Lamps
    For the April 2009 NOPR, DOE developed efficacy levels for 2-foot 
U-shaped GSFL by assessing the catalog efficacies of U-shaped lamps 
that utilize the same design options used for the 4-foot medium bipin 
GSFL lamps that DOE analyzed. 74 FR 16920, 16948 (April 13, 2009). To 
develop the April 2009 NOPR ELs for U-shaped lamps while taking into 
account manufacturing variability, DOE assessed compliance reports of 
U-shaped lamps. Where U-shaped lamp compliance report data was 
unavailable, DOE augmented its assessment of manufacturing variability 
with compliance report data for 4-foot medium bipin lamps due to the 
technological similarities between U-shaped and 4-foot medium bipin 
lamps. In the April 2009 NOPR, the maximum reduction in efficacy 
requirements for U-shaped lamps in comparison with the 4-foot medium 
bipin ELs was 7.7 percent at EL1 (the 4-foot medium bipin EL1 
requirement of 78 lm/W vs. the U-shaped EL1 requirement of 72 lm/W).
    At the public meeting, GE commented that it is in general agreement 
with the approach that DOE used to develop the efficacy levels for 2-
foot U-shaped lamps for the April 2009 NOPR. (GE, Public Meeting 
Transcript, No. 38.4 at p.

[[Page 34105]]

119-120) GE indicated, however, that the reduction in efficacy for U-
shaped lamps compared to 4-foot medium bipin lamps should be 
approximately 8 percent, as the production of the bend in U-shaped 
lamps adds additional manufacturing variability. (GE, Public Meeting 
Transcript, No. 38.4 at pp. 123-124) In writing, NEMA then commented 
that the assumptions that DOE used to develop U-shaped lamp reduction 
factors were incorrect; NEMA proposed that DOE set EL3 at 76 lm/W for 
U-shaped lamps with CCTs less than or equal to 4500K and 71 lm/W for U-
shaped lamps with CCTs greater than 4500K. NEMA warned that an EL3 
efficacy requirement higher than these would remove all T12 U-shaped 
lamps from the market and that the setting of EL4 or higher as a 
standard would negatively impact competition; according to comment, the 
setting of EL5 would eliminate from the market all energy-efficient U-
shaped lamps that feature a 6-inch spacing and the ability to fit into 
2x2-foot luminaires. (NEMA, No. 81 at pp. 2-3, 11)
    In response, DOE grouped U-shaped lamp compliance data sent to DOE 
in 2007 and 2008 into efficacy levels based on the design options 
featured in the 4-foot medium bipin lamps that DOE analyzed for the 
April 2009 NOPR, as follows: 700-series U-shaped 40W T12 lamps were 
grouped into EL1, and 800-series U-shaped 32W T8 lamps were grouped 
into either EL3, EL4, or EL5 based on catalog efficacy. DOE did not 
have any compliance reports from 2007 and 2008 for U-shaped 34W T12 
lamps. DOE found that it did not have enough data at ELs 1 through 5 to 
confidently assess the manufacturing variability of U-shaped lamps on 
the market. For EL1 through EL3, DOE thus selected the levels proposed 
by NEMA in response to the March 2008 ANOPR. (NEMA, No. 26 at p. 7) For 
EL4 and EL5, NEMA did not propose levels for U-shaped lamps. Thus, DOE 
used NEMA's suggested 8-percent value as a scaling factor from the 
linear 4-foot medium bipin efficacy levels. (NEMA, Public Meeting 
Transcript, No. 38.4 at pp. 123-124). The efficacy levels for low-CCT 
U-shaped lamps for this final rule are shown in chapter 5 of the TSD.
    DOE notes that two manufacturers currently produce U-shaped lamps 
that meet the EL4 proposed in the April 2009 NOPR and retained by DOE 
in this final rule. DOE acknowledges that currently, only one 
manufacturer produces U-shaped lamps that meet EL5. DOE is not aware of 
technological barriers or legal barriers (such as the utilization of a 
proprietary technology by this manufacturer) that would prevent other 
manufacturers from producing U-shaped lamps at EL5. For this reason, 
DOE is using 87 lm/W as the EL5 efficacy level requirement for U-shaped 
lamps in this final rule.
b. Lamps With Higher CCTs
    Because DOE received a number of comments related to its 
determination of efficacy levels based on compliance reports, DOE 
decided to reevaluate its efficacy levels at higher CCT levels using 
the latest compliance report data. For 4-foot MBP lamps with CCTs 
greater than 4500K, DOE discovered that the efficacy values proposed in 
the April 2009 NOPR required significant revision to achieve the 
technology goals outlined in chapter 5 of the TSD. Therefore, to 
determine efficacy values for these lamps, DOE employed the same 
methodology as was used to determine efficacy values for 4-foot MBP 
lamps with CCTs less than or equal to 4500K. Thus, as summarized in 
section V.B.4.a, DOE selected commercially available lamps for each 
efficacy level that represented that level's desired technology goal. 
These revised efficacy levels are supported by data contained in 
compliance reports submitted in 2008. The updated efficacy values for 
these lamps are shown in chapter 5 of the TSD.
    DOE also compared NEMA's proposed efficacy levels for 8-foot lamps 
against its proposed efficacy levels in the April 2009 NOPR. For 8-foot 
SP Slimline lamps with CCTs greater than 4500 K, efficacy levels 1, 2, 
and 5 were higher than those levels proposed by NEMA. For 8-foot RDC HO 
lamps with high CCTs, only efficacy level 2 was greater than what NEMA 
proposed. DOE analyzed recent compliance reports submitted and 
determined that not enough data existed in those reports to maintain 
the levels proposed in the April 2009 NOPR for these lamps. Therefore, 
DOE modified ELs 1, 2, and 5 for 8-foot SP Slimline lamps and EL2 for 
8-foot RDC HO lamps to reflect the levels that NEMA proposed. The 
revised efficacy levels are shown in section VII.A.1.
    For U-shaped lamps, NEMA proposed that DOE set EL1, EL2, and EL3 at 
65, 67, and 71 lm/W, respectively, for U-shaped lamps with CCTs greater 
than 4500K. (NEMA, No. 26 at p. 7; NEMA, No. 81 at p. 2) DOE did not 
have enough recent compliance report data for U-shaped lamps with CCTs 
above 4500K to accurately assess the manufacturing variability of U-
shaped lamps on the market. For this reason, DOE adopted NEMA's 
proposed requirements for this final rule. NEMA did not propose 
efficacy level requirements at EL4 and EL5. To develop requirements at 
these levels for U-shaped lamps with CCTs above 4500K, DOE used NEMA's 
suggested 8-percent value as a scaling factor and applied the factor to 
the high-CCT linear 4-foot medium bipin efficacy levels. (NEMA, Public 
Meeting Transcript, No. 38.4 at pp. 123-124). The efficacy levels for 
high-CCT U-shaped lamps for the April 2009 NOPR and for this final rule 
are shown in section VII.A.1.
c. Modified Spectrum IRL
    DOE received a number of comments on the reduction factor that DOE 
applied to the standard-spectrum IRL efficacy levels in order to 
develop efficacy levels for the modified-spectrum IRL product class. At 
the public meeting, NEMA commented that industry uses an efficacy 
reduction of 20 to 25 percent for modified-spectrum IRL (in comparison 
with standard-spectrum IRL of otherwise identical characteristics) and 
that the typical efficacy reduction is closer to 20 percent than 25 
percent. (NEMA, Public Meeting Transcript, No. 38.4 at pp. 128-129) 
After publication of the April 2009 NOPR, however, NEMA commented in 
writing that DOE's April 2009 NOPR analysis was based only on 50W 
modified-spectrum lamps and that DOE should choose a reduction factor 
of 25 percent for the modified-spectrum IRL product class in order to 
retain a diversity of modified-spectrum products on the market. (NEMA, 
No. 81 at p. 12) On the other hand, PG&E, ASAP, ACEEE, and NRDC 
commented in writing that if DOE does retain a modified-spectrum IRL 
product class for the final rule, the class should feature an efficacy 
reduction of no greater than 10 percent from the standard-spectrum IRL 
efficacy requirements so that manufacturers cannot produce modified-
spectrum IRL using technologies that are cheaper than technologies that 
would be needed to produced a standard-spectrum IRL of the same 
efficacy level, creating a loophole. (PG&E, ASAP, NRDC, No. 59 at p. 1-
2; NRDC, No. 82 at pp. 2, 4-5; ACEEE, No. 76 at p. 5) DOE generally 
does not believe that a modified-spectrum IRL product class will be 
utilized by manufacturers as a loophole that ultimately undermines 
energy savings. This is because DOE expects that designers of modified-
spectrum IRL will likely utilize the same design options featured in 
standard-spectrum IRL that meet a particular efficacy requirement (such 
as improved HIR technologies at EL4). Thus, in response to the comments 
of EEI, PG&E, ASAP, and NRDC, DOE expects modified-

[[Page 34106]]

spectrum IRL to have a similar cost as standard-spectrum IRL that 
comply with standards, minimizing migration to modified-spectrum IRL on 
a first-cost basis. In addition, modified-spectrum IRL are of lower 
lumen output than standard-spectrum IRL that otherwise have the same 
characteristics (particularly rated wattage) due to the subtractive 
filtering that is employed for spectrum modification. Consumers 
replacing standard-spectrum IRL with modified-spectrum IRL of the same 
rated wattage are likely to experience lower light levels, further 
discouraging migration.
    DOE acknowledges, however, that some manufacturers may attempt to 
produce modified-spectrum IRL using cheaper technologies if the 
efficacy reduction for modified-spectrum IRL permits this to occur. For 
the April 2009 NOPR, DOE analyzed two modified-spectrum IRL and found 
an average efficacy reduction of approximately 19 percent, in general 
support of NEMA's comment concerning a 20 to 25 percent efficacy 
reduction utilized by industry. PG&E commented, however, that DOE 
should analyze more than two modified-spectrum IRL in order to 
determine an appropriate efficacy reduction for the product class. 
(PG&E, Public Meeting Transcript, No. 38.4 at p. 132-133) PG&E, ASAP, 
and NRDC commented in writing that it tested commercially-available 
modified-spectrum cover glasses with a variety of commercially-
available IRL burner/reflector assemblies and found that one assembly 
produced a MacAdam step shift of more than six MacAdam steps, which is 
more than necessary to meet the modified-spectrum definition 
requirement of a four-MacAdam-step shift. The interested parties 
suggested that a smaller MacAdam-step shift would enable a more-
efficacious lamp that still provides modified-spectrum utility. (PG&E, 
ASAP, NRDC, No. 59 at p. 2)
    DOE supports the notion that additional information could enable a 
more accurate determination of the average efficacy reduction featured 
by modified-spectrum lamps and prevent a possible loophole. DOE also 
agrees that greater MacAdam-step shifts inherently reduce lamp efficacy 
by greater amounts, as more subtractive filtering is necessary to 
produce a larger shift in color point; the setting of a standard that 
can be met by commercially-available technologies that produce color 
points near the four-MacAdam-step boundary would thus preserve 
modified-spectrum utility on the IRL market while reducing the chance 
of a loophole. However, DOE was unable to find more modified-spectrum 
lamps on the market than those already found and utilized for the April 
2009 NOPR analysis. Thus, to assess the impact of varying degrees of 
spectrum modification through neodymium (which DOE found to be the most 
common method of modifying IRL spectra) in IRL cover glasses, DOE 
developed a model that correlated cover glass neodymium concentration 
with cover glass light output reduction and MacAdam-step shift in color 
point. Increasing neodymium concentrations produce greater light output 
reduction. DOE found that a 15-percent light output reduction 
correlated with a MacAdam-step shift slightly greater than four steps. 
To validate the model, DOE then obtained five commercially-available 
HIR IRL capsules and then assembled reflector lamps utilizing the 
capsules in combination with either standard-spectrum or modified-
spectrum commercially-available IRL cover glasses and reflectors. DOE 
then tested the lamps with the two cover glass types and determined 
their efficacies. The reduction in efficacy between the standard-
spectrum and modified-spectrum lamps utilizing the five commercially-
available HIR capsules obtained by DOE, averaged across the lamps, was 
approximately 16 percent. DOE believes that this value is in line with 
the output of the neodymium concentration model that it developed for 
the analysis. DOE also believes that manufacturers will be able to vary 
the neodymium concentration for cover glasses associated with a variety 
of lamp shapes such that modified-spectrum utility is preserved while 
standards are met. Thus, DOE is implementing a 15-percent reduction in 
efficacy levels for the modified-spectrum IRL product class in this 
final rule.
    While PG&E, ASAP, and NRDC mentioned that no more than a 10 percent 
reduction would be necessary for a modified-spectrum product class, DOE 
believes that this value is specific to the IRL featuring prototype 
(not commercially-available) technologies that these interested parties 
tested with a modified-spectrum cover glass. In writing, the three 
interested parties acknowledged that commercially-available IRL burner/
reflector assemblies tested with the same cover glass did not meet the 
modified-spectrum definition. (PG&E, ASAP, NRDC, Appendix 1, No. 63 at 
pp. 11-12) Because PG&E, ASAP, and NRDC did not indicate the filament 
temperature of the prototype IRL nor specify color point data, DOE 
could not determine the color of the IRL lumen output when operated 
with either the standard-spectrum or the modified-spectrum glasses. 
Thus, DOE has insufficient data to determine whether a 10-percent 
efficacy reduction could be achieved by manufacturers producing 
currently-available modified-spectrum lamps or if such a reduction 
would instead eliminate currently-available modified-spectrum lamps 
from the market. For this reason, DOE has chosen to use an efficacy 
reduction of 15 percent for the modified-spectrum IRL product class in 
this final rule, based on commercially-available IRL technologies.
d. Small Diameter IRL
    In the April 2009 NOPR, DOE recognized that the size of small-
diameter (PAR20) lamps vs. PAR30 and PAR38 lamps provides a specific 
utility to consumers (e.g. the ability to fit into smaller fixtures) 
but also results in an inherent efficacy reduction. Thus, DOE 
established a separate product class for small-diameter lamps in order 
to preserve the small-diameter utility in the IRL marketplace in the 
face of standards. 74 FR 16920, 16939 (April 13, 2009). Based on a 
comparison between the efficacies of commercially-available PAR20 lamps 
and their PAR30 and PAR38 counterparts, DOE selected an efficacy 
reduction factor of 12 percent vs. the large-diameter IRL product class 
and utilized this factor to develop the efficacy levels for the small-
diameter IRL product class.
    DOE received a number of comments on its choice of a 12-percent 
efficacy reduction factor for the small-diameter IRL product class. The 
California Stakeholders expressed that a 12-percent factor adequately 
describes the observed efficacy differences due to optics between PAR20 
and larger-diameter lamps; the California Stakeholders also warned DOE 
that the selection of a larger reduction factor would allow small-
diameter IRL to meet DOE's standards using less-efficient components, 
undermining DOE's energy savings goals. (California Stakeholders, No. 
63 at pp. 2, 22) NEMA and GE, on the other hand, commented that the 12-
percent reduction factor is inappropriate for the product class because 
75W and 50W PAR20 lamps utilize single-ended halogen burner 
technologies and a double-ended burner (which is more efficacious than 
a single-ended burner) will not fit into a PAR20 lamp, thus eliminating 
PAR20 lamps from the market in the face of a TSL4 or TSL5 standard. 
(NEMA, No. 81 at p. 7, pp. 12-13; GE, No. 80 at p. 6-7; GE, Public 
Meeting Transcript, No. 38.4 at pp. 60-61) Philips acknowledged that a 
12-percent factor describes the observed

[[Page 34107]]

efficacy differences between PAR20 lamps and larger-diameter lamps, but 
the interested party concurred with GE and NEMA concerning technical 
limitations that prevent double-ended burners from being installed into 
PAR20 lamps. (Philips, Public Meeting Transcript, No. 38.4 at p. 135-
136, p. 138) NEMA also commented that the smaller envelope featured on 
small-diameter lamps limits heat dissipation, which would cause such 
lamps to run hotter and increase the susceptibility to early failure if 
the highest-efficacy halogen IR burners were installed. (NEMA, No. 81 
at p. 13) In writing, NEMA recommended that DOE employ a reduction 
factor of 15 percent to 25 percent from the large-diameter efficacy 
levels for small-diameter lamps; the range represents the range of 
efficacies observed across small-diameter lamps on the market 
(considering a variety of manufacturers). (NEMA, No. 81 at p. 4) The 
California Stakeholders then commented in writing that PAR20 lamps will 
be able to accommodate double-ended burners by utilizing bent burner 
leads or cover glasses with a greater bulge and thus reach TSL5, as 
illustrated by two sources: A Philips MR16 lamp (which has a smaller 
diameter than a PAR20 lamp) on the European market that features a 
double-ended burner and bulged cover glass, and drawings from a 
lighting company that show the potential for a double-ended burner with 
a bent lead to be fitted into a PAR20 without a bulged cover glass. 
(California Stakeholders, No. 63 at pp. 22-24)
    Based on comments, DOE acknowledges that the installation of 
double-ended burners into small-diameter lamps could be problematic. 
DOE notes that the outer dimensions of a PAR20 lamp, including the 
shape of the bulge, are dictated by ANSI Standard C78.21 (most recently 
updated in 2003). DOE notes that it is unaware of any standard 
dictating the inner dimensions of a PAR20 lamp, nor is DOE aware of a 
standard dictating the dimensions of double-ended burners. Thus, DOE 
believes that some technical innovations may make the installation of a 
double-ended burner into a PAR20 lamp feasible. Interested parties did 
not provide additional data to DOE indicating the efficacy impacts of 
bending the lead of a double-ended burner so that it can be installed 
into a PAR20 lamp, however; DOE also could not obtain other data 
addressing these impacts. Also, DOE believes that manufacturers would 
not be able to position a double-ended burner at the optimum position 
for maximum efficacy in a PAR20 lamp due to the lamp's reduced size; 
thus, DOE believes that a greater reduction factor than 12 percent is 
warranted for PAR20 lamps at EL4 and EL5 even if a double-ended burner 
could be fitted into a PAR20 lamp.
    DOE acknowledges the Philips MR16 lamp that features a double-ended 
burner and also acknowledges that the MR16 format is smaller than the 
PAR20 format. The MR16 format, however, is a low-voltage format, and 
low-voltage lamps have different inherent characteristics than lamps 
designed for line-voltage operation. DOE thus does not believe that it 
can make assumptions about line-voltage small-diameter lamp designs by 
assessing low-voltage lamps. The California Stakeholders provided 
information showing a prototype low-voltage lamp with integrated 
transformer that can meet the April 2009 NOPR level of EL5 for IRL, but 
this interested party did not provide details about the lifetime of the 
lamp or the impacts of the transformer on efficacy. (CA Stakeholders, 
Appendix 4, No. 63 at pp. 1-5) While DOE is aware of low-voltage PAR20 
lamps utilizing integrated transformers for direct connection to line-
voltage sources, DOE does not have the data required to assess the 
impacts of such transformers on IRL efficacy; DOE thus could not 
confidently develop an efficacy level based on an IRL with an 
integrated transformer. See section VI.B.2.c for a further discussion 
of the integrated-transformer IRL design option. Because DOE cannot 
assess the effects of bent burner leads on lamp efficacy, acknowledges 
that double-ended burners cannot be optimally positioned in PAR20 
lamps, cannot make design assumptions for line-voltage lamps based on 
low-voltage lamps, and cannot assess the impacts of an integrated 
transformer on lamp efficacy, DOE is revising its PAR20 EL4 and EL5 
efficacy requirements in this final rule so that PAR20 lamps will not 
require double-ended burners to meet a standard established at EL4 or 
EL5.
    In order to determine the efficacy reduction that would result from 
using a single-ended burner instead of a double-ended burner in a lamp, 
DOE obtained a commercially-available single-ended HIR capsule and 
measured the location and dimensions of the lead wire inside of the 
capsule, which prevents a certain amount of energy from reaching the 
capsule wall and being reflected back to the capsule filament. (A 
double-ended burner features a lead wire outside of the capsule, where 
it does not interfere with the reflectance of energy from the capsule 
wall back to the capsule filament.) DOE then created a model to 
determine the efficacy impacts of the lead wire's presence inside of 
the capsule. DOE also simulated manufacturing variability by modeling 
the effects of changing the capsule dimensions and lead wire 
positioning. With the resulting data from the model, DOE determined the 
reduction in efficacy that results from the presence of the lead wire 
inside of a single-ended HIR capsule in comparison with a double-ended 
capsule, which features an external lead wire. This reduction was 
determined to be approximately 3.5 percent. For EL4 and EL5, DOE is 
thus changing the reduction factor for small-diameter lamps from the 
April 2009 NOPR value of 12 percent to the value of 15.5 percent for 
this final rule. This is within the reduction factor range proposed by 
NEMA for small-diameter IRL. (NEMA, No. 81 at p. 4) The small-diameter 
IRL reduction factors in the April 2009 NOPR and in this final rule are 
shown in Table V.3. 74 FR 16920, 16950 (April 13, 2009).

 Table V.3--Small-Diameter IRL Reduction Factors in the April 2009 NOPR
                         and in This Final Rule
------------------------------------------------------------------------
                Efficacy level                      NOPR      Final rule
------------------------------------------------------------------------
EL1...........................................          12%          12%
EL2...........................................          12%          12%
EL3...........................................          12%          12%
EL4...........................................          12%        15.5%
EL5...........................................          12%        15.5%
------------------------------------------------------------------------

    Concerning heat dissipation, DOE acknowledges that the smaller size 
of a PAR20 in comparison with larger-diameter lamps limits heat 
dissipation, which would cause a given filament to operate at a higher 
temperature if simply transplanted from a larger-diameter lamp to a 
PAR20 lamp without any other changes. DOE notes, however, that HIR R20 
lamps currently exist on the market, thus proving that high 
temperature-HIR technology in small-diameter lamps is technologically 
feasible. In addition, in its research, DOE found no ANSI standard that 
indicated a required seal temperature. In fact on product 
specifications, DOE found that commercially-available lamps have a 
variety of seal temperatures. In consideration of all of these factors, 
DOE believes that the 15.5 percent reduction for EL4 and EL5 is 
appropriate for small-diameter lamps.
e. IRL With Rated Voltages Greater Than or Equal to 125 Volts
    In the April 2009 NOPR, DOE proposed that covered IRL with rated

[[Page 34108]]

voltages greater than or equal to 125V must be 15 percent more 
efficacious than covered IRL with rated voltages less than 125V. At the 
public meeting, DOE received numerous comments on this proposal. NEMA 
commented that the proposed standard for 130V would not be technically 
feasible to achieve; 130V IRL are less efficacious than 120V IRL so 
that lifetime is preserved, and the effective elimination of 130V IRL 
would reduce utility for certain regions of the country with line 
voltages near 130V (since 120V IRL operated at 130V have reduced 
lifetimes). (NEMA, Public Meeting Transcript, No. 38.4 at pp. 60-62, 
66-67, 139-140) NEMA instead requested the elimination of a 130V IRL 
product class and the development of standards based strictly upon 
lamps' rated voltages. (NEMA, Public Meeting Transcript, No. 38.4 at 
pp. 61-62, 67; NEMA, No. 81 at pp. 7, 24) On the other hand, EEI 
commented in writing on its support of higher efficacy standards for 
lamps with rated voltages higher than 125V, while ACEEE commented at 
the public meeting that many 130V IRL are used on 120V lines as longer-
life lamps. (EEI, No. 39 at p. 3; ACEEE, Public Meeting Transcript, No. 
38.4 at pp. 65-66) Philips acknowledged that 130V IRL lose 15 percent 
in efficacy when operated at 120V but commented that there were other 
ways apart from separate product classes to prevent the usage of 130V 
IRL on 120V lines. (Philips, Public Meeting Transcript, No. 38.4 at pp. 
62, 139-140)
    DOE shares ACEEE's concern that without a more-stringent 130V IRL 
product class, 130V IRL that meet a particular IRL efficacy requirement 
will be purchased and used on 120V lines as longer-life lamps that no 
longer meet the efficacy requirement. While DOE agrees with NEMA's 
comment that 130V lamps use less power than their rated power when 
operated at 120V, DOE also supports NEMA's comments that 130V lamps are 
less efficacious than 120V lamps. (NEMA, Public Meeting Transcript, No. 
38.4 at p. 67; NEMA, No. 81 at p. 13) Specifically, a 130V lamp with a 
specific rated power, rated lumen output, efficacy, and rated lifetime 
will have lower power consumption, lower lumen output, lower efficacy, 
and longer lifetime when operated at 120V. By maintaining a separate 
product class for 130V IRL with a 15 percent increase in stringency 
relative to 120V IRL standards, DOE ensures that 130V IRL operated on 
120V lines will be as efficacious during operation as 120V IRL that 
comply with standards. DOE acknowledges that designers of 130V IRL may 
have to make certain tradeoffs to meet the efficacy requirements, but 
DOE also believes that there are a number of ways to make compliant 
130V IRL (such as by adjusting lamp lifetime). Therefore, DOE has kept 
the 130V IRL product class and its associated 15-percent stringency 
increase for the Final Rule.
    In writing, EEI also asked for clarification that the efficacy 
requirements shown in the April 2009 NOPR for IRL with rated voltages 
greater than or equal to 125V apply when the IRL are tested at 120V. 
(EEI, No. 39 at p. 3) In response, DOE notes that IRL must be tested 
for compliance according to the test procedure in section 4.3 of 
Appendix R to Subpart B of 10 CFR 430, which states in part that 
``[l]amps shall be operated at the rated voltage.'' Thus, IRL rated at 
130V should be operated at 130V during the efficacy measurement 
process. DOE believes that IRL operated at 130V are generally 15 
percent more efficacious than when they are operated at 120V; thus, 
retaining a separate product class for 130V IRL, with a 15-percent 
increase over 120V IRL standards, allows DOE to take into account the 
efficacy reduction that 130V IRL will experience when operated at 120V.

C. Life-Cycle Cost and Payback Period Analysis

    This section describes the LCC and payback period analyses and the 
spreadsheet model DOE used for analyzing the economic impacts of 
possible standards on individual consumers. Details of the spreadsheet 
model, and of all the inputs to the LCC and PBP analyses, are contained 
in chapter 8 and appendix 8A of the TSD. DOE conducted the LCC and PBP 
analyses using a spreadsheet model developed in Microsoft Excel. When 
combined with Crystal Ball (a commercially-available software program), 
the LCC and PBP model generates a Monte Carlo simulation \13\ to 
perform the analysis by incorporating uncertainty and variability 
considerations. For further details on the LCC and PBP Monte Carlo 
simulations, see the TSD appendix 8B, in which probable ranges of LCC 
results are presented.
---------------------------------------------------------------------------

    \13\ Monte Carlo simulations model uncertainty by utilizing 
probability distributions instead of single values for certain 
inputs and variables.
---------------------------------------------------------------------------

    The LCC analysis estimates the impact of a standard on consumers by 
calculating the net cost of a lamp (or lamp-and-ballast system) under a 
base-case scenario (in which no new energy conservation standard is in 
effect) and under a standards-case scenario (in which the proposed 
energy conservation regulation is applied). As part of the LCC and PBP 
analyses, DOE developed data that it used to establish product prices, 
sales taxes, installation costs, disposal costs, operating hours, 
product energy consumption, energy prices, product lifetime, and 
discount rates.
    As discussed in the April 2009 NOPR, the life-cycle cost of a 
particular lamp design is a function of the total installed cost (which 
includes manufacturer selling price, sales taxes, distribution chain 
mark-ups, and any installation cost), operating expenses (due to 
purchases of energy as well as repair and maintenance costs), product 
lifetime, and discount rate. 74 FR 16920, 16950 (April 13, 2009). DOE 
also incorporated a residual value calculation to account for any 
remaining lifetime of lamps (or ballasts) at the end of the analysis 
period. 74 FR 16920, 16950 (April 13, 2009). The residual value is an 
estimate of the product's value to the consumer at the end of the life-
cycle cost analysis period, which embodies the assumption that a lamp 
system continues to function beyond the end of the analysis period. DOE 
calculates the residual value by linearly prorating the product's 
initial cost consistent with the methodology described in the Life-
Cycle Costing Manual for the Federal Energy Management Program.\14\
---------------------------------------------------------------------------

    \14\ Fuller, Sieglinde K. and Stephen R. Peterson, National 
Institute of Standards and Technology Handbook 135 (1996 Edition); 
Life-Cycle Costing Manual for the Federal Energy Management Program 
(Prepared for U.S. Department of Energy, Federal Energy Management 
Program, Office of the Assistant Secretary for Conservation and 
Renewable Energy) (Feb. 1996). Available at: http://fire.nist.gov/fire/firedocs/build96/PDF/b96121.pdf.
---------------------------------------------------------------------------

    DOE also calculates a payback period for each standards-case lamp 
or lamp-and-ballast system. The payback period is the change in total 
installed cost of the more-efficient product compared to the baseline 
product, divided by the change in annual operating cost of that product 
compared to the baseline product. Stated more simply, the payback 
period is the time period for which a consumer must operate a more-
efficient product to recoup the assumed increased total installed cost 
(compared to the baseline product) through savings from reduced 
operating costs. DOE expresses this period in years.
    In addition, in the April 2009 NOPR and in today's final rule, DOE 
analyzes five types of events that would prompt a consumer to purchase 
a fluorescent lamp. These events account for the various economic 
impacts incurred by consumers depending upon the situations under which 
they are

[[Page 34109]]

purchasing a lamp., Described in detail in the April 2009 NOPR, these 
events are: Lamp Failure (Event I), Standards-Induced Retrofit (Event 
II), Ballast Failure (Event III), Ballast Retrofit (Event IV), and New 
Construction and Renovation (Event V). 74 FR 16920, 16958 (April 13, 
2009). Although described primarily in the context of GSFL, lamp 
purchase events can be applied to IRL as well. However, considering 
that IRL are generally not used with a ballast, the only lamp purchase 
events applicable to IRL are lamp failure (Event I) and new 
construction and renovation (Event V).
    Table V.4 summarizes the approach and data that DOE used to derive 
the inputs to the LCC and PBP calculations for the April 2009 NOPR and 
the changes made for today's final rule. The following sections discuss 
the comments DOE received regarding its presentation of the LCC and PBP 
analyses in the April 2009 NOPR and the responses and changes DOE made 
to these analyses as a result.

          Table V.4--Summary of Inputs and Key Assumptions Used in the NOPR and Final Rule LCC Analyses
----------------------------------------------------------------------------------------------------------------
                Inputs                               April 2009 NOPR                Changes for the final rule
----------------------------------------------------------------------------------------------------------------
Consumer Product Price................  Applied discounts to manufacturer         No change.
                                         catalog (``blue-book'') pricing in
                                         order to represent low, medium, and
                                         high prices for all lamp categories.
                                         Discounts were also applied to develop
                                         a price for ballasts.
Sales Tax.............................  Derived weighted-average tax values for   Updated the sales tax using
                                         each Census division and four large       the latest information from
                                         States from data provided by the Sales    the Sales Tax
                                         Tax Clearinghouse.\2\                     Clearinghouse.\3\ Updated
                                                                                   population estimates using
                                                                                   2008 U.S. Census Bureau
                                                                                   data.\4\
Installation Cost.....................  Derived costs using the RS Means          No change.
                                         Electrical Cost Data, 2007 \5\ to
                                         obtain average labor times for
                                         installation, as well as labor rates
                                         for electricians and helpers based on
                                         wage rates, benefits, and training
                                         costs. For GSFL, included 2.5 minutes
                                         of installation time to the new
                                         construction, major retrofit, and
                                         renovation events in the commercial and
                                         industrial sectors to capture the time
                                         needed to install luminaire disconnects.
Disposal Cost.........................  GSFL: Included a recycling cost of 10     No change.
                                         cents per linear foot in the commercial
                                         and industrial sectors.
                                        IRL: Not included.......................
Annual Operating Hours................  Determined operating hours by             Updated the regional
                                         associating building-type-specific        distribution of residential
                                         operating hours data with regional        buildings using the 2005
                                         distributions of various building types   Residential Energy
                                         using the 2002 U.S. Lighting Market       Consumption Survey.\10\
                                         Characterization \6\ and the Energy
                                         Information Administration's (EIA) 2003
                                         Commercial Building Energy Consumption
                                         Survey (CBECS),\7\ 2001 Residential
                                         Energy Consumption Survey,\8\ and 2002
                                         Manufacturing Energy Consumption
                                         Survey.\9\
Product Energy Consumption Rate.......  Determined lamp input power (or lamp-and- No change.
                                         ballast system input power for GSFL)
                                         based on published manufacturer
                                         literature. Used a linear fit of GSFL
                                         system power on several different
                                         ballasts with varying ballast factors
                                         in order to derive GSFL system power
                                         for all of the ballasts used in the
                                         analysis.
Electricity Prices....................  Price: Based on EIA's 2006 Form EIA-861   Updated with EIA's 2007 Form
                                         data.\11\                                 EIA-861.\12\
                                        Variability: Regional energy prices
                                         determined for 13 regions.
Electricity Price Trends..............  Forecasted with EIA's Annual Energy       Updated with EIA's April 2009
                                         Outlook (AEO) 2008.\13\                   AEO2009, which includes the
                                                                                   impacts of the American
                                                                                   Recovery and Reinvestment Act
                                                                                   of February 2009.\14\
Lifetime..............................  Commercial and industrial sector ballast  DOE added residential sector
                                         lifetime based on average ballast life    GSFL LCC analysis scenarios
                                         of 49,054 from 2000 Ballast Rule; \15\    where a consumer preserves
                                         developed separate ballast lifetime       the lamp during a fixture
                                         estimate for the residential sector       replacement and installs the
                                         using measured life reports. Lamp         preserved lamp on a new
                                         lifetime based on published               fixture. The analysis periods
                                         manufacturer literature where             for these scenarios are based
                                         available. DOE assumed a lamp operating   on the full lifetime of the
                                         time of 3 hours per start. Where          baseline lamp.
                                         manufacturer literature was not
                                         available, DOE derived lamp lifetimes
                                         as part of the engineering analysis.
                                        Residential GSFL: 4-foot medium bipin
                                         lamp lifetime is dependent on the
                                         fixture lifetime (i.e., for average
                                         residential lamp operating hours, the
                                         fixture reaches end of life before the
                                         lamp reaches end of life, and, thus,
                                         the lamp is retired before it fails.)
Discount Rate.........................  Residential: Approach based on the        For the residential sector,
                                         finance cost of raising funds to          included data from the 2007
                                         purchase lamps either through the         Survey of Consumer Finances
                                         financial cost of any debt incurred to    and the Cost of Savings Index
                                         purchase product or the opportunity       dataset covering 1984 to
                                         cost of any equity used to purchase       2008.\24\
                                         equipment, based on the Federal
                                         Reserve's Survey of Consumer Finances
                                         data \16\ for 1989, 1992, 1995, 1998,
                                         2001, and 2004.
                                        Commercial and industrial: Derived
                                         discount rates using the cost of
                                         capital of publicly-traded firms in the
                                         sectors that purchase lamps, based on
                                         data in the 2003 CBECS,\17\ Damodaran
                                         Online,\18\ Ibbotson's Associates,\19\
                                         the 2007 Value Line Investment
                                         survey,\20\ Office of Management and
                                         Budget (OMB) Circular No. A-94,\21\
                                         2008 State and local bond interest
                                         rates,\22\ and the U.S. Bureau of
                                         Economic Analysis.\23\

[[Page 34110]]

 
Analysis Period.......................  Commercial and industrial GSFL: Based on  No change.
                                         the longest baseline lamp life in a
                                         product class divided by the annual
                                         operating hours of that lamp.
                                        Residential GSFL: Based on the useful
                                         lifetime of the baseline lamp.
Lamp Purchasing Events................  Commercial and industrial sectors: DOE    No change.
                                         assessed five events: lamp failure,
                                         standards-induced retrofit, ballast
                                         failure (GSFL only), ballast retrofit
                                         (GSFL only), and new construction/
                                         renovation.
                                        Residential sector: DOE assessed three
                                         events: lamp failure, ballast failure
                                         (GSFL only), and new construction/
                                         renovation.
----------------------------------------------------------------------------------------------------------------
\1\ U.S. Bureau of Labor Statistics, Table Containing History of CPI-U U.S. All Items Indexes and Annual Percent
  Changes from 1913 to Present (Last accessed Feb. 20, 2009). Available at: ftp://ftp.bls.gov/pub/special.requests/cpi/cpiai.txt.
\2\ The four large States are New York, California, Texas, and Florida.
\3\ Sales Tax Clearinghouse, Aggregate State Tax Rates (2009) (Last accessed Feb. 20, 2009). Available at: http://thestc.com/STrates.stm. The February 20, 2009 material from this Web site is available in Docket  EE-
  2006-STD-0131. For more information, contact Brenda Edwards at (202) 586-2945.
\4\ U.S. Census Bureau, Population change: April 1, 2000 to July 1, 2008 (NST-EST2008-popchg2000-2008). Last
  accessed February 20, 2009. Available at: http://www.census.gov/popest/states/files/NST-EST2008-popchg2000-2008.csv.
\5\ R. S. Means Company, Inc., 2007 RS Means Electrical Cost Data (2007).
\6\ U.S. Department of Energy, Office of Energy Efficiency and Renewable Energy, Energy Conservation Program for
  Consumer Products: Final Report: U.S. Lighting Market Characterization, Volume I: National Lighting Inventory
  and Energy Consumption Estimate (2002). Available at: http://www.eere.energy.gov/buildings/info/documents/pdfs/lmc_vol1_final.pdf.
\7\ U.S. Department of Energy, Energy Information Administration, Commercial Building Energy Consumption Survey:
  Micro-level data, file 2 Building Activities, Special Measures of Size, and Multi-building Facilities (2003).
  Available at: http://www.eia.doe.gov/emeu/cbecs/public_use.html.
\8\ U.S. Department of Energy, Energy Information Administration, Residential Energy Consumption Survey: File 1:
  Housing Unit Characteristic (2006). Available at: http://www.eia.doe.gov/emeu/recs/recs2001/publicuse2001.html.
\9\ U.S. Department of Energy, Energy Information Administration, Manufacturing Energy Consumption Survey, Table
  1.4: Number of Establishments by First Use of Energy for All Purposes (Fuel and Nonfuel) (2002). Available at:
  http://www.eia.doe.gov/emeu/mecs/mecs2002/data02/shelltables.html.
\10\ U.S. Department of Energy, Energy Information Administration, Residential Energy Consumption Survey: File
  1: Housing Unit Characteristics (2008). Available at: http://www.eia.doe.gov/emeu/recs/recspubuse05/datafiles/RECS05file1.csv.
\11\ U.S. Department of Energy, Energy Information Administration, Form EIA-861 for 2006 (2006). Available at:
  http://www.eia.doe.gov/cneaf/electricity/page/eia861.html.
\12\ U.S. Department of Energy, Energy Information Administration, Form EIA-861 for 2007 (2007). Available at:
  http://www.eia.doe.gov/cneaf/electricity/page/eia861.html.
\13\ U.S. Department of Energy, Energy Information Administration, Annual Energy Outlook 2008 with Projections
  to 2030 (June 2008). Available at: http://www.eia.doe.gov/oiaf/archive/aeo08/index.html.
\14\ U.S. Department of Energy, Energy Information Administration, An Updated Annual Energy Outlook 2009
  Reference Case Reflecting Provisions of the American Recovery and Reinvestment Act and Recent Changes in the
  Economic Outlook (April 2009). Available at: http://www.eia.doe.gov/oiaf/servicerpt/stimulus/index.html.
\15\ U.S. Department of Energy, Energy Efficiency and Renewable Energy, Office of Building Research and
  Standards, Technical Support Document: Energy Efficiency Standards for Consumer Products: Fluorescent Lamps
  Ballast Final Rule (Sept. 2000). Available at: http://www1.eere.energy.gov/buildings/appliance_standards/residential/gs_fluorescent_0100_r.html.
\16\ The Federal Reserve Board, Survey of Consumer Finances. Available at: http://www.federalreserve.gov/PUBS/oss/oss2/scfindex.html.
\17\ U.S. Department of Energy, Energy Information Administration, Commercial Building Energy Consumption Survey
  (2003). Available at: http://www.eia.doe.gov/emeu/cbecs/.
\18\ Damodaran Online, The Data Page: Historical Returns on Stocks, Bonds, and Bills--United States (2006) (Last
  accessed Sept. 12, 2007). Available at: http://pages.stern.nyu.edu/~~adamodar. The September 12, 2007 material
  from this Web site is available in Docket  EE-2006-STD-0131. For more information, contact Brenda
  Edwards at (202) 586-2945.
\19\ Ibbotson's Associates, Stocks, Bonds, Bills, and Inflation, Valuation Edition, 2001 Yearbook (2001).
\20\ Value Line, Value Line Investment Survey (2007). Available at: http://www.valueline.com.
\21\ U.S. Office of Management and Budget, Circular No. A-94 Appendix C (2008). Available at: http://www.whitehouse.gov/omb/circulars/a094/a094.html.
\22\ Federal Reserve Board, Statistics: Releases and Historical Data--Selected Interest Rates--State and Local
  Bonds (2008). Available at: http://www.federalreserve.gov/releases/h15/data/Monthly/H15_SL_Y20.txt.
\23\ U.S. Department of Commerce, Bureau of Economic Analysis, Table 1.1.9 Implicit Price Deflators for Gross
  Domestic Product (2008). Available at: http://www.bea.gov/national/nipaweb/SelectTable.asp?Selected=N.
\24\ Mortgage-X, Mortgage Information Service. Cost of Savings Index (COSI), Index History. 2009. Last accessed,
  February 25, 2009. http://mortgage-x.com/general/indexes/default.asp.

1. Consumer Product Price
    In the April 2009 NOPR, DOE used a variety of sources to develop 
consumer equipment prices, including lamp and ballast prices in 
manufacturers' suggested retail price lists (``blue books''), State 
procurement contracts, large electrical supply distributors, hardware 
and home improvement stores, Internet retailers, and other similar 
sources. DOE then developed low, medium, and high prices based on its 
findings. 74 FR 16920, 16952 (April 13, 2009).
    At the public meeting, Philips commented that DOE's estimated costs 
of IRL in the residential sector reported in the proposed rule appear 
too low in comparison with the costs of commercial IRL. (Philips, 
Public Meeting Transcript, No. 38.4 at pp. 179-181) In response, DOE 
notes that the costs of all commercial IRL in the LCC and PBP analyses 
include $1.10 to account for the labor cost of a four-minute 
installation time at a labor rate of $16.55 per hour. (Using the 
consumer price index for 2008, the labor rate for this final rule was 
inflated to 2008 dollars, as compared to the April 2009 NOPR value of 
$15.94 per hour in 2007 dollars.) Conversely, DOE assumes that 
consumers in the residential sector will replace their own lamps and, 
therefore, does not model labor costs for IRL in the residential 
sector; this difference in

[[Page 34111]]

methodology contributes to the relative price difference between 
commercial and residential IRL. In addition, DOE acknowledges that 
lamps sold through various distribution chains may have differing end-
user prices. For this reason, DOE conducts the LCC analysis on the high 
and low lamp prices as sensitivities, DOE believes that the sources and 
methodologies used to develop IRL prices for the April 2009 NOPR 
reflect the variety of IRL prices encountered by consumers in the 
residential and commercial sectors. The results of the IRL price 
sensitivities analysis can be found in Appendix 8B of the TSD.
    Philips also commented that the incremental price differential for 
more-efficacious IRL appears too small. (Philips, Public Meeting 
Transcript, No. 38.4 at pp. 179-181) Additionally NEMA and Philips 
stated that the prices of IRL will be uncertain due to expected 
capacity constraints in 2012. (NEMA, Philips, Public Meeting 
Transcript, No. 38.4 at pp. 286-287)
    DOE recognizes that the imposition of a standard will commoditize 
higher-efficacy IRL that may be sold today as premium products at 
higher markups (from manufacturing costs to end-user prices) than 
lower-efficacy IRL. Prices of IRL in DOE's analysis are meant to 
reflect commoditization of these higher-efficacy products in the face 
of standards. DOE assessed discounts between blue book prices and end-
user prices of currently-available lower-efficacy IRL to obtain 
information about how commoditization affects IRL price. DOE took this 
information into account during the development of prices for the IRL 
that comply with each EL shown in today's final rule. Furthermore, 
although DOE recognizes that there may be uncertainty regarding future 
IRL prices, interested parties did not provide additional data to DOE 
as would cast doubt on its overall pricing methodology or as would 
support an alternative methodology. For these reasons, DOE has not 
changed the April 2009 NOPR IRL methodologies or prices for this final 
rule. For further information on the development of IRL prices, see 
chapter 7 of the final rule TSD.
2. Sales Tax
    In the April 2009 NOPR, DOE obtained State and local sales tax data 
from the Sales Tax Clearinghouse. (April 2009 NOPR TSD chapter 7) The 
data represented weighted averages that include county and city rates. 
DOE used the data to compute population-weighted average tax values for 
each Census division and four large States (New York, California, 
Texas, and Florida). For the final rule, DOE retained this methodology 
and used updated sales tax data from the Sales Tax Clearinghouse \15\ 
and updated population estimates from the U.S. Census Bureau.\16\
---------------------------------------------------------------------------

    \15\ Sales Tax Clearinghouse, ``Aggregate State Tax Rates'' 
(2009) (Last accessed February 20, 2009). Available at: http://thestc.com/STrates.stm. The February 20, 2009, material from this 
Web site is available in Docket EE-2006-STD-0131. For more 
information, contact Brenda Edwards at (202) 586 2945.
    \16\ U.S. Census Bureau, ``Population Change: April 1, 2000 to 
July 1, 2008'' (July 2008). Available at: http://www.census.gov/popest/states/files/NST-EST2008-popchg2000-2008.csv.
---------------------------------------------------------------------------

3. Annual Operating Hours
    As discussed in the April 2009 NOPR, DOE developed annual operating 
hours for IRL and GSFL by combining building type-specific operating 
hours data from the 2002 U.S. Lighting Market Characterization (LMC) 
\17\ with data in the 2003 Commercial Building Energy Consumption 
Survey (CBECS),\18\ the 2001 Residential Energy Consumption Survey 
(RECS),\19\ and the 2002 Manufacturing Energy Consumption Survey 
(MECS),\20\ which describe the probability that a particular building 
type exists in a particular region. 74 FR 16920, 16954-55 (April 13, 
2009). For this final rule, DOE updated the residential annual 
operating hours estimates using the 2005 RECS.\21\ Residential-sector 
average operating hours changed from 789 to 791 hours per year for GSFL 
and from 884 hours per year in the April 2009 NOPR to 889 hours per 
year for this final rule for IRL. DOE did not receive any further 
comments on residential-sector operating hours. For further details on 
the annual operating hours used in the analyses, see chapter 6 of the 
TSD.
---------------------------------------------------------------------------

    \17\ U.S. Department of Energy, Office of Energy Efficiency and 
Renewable Energy, ``U.S. Lighting Market Characterization. Volume I: 
National Lighting Inventory and Energy Consumption Estimate 
(2002).'' Available at: http://www.netl.doe.gov/ssl/PDFs/lmc_vol1_final.pdf.
    \18\ 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.
    \19\ U.S. Department of Energy, Energy Information 
Administration, Residential Energy Consumption Survey: File 1: 
Housing Unit Characteristic (2006). Available at: http://www.eia.doe.gov/emeu/recs/recs2001/publicuse2001.html.
    \20\ U.S. Department of Energy, Energy Information Agency, 
``Manufacturing Energy Consumption Survey, Table 1.4: Number of 
Establishments by First Use of Energy for All Purposes (Fuel and 
Nonfuel) (2002).'' Available at: www.eia.doe.gov/emeu/mecs/mecs2002/data02/shelltables.html.
    \21\ U.S. Department of Energy, Energy Information 
Administration, Residential Energy Consumption Survey: File 1: 
Housing Unit Characteristic (2009). Available at: http://www.eia.doe.gov/emeu/recs/recspubuse05/pubuse05.html.
---------------------------------------------------------------------------

4. Electricity Prices and Electricity Price Trends
    As explained in the April 2009 NOPR, DOE determined energy prices 
by deriving regional average prices for 13 geographic areas consisting 
of the nine U.S. Census divisions, with four large States (New York, 
Florida, Texas, and California) treated separately. 74 FR 16920, 16955-
56 (April 13, 2009). For the April 2009 NOPR, DOE derived electricity 
prices based on data from the 2006 publication of EIA Form 861. Id. At 
the public meeting, ACEEE commented that DOE should use the latest 
available electricity prices and electricity price trends in its 
analysis for the final rule. (ACEEE, Public Meeting Transcript, No. 
38.4 at pp. 154-155)
    DOE agrees with ACEEE and has updated the related electricity price 
and electricity price trend sources for the final rule analysis. For 
electricity price data, the analysis now utilizes EIA's Form 861 
electricity price data from the year 2007.\22\ DOE obtained electricity 
price trend data from EIA's latest AEO2009,\23\ which was published in 
April 2009 and is a special update of the March 2009 AEO2009 (the 
initial release of EIA's AEO2009) \24\ that includes the impacts of the 
American Recovery and Reinvestment Act (ARRA) of February 2009 (Pub. L. 
111-5). To project electricity prices to the end of the LCC analysis 
period, DOE used the reference economic growth projection in the April 
AEO2009. As done for the April 2009 NOPR, DOE used the price trend 
average rate of change during 2020-2030 to estimate the price trends 
after 2030. See chapter 8 of the April 2009 NOPR TSD \25\ as well as 
chapter 8 of the final rule TSD. The spreadsheet tools and LCC 
sensitivity scenarios featured in the April 2009 NOPR also included 
high-economic-growth and low-economic-growth electricity price trend

[[Page 34112]]

cases from EIA. The April 2009 AEO2009 did not include these cases, 
however. To generate them, DOE utilized the difference between the 
reference economic-growth case and the high- and low-economic-growth 
cases in the March 2009 AEO2009 as scaling factors to produce high- and 
low-economic-growth estimates for the spreadsheet tools and LCC 
sensitivity scenarios addressed in this final rule.
---------------------------------------------------------------------------

    \22\ U.S. Department of Energy, Energy Information 
Administration, Form EIA-861 for 2007 (2007). Available at: http://www.eia.doe.gov/cneaf/electricity/page/eia861.html.
    \23\ U.S. Department of Energy, Energy Information 
Administration, An Updated Annual Energy Outlook 2009 Reference Case 
Reflecting Provisions of the American Recovery and Reinvestment Act 
and Recent Changes in the Economic Outlook (April 2009). Available 
at: http://www.eia.doe.gov/oiaf/servicerpt/stimulus/index.html.
    \24\ U.S. Department of Energy, Energy Information 
Administration, Annual Energy Outlook 2009 with Projections to 2030 
(March 2009). Available at: http://www.eia.doe.gov/oiaf/aeo/.
    \25\ U.S. Department of Energy. Chapter 8: Life-Cycle Cost and 
Payback Period Analyses. Available at: http://www1.eere.energy.gov/buildings/appliance_standards/residential/pdfs/ch_8_lamps_standards_nopr_tsd.pdf.
---------------------------------------------------------------------------

    The results of DOE's analysis using the reference economic-growth 
projections are presented in this notice, with a full set of results 
displayed in chapter 8 of the TSD. DOE also presents LCC and PBP 
results for the low-economic-growth and high-economic-growth cases from 
AEO2009 in appendix 8B of the final rule TSD.
5. Ballast Lifetime
    For the April 2009 NOPR, DOE used a commercial and industrial 
sector ballast lifetime of approximately 50,000 hours, which is the 
average ballast life used in the 2000 final rule for fluorescent lamp 
ballasts (2000 Ballast Rule).\26\ 65 FR 56740 (Sept. 19, 2000). In the 
primary commercial sector LCC and PBP analysis, this is equivalent to a 
lifetime of approximately 14.2 years (based on an average of 3,435 
operating hours per year in the commercial sector).
---------------------------------------------------------------------------

    \26\ U.S. Department of Energy. April 2009 NOPR Technical 
Support Document. Chapter 4. Life-Cycle Costs and Payback Periods. 
Available at: http://www1.eere.energy.gov/buildings/appliance_standards/residential/pdfs/chap4.pdf.
---------------------------------------------------------------------------

    At the public meeting, Lutron Electronics agreed that a ballast 
lifetime of 50,000 hours is common, and a 14.2 year lifetime is 
appropriate for a ballast that is operated approximately 3,500 hours 
per year. However, Lutron Electronics also commented that the ballast 
service life (in years) will change as operating hours change. (Lutron 
Electronics, Public Meeting Transcript, No. 38.4 at pp. 152-153) DOE 
agrees with Lutron Electronics and verifies that in its commercial and 
industrial LCC analyses, for the Monte Carlo simulations (that analyze 
a distribution of operating hours) and for the consumer subgroup 
analyses, DOE varies ballast service life as operating hours change.
    For the residential sector LCC and PBP analysis in the April 2009 
NOPR, DOE used a ballast lifetime of 15 years, based on measure life 
reports that discuss ballast lifetime in terms of 
years.27 28 74 FR 16920, 16959 (April 13, 2009). In other 
words, DOE assumed that a ballast installed in the residential sector 
would remain in place for an average of 15 years, regardless of its 
annual operating hours. The measure life reports, published in 2005 and 
2007, incorporate both magnetic and electronic ballasts. DOE used the 
measure life reports because DOE believes they best capture the true 
service life of ballasts in the residential sector.
---------------------------------------------------------------------------

    \27\ GDS Associates, Inc., Engineers and Consultants, Measure 
Life Report: Residential and Commercial/Industrial Lighting and HVAC 
Measures (The New England State Program Working Group) (2007).
    \28\ Economic Research Associates, Inc., and Quantec, LLC, 
Revised/Updated EULs Based On Retention And Persistence Studies 
Results (Southern California Edison) (2005).
---------------------------------------------------------------------------

    At the NOPR public meeting, ACEEE stated that in 2005, the vast 
majority of ballasts were magnetic, suggesting that the measure life 
that DOE assumed may not be appropriate. ACEEE also commented that the 
ballast lifetimes, when expressed in hours (15 years in place is 
equivalent to 11,869 hours of life based on average residential GSFL 
operating hours), appeared too low for the residential sector. (ACEEE, 
Public Meeting Transcript, No. 38.4 at pp. 154, 169-170) In response, 
DOE notes that it did not receive any data that indicate the measure 
life of electronic ballasts differs from magnetic ballasts. Thus, DOE 
does not believe there is a difference in the lifetimes of the two 
ballast types that is substantial enough to affect the results of the 
analyses. First, it is worth noting that the 2000 Ballast Rule assumes 
no difference between the two ballast lifetimes.\29\ Second, 
manufacturer product literature does not generally suggest or market a 
difference in lifetimes between magnetic and electronic ballasts. 
Third, in interviews, manufacturers mentioned that there was no 
substantial difference in reliability (a proxy for service life) 
between magnetic and electronic ballasts. Finally, DOE understands that 
most ballasts are rated for longer lifetimes (in hours) than the 
lifetimes that DOE used in its analyses. DOE reiterates, however, that 
the measure life reports estimate the lifetimes of actual ballasts in 
the field, accounting for not only ballast failure at its rated life, 
but also premature failure, fixture removal, and replacement during 
renovation. For all of these reasons, DOE continues to use the measure 
life reports to determine ballast service life in the residential 
sector.
---------------------------------------------------------------------------

    \29\ U.S. Department of Energy. Chapter 4. Life-Cycle Costs and 
Payback Periods. Available at: http://www1.eere.energy.gov/buildings/appliance_standards/residential/pdfs/chap4.pdf.
---------------------------------------------------------------------------

6. Lamp Lifetime
    When possible, for the April 2009 NOPR, DOE used manufacturer 
literature to determine lamp lifetimes. 74 FR 16920, 16956-57 (April 
13, 2009). When published manufacturer literature was not available--as 
was the case for some IRL--DOE derived lamp lifetimes as part of the 
engineering analysis. DOE also considered the impact of group re-
lamping practices on GSFL lifetimes in the commercial and industrial 
sectors in this final rule. 74 FR 16920, 16954 (April 13, 2009). For 
details, see chapter 5 of the final rule TSD.
    For GSFL, DOE based its lamp lifetimes on lamp start cycles of 3 
hours per start. At the public meeting, Southern California Edison 
commented that residential GSFL may experience much shorter start 
cycles than 3 hours per start, thereby lowering their lifetimes from 
rated values. (Southern California Edison, Public Meeting Transcript, 
No. 38.4 at pp. 166-167) DOE acknowledges that some residential GSFL 
may indeed experience shorter start cycles than 3 hours per start, 
thereby reducing lamp lifetime due to increased electrode degradation. 
Research indicated to DOE that the effective lifetimes of lamps 
operated at start cycles other than 3 hours per start is highly 
variable and depends directly on the lamp type as well as the type of 
ballast (i.e., program start, instant start, or rapid start) to which 
the lamp is connected. Southern California Edison did not provide data 
to illustrate the expected lifetimes of any of the residential GSFL 
(either base-case or standards-case) featured on any of the ballasts 
that DOE presents in the LCC analysis, nor did it provide data 
indicating the prevalence of various start cycles in the residential 
sector. In response to these comments, DOE conducted research but was 
unable to find data sources for the residential sector that specified 
any of this information. For this reason, DOE has chosen to maintain 
the usage of rated lamp lifetimes based on 3 hour start cycles for this 
final rule.
7. Discount Rates
    In the April 2009 NOPR, DOE derived residential discount rates by 
identifying all possible debt or asset classes that might be used to 
purchase replacement products, including household assets that might be 
affected indirectly. DOE estimated the average proportions of the 
various debt and equity classes in the average U.S. household equity 
and debt portfolios using data from the Survey of Consumer Finances 
(SCF) sources from 1989 to 2004. DOE used the mean share of each class 
across the six sample years as a basis for estimating the effective 
financing rate for replacement equipment. DOE estimated interest or

[[Page 34113]]

return rates associated with each type of equity and debt using SCF 
data and other sources. The mean real effective rate across the classes 
of household debt and equity, weighted by the shares of each class, was 
5.6 percent for the April 2009 NOPR. 74 FR 16920, 16957 (April 13, 
2009). For this final rule, DOE updated the sources used to compute the 
discount rate in the residential sector. The analysis now features data 
from the 2007 Survey of Consumer Finances and the Cost of Savings Index 
dataset covering 1984 to 2008. Based on these updates, the residential 
sector average discount rate for the final rule is 4.8 percent.
    For the commercial sector and industrial sector, DOE derived the 
discount rate from the cost of capital of publicly-traded firms in the 
sectors that purchase lamps, as done for the April 2009 NOPR 74 FR 
16920, 16957 (April 13, 2009). Because DOE received no comments on its 
commercial and industrial sector discount rates and all sources used 
remain the most current sources available, for this final rule, DOE has 
continued to use discount rates of 7.0 percent and 7.6 percent for the 
commercial and industrial sectors, respectively.
8. Residential Fluorescent Lamp Analysis
    In the April 2009 NOPR, DOE produced a residential sector GSFL 
life-cycle cost and payback period analysis based upon measure life 
reports that indicated an average residential GSFL fixture lifetime of 
15 years. 74 FR 16920, 16956 (April 13, 2009). Under average operating 
hours (791 hours per year), DOE determined that a 4-foot MBP lamp would 
live approximately 19 years. In the April 2009 NOPR LCC analysis, DOE 
assumed that consumers would discard their lamps during fixture 
replacement, effectively ending the life of the lamps, thus resulting 
in no lamp-only replacements in the residential sector under average 
operating hours. The 2.5-year analysis period used by DOE for the 
residential GSFL lamp failure events represented DOE's belief that 
under high operating hours (1,210 hours per year), if a baseline lamp 
and fixture were purchased at the same time, the baseline lamp would 
fail after approximately 12.5 years and the fixture would be replaced 
2.5 years after the lamp failure (for a total fixture life of 15 
years). Thus, after a lamp failure, the replacement lamp would have 2.5 
years in which to operate before the fixture is replaced. DOE's 
analysis period for calculating the LCC savings for residential 
consumers responding to a lamp failure was therefore 2.5 years.
    Both Southern California Edison and the California Stakeholders 
commented that the 2.5-year analysis period utilized by DOE in the NOPR 
to model the residential GSFL lamp failure events is too short and that 
the energy savings should be considered over the full life of the 
replacement lamp, in other words 12.5 years. In their suggested 
revisions to the LCC analysis, the stakeholders imply that upon fixture 
replacement, consumers will retain their previously-installed 
replacement lamp and reinstall it on a new fixture. According to the 
comments, analyzing such a scenario under high operating hours results 
in significant life-cycle cost savings for the residential lamp failure 
event when consumers are forced to retrofit their T12 systems with T8 
systems. (Southern California Edison, No. 53 at p. 1-7; California 
Stakeholders, No. 63 at p. 9)
    DOE acknowledges that in the residential sector, consumers may 
choose to preserve a lamp instead of discarding it upon fixture 
replacement, though in its research, DOE was unable to determine which 
situation was more likely. DOE recognizes that retaining a lamp beyond 
the fixture or ballast life would extend the useful lamp life, and, 
thus, the analysis period. Modeling this scenario would take into 
account operating cost savings over a longer period of time and 
additional equipment costs to the consumer, who in the base case is 
replacing their T12 lamp and will need to purchase a new ballast at 
some point in the future. Therefore, for this final rule, DOE has 
analyzed an additional scenario in the residential sector LCC analysis 
modeling this preservation of lamp behavior. This analysis shows that 
some residential consumers with T12 systems do in fact obtain LCC 
savings when forced to retrofit their T12 ballast with a T8 system. 
However, DOE also notes that the results of this analysis are highly 
dependent on the remaining years of lifetime left on the T12 ballast 
when the lamp is replaced. DOE presents the LCC results for this 
additional scenario in section VII.C.1.a of this final rule as well as 
in chapter 8 and appendix 8B of the TSD.
    In contrast to Southern California Edison and the California 
Stakeholders who implied that DOE's analysis understated the consumer 
economic savings to the residential sector of retrofitting from a T12 
to T8 system, GE commented that such a retrofit presents a best-case 
estimate of a 50-year payback period, and, therefore, is not 
economically justified. (GE, No. 80 at pp. 1-3; GE, Public Meeting 
Transcript, No. 38 at p. 81)
    While DOE acknowledges that the standards presented in this final 
rule place some burden on some residential T12 GSFL users, DOE believes 
that the LCC analysis performed for this final rule accurately reflects 
this burden. DOE notes that as discussed below, payback period 
calculations do not account for expenses incurred by consumers who 
purchase new fixtures in the middle of the analysis period. In 
addition, DOE notes that the assumptions of electricity prices, labor 
rates, system energy savings, and operating hours that GE used to 
produce the payback estimate in its written comment do not align with 
the inputs that DOE presented in the April 2009 NOPR and updated for 
this final rule. DOE recognizes that there may be some variability in 
these inputs, but believes that DOE estimates represent those 
experienced for the average consumer. In addition, DOE notes that it 
did not receive specific adverse comments on these inputs themselves.
9. Rebuttable Payback Period Presumption
    The payback period (PBP) is the amount of time it takes a consumer 
to recoup the assumed incremental costs of a more-efficient product 
through lower operating costs. In the April 2009 NOPR and today's final 
rule, DOE used a ``simple'' PBP, so named because the PBP does not take 
into account other changes in operating expenses over time or the time 
value of money. 74 FR 16920, 16957-58 (April 13, 2009). As inputs to 
the PBP analysis, DOE used the total installed cost of the product to 
the consumer for each efficacy level, as well as the first year annual 
operating costs for each efficacy level. The calculation requires the 
same inputs as the LCC, except for energy price trends and discount 
rates; only energy prices for the year the standard takes effect (2012 
in this case) are needed.
    At the public meeting, Earthjustice commented that there is a 
presumption that an energy conservation standard is economically 
justified if the payback period of products that comply with the 
standard is less than three years. (Earthjustice, Public Meeting 
Transcript, No. 38.4 at pp. 186-187) Earthjustice further stated that 
DOE did not calculate a rebuttable presumption payback period for each 
trial standard level presented in the April 2009 NOPR and that DOE 
cannot ignore the rebuttable presumption payback period out of 
preference for the seven-factor test described in 42 U.S.C. 
6295(o)(2)(B)(i). ACEEE similarly commented in writing that ``[a] 
higher burden of proof is required to overcome the rebuttable

[[Page 34114]]

presumption.'' (Earthjustice, No. 60 at p. 6; ACEEE, No. 76 at p. 6) 
DOE is aware of the rebuttable presumption payback period test in 42 
U.S.C 6295(o)(B)(iii), which states that ``[i]f 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 procedure, there shall be a 
rebuttable presumption that such standard level is economically 
justified.'' While DOE acknowledges that the rebuttable presumption 
payback period computation can have value, DOE emphasizes that the 
presumption is rebuttable, specifically because DOE is required by law 
to consider the specific criteria in 42 U.S.C. 6295(o)(2)(B)(i) when 
prescribing new standards, such as impacts on utility, competition, and 
the Nation as a whole. Thus, DOE's analyses of these criteria serve to 
either support or rebut any initial determination that a standard is 
economically justified based on the rebuttable payback period 
presumption. There is no statutory provision that requires DOE to 
emphasize the rebuttable presumption payback period test over the 
specific criteria that must be considered according to 42 U.S.C. 
6295(o)(2)(B)(i); thus, DOE disagrees that ``[a] higher burden of proof 
is required to overcome the rebuttable presumption.'' There is also no 
statutory requirement for DOE to present a single rebuttable 
presumption payback period for each trial standard level. DOE has 
conducted the full set of economic analyses required by 42 U.S.C. 
6295(o)(B)(i) for this final rule. The results of this analysis serve 
as the basis for DOE to definitively evaluate the economic 
justification for a potential standard level.
    The payback periods shown in chapter 8 and appendix 8B of the final 
rule TSD are ``simple payback periods'' computed using the same 
methodology that would be utilized to compute payback periods for a 
rebuttable presumption payback period test; DOE's seven-factor analysis 
serves to confirm or rebut any assumption of economic justification 
based on payback periods that are shorter than three years. DOE 
stresses, however, that there are several factors for which the LCC 
analysis accounts, but the payback period analysis does not. For 
example, the LCC analysis includes financing effects and utilizes 
energy costs that vary over time. In addition, DOE notes that the 
simple payback period values computed for some lamp purchase events and 
scenarios do not fully express the equipment costs experienced by 
consumers in these scenarios. Payback period calculations take into 
account only the installed costs incurred at the very beginning of the 
analysis period. Thus, the calculation excludes the economic impacts of 
any additional costs (e.g., a new ballast purchase, recycling costs) 
that may be incurred in the middle or at the end of the analysis 
period. For these reasons, DOE believes that the LCC analysis and other 
analyses performed for this final rule serve as a higher-fidelity 
assessment of economic impacts than the computation of payback periods 
alone. In other words, the LCC results serve to support or rebut the 
results of the PBP analysis. Therefore, DOE is continuing to utilize 
these higher-fidelity analyses as a definitive evaluation of the 
economic impacts of the standards presented and chosen in this final 
rule.

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

    DOE's NIA assesses 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 standards at specific 
efficacy levels.
    For the final rule analysis, DOE used the same spreadsheet model 
(with updated inputs as discussed below) described and used in the NOPR 
to calculate the NES and NPV based on the annual energy consumption and 
total installed cost data employed in the LCC analysis. 74 FR 16920, 
16958-71 (April 13, 2009). DOE forecasts energy savings, energy cost 
savings, equipment costs, and NPV for each product class from 2012 
through 2042. The forecasts provide annual and cumulative values for 
all four output parameters. DOE also examines impact sensitivities by 
analyzing various lamp shipment scenarios (such as Roll-up and Shift).
    To arrive at these output parameters, DOE first develops a base-
case forecast for each analyzed lamp type. This forecast characterizes 
energy use and consumer costs (lamp purchase and operation) in the 
absence of new or revised energy conservation standards. To evaluate 
the impacts of such standards on these lamps, DOE compares this base-
case projection with projections characterizing the market if DOE were 
to promulgate new or amended standards (i.e., the standards case). In 
characterizing the base and standards cases, DOE considers historical 
shipments, its shipment projections, emerging technologies, the mix of 
efficacies sold in the absence of any new standards, and how that mix 
might change over time. Inputs and issues associated with the NIA and 
any changes made in this final rule are discussed in more detail 
immediately below.
1. Overview of NIA Changes in This Notice
    Based on the comments it received regarding the April 2009 NOPR, 
DOE made a number of changes to the NIA. Table V.5 summarizes the 
approach and data DOE used to derive the inputs to the NES and NPV 
analyses for the April 2009 NOPR, as well as the changes it made for 
this final rule in response to comments and updated information. As 
demonstrated by the table, DOE changed several inputs due to the 
availability of updated sources. For example, DOE updated projected 
electricity prices from EIA's AEO2008 estimates to AEO2009. In 
addition, DOE calculated new annual marginal site-to-source conversion 
factors based on the version of the National Energy Modeling System 
(NEMS) that corresponds to AEO2009. Following the table, DOE details 
additional inputs and changes, and summarizes and responds to each of 
the NIA-related comments it received at the public meeting and in 
written comments. See TSD chapters 10 and 11 for further details.

 Table V.5--Approach and Data Used To Derive the Inputs to the National
              Energy Savings and Net Present Value Analyses
------------------------------------------------------------------------
                                 April 2009 NOPR       Changes for the
           Inputs                  description           final rule
------------------------------------------------------------------------
Shipments...................  Annual shipments      See Table V.6 and
                               from shipments        Table V.7.
                               model.
Effective date of standard..  2012................  No change.
Analysis period.............  2012 to 2042........  No change.

[[Page 34115]]

 
Unit energy consumption (kWh/ Established in the    Residential
 yr).                          energy-use            operating hours
                               characterization,     updated based on
                               TSD chapter 6, by     RECS 2005 (from
                               lamp or lamp-and-     RECS 2001).
                               ballast design and
                               sector.
Total installed cost........  Established in the    No change.
                               product price
                               determination, TSD
                               chapter 7 and the
                               LCC analysis,
                               chapter 8, by lamp-
                               and-ballast designs.
Electricity price forecast..  Based on AEO2008      Updated for AEO2009
                               forecasts (to 2030)   (used version
                               and an                informed by impacts
                               extrapolation for     of the American
                               beyond 2030. (See     Reinvestment and
                               TSD chapter 8).       Recovery Act).
Energy site-to-source         Conversion varies     Updated for AEO2009
 conversion.                   yearly and was        (used version
                               generated by DOE/     informed by impacts
                               EIA's NEMS program    of the American
                               (a time-series        Reinvestment and
                               conversion factor;    Recovery Act).
                               includes electric
                               generation,
                               transmission, and
                               distribution
                               losses).
                              Conversion factors
                               for beyond 2030 are
                               held constant.
HVAC interaction savings....  6.25% of total        No change.
                               energy savings in
                               all sectors.
Rebound effect..............  1% of total energy    No change.
                               savings in the
                               commercial and
                               industrial sectors.
                              8.5% of total energy
                               savings in the
                               residential sector.
Discount rate...............  3% and 7% real......  No change.
Present year................  Future costs and      Future costs and
                               savings are           savings are
                               discounted to 2007.   discounted to 2009.
------------------------------------------------------------------------

2. Shipments Analysis
    Lamp shipments are an important input to the NIA. In the April 2009 
NOPR, DOE explained how it developed separate shipment models for GSFL 
and IRL. 74 FR 16920, 16959-70 (April 13, 2009). In general, to 
forecast shipments for these two categories of lamps, DOE followed a 
four-step process. First, DOE used 2001-to-2005 historical shipment 
data from NEMA and other publicly-available sources to estimate the 
total historical shipments (i.e., NEMA member and non-NEMA member 
shipments) of each lamp type analyzed. Second, based on these 
historical shipments and the average service lifetime of each lamp 
type, DOE calculated the installed stock of lamps for each lamp type in 
2005. Third, by modeling lamp purchasing events, and applying growth 
rate, replacement rate, and emerging technologies penetration rate 
assumptions, DOE developed annual shipment projections from 2006 to 
2042. (NEMA had not provided publically-available data for years after 
2005). Specifically, DOE modeled lamp (and ballast for GSFL) shipments 
based on four lamp-purchasing market events: (1) New construction; (2) 
ballast failure (GSFL only); (3) lamp replacement; and (4) standards-
induced retrofit (for the standards case). DOE also calibrated its 
shipments model to reflect confidential shipment data provided by NEMA 
for 2006 and 2007. Finally, because the shipments of lamp designs and 
lamp-and-ballast designs (for GSFL) often depend on their properties 
(e.g., ballast factor and efficacy), DOE developed base-case and 
standards-case market-share matrices as another model input. The 
market-share matrices characterize the efficacy, power rating, light 
output, and lifetime of the lamp and lamp-and-ballast designs. The 
matrices input the percentage market share of each design into the 
shipment model. DOE used these market-share matrices to forecast lamp 
stock and shipments, taking into account each design's respective 
lifetime.
    Table V.6 and Table V.7 summarize the approach and data DOE used 
for GSFL and IRL, respectively, to derive the inputs to the shipments 
analysis for the April 2009 NOPR, as well as the changes DOE made for 
the final rule. A discussion of comments DOE received on these inputs 
and of the changes implemented for the final rule follows.

Table V.6--Approach and Data Used to Derive the Inputs to GSFL Shipments
                                Analysis
------------------------------------------------------------------------
                                    2009 NOPR          Changes for the
           Inputs                  description           final rule
------------------------------------------------------------------------
Historical shipments........  2001-2005 shipment    No change.
                               data provided
                               publicly by NEMA
                               (except for T5
                               lamps; see NOPR TSD
                               chapter 10).
                               Assumed NEMA data
                               represented 90
                               percent of GSFL
                               shipments.
                               Calibrated 2006-
                               2007 forecasted
                               shipments based on
                               confidential
                               historical shipment
                               data NEMA provided
                               for those years.
Lamp inventory..............  Calculated stock in   No change.
                               2005. Then used
                               growth, emerging
                               technologies, and
                               shipment
                               assumptions to
                               establish lamp
                               inventory from 2006
                               to 2042.
Growth......................  Based commercial and  Updated commercial
                               residential growth    and residential
                               on AEO2008            growth for AEO2009
                               estimates for         (used version
                               future floor space    informed by impacts
                               growth. For the       of the American
                               residential sector,   Reinvestment and
                               modeled variations    Recovery Act).
                               in number of lamps
                               per new home. For
                               the industrial
                               sector, projected
                               floor space growth
                               using the 2002
                               Manufacturer Energy
                               Consumption Survey
                               (MECS 2002).
Base-case scenarios.........  Developed two base-   Updated LED prices
                               case scenarios, one   and performance
                               of which modeled      projections for
                               the market            DOE's Solid State
                               penetration of LEDs   Lighting Research
                               based on projected    and Development
                               payback period.       Multi-Year Program
                                                     Plan FY'09-FY'15.

[[Page 34116]]

 
Market-share matrices.......  Developed product     Revised product
                               distributions based   distributions based
                               on comments,          on comments, NEMA
                               interviews, and       survey data and
                               catalog research.     further research.
                               Matrices apportion
                               a share of
                               shipments for each
                               lamp-and-ballast
                               design option.
Standards-case scenarios....  Considered two sets   No change
                               of scenarios to
                               characterize
                               consumer behavior
                               in response to
                               standards: the
                               Shift and Roll-up
                               scenarios and the
                               High and Market
                               Segment-Based
                               Lighting Expertise
                               scenarios.
------------------------------------------------------------------------


 Table V.7--Approach and Data Used to Derive the Inputs to IRL Shipments
                                Analysis
------------------------------------------------------------------------
                                    2009 NOPR          Changes for the
           Inputs                  description           final rule
------------------------------------------------------------------------
Historical shipments........  2001-2005 shipment    Received additional
                               data provided         historical
                               publicly by NEMA.     shipments (2004-
                               Assumed NEMA data     2008) from NEMA
                               represented 85        with which DOE
                               percent of IRL        verified growth,
                               shipments.            projected
                               Calibrated 2006-      shipments, and
                               2007 projected        emerging
                               shipments based on    technologies
                               confidential          assumptions.
                               historical shipment
                               data NEMA provided
                               for those years.
Lamp inventory..............  Calculated stock in   No change.
                               2005 based on
                               average lifetime
                               and historical
                               shipments. Then
                               used growth,
                               replacement rate,
                               and emerging
                               technologies
                               assumptions to
                               establish lamp
                               inventory from 2006
                               to 2042.
Growth......................  Shipment growth       Updated for AEO2009
                               driven by socket      (used version
                               growth. Socket        informed by impacts
                               growth based on       of the American
                               AEO2008 estimates     Reinvestment and
                               for future            Recovery Act).
                               commercial floor
                               space and
                               residential
                               buildings. Also
                               accounted for trend
                               of increasing
                               sockets per home.
Base-case R-CFL and emerging  Developed two base-   Updated LED prices
 technologies.                 case scenarios        and performance
                               modeling the market   projections for
                               penetration of        DOE's Solid State
                               light emitting        Lighting Research
                               diodes (LEDs),        and Development
                               ceramic metal         Multi-Year Program
                               halides (CMH), and    Plan FY'09-FY'15.
                               reflector compact
                               fluorescent lamps
                               (R-CFL) based on
                               projected payback
                               period.
Market-share matrices.......  Considered mix of     No change.
                               technologies
                               consumers select in
                               the base case and
                               standards case, as
                               well as each of the
                               scenarios analyzed.
Standards-case scenarios....  Modeled both Roll-up
                               and Shift
                               scenarios.
                              Revised BR lamp       Modeled migration to
                               sensitivity           only exempted BR
                               scenario, creating    lamps in the new
                               two new standards-    ``BR Product
                               case scenarios also   Substitution''
                               accounting for        scenario, which
                               additional            replaced the ``No
                               migration to R-CFL:   Product
                               ``Product             Substitution''
                               Substitution'' and    scenario.
                               ``No Product         Modeled migration to
                               Substitution.''       only R-CFL in the
                                                     new ``R-CFL Product
                                                     Substitution,''
                                                     which replaced the
                                                     ``Product
                                                     Substitution''
                                                     scenario.
                                                    Added the ``Baseline
                                                     Lifetime''
                                                     scenarios modeling
                                                     sale of lamps with
                                                     lifetimes similar
                                                     to the baseline
                                                     lamps in the
                                                     standards case.
                                                     (See section VI.C)
------------------------------------------------------------------------

3. Macroeconomic Effects on Growth
    In the April 2009 NOPR, as part of its shipments forecasts, DOE 
established commercial floor space and residential buildings growth 
based on AEO2008. Because AEO2008 does not provide industrial floor 
space forecasts, DOE used historical MECS floor space values to 
establish a growth rate for the industrial sector. 74 FR 16920, 16961 
(April 13, 2009). OSI stated that growth will be subject to economic 
shocks over time, and pointed to the current decline in the commercial 
market as evidence to that fact. (OSI, Public Meeting Transcript, No. 
38.4 at p. 213-214) Southern California Edison commented that DOE 
should look at past economic dislocations to better forecast lamp 
shipments through 2042. (Southern California Edison, Public Meeting 
Transcript, No. 38.4 at p. 214) The California Stakeholders urged DOE 
not to change its NIA assumptions with respect to the recent 
macroeconomic downturn reasoning that such a modification would add no 
value to DOE's analysis because no one can accurately predict the 
timing and extent of an economic recovery. An attempt by DOE to do so 
would unduly burden its efforts to publish a final rule by the 
deadline. (California Stakeholders, No. 63 at p. 8)
    While DOE agrees that future shipments will be subject to general 
economic shocks over time, DOE believes there is no practical way of 
projecting the timing of those shocks throughout the analysis period. 
DOE's projections (of sockets and thus shipment growth) incorporate 
AEO2009's assumption of average gross domestic product (GDP) growth of 
2.5 percent annually. That is consistent with historical growth, which 
has averaged 2.85 percent annually over the last 30 years, covering 
both recessionary and expansionary cycles.\30\ Because of this 
consistency with historical trends and the incorporation of future 
economic growth considerations, DOE believes its approach of using 
AEO's projections is superior to extrapolating from specific historical 
economic events.
---------------------------------------------------------------------------

    \30\ National Economic Accounts, Bureau of Economic Analysis, 
U.S. Department of Commerce (Last accessed on Feb. 28, 2009). 
Available at: http://www.bea.gov/national/nipaweb/Index.asp.

---------------------------------------------------------------------------

[[Page 34117]]

4. Reflector Market Growth
    To establish IRL shipment forecasts in the April 2009 NOPR, DOE 
first modeled the projected growth in the total reflector lamp market. 
To do this, DOE utilized the year-to-year commercial floor space and 
residential building growth projections in AEO2008. DOE also accounted 
for a trend toward more fixtures in new and renovated homes. To do 
this, DOE obtained historical California data\31\ on recessed cans per 
home, categorized by home age. Using this data, DOE estimated the 
average number of recessed cans per home to grow from 4.82 in 2005 to 
8.52 in 2042. To estimate the growth rate in each year, DOE multiplied 
this growth in the number of recessed cans in homes by the projected 
stock of homes according to AEO2008. Combining these two sources, DOE 
predicted an average growth rate of sockets of 2.6 percent between 2006 
and 2042. 74 FR 16920, 16961 (April 13, 2009).
---------------------------------------------------------------------------

    \31\ RLW Analytics, Inc., ``California Statewide Residential 
Lighting and Appliance Efficiency Saturation Survey'' (August 2005) 
(Last accessed on Sept. 29, 2008). Available at: www.calresest.com/docs/2005CLASSREPORT.pdf.
---------------------------------------------------------------------------

    In response to DOE's shipment forecasts, NEMA commented that DOE's 
stated average annual growth rate of 2.6 percent for IRL was not 
realistic. NEMA also provided additional historical IRL shipment data 
from 2004 to 2008 that show shipments of PAR38 lamps decreasing 
approximately 8 percent per year and shipments of PAR30 and PAR20 lamps 
only marginally increasing. (NEMA, No. 81 at p. 14-15) In response, DOE 
notes that the 2.6 percent growth rate in sockets presented in the 
April 2009 NOPR does not represent growth in overall IRL shipments. DOE 
used that growth in sockets and then applied varying penetrations of 
non-IRL technologies into those sockets to determine IRL shipment 
forecasts, as discussed in section V.D.5. In fact, after accounting for 
these non-IRL technologies, DOE's resulting 2004 to 2008 IRL shipments 
decline at a rate consistent with NEMA's historical shipments.
    At the NOPR public meeting, EEI commented that data from RECS show 
that California homes historically have been smaller than the national 
average. Therefore, using the California study as a proxy for the 
nation as a whole may not be appropriate. Additionally, in recent 
years, EEI stated that new U.S. homes have stopped growing in terms of 
average floor space. EEI suggested that DOE research other State 
studies and regional studies from the National Association of Home 
Builders to obtain more values for growth rates of lighting fixtures. 
Philips agreed and stated a preference for much more pessimistic IRL 
growth projections than those used by DOE, due to the economic 
slowdown, houses getting smaller, and the penetration of CFLs and other 
emerging technologies. (EEI, Public Meeting Transcript, No. 38.4 at p. 
196; Philips, Public Meeting Transcript, No. 38.4 at p. 197; EEI, No. 
38.4 at pp. 3,4)
    In response, DOE agrees that RECS data shows that the average home 
in California is smaller than the average home in the U.S. However, 
that fact does not mean DOE's extrapolation of the California trend 
(showing increasing number of light sources per home) to the nation is 
inappropriate. As discussed above and in TSD chapter 10, DOE used the 
growth rate of sockets per California home as an input into its 
national shipment projections, not the absolute number of sockets per 
home. It is the growth in the size of California homes relative to the 
growth of all U.S. homes that is important to the analysis, not the 
absolute size of the homes. Therefore, as long as the floor space 
growth rate of new homes in California is consistent with rest of the 
country, the trend toward more sockets in California is applicable in 
this instance to the country as a whole. To that point, Census data 
from 1973 to 2008 show that average floor space of new homes in the 
West has grown at roughly the same rate as in the nation overall--1.11 
percent versus 1.20 percent. Therefore, DOE believes the application of 
the California data to the rest of the country is appropriate in this 
instance and has not changed its methodology for the final rule.
    With regard to the comment that homes are no longer growing in 
size, DOE's analysis of census housing data shows positive annual 
single-family home floor space growth in each year from 1994 to 2007. 
In 2008, the overall U.S. average did indeed decline by 0.5 percent. 
However, while year-to-year average growth has varied over 35 years, 
the long-term trend is clearly upward--as mentioned above, the average 
floor space of new homes has grown at a compounded annual rate of 1.2 
percent since 1973. AEO2009 projections for average residential square 
footage, which incorporate macroeconomic effects, also predict a long-
term trend of positive floor space growth. Therefore, DOE believes 
projecting continued growth in the number of sockets per home is 
appropriate and has not changed its methodology for the final rule. 
This enables DOE to continue to use AEO forecasts, which capture 
macroeconomic conditions--as many comments have urged DOE to do--in its 
socket and shipment growth projections. With regard to the comment 
suggesting DOE obtain more regional housing data, DOE notes that 
AEO2009 projections for residential housing stock growth are based off 
Census data on the nine Census Divisions. AEO projects housing stocks 
separately for each Census Division. Given the purposes of this 
analysis and the nationwide applicability of standards, DOE believes 
this methodology incorporates a sufficient level of geographic 
granularity.
5. Penetration of R-CFLs and Emerging Technologies
    As discussed in more detail in the April 2009 NOPR (74 FR 16920, 
16962-63 (April 13, 2009)) DOE developed and analyzed two base-case 
shipment scenarios for IRL that estimated varying penetrations of non-
IRL technologies into the reflector market. For the Existing 
Technologies scenario, DOE only considered the market penetration of 
technologies that are currently readily available and have reached 
maturation in terms of price and efficacy, namely R-CFL. In the 
Emerging Technologies scenario, DOE attempted to forecast the market 
penetration of mature technologies and those technologies that are 
still undergoing significant changes in price and efficacy. 
Specifically, DOE considered the market penetration of R-CFL, LED 
lamps, and CMH lamps in the Emerging Technologies scenario. Because the 
lamps employing emerging technologies are beyond the scope of the 
rulemaking, DOE did not consider them design options for improving IRL 
or GSFL efficacy. Instead, DOE considered these technologies potential 
substitutes for the lamps covered in this rulemaking. DOE assumed that 
the price of emerging technologies relative to covered technologies is 
related to the likelihood that a consumer will buy an emerging 
technology instead of a covered lamp.
    DOE developed price, performance, and efficacy forecasts for each 
of the analyzed R-CFL and emerging technologies. For the LED forecasts, 
DOE used data from its Solid State Lighting Multi-Year Program Plan. 
(For this final rule, DOE updated its LED forecasts for DOE's latest 
Multi-Year Program Plan.)\32\ With these inputs, DOE calculated the 
payback period (PBP) of each technology in the relevant

[[Page 34118]]

sector using the difference between its purchase price, annual 
electricity cost, and annual lamp replacement cost relative to the lamp 
it replaces. (See TSD chapter 10 for further details.) DOE then used a 
relationship between PBP and market penetration to predict the market 
penetration of each technology in the relevant sector in every year 
from 2006 to 2042. DOE received several comments on how it estimated R-
CFL and emerging technologies penetrations into the IRL market, as 
discussed below.
---------------------------------------------------------------------------

    \32\ Multi-Year Program Plan FY'09 to FY'15: Solid-State 
Lighting Research and Development (March 2009). Available at: http://apps1.eere.energy.gov/buildings/publications/pdfs/ssl/ssl_mypp2009_web.pdf.
---------------------------------------------------------------------------

    At the public meeting, EEI commented that dimmable CFLs could 
dramatically impact IRL growth if the dimmable technology improves. 
(EEI, Public Meeting Transcript, No. 38.4 at p. 202) In contrast, ADLT 
commented that DOE overestimated the penetration of R-CFLs in the 
commercial market in its April 2009 NOPR analysis. ADLT stated that 
many commercial lighting applications require directional lighting for 
which R-CFLs are ineffective. (ADLT, No. 72 at p. 5)
    In response to EEI's comment, DOE agrees that enhanced utility 
features of various emerging technologies may change the rate at which 
they are adopted. DOE also acknowledges that there is considerable 
uncertainty in predicting the penetration of non-IRL technologies into 
the IRL market. It is for this very reason that DOE models two base-
case scenarios that encompasses a large range of potential 
penetrations. DOE believes that its Emerging Technologies forecast 
adequately captures the effects of any increased penetration of R-CFLs 
through advances in dimming technology. As discussed in TSD chapter 10, 
based on payback period calculations, in the Emerging Technologies 
forecast, DOE predicts that R-CFLs will have a significant impact on 
IRL shipments only in the first few years of the analysis period. 
Thereafter, LEDs, which have dimming capability (and thus can provide 
the utility at issue in the comment), become more cost-effective and 
dominate the emerging technologies forecast, despite any potential 
future improvement in R-CFL dimming capabilities.
    With regard to ADLT's comment, DOE recognizes that there are 
several qualities of R-CFLs (such as form factor, beam spread, color 
quality, directionality, and dimming capability) which may result in 
consumers' unwillingness to purchase them for IRL applications. DOE has 
attempted account for these factors by reducing the penetration of R-
CFLs by approximately 40 percent relative to the penetrations predicted 
by the payback period-penetration calculations. However, considering 
the significant uncertainty regarding these penetrations, DOE verified 
its R-CFL penetration by comparing its modeled shipments from 2005 to 
2008 to NEMA's historical shipments. As discussed earlier, DOE found 
that during this time period, the rate of decline in historical IRL 
shipments (which is primarily due to R-CFL penetration) is consistent 
with DOE's modeled shipments. For this reason, DOE does not feel it 
necessary or that there is an analytical basis and data to modify its 
R-CFL penetration estimates.
    Pertaining to the Emerging Technology forecasts, NEMA commented 
that the April 2009 NOPR analysis incorrectly projected IRL shipments 
to increase after reaching a minimum level. NEMA asserted that DOE 
should remodel its expected energy savings with a continued decline in 
IRL shipments after 2024. (NEMA, No. 81, p. 15) DOE believes that its 
IRL forecasts are reasonable. As emerging technologies continue to 
improve and their prices continue to decrease, DOE agrees that IRL 
shipments will further decline as market share shifts from IRL to LED. 
However, as these emerging technologies reach maturation, DOE believes 
that their relative market share will stabilize, consistent with their 
mature cost and performance features. Thus, as the total number of 
reflector lamp sockets continues to increase (due to new construction), 
it is reasonable to predict that IRL shipments will experience a 
moderate increase as well. However, as DOE acknowledges that there is 
considerable uncertainty regarding its forecasts, DOE performed a 
sensitivity analysis for the Emerging Technologies scenario in which 
IRL shipments continue to decline until emerging technologies reach a 
maximum market penetration, which is upheld for the rest of the 
analysis period. This sensitivity analysis results in approximately a 6 
percent decrease in energy savings over the analysis period.
6. Building Codes
    In response to the April 2009 NOPR, GE commented that increasingly-
stringent building codes will most likely be phased in over time, 
causing IRL growth to slow and decline. (GE, Public Meeting Transcript, 
No. 38.4 at pp. 205-206) EEI also stated that the most recent model 
building codes would have an effect on lighting technologies and 
efficiencies. EEI added that the 2009 International Energy Conservation 
Code (IECC) for residential construction calls for 50 percent of 
lighting to be high-efficiency. Once DOE certifies the IECC, EEI 
stated, States have one year to update their codes to meet or exceed 
the IECC 2009, which will alter the growth of IRL. (EEI, Public Meeting 
Transcript, No. 38.4, pp. 206-207, 315; EEI, No. 45 at pp. 5-6).
    In response, to evaluate the effects of more-stringent building 
codes being phased in over the analysis period, DOE identified and 
evaluated three of the most influential building codes across the 
country. These included: (1) California's Title 24,\33\ which is 
mandatory in the State; (2) the latest International Energy 
Conservation Code (IECC 2009), which is a model energy code and which 
some States voluntarily incorporate by reference into their building 
codes, and (3) ASHRAE/IESNA Standard 90.1-2004. Each code has sections 
that pertain to residential and commercial lighting. For example, IECC 
2009 requires that high-efficacy light bulbs be installed in at least 
50 percent of permanent lighting fixtures in new residential homes. 
``High-efficacy'' is defined as:
---------------------------------------------------------------------------

    \33\ California Energy Commission, ``Residential Compliance 
Manual For California's Energy Efficiency Standards,'' Chapter 6 
(April 2005) (Last accessed: June 18, 2009). Available at: http://www.energy.ca.gov/2005publications/CEC-400-2005-005/chapters_4/q/6_Lighting.pdf.
---------------------------------------------------------------------------

    ``A lighting fixture that does not contain a medium screw base 
socket (E24/E26) and whose lamps have a minimum efficacy of:
    1. 60 lumens per watt for lamps over 40 watts,
    2. 50 lumens per watt for lamps over 15 watts to 40 watts,
    3. 40 lumens per watt for lamps 15 watts or less.'' \34\
---------------------------------------------------------------------------

    \34\ International Code Council, ``International Energy 
Conservation Code: Excerpt From the 2007 Supplement'' (July 2007) 
(Last accessed: June 18, 2009). Available at: http://www.iccsafe.org/cs/codes/2007-08cycle/2007Supplement/IECC07S.pdf.
---------------------------------------------------------------------------

    The California Building Standards Code (Title 24) requires that all 
luminaires that are permanently installed via new construction, 
alterations, or additions (including replacements) be high-efficacy. 
Title 24's definition of ``high-efficacy'' is very similar to that in 
IECC 2009.
    DOE also researched ASHRAE/IESNA Standard 90.1-2004, a commonly-
referenced code for commercial buildings. Although it rarely references 
lumen-per-watt metrics directly, the code does impose lighting power 
density requirements and requires controls for many building types and 
sizes, while providing various allowances and exemptions for many 
applications.
    When evaluating how such codes will affect lamp shipments, it is 
important to note that DOE does not have the authority to mandate that 
States enact

[[Page 34119]]

residential building codes, as EEI suggested (although for commercial 
codes DOE can require the adoption of a certain code it determines will 
improve the energy efficiency of the nation's commercial building 
stock). (42 U.S.C. 6833(b)(2)(A)) To clarify, EPCA requires DOE to 
determine whether updates to IECC's residential energy efficiency code 
will improve the energy efficiency of the nation's residential housing 
stock. When DOE makes such a positive determination, States are 
required to review (but not necessarily adopt) the energy provisions of 
the code and to determine whether it would be appropriate to revise 
residential building codes to meet or exceed the model code on which 
DOE made a positive determination. (42 U.S.C. 6833(b)(1)). States must 
complete their review within two years of DOE's positive determination. 
Given a variety of policy considerations and the absence of a direct 
mandate under EPCA that States adopt such building codes, currently, 
the stringency of residential codes adopted varies widely throughout 
the country.\35\ The most recent and stringent codes are not 
necessarily adopted by States. Furthermore, in some States, local 
governments have authority over their building codes (known as ``Home 
Rule''), making it even more likely that the stringency of building 
codes will vary widely throughout the country. For these reasons, DOE 
does not believe that it should explicitly assume that new, more 
stringent codes will necessarily be adopted, implemented, and enforced. 
Furthermore, building codes are informed by product capabilities, IESNA 
recommended light levels, and lamp and ballast efficiencies, rather 
than vice versa. With that said, however, while not a driver of 
development of more efficient technology, DOE agrees that increasingly-
stringent residential building codes are likely to contribute to a 
greater share of shipments being higher-efficacy lamps by the end of 
the analysis period as compared to the start of the period. Consistent 
with this trend, DOE's market share matrices show migration to higher-
efficacy lamps in the base case, which allow for the effects of more-
energy-efficient building codes, although DOE did not directly analyze 
those effects. See chapter 10 of the TSD for the full market-share 
matrices in 2012 and 2042.
---------------------------------------------------------------------------

    \35\ See: http://www.energycodes.gov/implement/state_codes/index.stm.
---------------------------------------------------------------------------

7. GSFL Shipments Growth
    NEMA also commented on several aspects of the GSFL shipment 
forecasts. NEMA commented that DOE should forecast shipments that 
account for a migration to GSFL with longer lifetimes. NEMA argued that 
this phenomenon, currently occurring through both the increased 
shipments of T8 lamps relative to T12 lamps and through a movement from 
short-life T8 lamps to long-life T8 lamps, will result in a decline of 
overall GSFL shipments. NEMA stated that such an effect would 
materially affect DOE's economic justification of GSFL standard levels. 
(NEMA, No. 81 at p. 14) In response to NEMA's concern, DOE agrees that 
it is important to account for the economic effects of consumers 
purchasing longer-life GSFL and has done so. In its NOPR analyses and 
in chapter 11 of the TSD, DOE has fully accounted for this migration 
toward longer-life lamps in its calculations of consumer equipment 
costs and industry revenues, which are inputs into its calculations of 
NPV and INPV. According to the NIA model, the average commercial sector 
4-foot MPB T8 shipped in 2012 has a lifetime of approximately 6 years; 
in 2042, the average lifetime is approximately 7 years.
    NEMA also commented that DOE overlooked the trend toward more 
lighting controls and occupancy sensors in the commercial sector and, 
therefore, did not account for this effect in slowing shipment growth 
and reducing potential energy savings. NEMA asserted that this 
highlights the flaw in the current rulemaking approach (e.g., 
considering lamps instead of lighting systems). (NEMA, No. 81 at p. 14)
    In response, DOE researched the issue of lighting controls and how 
their deployment may affect the potential energy savings from more-
efficient lamps. DOE agrees that lighting controls are penetrating the 
commercial buildings sector and as these technologies advance, building 
managers seek to control costs, and more recent commercial building 
energy codes are adopted. DOE's research suggested this trend is almost 
entirely in the new construction and major renovation market segments. 
A 2003 study suggested such controls are already common to roughly 60 
percent of newly-constructed commercial square footage.\36\ DOE has 
determined that the impacts of lighting controls are captured by the 
operating-hours data derived from CBECS and employed in DOE's analysis. 
However, as NEMA pointed out, given the additional time for the 
continued market penetration of these controls throughout the analysis 
period and the fact that buildings larger than 5,000 square feet 
require automatic shutoff controls to be in compliance with the most 
recent versions of the most referenced energy codes,\37\ higher 
penetration rates are possible in the future. Therefore, to evaluate 
the potential increased penetration of lighting controls, DOE conducted 
a sensitivity analysis in which it estimated that all new commercial 
building floor space after 2012 featured automated lighting controls, 
such as occupancy sensors and scheduling systems.
---------------------------------------------------------------------------

    \36\ DiLouie, Craig, ``Lighting Controls: Current Use, Major 
Trends and Future Direction,'' Lighting Controls Association (2003).
    \37\ See, for example, http://resourcecenter.pnl.gov/cocoon/morf/ResourceCenter/article/1566. (Last accessed June 16, 2009).
---------------------------------------------------------------------------

    Next, DOE estimated the reduced operating hours due to these 
lighting controls based on industry references. A Lighting Research 
Center study on savings potential from occupancy sensors found a range 
of 17 percent to 60 percent, depending on the application and tenant 
behavior.\38\ This finding was in line with other industry estimates. 
For its analysis, DOE assumed the midpoint of these findings (38.5 
percent) as the energy savings achieved by new commercial buildings 
employing lighting controls. DOE then reduced commercial operating 
hours by the product of the energy savings, increase in commercial 
square footage with lighting controls, and the average proportion of 
the lighting market serving newly-constructed commercial buildings over 
the analysis period. Based on these inputs, DOE calculated 
approximately a 0.5 percent decline in national energy savings and an 
average reduction in shipments of 0.5 percent over the analysis period. 
Although this reflects a relatively small impact, DOE considered this 
information in weighing the economic justification of the final rule. 
See TSD chapter 11 for more details on the lighting controls 
sensitivity analysis.
---------------------------------------------------------------------------

    \38\ VonNeida, Bill; Maniccia, Dorene; Tweed, Alan, An Analysis 
of the Energy and Cost Savings Potential of Occupancy Sensors for 
Commercial Lighting Systems, Lighting Research Center and 
Environmental Protection Agency (August 2000).
---------------------------------------------------------------------------

8. Residential Installed GSFL Stock
    In the April 2009 NOPR, DOE allotted a portion of the 4-foot MBP 
installed stock in 2012 to the residential sector. To model this, DOE 
chose the representative system as a 40W T12, 4-foot MBP lamp on a 
magnetic low-ballast-factor ballast. 74 FR 16920, 16942-16943 (April 
13, 2009). DOE

[[Page 34120]]

received comments on its residential sector analysis for the GSFL NIA. 
These comments are discussed below.
    NEMA stated that DOE's analysis overlooked the fact that a small 
portion of the residential installed base is already composed of T8 
lamps, thereby resulting in an overstatement of energy savings. NEMA 
stated that fixture manufacturers have begun to sell more T8 fixtures 
for the residential sector and that one luminaire manufacturer reported 
sales in the sector are currently split evenly between T8 and T12 
fixtures. (NEMA, No. 81 at p. 8)
    DOE acknowledges that in there is some present migration to T8 
lamps in the residential sector. However, DOE also believes that the 
vast majority of the installed GSFL stock in the residential sector is 
T12 lamps. This view was communicated in public meetings, comments, and 
manufacturer interviews, as noted in the April 2009 NOPR. 74 FR 16920, 
16942 (April 13, 2009). For example, in earlier comments, NEMA stated 
that the residential sector is projected to use more than 75 percent of 
all 4-foot medium bipin T12 lamps sold by 2012 and this level would be 
expected to persist, given that the 2000 Ballast Rule allows continued 
use of the most common residential magnetic ballast. (NEMA, No. 21, at 
p. 20; OSI, Public Meeting Transcript, No. 20 at p. 276) DOE's 
estimates are roughly in line with this estimate. Furthermore, DOE's 
approach is consistent with a 2008 PG&E study that assumed, based on 
discussions with fixture manufacturers and distributors, all current 
residential fixtures were T12 systems.\39\ Based on these comments, 
interviews, and its own research, DOE chose to analyze the 4-foot 
medium bipin T12 lamp as the representative system in the residential 
sector. Taken together, PG&E's study and the public comments DOE 
received do not compel a change in this approach. However, DOE does 
assume and account for rapid migration to T8 lamps in the residential 
sector in the base case, reflecting the trend noted by NEMA. For 
example, in the base case, DOE assumes the stock of 4-foot medium bipin 
T8 lamps in the residential sector will grow more than 10-fold in the 
first decade after the effective date, or roughly at a 28-percent 
compounded annual growth rate. Therefore, DOE has retained its 
methodology in this respect.
---------------------------------------------------------------------------

    \39\ ''Codes and Standards Enhancement (CASE) Initiative for 
PY2008: Title 20 Standards Development,'' Analysis of Standards 
Options for Linear Fluorescent Fixtures (Prepared for PG&E by ACEEE, 
Lighting Wizards, and Energy Solutions). (Last modified May 14, 
2008)
---------------------------------------------------------------------------

    EEI commented that 34W T12 lamps are being sold now in hardware 
stores for the residential market, and, therefore, DOE should not 
assume that the entire residential market is composed of 40W T12 lamps. 
Southern California Edison commented that only about 25 percent of T12 
lamps are 40W (DOE's baseline lamp) in California. On the other hand, 
GE commented that the overwhelming majority of GSFL in the residential 
market are 40W lamps. (EEI, Public Meeting Transcript, No. 38.4 at p. 
222; Southern California Edison, Public Meeting Transcript, No. 38.4 at 
pp. 188-189; GE, Public Meeting Transcript, No. 38.4 at p. 189)
    DOE acknowledges that some 34W T12 lamps may be sold to residential 
consumers. Therefore, DOE has revised its residential 4-foot T12 
market-share matrix to reflect this effect. In addition, DOE revised 
its 4-foot T12 market-share matrices in both the commercial and 
residential markets to better reflect confidential manufacturer survey 
data, as it relates to triphosphor and halophosphor shipment 
categories. As a result of these two changes, DOE now assumes that in 
the 2012 base case, 8 percent of 4-foot T12 lamp shipments in the 
residential sector are 34W, and 92 percent are 40W (down from 100 
percent in the April 2009 NOPR). Overall, for this final rule, DOE 
allocated 90 percent (up from 67 percent) of the commercial 4-foot T12 
market to 34W lamps and 10 percent to 40W.
9. GSFL Lighting Expertise Scenarios
    In the April 2009 NOPR, DOE considered two sets of standards-case 
scenarios for GSFL shipments: (1) Roll-up and Shift scenarios; (2) High 
and Market Segment-Based Lighting Expertise scenarios. 74 FR 16920, 
16967-16968 (April 13, 2009). The Roll-up and Shift scenarios address 
the issue of whether consumers who currently purchase lamps with 
efficacies that exceed (not just meet) the minimum standard would be 
likely to shift to even higher efficacy lamps in the face of amended 
standards. These scenarios and the comments DOE received on them are 
described below. For further details on the scenarios DOE analyzed and 
developed, see TSD chapter 10.
    For the April 2009 NOPR, DOE modeled the Lighting Expertise 
scenarios that analyzed the lamp and ballast purchase decisions 
consumers are likely to make when required to purchase higher-efficacy 
lamps. DOE analyzed these scenarios because how consumers respond to 
this situation could substantially affect the potential energy savings 
and NPV that will result from amended standards. For example, to 
maintain lumen output with a new higher-efficacy lamp, some consumers 
may select a reduced-wattage lamp to replace a less-efficacious 
predecessor. Others may simply replace the lamp with one of the same 
wattage, not make any other adjustments, and accept higher light 
output. For GSFL, which operate on ballasts, consumers may also choose 
to run the higher-efficacy lamps on lower-ballast-factor ballasts. To 
the extent that lower ballast factors (BF) can achieve the appropriate 
lumen output, DOE incorporated them into the technology choices facing 
consumers.
    The Lighting Expertise scenarios estimate the extent to which 
consumers in the standards case may migrate to energy-saving, reduced-
wattage lamps, or, when reduced-wattage lamps are not available or 
feasible, pair the new lamps with a lower-BF ballast (i.e., ballast 
factor ``tuning''). With the results of this analysis, DOE developed 
two standards-case scenarios called the ``High'' and ``Market Segment-
Based'' Lighting Expertise scenarios. This set of scenarios 
characterizes the likelihood consumers will maintain equivalent light 
output upon the purchase of a new higher-efficacy lamp or accept higher 
lighting levels. In the High Expertise scenario, consumers who can 
maintain lumen levels, do so. Conversely, in the Market Segment-Based 
scenario, DOE assumes only a percentage of consumers will have the 
expertise, based primarily on their market segment and purchase event, 
to make this energy savings decision.
    In general, NEMA supported the modeling of the Market Segment-Based 
Lighting Expertise scenario as the more realistic outcome of amended 
energy conservation standards. NEMA stated that despite an increase in 
efficacy, triphosphor lamps (particularly those at TSL4 and TSL5) will 
not save consumers any energy, because the lamps will be the same 
wattage as those they replace (with consumers simply realizing higher 
lighting levels). (Philips, Public Meeting Transcript, No. 38.4 at pp. 
253-254; GE, Public Meeting Transcript, No. 38.4 at pp. 256-7; NEMA, 
No. 81 at p. 19) NEMA also commented that original equipment 
manufacturer (OEM) sales data indicates that roughly 90 percent of OEM 
luminaires (used in the fixture replacement, renovation, and new 
construction markets), are shipped with ballasts with a normal ballast 
factor. Therefore, NEMA commented, DOE's estimate of consumers with 
high expertise for new construction and

[[Page 34121]]

renovation in the commercial sector (69 percent and 78 percent, 
respectively) are likely overstated and should probably be closer to 
what it estimates for the fixture replacement (34 percent) market. 
(OSI, Public Meeting Transcript, No. 38.4 at pp. 233-235, NEMA, No. 81, 
pp. 15-16)
    In response to the comments it received, DOE conducted further 
research and interviews on this issue. Specifically, DOE reevaluated 
its assumptions based on confidential sales channel data on instant-
start electronic T8 ballast sales that DOE received. The data were 
categorized by ballast type (standard or high-efficiency), ballast 
factor, and sales channel. OEM sales, which represent ballasts 
generally sold to fixture manufacturers, best match the fixture 
replacement, renovation, and new construction purchase events in DOE's 
analysis.
    While the OEM sales data suggest, as NEMA noted, that most ballasts 
shipped for new fixtures have normal ballast factors, DOE does not 
believe such a distribution will necessarily characterize the lamp/
ballast market in the standards case for the following reasons. First, 
the current distribution of ballast factors cannot be assumed to be 
predictive of the standards-case distribution. As more efficient lamps 
are introduced, a key variable--lumen output--in the utility of 
fixtures will have changed, all other things being equal. If, in the 
standards case, fixture OEMs were agnostic to ballast factor and 
continued to purchase the same distribution of high, normal, and low 
ballast factors, they would be altering and perhaps jeopardizing this 
utility the consumer derives from their product. Because fixtures are 
often designed and marketed for a typical lumen output, DOE does not 
believe it is likely that OEMs would be disinterested in the light 
output of their product in the standards case. This is reinforced by 
the emphasis on the cost of ownership estimates provided by fixture 
manufacturers in their specifications sheets and marketing materials. 
Given higher-efficacy lamps, DOE believes fixture manufacturers will 
continue to market energy savings as before, which will require pairing 
reduced-wattage lamps (if sold with the fixture) or low BF ballasts 
with their fixtures.
    Next, discussions with fixture manufacturers and DOE's product 
research indicate fixture manufacturers have the flexibility to meet 
the demand of their end-users. There are no inherent substitutability 
issues that would pose obstacles in migrating from normal ballast 
factor to a low ballast factor. In interviews, fixture manufacturers 
communicated their desire and that of their customers to ``match'' 
lumens--i.e., not over-light or under-light relative to the system 
being replaced. For example, one fixture manufacturers noted that it 
was common for them to replace three-lamp fixtures with two-lamp 
fixtures.
    Manufacturers stated during the public meeting that the commercial 
sector is mostly characterized by a high level of lighting 
sophistication. (Philips, Public Meeting Transcript, No. 38.4 at pp. 
239-240) For all of these reasons, DOE believes that fixture OEMs would 
be likely to consider lower BF ballasts, if more-efficacious lamps were 
required due to standards. Therefore, DOE decided not to change its 
lighting expertise assumptions for this final rule and continues to use 
the results of its analysis to characterize the Market-Segment-Based 
Lighting Expertise scenario. However, whereas DOE believes it has 
modeled market behavior which is consistent with the available 
research, DOE acknowledges the uncertainty in these estimates, and, 
therefore, modeled a sensitivity scenario in which it assumed that 34 
percent (as recommended by NEMA) of consumers in the new construction 
and renovation markets migrate to lower-ballast-factor ballasts or low-
wattage lamps. Generally, this sensitivity scenario reduces energy 
savings and NPV by approximately 20 percent and 25 percent, 
respectively (depending on the TSL and scenario). NPV and NES remain 
highly positive. See TSD chapter 11 for results of this sensitivity 
analysis.
    In the April 2009 NOPR, DOE characterized residential consumers as 
having low lighting expertise in the Market-Segment-Based Lighting 
Expertise scenario and assumed 0 percent of these consumers would 
migrate to lower-BF ballasts or lower-wattage lamps in this standards-
case scenario. 74 FR 16920, 16968 (April 13, 2009). ASAP commented that 
the residential consumer's expertise, or lack thereof, is not as 
relevant as what is on the store shelf and what is on sale. Therefore, 
ASAP argued, 0 percent choosing a lower BF ballast or reduced wattage 
is likely not accurate for fixture replacement in the residential 
sector. (ASAP, Public Meeting Transcript, No. 38.4 at pp. 236-237)
    DOE reiterates that how consumers behave in this respect is highly 
uncertain. What is on sale in the store clearly has an effect, but to 
assert that it is the only determinate would be to disregard the impact 
of consumer choice. Additionally, what is on sale depends largely on 
the expertise of the agent deciding what the store should stock, and 
how responsive this agent is to consumer demand. As discussed in the 
April 2009 NOPR, because of the uncertainty around this issue DOE 
decided to consider both the High and Market Segment-Based Lighting 
Expertise scenarios. 74 FR 16920, 16967-68 (April 13, 2009). With these 
scenarios, DOE attempts to capture this range of potential impacts, 
with the Market Segment-Based scenario characterizing the lower bound. 
DOE decided for this final rule to continue to assume, in the Market 
Segment-Based lighting expertise scenario, that 0 percent of 
residential fixture replacement purchases will pair lower ballast 
factors with higher-efficacy lamps, or purchase reduced-wattage lamps. 
In contrast, the High Lighting Expertise scenario is meant to represent 
the upper bound of impacts and assumes that 100 percent of residential 
decision-makers have high lighting expertise.
10. IRL Product Substitution Scenarios
    In the April 2009 NOPR, DOE modeled two sets of standards-case 
scenarios for IRL: Shift/Roll-up and Product Substitution/No Product 
Substitution. 74 FR 16920, 16969-70 (April 13, 2009). Similar to GSFL, 
the Shift/Roll-up scenarios consider whether consumers purchasing lamps 
with efficacies that exceed (not just meet) the minimum standard would 
be likely to shift to even higher efficacy lamps in the face of amended 
standards. In the Product Substitution scenario, DOE assumed consumers 
purchasing covered IRL in the base case do not necessarily continue to 
purchase regulated IRL in the standards case. Accordingly, DOE modeled 
a shift to both exempted BR lamps (namely the 65W BR30 lamp) and to R-
CFL in the standards case. In the ``No Production Substitution'' 
scenario, DOE assumed consumers who purchase covered IRL technology in 
the base case continue to purchase covered IRL technology in the 
standards case (i.e., the total number of installed covered IRL in the 
base case is the same as that in the standards case throughout the 
analysis period). In this scenario, DOE did not model any additional 
shift in the standards case to non-regulated reflector technologies. 
For more information about the IRL standards-case scenarios, see 
chapter 10 of the NOPR TSD.
    DOE received several comments on the merits of modeling the Product 
Substitution and No Product Substitution scenarios. ASAP and the 
Alliance to Save Energy commented that DOE should model migration to R-
CFL and migration to exempt BR lamps

[[Page 34122]]

separately in order to better determine the effects of standards. ASAP 
suggested that DOE's decision to simultaneously model R-CFL and BR 
lamps obscured standards-case impacts because it combined two 
offsetting effects-migration to BR lamps, which would decrease energy 
savings, and migration to R-CFL, which would increase energy savings. 
(ASAP, Public Meeting Transcript, No. 38.4. at p. 241; Alliance to Save 
Energy, Public Meeting Transcript, No 38.4. at pp. 243-244). ACEEE and 
ADLT commented that because DOE intends to cover previously-exempted 
lamps in a separate rulemaking, it should eliminate or greatly reduce 
modeled migration to these lamps in the standards case. (ACEEE, No. 76 
at p. 6, ADLT, No. 72 at p. 4) Philips also commented that DOE's 
assumption in the No Product Substitution scenario--that consumers who 
purchase covered IRL in the base case will continue to do so in the 
standards case--is incorrect because standards will increase the cost 
of covered IRL. This increase will tend to accelerate the penetration 
of competing technologies, which the No Product Substitution scenario 
fails to incorporate. (Philips, Public Meeting Transcript, No. 38.4 at 
p. 239)
    First, DOE notes that currently exempted BR lamps, which are not 
included in the current rulemaking but are largely at issue in this 
discussion, may be analyzed for energy conservation standards in a 
separate rulemaking. At this time, DOE cannot predict what minimum 
efficacy requirements, if any, may be established for BR lamps. 
Therefore, it is impossible to determine how lamps exempted from this 
rulemaking (BR lamps) will compare in cost and efficacy to those IRL 
covered by today's final rule. As a result, there is a great deal of 
uncertainty in estimating the number of consumers likely to migrate to 
BR lamps. For this very reason, DOE maintains the following two 
scenarios. In the first scenario, no migration to the exempted 65W BR 
lamp is modeled (representative of a situation in which the exempted 
lamps are regulated at the same efficacy level as those IRL in this 
rulemaking) and only migration to R-CFL occurs. In the second scenario, 
DOE models the same migration to the 65W BR lamp as in the NOPR 
(representative of a situation in which the exempted lamps remain 
unregulated).
    However, DOE agrees that modeling the two separate offsetting 
standards-case impacts (migration to R-CFL and migration to the 65W BR 
lamp together) conflates two variables that may be more illustrative 
when modeled separately. Therefore, for this final rule, DOE is 
modifying what was called the Product Substitution scenario in the 
April 2009 NOPR and by dividing it into two scenarios and renaming them 
the ``R-CFL Product Substitution'' and ``BR Product Substitution'' 
scenarios, respectively. In the R-CFL Product Substitution scenario, 
DOE models migration to only R-CFL in response to standards (for the 
reasons addressed in the comments and responses above). Similarly, in 
the BR Product Substitution scenario, DOE models migration only to BR 
lamps. DOE believes this approach best isolates the potential energy 
savings impacts of migration to the two different technologies. DOE has 
maintained its approach of modeling incrementally greater migration to 
R-CFL and BR lamps for higher TSLs in these scenarios; it also 
maintained the magnitude of these increases. In consideration of 
Philips's comment, DOE is no longer analyzing the ``No Product 
Substitution Scenario.'' DOE received several comments on the merits of 
modeling the ``No Product Substitution'' scenario for determining 
manufacturer impacts due to standards. These comments are discussed in 
section V.F.
    Philips commented that it would be unlikely for the commercial 
sector to migrate to BR lamps in the standards case because the sector 
is driven by life-cycle costs (which are generally higher for BR lamps) 
and because most commercial entities have high lighting knowledge. As 
for the residential sector, Philips noted that BR lamps are not 
suitable for outdoor applications, limiting the pool of applications 
for which BR lamps are suitable to be potential replacements for 
covered IRL in the standards case. (Philips, Public Meeting Transcript, 
No. 38.4 at p. 239)
    DOE agrees that PAR lamps may be more suitable for outdoor 
applications than the exempted BR lamps. However, as noted in the April 
2009 NOPR and based on residential estimates that 40 percent of all 
residential IRL are PAR lamps,\40\ DOE believes that a considerable 
portion of residential PAR lamps are used in non-outdoor applications 
that are suitable for both PAR and the exempted BR lamps. 74 FR 16920, 
16970 (April 13, 2009). Thus, DOE maintains for this final rule that 
some residential consumers may move to exempted IRL in the standards 
case, although a great deal of uncertainty remains. For this reason DOE 
models a separate scenario which reflects no migration to the 65W BR 
lamps. Regarding NEMA's assertion that commercial consumers are more 
sensitive to life-cycle cost, DOE agrees that the penetration rates of 
less-cost-effective lamps will be lower in the commercial sector than 
the residential sector. In the April 2009 NOPR, DOE took this factor 
into account in its analysis by using separate payback period-
penetration relationships for each sector. 74 FR 16920, 16963 (April 
13, 2009). For the reasons discussed above, for this final rule, DOE 
maintains the same migration to the 65W BR lamp as modeled in the April 
2009 NOPR in the Product Substitution scenario.
---------------------------------------------------------------------------

    \40\ New York State Energy Research and Development Authority, 
Incandescent Reflector Lamps Study of Proposed Energy Efficiency 
Standards for New York State (2006) (Last accessed Oct. 7, 2006). 
Available at: http://www.nyserda.org/publications/Report%2006-07-Complete%20report-web.pdf.
---------------------------------------------------------------------------

    IALD commented that DOE did not consider all the possible 
substitution scenarios in the April 2009 NOPR. For example, consumers 
may switch to fixtures with exempted AR (aluminum reflector) and MR 
(multi-faceted reflector) lamps because of the lower upfront cost, or 
lamp manufacturers may choose to produce 39W lamps (outside the scope 
of coverage of DOE's regulations). (IALD, No. 71 at p. 2, 3) In 
response, DOE believes that a migration to AR and MR lamps is unlikely 
to have a material impact on energy savings due to the unique 
characteristics (e.g., lamp size, voltage, or socket) of these lamps 
and because they generally cannot be interchanged with other 
reflectorized lamps.\41\ In addition, DOE does not expect a significant 
migration to 39W lamps as a result of standards for the following 
reason. If these lamps were manufactured at lower efficacies without 
halogen technology (thereby circumventing the standard), they would 
likely have much lower lumen output than needed to meet the demand of 
consumers of the existing lamp, thereby making it an unacceptable 
replacement.
---------------------------------------------------------------------------

    \41\ Lighting Resource Center, NLPIP Lighting Answers: Volume 6, 
Issue 2 (Sept. 2002) (Last accessed: June 21, 2009). Available at: 
http://www.lrc.rpi.edu/programs/nlpip/lightingAnswers/mr16/reflectorizedLamps.asp.
---------------------------------------------------------------------------

    For more information about the R-CFL Product Substitution and BR 
Product Substitution standards-case scenarios, see chapter 10 of the 
TSD.
11. Discount Rates
    In its analyses, DOE multiplies monetary values in future years by 
a discount factor in order to determine its present value. DOE 
estimated national impacts using both a 3-percent and a 7-percent real 
discount rate as the average real rate of return on private investment

[[Page 34123]]

in the U.S. economy. NRDC argued that DOE should use a 2-percent or 3-
percent discount rate and should not apply it to the value of carbon 
emissions. (NRDC, No. 82 at p. 5).
    In response, DOE notes that it follows the guidelines on discount 
factors set forth by the Office of Management and Budget (OMB). 
Specifically, DOE uses these discount rates in accordance with guidance 
that OMB provides to Federal agencies on the development of regulatory 
analysis (OMB Circular A-4 \42\ (Sept.17, 2003), particularly section 
E, ``Identifying and Measuring Benefits and Costs''). Accordingly, DOE 
is continuing to use 3-percent and 7-percent real discount rates for 
the relevant calculations for this final rule. Furthermore, DOE 
continues to report both undiscounted and discounted values of carbon 
emission reductions. DOE believes this allows for consideration of a 
range of policy perspectives, one of which is the view that a reduction 
in emissions today is more valuable than one in thirty years.
---------------------------------------------------------------------------

    \42\ Available at: http://www.whitehouse.gov/omb/assets/regulatory_matters_pdf/a-4.pdf.
---------------------------------------------------------------------------

E. Consumer Sub-Group Analysis

    In analyzing the potential impact of new or amended standards on 
commercial customers, DOE evaluates the impact on identifiable groups 
(i.e., sub-groups) of customers, such as different types of businesses 
that may be disproportionately affected by a National standard level. 
In the April 2009 NOPR, DOE identified low-income consumers, 
institutions of religious worship, and institutions that serve low-
income populations, and consumers of T12 electronic ballasts as lamp 
consumer sub-groups that could be disproportionately affected, and 
examined the impact of proposed standards on this group. 74 FR 16920, 
16971-72 (April 13, 2009). DOE determined the impact on this consumer 
sub-group using the LCC spreadsheet model. DOE did not receive comments 
on sub-groups chosen to analyze nor on the assumptions applied to those 
sub-groups. DOE relied on the same methodology outlined in the April 
2009 NOPR for the final rule analysis. The results of DOE's LCC sub-
group analysis are briefly summarized in section VII.C.1.b and 
described in detail in chapter 12 of the TSD.

F. Manufacturer Impact Analysis

    DOE performed a manufacturer impact analysis (MIA) to estimate the 
financial impact of energy conservation standards on manufacturers of 
GSFL and IRL, and to assess the impact of such standards on employment 
and manufacturing capacity. DOE's MIA methodology is discussed in 
detail in the April 2009 NOPR (74 FR 16920, 16972-77 (April 13, 2009)) 
and in chapter 13 of the TSD. DOE conducted the MIA for GSFL and IRL in 
three phases. Phase 1 (Industry Profile) consisted of preparing an 
industry characterization, including data on market share, sales 
volumes and trends, pricing, employment, and financial structure. Phase 
2 (Industry Cash Flow Analysis) focused on the industries as a whole. 
In this phase, DOE used the Government Regulatory Impact Model (GRIM) 
to prepare an industry cash-flow analysis for each industry (GSFL and 
IRL). Using publicly-available information developed in Phase 1, DOE 
adapted the GRIM's generic structure to perform an industry cash flow 
analysis for manufacturers of GSFL and IRL both with and without energy 
conservation standards. In Phase 3 (Sub-Group Impact Analysis) DOE 
conducted interviews with manufacturers representing the majority of 
domestic GSFL and IRL sales. During these interviews, DOE discussed 
engineering, manufacturing, procurement, and financial topics specific 
to each company and obtained each manufacturer's view of the 
industries. The interviews provided valuable information DOE used to 
evaluate the impacts of an energy conservation standard on manufacturer 
cash flows, manufacturing capacities, and employment levels. DOE then 
finalized its assumptions for the cash flow analysis and described the 
qualitative impacts on manufacturers due to amended energy conservation 
standards.
    The GRIM inputs consist of data regarding the cost structures for 
GSFL and IRL industries, shipments, and revenues. These include 
information from many of the analyses described above, such as retail 
prices from the product price determination analysis and shipments 
forecasts from the NIA.
    For the final rule, DOE incorporates a number of changes to GRIM 
inputs that were made in the other analyses for this rulemaking. The 
GRIM uses the medium prices in the product price determination analysis 
to calculate the manufacturer production costs (MPCs) for each 
equipment class at each TSL. By multiplying the production costs by 
different sets of markups, DOE derives the manufacturer selling prices 
used to calculate industry revenues. Following the NOPR, DOE updated 
its product price determination analysis using the CPI. DOE uses these 
updated prices in the GRIM for the final rule.
    The GRIM estimates manufacturer revenues based on total-unit-
shipment forecasts and the distribution of these shipments by efficacy. 
Changes in the efficacy mix at each standard level are a significant 
driver of manufacturer finances. For the final rule analysis, DOE 
updated the GSFL and IRL MIA results based on the total shipments and 
efficacy distribution estimated in the final rule NIA.
    As described in section V.D.10, DOE updated the substitution 
scenarios in the IRL GRIM. For the April 2009 NOPR, DOE modeled a set 
of standards-case IRL scenarios called the ``Product Substitution'' and 
``No Product Substitution'' scenarios. 74 FR 16920, 16969-70 (April 13, 
2009). In the Product Substitution scenario, DOE assumed consumers 
purchasing covered IRL in the base case do not necessarily purchase 
covered IRL in the standards case. DOE modeled a shift to both exempted 
BR R-CFL in the standards case. In the ``No Production Substitution'' 
scenario, DOE assumed consumers who purchase covered IRL technology in 
the base case continue to purchase covered IRL technology in the 
standards case.
    In response to comments by ASAP, for today's final rule, DOE 
modified the IRL shipments scenarios. The Product Substitution is 
modified by dividing it into two and renaming them the ``R-CFL Product 
Substitution'' and ``BR Product Substitution'' scenarios. In the R-CFL 
Product Substitution scenario, DOE models migration to only R-CFL in 
response to standards. Similarly, in the BR Product Substitution 
scenario, DOE models migration only to BR lamps. For further detail in 
DOE's modification of the Product Substitution scenarios and its 
response to ASAP's comments regarding this issue, see section V.D.10 of 
today's notice.
    For the April 2009 NOPR, DOE determined the total capital 
conversion costs that would be required for the IRL industry to convert 
existing production to meet demand at each TSL. For the NOPR, DOE 
scaled the IRL capital conversion costs using the Existing Technologies 
base-case shipments to account for the decline in shipments before 
standards become effective. DOE used the same capital conversion costs 
for all scenarios. For today's final rule, DOE updated the capital and 
product conversion costs to 2008$ using the PPI for NAICS code 335110 
(electric lamp bulb and part manufacturing) for both GSFL and IRL. 
Additionally, for the final rule, DOE is using two sets of capital 
conversion costs. For all IRL scenarios in the Existing Technologies 
base case, DOE scales its updated

[[Page 34124]]

estimate of the capital conversion costs using the Existing 
Technologies base-case shipments. For all IRL scenarios in the Emerging 
Technology base case, DOE scales its updated estimate of the capital 
conversion costs using the Emerging Technologies base-case shipments. 
Scaling the IRL capital conversion costs for each base case results in 
lower capital conversion costs in the Emerging Technologies base case 
than in the Existing Technologies base case. DOE believes this approach 
to scaling capital conversion cost with shipments more accurately 
captures the capital costs that the IRL industry could incur in each 
scenario.
    For today's final rule and in response to comments, DOE developed a 
shortened lifetime scenario for IRL to investigate the effects of 
shorter lamp lifetime at higher TSLs. In this sensitivity scenario, DOE 
changes the lifetime and prices of the higher-efficacy representative 
lamps at TSL 4 and TSL 5. These changes in characteristics also 
simulate certain lamps becoming a commodity product in response to 
energy conservation standards. These alterations cause higher shipments 
in the standards case and result in reduced negative impacts on the 
industry. See section VI.C.1 of today's final rule for an explanation 
of the lifetime sensitivity scenario. For the INPV results in the 
lifetime sensitivity scenario, see section VII.C.2.a of today's notice 
and chapter 13 of the TSD.
    For the April 2009 NOPR, DOE used a set of markup scenarios to 
calculate manufacturer selling prices in order to estimate industry 
revenues in its cashflow analysis. 74 FR 16920, 16977 (April 13, 2009). 
In both the IRL and GSFL GRIM, DOE modeled a Flat Markup scenario. This 
scenario assumed that the cost of goods sold for each lamp is marked up 
by a flat percentage to cover standard selling, general, and 
administrative (SG&A) expenses, research and development (R&D) 
expenses, and profit. To derive this percentage, DOE evaluated 
publicly-available financial information for manufacturers of lighting 
equipment. For today's final rule, DOE continues to model a Flat Markup 
scenario in both the IRL and GSFL GRIM.
    For GSFL only, DOE also modeled a Four-Tier markup scenario for the 
April 2009 NOPR. 74 FR 16920, 16977 (April 13, 2009). In this scenario, 
DOE assumed that the markup on lamps varies by efficacy in both the 
base case and the standards case. DOE used information provided by 
manufacturers, the medium prices in its product price determination, 
and industry average gross margins to estimate markups for GSFL under a 
four-tier pricing strategy in the base case. In this scenario premium 
products have a higher markup at each increasing tier of efficacy 
(i.e., a higher markup for each increasing phosphor series). In the 
standards case, DOE modeled the situation in which a reduction in 
product portfolios squeezes the margins of higher-efficacy products as 
they are ``demoted'' to lower-relative-efficacy-tier products.
    For today's final rule, DOE incorporates additional assumptions in 
its Four-Tier markup scenario for both the base case and standards 
case. For the final rule, DOE continues to model a base-case pricing 
strategy in which each phosphor series earns a separate markup. However 
these mark-ups are changing over time during the analysis period to 
take into account commoditization of more-efficient lamps as they gain 
market share. Depending on the product class of GSFL, the market share 
of either 800 or 800 plus series lamps overtakes the market share of 
700 series lamps. This capture of market share is fully realized at 
later dates (between 2035 and 2040, depending on the base-case scenario 
and product class). The original markups for 700, 800, and 800 plus 
series lamps converge to a single, lower markup over time. The Four-
Tier markup standards case continues to ``squeeze'' the margins of 
commoditized lamps, but the impacts are reduced because the margins are 
already lowered in the base case. For an extensive explanation of the 
revised Four-Tier markup scenario, see chapter 13 of the TSD.
    During the NOPR public meeting OSI commented that the INPV results 
for GSFL show that the manufacturer impacts were taken into 
consideration in DOE's arrival at the appropriate proposed energy 
conservation standard. However, the negative INPV results for IRL, 
especially at the proposed TSL 4, indicated that the impact on 
manufacturers was not considered in DOE's proposed energy conservation 
standard for IRL (OSRAM/Sylvania, Public Meeting Transcript, No. 38 at 
pp 284-286). Similarly, NEMA commented that DOE failed to give adequate 
consideration to the negative INPV at TSL4 (NEMA, No. 81 at p. 4). 
Philips added that the analysis for IRL showed a large increase in NPV 
at TSL 3, the first TSL to require exclusively infrared technology. The 
benefit to consumers moving past TSL 3 was incremental whereas the 
impacts on manufacturers were worse at TSL 4 than TSL 3 (Philips, 
Public Meeting Transcript, No. 38 at pp 292-293).
    For the April 2009 NOPR, DOE presented the results of the MIA and 
its determination of proposed energy conservation standard levels for 
GSFL and IRL based on the EPCA criteria. Specifically, EPCA provides 
that any such standard for a covered product must be designed to 
achieve the maximum improvement in energy efficiency that the Secretary 
determines is technologically feasible and economically justified and 
that results in significant conservation of energy. (42 U.S.C. 
6295(o)(2)(A) and (3)(B)) 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, considering the seven factors. (42 U.S.C. 
6295(o)(2)(B)(i)) DOE believes that the industry commenters took a 
contrasting approach to the agency's analysis under the relevant 
statutory criteria by attempting to frame the issue as one of comparing 
incremental benefits to consumers relative to impacts on manufacturers 
at in moving from TSL3 to TSL 4. Instead, DOE interprets the proper 
application of statutory criteria, to require atop-down approach, which 
implies DOE must first analyze the TSL that would save the maximum 
amount of energy. If that TSL is not economically justified (i.e., the 
benefits do not exceed the burdens), DOE must then analyze the TSL with 
the next greatest energy savings until it reaches a TSL that it 
determines is economically justified and technologically feasible. 
Impacts on manufacturers and consumers are specific criteria that DOE 
must consider in its analysis. (42 U.S.C. 6295 (o)(2)(B)(i)(I)) In the 
April 2009 NOPR, DOE found that TSL 5 was not economically justified 
for IRL. DOE then analyzed TSL 4 and found that it was economically 
justified and technologically feasible. 74 FR 16920, 17018 (April 13, 
2009).
    For the April 2009 NOPR, DOE considered the negative impacts on 
INPV for IRL manufacturers at TSL 4. However, the Secretary reached the 
initial conclusion that the benefits of energy savings, emissions 
reductions, the positive net economic savings to the Nation, and 
positive life-cycle cost savings at TSL 4 would outweigh the 
potentially large reduction in INPV for manufacturers. 74 FR 16920, 
17018 (April 13, 2009). For the final rule, DOE continues to base its 
determination of whether a standard level is economically justified 
using all seven EPCA factors. While the impacts on consumers and 
manufacturers are both considered in making this

[[Page 34125]]

determination, none of these factors are reviewed in isolation. 
Although DOE gathers information on each of the seven statutory factors 
individually, the Secretary must ultimately consider the seven factors 
collectively in determining whether a standard is economically 
justified.
    In its comments on DOE's April 2009 NOPR, ADLT stated that DOE's 
use of longer lifetimes at TSL 4 and TSL 5 is counter to manufacturer 
interviews. According to ADLT, because longer lamp lifetimes would have 
a significant impact on IRL shipments, the MIA overstates the impact on 
manufacturers. (ADLT, No. 72 at p. 3)
    DOE acknowledges that lifetimes of analyzed lamps have a 
significant impact on IRL shipments. For the April 2009 NOPR, DOE 
presented its assumptions for lamp lifetimes and shipment projections. 
74 FR 16920, 16956-57, 16959-65 (April 13, 2009). DOE also acknowledges 
that shipments are a significant driver of INPV results, especially in 
the IRL industry. To analyze the effects of lower lifetimes on IRL 
shipments at TSL 4 and TSL 5, DOE included a lifetime sensitivity 
analysis for today's final rule. The INPV results for the sensitivity 
scenario show that reduced lamp lifetimes at TSL 4 and TSL 5 
significantly reduce the negative impacts on IRL manufacturers. DOE 
agrees with ADLT that the impacts on the IRL industry would be lower if 
manufacturers reduced lamp lifetimes in response to the energy 
conservation standards. See section VI.C.1 of today's final rule for an 
explanation of the lifetime sensitivity scenario. For the INPV results 
in the lifetime sensitivity scenario, see section VII.C.2.a of today's 
notice and chapter 13 of the TSD.
    The CA Stakeholders are concerned that DOE's analysis of the burden 
on the GSFL industry may have focused primarily on the worst case 
scenario, rather than on the more likely combination of scenarios. The 
CA Stakeholders argue that if DOE were to average the impacts on GSFL 
manufacturers in the 16 possible scenarios, the industry losses would 
be less than half of the losses associated with the worst case scenario 
(CA Stakeholders, No. 63 at p. 11).
    In arriving at the energy conservation standards in this final 
rule, DOE considered the full range of potential impacts on GSFL 
manufacturers. To determine the range of potential impacts on GSFL 
manufacturers, DOE performed an analysis which included 16 different 
industry cash flow scenarios. These scenarios considered numerous 
variables which influence the analysis (level of emerging technologies, 
markup strategies, product substitution, consumer lighting expertise, 
and product mix). To better explain the basis of its decision DOE 
describes how it balanced the likelihood of the scenarios and the range 
of uncertainty in arriving at today's standards. For a more detailed 
explanation of how DOE arrived at its decision for today's final rule, 
see section VII.D of today's notice.
    All manufacturers expressed the view that the supply of standards-
compliant lamps would be constrained. OSI commented that the large, 
negative INPV impacts for IRL manufacturers show that after the 
effective date of the standard, only the current volumes of standards-
compliant lamps will be produced by manufacturers. (OSI, Public Meeting 
Transcript, No. 38 at p. 286). Philips stated that there is not an 
opportunity to invest in IRL because of negative impacts on 
manufacturers at the proposed level and the limited time horizon of the 
investment due to emerging technology. According to Philips, these 
factors could cause the IRL industry to experience a capacity 
constraint of HIR lamps (Philips, Public Meeting Transcript, No. 38 at 
pp. 287-288). GE agreed that this rulemaking forces a decision upon 
manufacturers in terms of whether to invest in a technology whose 
market is expected to decline over time. This limited investment will 
lead to a constrained IRL HIR lamp market (GE, Public Meeting 
Transcript, No. 38 at pp. 292-293). Similarly, NEMA commented that TSL 
4 or above is essentially unthinkable for the industry and would cause 
capacity issues. NEMA added that TSL 3 or above for IRL would require 
manufacturers to over-invest to increase capacity of HIR lamps that 
will no longer be needed in a few years. NEMA believes these 
investments, which may never be recovered, cannot be justified 
financially and economically because of the diminishing market of 
covered IRL as a result of emerging technology. (NEMA, No. 81 at pp. 5, 
10)
    In the April 2009 NOPR, DOE included the capital conversion costs 
that would be required to meet the entire industry demand at each TSL. 
74 FR 16920, 17001-02 (April 13, 2009). DOE based these estimates on 
interviews with manufacturers that produce the vast majority of IRL for 
sale in the United States. DOE obtained financial information through 
these manufacturer interviews and aggregated the results to mask any 
proprietary or confidential information from any one manufacturer. 
These estimates were found to be consistent with financial ratios for 
plant, property, and equipment reported in manufacturer financial 
statements. For TSL 5, because some manufacturers did not provide 
capital costs since they had no access to the needed technology, DOE 
supplemented manufacturer information with information provided by a 
supplier of coating technology. Therefore, DOE believes that the large 
capital conversion costs identified are representative of the 
expenditures that would be required for the industry to increase the 
production of higher-efficacy lamps at each TSL. DOE also cited these 
large capital conversion costs as a primary driver of the large, 
negative impacts on INPV. 74 FR 16920, 17002-03 (April 13, 2009).
    In the April 2009 NOPR, DOE acknowledged manufacturers' concern 
about the potential for emerging technologies to further erode the IRL 
market. 74 FR 16920, 17002-03 (April 13, 2009). DOE also noted that an 
IRL standard would be unique because it would force investments in a 
market that could shrink over the entire lifetime of the investment. 
These large capital conversion costs continue to be a significant 
driver of the large, negative INPV values.
    DOE believes that the large, negative INPV results compared to the 
industry value using the Emerging Technologies base case accurately 
captures manufacturer concerns about the lack of a financial return 
from large capital conversion in a shrinking market.
    Philips commented that the capacity constraint would be worse at 
TSL 4 than at TSL 3, even though both these TSLs involve HIR 
technology. According to Philips, the additional time needed for the 
manufacturing processes associated with IRL lamps that meet TSL 4 could 
lead to additional capacity constraints because fewer products can be 
produced after the effective date of the standards. (Philips, Public 
Meeting Transcript, No. 38 at pp. 292-293)
    DOE agrees that the INPV impacts at TSL 4 are larger than at TSL 3. 
The production of improved infrared capsules is more time consuming 
than the production of standard HIR lamps. The improvements to standard 
HIR lamps lower the output of each coating machine because production 
run would require additional cycle time for the coating process and 
quality control. The additional capital conversion costs at TSL 4 
include the additional production equipment required to meet industry 
demand with a lower production output rate. DOE believes that there is 
sufficient lead time for manufacturers to convert their existing 
facilities to meet market demand with standards-compliant lamps. 
Manufacturers could mitigate possible capacity constraints by

[[Page 34126]]

installing additional coaters, purchasing infrared burners from a 
supplier, and using existing excess capacity.
    The CA Stakeholders and ACEEE commented that DOE's capital 
conversion and product conversion costs for IRLs should have addressed 
the fact that massive investments in advanced IR technologies will 
likely be happening absent standards. According to the CA Stakeholders, 
due to great potential improvements and consumer preferences, IRL 
manufacturers will already be making investments in advanced burner 
technology to meet the EISA 2007 requirement for general service 
incandescent lamps. These investments include coating machines and 
coating technology that can be applied to both general service lamp 
burners and reflector lamp burners. (CA Stakeholders, No. 63 at p. 27) 
(ACEEE, No. 76 at p. 5)
    DOE believes that the energy conservation standards set by today's 
final rule are more stringent than the EISA 2007 requirements for 
general service incandescent lamps in 2012, and, therefore, these GSIL 
investments are not pertinent to the IRL analysis. The EISA 2007 GSIL 
standards that are effective in 2020 are similar to the IRL energy 
conservation standards for today's final rule. If manufacturers use the 
same technology in 2020, improved capsule technology could be used to 
reach prescribed GSIL efficacy levels. However, it is uncertain that a 
similar pathway for GSIL will be used to reach the prescribed efficacy 
levels in 2020 since emerging technologies may offer a better solution. 
Because the GSIL regulation is effective eight years after the 
effective date for today's IRL energy conservation standard and because 
manufacturers will have already made investments for IRL, any GSIL 
investments to meet the 2020 requirements will not impact the magnitude 
of investments needed by the IRL industry to meet today's final rule.
    OSI stated that an additional concern about the declining market 
share of IRL due to emerging technology is that IRL are manufactured 
mostly in the United States, whereas the alternative technologies are 
not. The commenter argued that a standard that hastens the shift to 
alternative technologies would have negative impacts on domestic 
employment in the IRL industry. (OSI, Public Meeting Transcript, No. 38 
at p. 286)
    In response, DOE notes that in the April 2009 NOPR, DOE includes 
two base-case scenarios which examine the employment impacts of energy 
conservation standards. The Emerging Technologies base case models the 
situation in which emerging technologies such as LED and CMH lamps take 
an increasing share of covered IRL. Shipments of IRL are eroded in both 
the Existing Technologies and Emerging Technologies scenarios by R-CFL 
(a fully mature technology). In the Emerging Technology base case, IRL 
shipments are replaced by CMH, LEDs, and other emerging technologies 
that have the potential to replace a greater percentage of recessed can 
fixtures. DOE treats the erosion of the IRL market as a base-case 
issue, since the market decline is occurring without standards. In the 
April 2009 NOPR and in today's final rule, DOE acknowledges that the 
differential between employment levels in the Existing Technologies and 
Emerging Technologies base cases is large. However, the impact caused 
by standards is much less than the difference in employment between the 
two base cases. In any scenario, energy conservation standards have a 
small impact on the average employment levels in the IRL industry.
    At the NOPR public meeting, GE expressed concern that the GSFL 
energy conservation standards could shift production overseas. (GE, 
Public Meeting Transcript, No. 38 at pp. 278-279)
    DOE agrees that energy conservation standards will require 
significant capital conversion costs that could cause manufacturers to 
consider sourcing decisions, but DOE believes that many other factors 
could mitigate the decision to relocate production facilities abroad in 
response to amended standards. For example, the majority of GSFL are 
produced domestically on high-speed lines. The large capital conversion 
costs required at higher TSLs involve converting these existing high-
speed lines to ones capable of producing smaller-diameter lamps. While 
these capital conversion costs are large, moving production outside the 
United States would require additional costs to transport existing 
production lines and to build a green field facility, none of which 
would eliminate the cost to convert the lines for smaller-diameter 
lamps. Furthermore, the highly-capitalized production process causes 
the labor content of GSFL to be a relatively small portion of the 
overall cost of each lamp. Because the vast majority of GSFL production 
costs are material costs, the labor cost savings from moving abroad 
would be relatively low. Most of the GSFL labor cost results from 
skilled workers that monitor and control the production process. There 
are relatively few unskilled workers in the production process, which 
further reduces the labor cost savings from relocation. Instead, the 
labor content of GSFL represents intellectual capital for GSFL 
production, so this would present another hurdle that would need to be 
addressed with relocation. A final mitigating factor that could prevent 
relocation of domestic production is increased shipping costs. Higher 
shipping costs, especially if production required oceanic freight, 
would likely outweigh any labor cost savings. For further information 
of conversion costs and possible employment impacts due to today's 
energy conservation standards, see chapter 13 of the TSD.
    While DOE describes the factors that could mitigate a decision by 
U.S. manufacturers to relocate production facilities abroad due to 
amended energy conservation standards, DOE also recognizes that access 
to rare earth phosphors could also impact sourcing decisions. As 
described in section VI.G, most of the current supply of rare earth 
phosphors is controlled by China. A drastic change to export quotas or 
tariffs could influence the sourcing decision of U.S. manufacturers 
more significantly than amended energy conservation standards. If 
export quotas continue to decrease, companies could decide to relocate 
to China in order to gain access to the available rare earth phosphors 
supply, regardless of the energy conservation standard. However, DOE's 
direct employment conclusions do not account for the possible 
relocation of domestic manufacturing to other countries as a result of 
changes in export quotas or tariffs on materials used (e.g., rare earth 
phosphors) because the potential for relocation is uncertain.
    During the public meeting, Energy Solutions inquired if the IRL 
analysis considered that emerging technology and other IRL replacements 
are often made by the same manufacturers (Energy Solutions, Public 
Meeting Transcript, No. 38, at pp. 288-289). The CA Stakeholders, 
ACEEE, and NRDC commented that DOE's INPV analyses should consider the 
positive impacts to lamp manufacturers associated with the increased 
sales of the non-covered products resulting from standards. (CA 
Stakeholders, No. 63 at p. 4) (ACEEE, No. 76 at p. 6) (NRDC, No. 82 at 
pp. 4-5) The CA Stakeholders, ACEEE, and NRDC claimed the MIA impacts 
are overstated because the IRL and GSFL products that might see a 
reduction in shipment volume are generally made by the same 
manufacturers who sell the emerging technologies that may see a 
resulting increase in shipment volume. (CA Stakeholders, No. 63 at p. 
7) (ACEEE, No. 76 at p. 6) (NRDC, No. 82 at pp. 4-5) Accordingly, the 
CA

[[Page 34127]]

Stakeholders agreed with the petitioners'\43\ argument in appealing 
that the Secretary must fully consider, ``the economic impact of the 
standard on the manufacturers * * * of the products subject to such 
standard.'' (42 U.S.C. 6295(o)(2)(B)(i)I). The CA Stakeholders stated 
that because one of the impacts ``of the standard on the 
manufacturers'' of IRL and GSFL products will be increased sales (at 
higher markups) of exempt or non-covered lamps made by the same 
manufacturers, the statutory language requires that these positive 
impacts also be taken into account. Similarly, EEI commented that 
manufacturer impacts should account for the lost sales of baseline 
products as well as increased sales of high-efficiency products. (EEI, 
No. 39 at p. 4)
---------------------------------------------------------------------------

    \43\ (States of New York, Connecticut, New Jersey, and 
California, Commonwealth of Massachusetts, City of New York, and 
California Energy Commission) in the United States Court of Appeals 
in a petition regarding DOE's Furnace Rulemaking (State of New York 
v. U.S. Dep't of Energy, No. 08-0311 (2d Cir. filed January 17, 
2008))
---------------------------------------------------------------------------

    In response, the Emerging Technologies scenario describes how 
emerging technologies may erode the market for covered products in the 
base case, absent standards. The penetration of emerging technology 
reduces the number of covered lamps sold in future years in the same 
manner as a reduction in commercial floor space over time might reduce 
demand for covered IRL and GSFL lamps. The level of base-case reduction 
in lamp sales is independent of the energy conservation standard. The 
Emerging Technologies base case has lower energy savings in the NIA and 
lower base-case INPV in the GRIM, as compared to the Existing 
Technologies scenario.
    The situation described for the furnaces and boilers rulemaking 
only exists for IRL in this rulemaking. In the furnaces and boilers 
rulemaking, the MIA analysis captured the product switching from gas 
furnaces to electric heat pumps induced by amended energy conservation 
standards. 72 FR 65136, 65158-61 (Nov. 19, 2007). The analogous 
situation for IRL occurs when the higher prices of covered lamps induce 
sales of non-covered BR lamps and R-CFLs. This migration from covered 
IRL to non-covered products was modeled in the April 2009 NOPR in the 
Product Substitution scenario. 74 FR 16920, 16969-70 (April 13, 2009). 
For the final rule, this situation was modeled in both the BR Product 
Substitution scenario and the R-CFL Product Substitution scenario. 
Thus, DOE modeled the impacts on the IRL industry from reduced sales of 
covered IRL due to price effects. The difference in INPV of including 
or excluding the sales of non-covered products was found to be small. 
Including these sales in the GRIM is not a major driver of the INPV 
results.
    Instead, the larger declines in INPV in the Emerging Technologies 
scenario (compared to the Existing Technologies scenario) are not due 
to the exclusion of emerging technology sales from the analysis or to 
the declining sales of covered products, since the covered products are 
also declining in the base case. Instead, the larger impacts are caused 
by the overinvestment in the standards-compliant technology. In the 
Emerging Technologies scenario, manufacturers must invest in production 
levels anticipated for 2012, but the sales of covered products 
immediately begin to fall. In the base case, sales of covered products 
also decline, but manufacturers do not need to make extraordinary 
capital expenses. These extraordinary capital expenses cause the 
industry's cash flow to decrease significantly in comparison to the 
base case, causing an overall decrease of estimated INPV.
    The CA Stakeholders claimed that by focusing on decreased sales of 
the specific technology being regulated, DOE is interpreting the 
statute to favor the status quo over more-efficient alternative 
technologies that are not being specifically regulated. According to 
the CA Stakeholders, there is nothing in the statue that limits DOE's 
review to only consider the impacts on regulated IRL and GSFL. (CA 
Stakeholders, No. 63 at p. 8) The CA Stakeholders recommended that DOE 
should focus its analysis on the economic impact on lighting 
manufacturers as a whole, rather than on the impacts of the specific 
technology being regulated. (CA Stakeholders, No. 63 at p. 8) 
Similarly, Earthjustice commented that the INPV results shown in the 
MIA should be bounded around the corporation, not the profit center 
that makes the covered products (Earthjustice, Public Meeting 
Transcript, No. 38, at p. 295). Agreeing with Earthjustice, the 
Appliance Standards Awareness Project stated that INPV impacts shown in 
the MIA should be bounded around the corporation and added that the 
difficulty in analyzing the impacts at the corporation level does not 
remove DOE's obligation to do so (ASAP, Public Meeting Transcript, No. 
38, at pp. 290-291 and pp. 295-297). EEI also commented that DOE should 
not try to analyze the impacts of the lighting standard on all 
operations of manufacturers, especially those with multiple product 
lines and multiple global production facilities. EEI stated that such 
an analysis would take too much time and could possibly delay the 
issuance of a standard. (EEI, No. 39 at p. 4)
    In response, DOE recognizes that the energy conservation standards 
may induce sales of non-covered products which are in whole or in part 
manufactured by the same manufacturers as the products covered by this 
rulemaking. These sales will increase the revenues and possibly 
increase the profits of the manufacturers that make covered IRL and 
GSFL. To include these revenues and profits in the GRIM analysis 
requires the same level of information about the product costs, 
required investments to increase sales, and the profitability as 
covered products. This information greatly increases both the 
complexity and uncertainty of the analysis of the products covered by 
this rulemaking. Much of this analysis is also outside the scope of 
this rulemaking. However, understanding that this can be a major driver 
of the GRIM results for some rulemakings, DOE attempted to bound the 
potential impact of the product substitutions on the industry value. 
For this reason, in the April 2009 NOPR, DOE ran the No Product 
Substitution scenario in the GRIM analysis. For today's final rule, DOE 
ran both the BR Substitution and the R-CFL Substitution scenarios. The 
difference in impacts between the Product Substitution and No Product 
Substitution scenarios represented the lost sales and profits to 
manufacturers. The difference in industry value from including the 
revenue from induced sales of BR lamps in the BR Product Substitution 
scenario and excluding the revenue represents the potential benefits of 
these sales to manufacturers of covered IRL. The difference in industry 
value from including the revenue from induced sales of R-CFL lamps in 
the R-CFL Product Substitution scenario and excluding the revenue 
represents the potential benefits of these sales to manufacturers of 
covered IRL. DOE reports these differences and qualitatively describes 
those factors which might mitigate the impact on those firms which 
produce both types of produces. The analysis shows that the inclusion 
of the additional revenues has minimum impacts on the estimated INPVs. 
For further qualitative and quantitative information on the scenarios 
and results for the MIA, see chapter 13 of the TSD.
    Although IRL manufacturers may receive revenue from additional 
sales of R-CFL and exempted BR lamps, it is not certain that this would 
be a net benefit to manufacturers. In both the R-CFL

[[Page 34128]]

Substitution and BR Substitution scenarios, covered IRL sales are not 
completely replaced by the additional sales of R-CFL and exempted BR 
lamps.. To provide an upper bound of the potential benefit to IRL 
manufacturers, DOE includes the revenue from R-CFL and exempted BR 
lamps but does not consider any capital conversion costs to increase 
sales of these products. In any scenario, the potential benefits of 
these sales to IRL manufacturers have far less impact on INPV than the 
capital and product conversion costs needed to reach higher TSLs for 
covered IRL. In any of the April 2009 NOPR and today's final rule 
substitution scenarios, the large capital conversion costs are the 
biggest driver of the large, negative impacts on INPV. Thus, any 
additional benefit from sales of non-covered IRL products are not 
enough to mitigate the impacts on INPV due to the necessary estimated 
capital and product conversion costs.
    The CA Stakeholders, ACEEE, and NRDC commented that the American 
Recovery and Reinvestment Act of 2009 (ARRA) has tax provisions that 
could possibly mitigate the impacts on manufacturers due to energy 
conservation standards. Specifically, the commenters cited provisions 
in ARRA offer low-interest ``industrial development bonds'' for 
expanding manufacturing capabilities, as well as an advanced energy 
project tax credit for manufacturers of covered products. According to 
the commenters, these provisions would help manufacturers cover 
possible conversion costs associated with energy conservation 
standards. (CA Stakeholders, No. 63 at p. 7) (ACEEE, No. 76 at pp. 5-6) 
(NRDC, No. 82 at p. 3)
    DOE acknowledges that manufacturers of GSFL and IRL may qualify for 
the industrial development bonds and advanced energy project tax credit 
programs. If GSFL and IRL manufacturers do apply and receive the bonds 
and/or tax credit, these benefits could help mitigate some of the 
impacts of energy conservation standards. However, structures for the 
industrial development bonds and advanced energy project tax credit 
programs have not been finalized, and there is insufficient information 
available to do a thorough analysis of their potential impacts. 
Accordingly, DOE cannot determine with certainty that manufacturers of 
covered IRL and GSFL are eligible for either program. Any quantitative 
analysis of the industrial development bonds program or the advanced 
energy project tax credit program and their possible impacts on the 
GSFL and IRL industry would be highly speculative. Therefore, DOE did 
not include the bonds or tax credit in its analysis of potential 
impacts on the GSFL and IRL industries.
    According to the CA Stakeholders and ACEEE, the MIA does not 
consider pending legislation that could help mitigate the impacts due 
to energy conservation standards. Specifically, the CA Stakeholders 
cite three examples of pending legislation that could help to mitigate 
the impacts on GSFL and IRL manufacturers due to amended energy 
conservation standards: (1) Restoring America's Manufacturing 
Leadership through Energy Efficiency Act of 2009; (2) 21st Century 
Energy Technology Deployment Act of 2009; and (3) American Clean Energy 
and Security Act of 2009. (CA Stakeholders, No. 63 at p. 7) (ACEEE, No. 
76 at p. 6)
    If adopted in present form, DOE acknowledges that the proposed 
legislation cited by the CA Stakeholders could potentially mitigate the 
impacts of energy conservation standards on GSFL and IRL manufacturers 
if they were to qualify for the benefits in the proposed legislation. 
However, because the legislation is pending and has not become public 
law, passage of such proposed legislation or the final form of those 
provisions are the matters of speculation. Therefore, DOE does not 
include the proposed legislation's potential to mitigate the impacts on 
GSFL and IRL manufactures in its analysis nor has it considered the 
pending legislation in its decision for today's rule.
    The CA Stakeholders commented that energy conservation standards 
have consistently spurred innovation, resulting in even higher-
efficiency products. However, in its analysis, DOE assumes that high-
lumen T8 lamps represent the only opportunity for manufacturers to 
maintain profit margins through 2042. (CA Stakeholders, No. 63 at p 13) 
Additionally, the CA Stakeholders and ACEEE argued that DOE did not 
consider that GSFL manufacturers at TSL 4 and TSL 5 will be able to 
maintain high margins on a variety of other covered and non-covered 
products in their portfolio. These other covered products include T5s 
and extremely-high-lumen T8s, while non-covered products include solid 
state lighting such as LEDs. According to the CA Stakeholders, ACEEE, 
and NRDC, GSFL have other characteristics that could command higher 
margins besides efficacy, including long life, low wattage, resistance 
to high and low temperature, and low mercury content. If any of these 
upsell opportunities commanded higher markups, the positive impacts on 
INPV would be significant and should be reflected in DOE's analysis. 
(CA Stakeholders, No. 63 at pp. 13-14) (ACEEE, No. 76 at p. 4) (NRDC, 
No. 82 at p. 3).
    In response, DOE recognizes that manufacturers will attempt to 
devise product differentiation strategies to compensate for a 
compression of the efficacy range of their product lines as a result of 
energy conservation standards. These strategies may include redefining 
efficacy tiers to more narrow bands, introducing more efficacious lamps 
than are currently offered, or stressing product attributes other than 
efficacy. The great number of assumptions required to model all 
possible markup strategies in the GRIM would not add to DOE's 
qualitative description of how these upsells would impact INPV. As 
described previously, the Flat Markup scenario captures the INPV 
effects, assuming that manufacturers fully compensate for a reduced 
range of efficacy values in their product portfolio. Thus, DOE's 
consideration of the factors evoked by the CA Stakeholders and ACEEE is 
encompassed in the inclusion of a Flat Markup scenario and in its 
discussion of the relative weight it places on the markup scenarios for 
each of the TSLs.
    In comments on DOE's April 2009 NOPR, the CA Stakeholders stated 
that based on a sensitivity analysis of the GSFL GRIM, DOE's concern 
that standards could eliminate higher margins currently earned by more-
efficacious products was a significant driver in determining the total 
impacts on the GSFL industry. The CA Stakeholders pointed out that the 
Four-Tier markup scenario had the greatest effect in determining the 
INPV impacts on the GSFL industry. (CA Stakeholders, No. 63 at p. 12)
    For the April 2009 NOPR, DOE modeled two different markup scenarios 
to capture potential pricing schemes manufacturers apply to their 
products. 74 FR 16920, 16977 (April 13, 2009). The Flat Markup scenario 
applies a single markup to all products regardless of their efficacy. 
This scenario also assumes that manufacturers maintain their gross 
margin as a constant percentage throughout the analysis period, 
regardless of standards. The Four-Tier markup scenario applied a 
different markup to four different tiers of products (that correspond 
to the four phosphor series). As higher efficacies are required by 
energy conservation standards, manufacturers' product portfolios are 
reduced, squeezing the gross margins of higher-efficacy products as 
they are ``demoted'' to lower-relative-efficacy-tier products.

[[Page 34129]]

    DOE agrees with the CA Stakeholders that the markup strategy is the 
primary driver of INPV for GSFL manufacturers. Therefore, to capture 
the full range of potential impacts of energy conservation standards on 
the GSFL INPV, DOE used the two markup scenarios for the April 2009 
NOPR. For today's final rule, DOE continues to use both the Flat Markup 
and the Four-Tier markup scenarios to bound the potential impacts of 
energy conservation standards on the GSFL INPV.
    The CA Stakeholders and ACEEE commented that the base cases 
overestimated the margins that manufacturers will be able to maintain 
for high-lumen T8 lamps as the market naturally shifts to more-
efficient products. (CA Stakeholders, No. 63 at p. 4) (ACEEE, No. 76 at 
p. 4) Additionally, the CA Stakeholders commented that as products 
become more efficient, absent standards and in a competitive market, 
higher-efficacy products will not maintain their current margins. (CA 
Stakeholders, No. 63 at p. 12) The CA Stakeholders also argued that 
DOE's Four-Tier markup analysis for the four-foot medium bi-pin lamps 
appears to show manufacturers will maintain the estimated markup for 
800 series high-lumen T8 lamps meeting TSL 5 indefinitely. According to 
the CA Stakeholders, high-lumen T8s have been available for several 
years and are already being commoditized. However, DOE's own analysis 
has shown that the market is shifting to higher-efficacy products 
without energy conservation standards. (CA Stakeholders, No. 63 at p. 
12)
    For the April 2009 NOPR, DOE modeled two different markup 
scenarios. 74 FR 16920, 16977 (April 13, 2009). The first scenario 
applies a single markup to all products regardless of their efficacy. 
The second markup scenario applies a different markup to four tiers of 
product efficacies that correspond to the four phosphor series. As the 
CA Stakeholders correctly stated, DOE assumed these two markup 
structures would be maintained throughout the analysis period. The CA 
Stakeholders also correctly stated that markups are the primary driver 
of INPV for GSFL. The CA Stakeholders believe that higher-efficacy 
lamps are already being commoditized and that non-covered, emerging 
technology will command high margins for manufacturers. While this 
assumption is not certain, DOE agrees that the premium GSFL covered in 
this rulemaking will likely follow a typical product life cycle, in 
which the average margins decrease over time in the base case, thereby 
resulting in a lower INPV than quantified by the Four-Tier markup 
scenario presented in the April 2009 NOPR. DOE also agrees that it is 
likely that as more-efficacious lighting products enter or replace GSFL 
in the market, premium products which currently command higher markups 
will become commoditized over time, and margins will erode. As non-
covered emerging technologies reduce the size of the GSFL market, the 
overall margins of the GSFL market will also be reduced. Based on these 
additional assumptions, DOE has revised the Four-Tier markup scenario 
for today's final rule as previously described. DOE estimates that this 
commoditization reduces the base-case industry value and, to a lesser 
degree, the INPV impacts in the standards case. For further explanation 
of the Four-Tier markup scenario and the revised INPV results, see 
chapter 13 of the TSD.
    NRDC commented that commoditization of features and margin 
reduction will occur regardless of the standard set for the GSFL 
industry, but technological innovation will result in the introduction 
of new premium products as well. NRDC added that DOE has forecasted two 
scenarios and compared them to determine the manufacturer impact. 
According to NRDC's comments, the reality will certainly be somewhere 
in between a no-standards situation and the product commoditization 
scenario. NRDC concluded that the MIA results are likely to be 
significantly overstated because the true impacts will be in between 
these two situations (NRDC, No. 82 at p. 3).
    In the April 2009 NOPR, DOE requested comment on the ability of 
GSFL manufacturers to maintain margins through differentiation by other 
means and how the ability to differentiate products might vary over 
time. 74 FR 16920, 17001 (April 13, 2009). At TSL 5, DOE believes that 
the ability for manufacturers to differentiate products by means other 
than efficacy by the year 2012 is limited. Currently, only the most 
efficient lamps available meet this efficacy level. This ability could 
improve in later years as other features and higher efficacy products 
are introduced. However, given the discounting of future cash flows, 
the effect of this gradual improvement will be small. For this reason, 
DOE believes that the INPV results would be greater than the midpoint 
of the range of impacts. At TSL 4, manufacturers maintain some ability 
to create tiers of efficacy, which will mitigate some of the effects of 
commoditization of premium GSFL. However, DOE disagrees with the 
statement that the impacts on manufacturers are likely to be 
significantly overstated. DOE believes the revisions to the Four-Tier 
markup scenario have addressed the Advocates' concerns regarding an 
unrealistic change in profitability in the standards cases.
    The CA Stakeholders commented that DOE should conduct its own 
research and/or seek alternate sources of information to calculate the 
manufacturer margins and conversion costs for T12 and T8 lamps. The CA 
Stakeholders argued that because manufacturer margins and conversion 
costs are two of the most significant GRIM inputs, to preserve the 
transparency of its analysis, DOE should not rely primarily on 
confidential data provided by one set of stakeholders (CA Stakeholders, 
No. 63 at p. 14).
    In response, DOE understands the need for transparent and accurate 
data on which to base its analysis. Profit margin data at the product-
line level are possibly the most sensitive data for any company, and 
therefore, are not readily available to the public. DOE attempts to 
validate any sensitive data provided by manufacturers, including 
information about profit margins, by first requesting any documentary 
evidence. DOE also compares the data submittals for each manufacturer 
for consistency. To the extent possible DOE has developed and will 
continue to develop its own estimates of key parameters for the MIA, 
such as manufacturing costs and pricing, by researching published 
sources, contacting tooling suppliers, and retaining the services of 
industry consultants. To maintain confidentiality and transparency at 
the same time, DOE makes its estimates of manufacturer margins and 
conversion costs available for public comment in an industry-aggregated 
form. This process allows DOE to further refine its assumptions and 
estimates based on the responses provided by interested parties.
    The CA Stakeholders commented that the MIA's assumptions should not 
be revised to consider the current economic recession. The CA 
Stakeholders argued that such revisions would not add any practical 
value, given that it is impossible to accurately predict the direction 
of short-term economic cycles. (CA Stakeholders, No. 63 at p. 8)
    As previously stated, for today's final rule, DOE has updated the 
GSFL and IRL GRIMs with revised NIA shipments and scenarios and used 
the updated product price determination inputs. DOE also revised the 
conversion costs using the appropriate PPI. These changes are typical 
revisions for energy conservation rulemakings and are not

[[Page 34130]]

specifically attributable to current economic conditions. DOE agrees 
with CA Stakeholders and has not made revisions to the MIA specifically 
in response to the current near-term economic downturn. For additional 
information on the updates to the NIA and product price determination, 
see section V.D of today's notice, respectively. For further 
explanation of inputs and updates to the GSFL and IRL GRIMs, see 
chapter 13 of the TSD.
    The CA Stakeholders commented that the effective date of today's 
final rule for GSFL and IRL energy conservation standards has a 
significant impact on the reported INPVs, and that any prorogation of 
the effective date would help mitigate impacts on the industry due to 
energy conservation standards. The CA Stakeholders recommended that DOE 
should establish an effective date for GSFL for their proposed Tier 1 
standards (TSL4) in 2012 and for Tier 2 (TSL5) in 2016. (CA 
Stakeholders, No. 63 at p. 2, 14). Similarly, ACEEE argued that a 
phase-in standard would allow additional lead time for manufacturers 
and capture maximum energy savings. However, ACEEE requested expedited 
phase-in dates for GSFL standards at Tier 1 (July 2012) and Tier 2 
(July 2015) (ACEEE, No. 76 at p. 2). ACEEE presented the alternative of 
a later effective date for choosing TSL 5 for all covered GSFL (2013 or 
2014), because it provides manufacturers additional time to spread 
conversion cost, thereby minimizing the impacts on INPV (ACEEE, No. 76 
at pp. 2-3). Similar to ACEEE's alternative effective date, OSI 
requested a one-year extension of the effective date for IRL products 
only. OSI commented that the extension would allow sufficient time to 
replace its capital base for covered IRL and allow for manufacturing of 
the higher-efficacy products to stabilize (OSI, No. 84 at p. 1).
    DOE agrees that the effective date of energy conservation standards 
(i.e., compliance date) has a significant impact on INPV. In the GRIM 
cashflow analyses, the conversion costs are implemented in the years 
between the announcement of the final rule and the effective date of 
the standards. By delaying the effective date and the required capital 
and product conversion costs, it would in theory be possible to reduce 
the negative impacts on INPV calculated for the proposed standards 
case, due to discounting the negative cash flows for conversion costs 
in later years. However, for the reasons discussed in section VI.I, for 
today's final rule, DOE is not using a tiered approach to set energy 
conservation standards. Similarly, for the reasons discussed in section 
VI.I, DOE is not considering a later effective date for either the GSFL 
or the IRL energy conservation standard. The implications of a later 
effective date on the GSFL and IRL INPV are not being considered.
    For a detailed discussion of the MIA, see chapter 13 of the TSD 
accompanying this notice.

G. Employment Impact Analysis

    DOE considers employment impacts in the domestic economy as one 
factor in setting energy conservation standards. Employment impacts 
include direct and indirect impacts. Direct employment impacts are 
changes in the number of employees for manufacturers of the appliance 
products that are subject to standards, their suppliers, and related 
service firms. The MIA addresses these impacts. Indirect employment 
impacts from standards consist of the net jobs created or eliminated in 
the national economy, other than in the manufacturing sector being 
regulated, due to: (1) Reduced spending by end users on energy; (2) 
reduced spending on new energy supply by the utility industry; (3) 
increased consumer spending on the purchase of new products; 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. DOE also expects these shifts in spending and 
economic activity to affect the demand for labor in the short term.
    In developing the April 2009 NOPR and today's final rule, DOE 
estimated indirect national employment impacts using an input/output 
model of the U.S. economy called Impact of Sector Energy Technologies 
(ImSET \44\). ImSET is a spreadsheet model of the U.S. economy that 
focuses on 188 sectors most relevant to industrial, commercial, and 
residential building energy use. 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 
188 sectors. ImSET's national economic I-O structure is based on a 1997 
U.S. benchmark table, especially aggregated to those sectors. For 
further details, see chapter 15 of the TSD accompanying this notice.
---------------------------------------------------------------------------

    \44\ Roop, J. M., M. J. Scott, and R. W. Schultz, ImSET: Impact 
of Sector Energy Technologies (PNNL-15273 Pacific Northwest National 
Laboratory) (2005). Available at http://www.pnl.gov/main/publications/external/technical_reports/PNNL-15273.pdf.
---------------------------------------------------------------------------

    As described in section V.G, DOE uses ImSet to consider indirect 
employment impacts when evaluating alternative standard levels. Direct 
employment impacts on the manufacturers that produce IRL and GSFL are 
analyzed in the manufacturer impact analysis, as discussed in section 
V.F.

 H. Utility Impact Analysis

    The utility impact analysis determines the changes to energy supply 
and demand (and forecasted power generation capacity) that result from 
the end-use energy savings due to new or amended energy conservation 
standards. DOE used a version of EIA's National Energy Modeling System 
(NEMS) for this utility impact analysis. NEMS, which is available in 
the public domain, is a large, multisectoral, partial-equilibrium model 
of the U.S. energy sector. EIA uses NEMS to produce its AEO, a widely-
recognized baseline energy forecast for the United States. The version 
of NEMS used for appliance standards analysis is called NEMS-BT \45\ 
and is primarily based on the April Update of the AEO 2009 \46\ with 
minor modifications. The analysis output includes a forecast of the 
total electricity generation capacity at each TSL.
---------------------------------------------------------------------------

    \45\ EIA approves the use of the name NEMS to describe only an 
official 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. (``BT'' stands for DOE's Building Technologies 
Program.) For more information on NEMS, refer to ``The National 
Energy Modeling System: An Overview,'' DOE/EIA-0581 (98) (Feb. 
1998). Available at http://tonto.eia.doe.gov/ftproot/forecasting/058198.pdf.
    \46\ An Updated Annual Energy Outlook 2009 Reference Case 
Reflecting Provisions of the American Recovery and Reinvestment Act 
and Recent Changes in the Economic Outlook, April 2009.
---------------------------------------------------------------------------

    DOE obtained the energy savings inputs associated with electricity 
consumption savings from the NIA. These inputs reflect the effects on 
electricity of efficiency improvements due to the deployment of GSFL 
and IRL that would meet the energy conservation standards set forth in 
this rulemaking. Chapter 14 of the TSD accompanying this notice 
presents details on the utility impact analysis.
    DOE received comments to the ANOPR requesting that DOE report gas 
and electricity price impacts, and the economic benefits of reduced 
need for new electric power plants and infrastructure. The expectation 
is that lower electricity demand will lead to

[[Page 34131]]

lower prices for both electricity and natural gas that would benefit 
consumers.
    DOE considered reporting gas and electricity price impacts but 
found that the uncertainty of price projections, together with the 
fairly small impact of the standards relative to total electricity 
demand, makes these price changes highly uncertain. As a result, DOE 
believes that they should not be weighed heavily in the decision 
concerning the standard level. Given the current complexity of utility 
regulation in the United States (with significant variances among 
States), it does not seem appropriate to attempt to measure impacts on 
infrastructure costs and prices where there is likely to be significant 
overlap.

 I. Environmental Assessment

    Pursuant to the National Environmental Policy Act of 1969 (NEPA) 
(42 U.S.C. 4321 et seq.) 42 U.S.C. 6295(o)(2)(B)(i)(VI), DOE prepared 
an environmental assessment (EA) of the potential impacts of the 
proposed standards it considered for today's final rule which it has 
included as chapter 16 of the TSD for the final rule. DOE found the 
environmental effects associated with the standards for GSFL and IRL to 
be insignificant. Therefore, DOE is issuing a Finding of No Significant 
Impact (FONSI), pursuant to NEPA, the regulations of the Council on 
Environmental Quality (40 CFR parts 1500-1508), and DOE's regulations 
for compliance with NEPA (10 CFR part 1021). The FONSI is available in 
the docket for this rulemaking.
    In the EA, DOE estimated the reduction in total emissions of 
CO2 and NOX using the NEMS-BT computer model. DOE 
also calculated a range of estimates for reduction in mercury (Hg) 
emissions using power sector emission rates. The EA does not include 
the estimated reduction in power sector impacts of sulfur dioxide 
(SO2), because DOE has determined that any such reduction 
resulting from an energy conservation standard would not affect the 
overall level of SO2 emissions in the United States due to 
the presence of national caps on SO2 emissions. These topics 
are addressed further below; see chapter 16 of the TSD for additional 
detail.
    EEI commented that DOE should consider the environmental impacts of 
the production processes especially if higher efficiency standards 
would result in more manufacturing overseas. (EEI, No. 45 at p. 4) As 
discussed in the manufacturer impact analysis (see section V.F), DOE 
does not expect a migration of production of IRL overseas as a result 
of this rule. In addition, as the migration of GSFL production overseas 
is highly speculative, DOE does not feel it appropriate to incorporate 
the environmental impacts of production processes if moved overseas.
    Earthjustice stated that DOE must calculate the amount of 
reductions in emissions of particulate matter (PM) that will result 
from standards for GSFLs and IRLs (and monetize the value). 
Earthjustice stated that even if DOE believes that the impacts on 
secondary PM emissions were physically impossible to estimate due to 
their complexity, it would not justify DOE ignoring the impact of 
standards on primary emissions of PM from power plants. (Earthjustice, 
No. 60 at pg 8) PM emissions reductions are much more difficult to 
estimate than other emissions due to the wide range of power plant 
controls and individual plant operations that impact PM emissions. DOE 
is not currently able to run a model that can make these estimates 
reliably at the national level.
    NEMS-BT is run similarly to the AEO2009 NEMS, except that lighting 
energy use is reduced by the amount of energy saved (by fuel type) due 
to the trial standard levels. The inputs of national energy savings 
come from the NIA analysis. For the EA, the output is the forecasted 
physical emissions. The net benefit of a standard is the difference 
between emissions estimated by NEMS-BT and the Updated AEO2009 
Reference Case. The NEMS-BT tracks CO2 emissions using a 
detailed module that provides results with broad coverage of all 
sectors and inclusion of interactive effects.
    The Clean Air Act sets an emissions cap on SO2 for all 
affected Electric Generating Units. The attainment of the emissions cap 
is flexible among generators and is enforced through the use of 
emissions allowances and tradable permits. In other words, with or 
without a standard, total cumulative SO2 emissions will 
always be at or near the ceiling, and there may be some timing 
differences among yearly forecasts. Thus, it is unlikely that there 
will be reduced overall SO2 emissions from standards as long 
as the emissions ceilings are enforced. Although there may be no actual 
reduction in SO2 emissions, there still may be an economic 
benefit from reduced demand for SO2 emission allowances. 
Electricity savings decrease the generation of SO2 emissions 
from power production, which can lessen the need to purchase 
SO2 emissions allowance credits, and thereby decrease the 
costs of complying with regulatory caps on emissions.
    NOX emissions from 28 eastern States and the District of 
Columbia (DC) are limited under the Clean Air Interstate Rule (CAIR), 
published in the Federal Register on May 12, 2005.\47\ Although CAIR 
has been remanded to EPA by the DC Circuit, it will remain in effect 
until it is replaced by a rule consistent with the Court's July 11, 
2008 opinion in North Carolina v. EPA.\48\ Because all States covered 
by CAIR opted to reduce NOX emissions through participation 
in cap-and-trade programs for electric generating units, emissions from 
these sources are capped across the CAIR region.
---------------------------------------------------------------------------

    \47\ 70 FR 25162 (May 12, 2005).
    \48\ 531 F.3d 896 (D.C. Cir. 2008); see also North Carolina v. 
EPA, 550 F.3d 1176 (D.C. Cir. 2008).
---------------------------------------------------------------------------

    For the 28 eastern States and D.C. where CAIR is in effect, no 
NOX emissions reductions will occur due to the permanent 
cap. Under caps, physical emissions reductions in those States would 
not result from the energy conservation standards under consideration 
by DOE, but standards might have produced an environmentally-related 
economic impact in the form of lower prices for emissions allowance 
credits, if they were large enough. However, DOE determined that in the 
present case, such standards would not produce an environmentally-
related economic impact in the form of lower prices for emissions 
allowance credits, because the estimated reduction in NOX 
emissions or the corresponding allowance credits in States covered by 
the CAIR cap would be too small to affect allowance prices for 
NOX under the CAIR. In contrast, new or amended energy 
conservation standards would reduce NOX emissions in those 
22 States that are not affected by CAIR. As a result, the NEMS-BT does 
forecast emissions reductions from the proposed amended standards 
considered in today's final rule.
    In the April 2009 NOPR, however, DOE provided a different estimate 
of NOX reductions, because DOE assumed that the CAIR had 
been vacated. 74 FR 16920, 17009-14 (April 13, 2009). This is because 
the CAIR rule was vacated by the U.S. Court of Appeals for the District 
of Columbia Circuit (DC Circuit) in its July 11, 2008 decision in North 
Carolina v. Environmental Protection Agency.\49\ Although the DC 
Circuit, in a December 23, 2008 opinion,\50\ decided to allow the CAIR 
rule to remain in effect until it is replaced by a rule consistent with 
the

[[Page 34132]]

Court's earlier opinion, DOE retained its analysis of NOX 
emissions reductions based on an assumption that the CAIR rule was not 
in effect, because: (1) The NOPR was so advanced at the time that the 
December 23, 2008 opinion was issued that revisiting the analysis would 
have caused undue delay; and (2) neither the July 11, 2008, nor the 
December 23, 2008 decisions of the D.C. Circuit changed the standard-
setting proposals offered in the NOPR.
---------------------------------------------------------------------------

    \49\ 531 F.3d 896 (D.C. Cir. 2008).
    \50\ See 550 F.3d 1176 (D.C. Cir. 2008).
---------------------------------------------------------------------------

    Thus, for the April 2009 NOPR, DOE established a range of 
NOX reductions based on low and high emissions rates (in 
metric kilotons of NOX emitted per terawatt-hour (TWh) of 
electricity generated) derived from the AEO2008. DOE anticipated that, 
in the absence of the CAIR's trading program, the new or amended energy 
conservation standards would reduce NOX emissions 
nationwide, not just in 22 States.
    Similar to SO2 and NOX, future emissions of 
Hg would have been subject to emissions caps under the Clean Air 
Mercury Rule \51\ (CAMR), which would have permanently capped emissions 
of mercury for new and existing coal-fired plants in all States by 
2010, but the CAMR was vacated by the DC Circuit in its decision in New 
Jersey v. Environmental Protection Agency \52\ prior to publication of 
the April 2009 NOPR. However, the NEMS-BT model DOE initially used to 
estimate the changes in emissions for the proposed rule assumed that Hg 
emissions would be subject to CAMR emission caps.
---------------------------------------------------------------------------

    \51\ 70 FR 28606 (May 18, 2005).
    \52\ 517 F 3d 574 (D.C. Cir. 2008).
---------------------------------------------------------------------------

    After CAMR was vacated, DOE was unable to use the NEMS-BT model to 
estimate any changes in the quantity of mercury emissions (anywhere in 
the country) that would result from standard levels it considered for 
the proposed rule. Instead, DOE used an Hg emissions rate (in metric 
tons of Hg per energy produced) based on the AEO2008 for the April 2009 
NOPR. Because virtually all mercury emitted from electricity generation 
is from coal-fired power plants, DOE based the emissions rate on the 
metric tons of mercury emitted per TWh of coal-generated electricity. 
To estimate the reduction in mercury emissions, DOE multiplied the 
emissions rate by the reduction in coal-generated electricity 
associated with the standards considered. Because the CAMR remains 
vacated, DOE continued to use the approach it used for the April 2009 
NOPR to estimate the Hg emission reductions due to standards for 
today's final rule.
    EEI commented that, ``if the standard leads to more use of compact 
fluorescent technology as replacements for incandescent reflector 
lamps, there will be an increase in mercury use and disposal issues 
compared to the baseline technologies.'' (EEI, No. 45 at p. 4). DOE 
estimates that any increase in use of CFLs, as compared to having no 
new or amended GSFL and IRL standards, would be minimal and any related 
mercury releases would be environmentally insignificant and 
speculative, particularly since only a fraction of CFLs are improperly 
disposed of and only a small fraction of the mercury in those CFLs 
leaches into the environment.
    Earthjustice and NRDC argue that DOE should incorporate the value 
of CO2 emissions reductions into the LCC and NPV analyses 
because the value of CO2 emissions reductions affects the 
economic justification of standards, DOE must incorporate these effects 
into the LCC and NPV analyses. (Earthjustice, No. 60, at pgs 7-8 and 
(NRDC and Earthjustice, Issue Paper, No. 82 at p. 1)) New York, et al. 
also recommended that DOE prioritize energy savings and reduced 
CO2 emissions and allocate at least as much weight to the 
monetary value of reduced carbon emissions as it does to other monetary 
impacts. (NY et al., No. 88 at p. 1)\53\ On the other hand, NEMA 
expressed support of the approach used by DOE in the NOPR to reflect a 
range for monetized values and report environmental benefits separately 
from the net benefits of energy savings. (NEMA, No. 81 at p. 21)
---------------------------------------------------------------------------

    \53\ A joint comment by the States of New York, California, 
Connecticut, Delaware, Illinois, Massachusetts, New Hampshire, New 
Jersey, Ohio, Vermont, and Washington.
---------------------------------------------------------------------------

    DOE notes that neither EPCA nor NEPA requires that the economic 
value of emissions reduction be incorporated in the LCC or NPV analysis 
of energy savings. DOE has chosen to report these benefits separately 
from the net benefits of energy savings. A summary of the monetary 
results is shown in section VII.C.6 of this notice. DOE considered both 
values when weighing the benefits and burdens of standards.

J. Monetizing Carbon Dioxide and Other Emissions Impacts

    DOE also calculated the possible monetary benefit of 
CO2, NOX, and Hg reductions. Cumulative monetary 
benefits were determined using discount rates of 3 and 7 percent. DOE 
monetized reductions in CO2 emissions due to the standards 
in this final rule based on a range of monetary values drawn from 
studies that attempt to estimate the present value of the marginal 
economic benefits (based on the avoided marginal social costs of 
carbon) likely to result from reducing greenhouse gas emissions. The 
marginal social cost of carbon is an estimate of the monetary value to 
society of the environmental damages of CO2 emissions.
    Several parties provided comments regarding the economic valuation 
of CO2 for the April 2009 NOPR. NRDC commented that New 
England now has a CO2 trading price that could be used by 
DOE (NRDC, Public Meeting Transcript, No. 38.4 at p. 311-312) NRDC and 
Earthjustice argue that DOE should incorporate an assumption of a 
mandatory cap on CO2 emissions or at the very least revise 
the range of CO2 valuation. (NRDC and Earthjustice, Issue 
Paper, No. 82, p. 1-14) NY et al. also criticized the range of 
CO2 values used in the NOPR and recommended the use of a 
long-run marginal abatement cost of CO2 for monetizing 
CO2 emission reductions, rather than the damage costs given 
the highly uncertain nature of the latter (NY et al., No. 88, p. 9-10). 
As discussed in section VII.C.6, DOE has updated the approach described 
in the April 2009 NOPR (74 FR 16920, 17009 (Apr. 13, 2009)) for its 
monetization of environmental emissions reductions for today's rule.
    Although this rulemaking does not affect SO2 emissions 
or NOX emissions in the 28 eastern States and D.C. where 
CAIR is in effect, there are markets for SO2 and 
NOX emissions allowances. The market clearing price of 
SO2 and NOX emissions allowances is roughly the 
marginal cost of meeting the regulatory cap, not the marginal value of 
the cap itself. Further, because national SO2 and 
NOX emissions are regulated by a cap-and-trade system, the 
cost of meeting these caps is included in the price of energy. Thus, 
the value of energy savings already includes the value of 
SO2 and NOX control for those consumers 
experiencing energy savings. The economic cost savings associated with 
SO2 and NOX emissions caps is approximately equal 
to the change in the price of traded allowances resulting from energy 
savings multiplied by the number of allowances that would be issued 
each year. That calculation is uncertain because the energy savings 
from new or amended standards for IRL and GSFL would be so small 
relative to the entire electricity generation market that the resulting 
emissions savings would have almost no impact on price formation in the 
allowances market. These savings would most likely be outweighed by 
uncertainties in the

[[Page 34133]]

marginal costs of compliance with SO2 and NOX 
emissions caps.
    EEI commented that the cost of remediating emissions such as 
CO2, NOX, SO2, and mercury were 
already included in electricity rates paid by consumers and therefore 
emission reductions should not be ``monetized'' because it would lead 
to double counting. (EEI, No. 78 at p. 4-5). As described above, DOE 
has only monetized the value of emissions not covered by existing caps, 
such as NOX in regions not covered by CAIR. The monetization 
of these emissions is based on estimates of their damage costs (i.e., 
health effects) that are not included in economic prices.
    EEI also commented that DOE should consider the most recent trends 
in electricity generation, including reductions in emissions, the rise 
of renewable portfolio standards, and the possibility of an upcoming 
CO2 cap-and-trade program which would reduce the amount of 
CO2 produced per kWh generated. (EEI, No. 45 at p. 5) 
Earthjustice stated that Federal caps will likely be in place by the 
time new standards become effective, so DOE should increase its 
electricity prices to reflect the cost of complying with emission caps. 
Earthjustice also noted that there are regional cap-and-trade programs 
in effect in the Northeast (Regional Greenhouse Gas Initiative (RGGI)) 
and the West (Western Climate Initiative (WCI)) that will affect the 
price of electricity but are not reflected in the AEO energy price 
forecasts. (Earthjustice, No. 60 at p. 6-7) NY et al. also recommended 
including some level of CO2 pricing in its modeling. (NY et 
al., No. 88, at p. 25)
    In response, DOE incorporated current trends in its analysis, but 
expressly did not include possible future legislation in this 
rulemaking. The current NEMS-BT model used in projecting the 
environmental impacts includes the CAIR rule, as described above, which 
is projected to reduce SO2 and NOX emissions. 
NEMS-BT also takes into account the current set of State level 
renewable portfolio standards, the effect of the RGGI, and utility 
investor reactions to the possibility of future CO2 cap and 
trade programs, all of which impact electricity prices and reduce the 
projected carbon intensity of generation.\54\
---------------------------------------------------------------------------

    \54\ For more information, see the Update to the AEO2009 and the 
AEO2009 Assumptions documentation [add proper cites].
---------------------------------------------------------------------------

VI. Discussion of Other Key Issues and Comments

A. Sign Industry Impacts

    The CA Stakeholders supported the adoption of TSL3 for the 8-foot 
SP Slimline and 8-foot RDC HO product classes partially due to concern 
for the outdoor sign industry. Based on communication with the Director 
of Technical & Regulatory Affairs for the International Sign 
Association, the CA Stakeholders believed that the outdoor sign 
industry would experience significant negative impacts if covered 8-
foot T12 lamps were eliminated by DOE proposing TSL4. (CA Stakeholders, 
No. 63 at p. 10) However, DOE does not believe that such an impact 
exists. The definition of ``general service fluorescent lamp'' exempts 
any fluorescent lamp designed and marketed for cold temperature 
applications. 10 CFR 430.2. Because outdoor signs typically require 
lamps and ballasts designed for cold temperature operation, they should 
be minimally impacted by an energy conservation standard. If owners of 
outdoor signs are in fact using covered 8-foot T12 lamps, they have the 
option to replace those lamps with either a covered 8-foot T8 lamp or 
an exempted 8-foot T12 lamp designed for use in cold temperature 
applications. Thus, the outdoor sign industry will not be negatively 
impacted by DOE adopting TSL4.

B. Max-Tech IRL

    As required under 42 U.S.C. 6295(p)(1) and described in the April 
2009 NOPR, DOE identified the efficacy levels that would achieve the 
maximum improvements in energy efficiency that are technologically 
feasible (max-tech levels) for GSFL and IRL. 74 FR 16920, 16933-35 
(April 13, 2009). For IRL, DOE tentatively determined that the maximum 
technologically feasible efficacy level would incorporate the highest-
efficiency technologically feasible reflector, halogen infrared 
coating, and filament design. Id. Combining all three of these high-
efficiency technologies simultaneously results in the maximum 
technologically feasible level. However, because the only technology 
pathway to this level is dependent on a proprietary technology, DOE did 
not consider this level further in its analyses. In the April 2009 
NOPR, DOE analyzed TSL5, which is the most efficient commercially-
available IRL and employs a silver reflector, an improved (but not 
most-efficient) IR coating, and a filament design that results in a 
lifetime of 4,200 hours. Although this commercially-available lamp uses 
the patented silver technology, DOE believes that there are alternate 
pathways to achieve this level. A combination of redesigning the 
filament to achieve higher temperature operation (and thus reducing 
lifetime to 3,000 hours), employing other non-proprietary high-
efficiency reflectors, and applying a higher-efficiency IR coating has 
the potential to result in an IRL that meets an equivalent efficacy 
level (for more information regarding these technologies, see chapter 3 
of the TSD). Therefore, in the April 2009 NOPR, DOE concluded that TSL5 
is the maximum technologically feasible level for IRL that is not 
dependent on the use of a proprietary technology. Id.
1. Treatment of Proprietary Technologies
    Several stakeholders commented that DOE did not analyze the max-
tech level for IRL as required by EPCA because IRL can achieve 
efficacies even higher than TSL5. (ASAP, Public Meeting Transcript, No. 
38.4 at p. 96; ADLT, Public Meeting Transcript, No. 38.4 at p. 113; 
Earthjustice, No. 60 at pp. 2-3; CA Stakeholders, No. 63 at p. 14; 
ACEEE, No. 76 at p. 5; NRDC, No. 82 at p. 2) Commenters disagreed with 
DOE's conclusion that it could not establish a TSL that required the 
use of a proprietary technology. (Earthjustice, No. 60 at pp. 3-4; CA 
Stakeholders, No. 63 at p. 14; ACEEE, No. 76 at p. 5) These 
stakeholders claimed that DOE must either analyze the economic impacts 
of the true max-tech level, which would incorporate the proprietary 
technology, or show that standards based on the proprietary silverized 
reflector are not technologically feasible. (Earthjustice, No. 60 at p. 
4; CA Stakeholders, No. 63 at pp. 14-15)
    DOE agrees with the stakeholders that max-tech level for IRL is 
different than TSL5. While TSL5 is the highest efficiency level on 
which DOE performed the full range of economic analyses (including LCC, 
national impacts, and manufacturer impacts), DOE maintains that it did 
in fact consider and analyze the max-tech level consistent with EPCA. 
According to EPCA, DOE is required to establish energy conservation 
standards that ``shall be designed to achieve the maximum improvement 
in energy efficiency * * * which the Secretary determines is 
technologically feasible and economically justified.'' (42 U.S.C. 
6295(o)(2)(A)) To determine economic justification, DOE considers 
(among other factors) ``the economic impact of the standard on the 
manufacturers'' and ``the impact of any lessening of competition * * * 
that is likely to result

[[Page 34134]]

from the imposition of a standard.'' (42 U.S.C. 6295(o)(2)(B)(i)(I) and 
(V))
    The observation that DOE did not label the max tech level as TSL6 
does not mean that DOE did not consider this efficiency level. As noted 
in the April 2009 NOPR and further explained below, DOE rejected this 
level because it required the use of a proprietary technology. However, 
DOE is not broadly screening out proprietary technologies or otherwise 
eliminating them from its analysis. In contrast to the present case, 
most patents do not convey market power to their owners because close 
substitutes for these inventions exist. Licensors will pay no more for 
these technologies than the cost advantage they provide over the next 
best alternative pathway to compliance with the efficiency standard. 
Ultimately the availability of cost-effective alternate technology 
pathways is what limits the ability of the owner of a proprietary 
technology to extract high fees for its use.
    However, it is DOE's opinion that a standard level which can only 
be met with a single proprietary technology which comes without 
assurances of open and free technology access should be rejected 
because it carries great risk of resulting in an anti-competitive 
market, a principle consistently applied in past DOE rulemakings. In 
such a situation, the standards-setting process itself would convey 
great market power because there would be no alternative means to 
satisfy the standard. DOE believes that this is sufficient cause to 
conclude that the max-tech level in question is not economically 
justified. Having made this determination, there was no need or benefit 
to performing additional analyses relevant to the other statutory 
criteria. In fact, in Natural Resources Defense Council v. Herrington, 
the DC Circuit recognized that a complete analysis of all factors in 
not always required: `` If no standard could have been based on 
prototypes without requiring manufacturers to accomplish the 
impossible, we agree that DOE could reasonably deem all such standards 
economically unjustified without trudging through the remaining 
statutory factors.'' 768 F.2d 1355, 1396-97 (D.C. Cir. 1985).
    At the NOPR public meeting, ASAP suggested that DOE should consider 
cross-licensing as a vehicle for manufacturers to access proprietary 
technologies if such technologies might comprise the only pathway to 
compliance with a certain standard level. (ASAP, Public Meeting 
Transcript, No. 38.4 at p. 97) While DOE acknowledges that 
manufacturers of proprietary technologies can create cross-licensing 
agreements with other organizations, DOE continues to reject the notion 
that a standard requiring a specific proprietary technology can be 
established under the EPCA criteria, for several reasons. First, the 
availability and the price of the proprietary technology could change 
after the efficiency standards are established, if the patent owner 
attempts to extract the value added by the standard-setting process in 
royalty fees for the technology required to meet the max-tech level. 
Second, DOE believes that the terms of cross-licensing agreements are 
generally not made public, so it is difficult to assess historical 
trends as to the impact of such agreements on the market. Thus, DOE 
cannot assess the cost implications of current or future cross-
licensing agreements made in the industry; by extension, DOE cannot 
assess the manufacturer, consumer, or nationwide impact of a standard 
that requires the usage of a proprietary technology.
    In consideration of all of these factors, DOE maintains that it 
considers a standard level which can be met by only one proprietary 
design to be economically unjustified. Thus, DOE has rejected the max-
tech level for IRL, and conducted the full range of economic analyses 
on what it believes to be the next highest efficiency level (not 
dependent on a proprietary design), TSL5.
2. Other Technologies
    In response to the April 2009 NOPR, DOE received a number of 
comments suggesting that even without the use of a proprietary 
technology, several existing technologies could be utilized to produce 
IRL with efficacies that meet or exceed TSL5. (ADLT, Public Meeting 
Transcript, No. 38.4 at pp. 107-110, 113; CA Stakeholders, No. 63 at 
pp. 16-17; ADLT, No. 72 at p. 2; ACEEE, No. 76 at p. 5; NRDC, No. 82 at 
p. 4) Manufacturers also commented on the burdens and barriers 
associated with implementing some of these technologies. Comments 
received regarding alternate technologies that could be used to meet or 
exceed TSL5 are summarized below.
a. High-Efficiency IR Coatings
    DOE analyzed advanced IR coatings in the April 2009 NOPR as a 
possible technology pathway to achieving TSL5 without the use of the 
proprietary silverized reflector. 74 FR 16920, 16944-45 (April 13, 
2009). As part of its analysis (documented in the Appendix 5D of the 
TSD), DOE obtained several halogen burners on which advanced IR 
coatings were deposited.\55\ Using a combination of testing and 
engineering calculations, DOE determined the maximum lamp efficacy that 
could result from implementing an advanced IR coating and non-
proprietary aluminum reflector, while maintaining a lamp lifetime 
similar to the baseline lamp lifetime.
---------------------------------------------------------------------------

    \55\ Halogen infrared (HIR) lamps that are commercially 
available today typically use infrared (IR) coatings with 
alternating layers of two materials (i.e., SIO2 and a 
second material of either Ta2O5 or 
Nb2O5) and have layer counts ranging from 45 
to 75. In contrast, the most-efficient HIR lamps have a coating made 
of three materials: SiO2, Ta2O5, 
and TiO2, the latter in the high-index rutile phase. This 
three-material coating, described as a Hybrid\TM\ by Advanced 
Lighting Technologies, Inc. (hereafter referred to as ``advanced IR 
coating ''), has an effective IR reflectance significantly higher 
than that of the two-material coatings used in the commercially-
available examples, thereby resulting in enhanced lumen-per-watt 
(lm/W) values.
---------------------------------------------------------------------------

    In response to the April 2009 NOPR, several stakeholders noted that 
DOE's maximum lamp efficacy as presented in Appendix 5D of the TSD, far 
exceeds that of TSL5 and, thus, should have been considered as a higher 
TSL6. (PG&E, Public Meeting Transcript, No. 38.4 at p. 99; CA 
Stakeholders, No. 63 at p. 15) The CA Stakeholders further agreed with 
DOE's statement in appendix 5D that advanced IR coatings are not a 
developmental product. (CA Stakeholders, No. 63 at p. 17) ADLT 
confirmed that the uncoated burner tested by DOE for appendix 5D has 
been used in products for several years in the United States and that 
the coating applied to this burner has been in production in Europe on 
12V burners for several years. (ADLT, No. 72 at p. 3)
    In contrast, NEMA commented that because DOE's lamp efficacies 
calculated in Appendix 5D are based on prototype burners, and not on 
product that is currently in production, these values overestimate the 
final performance that would be achieved after making all design and 
process tradeoffs necessary to implement a complete high-speed, high-
volume assembly process. (NEMA, No. 81 at pp. 28-29) In addition, both 
Philips and ADLT agreed that there is a difference between the efficacy 
that can be attained in a laboratory production process and that which 
can be attained in an industrial environment. ADLT acknowledged that 
this difference is more pronounced when employing higher-efficiency IR 
coatings. (Philips, Public Meeting Transcript, No. 38.4 at p. 111; 
ADLT, Public Meeting Transcript, No. 38.4 at pp. 112-113)
    While DOE considers advanced IR coatings to be a valid design 
option for increasing IRL efficacy and has not screened it out of the 
analysis, DOE also

[[Page 34135]]

recognizes that it lacks the data to accurately estimate the 
performance of lamps utilizing this design option when manufactured at 
the production volumes needed to service the IRL market. Although all 
individual components of the prototype have been produced in high 
volume for separate products, that alone does not prove that a lamp 
with that combination of parts would have the same efficacy when 
manufactured on a large scale. In addition, as the analysis performed 
in appendix 5D of the TSD was based on an IR coating deposited in a 
laboratory environment, it is reasonable to assume that the efficacy of 
similar burners when manufactured in an industrial environment will be 
lower. While DOE recognizes that advanced IR coatings will likely 
produce higher-efficacy IRL, because DOE does not have adequate data to 
accurately estimate this efficacy, DOE is no longer considering the 
tested burners in establishing the max-tech level or alternate 
technology pathways to achieving other TSLs.
b. Silverized Reflectors
    Commenters stated that in addition to the patent for GE's 
silverized reflector, two other patents exist for manufacturing 
coatings of reflective silver. Another company possesses a provisional 
patent for a silverized lamp reflector (``Reflector A''), a technology 
(currently in development) that has been demonstrated in prototypes 
that have tested performances at least equal to that of the patented 
technology. A third entity has a patent for a ``durable silver 
reflective coating'' (``Reflector B'') that could be used for lamp 
applications. (CA Stakeholders, No. 63 at p. 19-20; ADLT, No. 72 at p. 
2)
    While recognizing the promise of these reflective silver 
technologies, DOE notes that significant uncertainty remains as to the 
successful implementation of both of these designs in commercial 
products at the scale needed to service the IRL market. In addition, 
DOE has no data on the performance of Reflector A. Although stakeholder 
have provided tested efficacies of lamps utilizing Reflector B, similar 
to the discussion regarding advance IR coatings, DOE is unable 
accurately estimate the performance of these lamps when produced at 
high volumes in industrial environments. For this reason, although DOE 
considers silverized reflectors as an IRL design option, DOE has 
concluded that it cannot base its establishing of max-tech or adoption 
of any other TSL on the potential performance of these reflectors.
c. Integrally-Ballasted Low-Voltage IRL
    In the April 2009 NOPR, DOE screened out integrally-ballasted low-
voltage IRL as a technology option, because it was unaware of any IRL 
with integrated transformers that stepped down voltage from 120V line 
voltage. 74 FR 16920, 16940 (April 13, 2009). Therefore, DOE could not 
conclusively determine if this technology option was technologically 
feasible. (See the Chapter 4 of the NOPR TSD). To demonstrate 
technological feasibility, the California Stakeholders contracted a 
consulting company to combine existing lamp components to make several 
prototypes of 120V IRL utilizing low-voltage capsules. The tested 
efficacies of these prototype indicated that low-voltage capsules could 
be used as a technology pathway to meeting TSL4 and TSL5. (California 
Stakeholders, No. 63 at pp. 20-21) Regarding the technological 
feasibility of low-voltage IRL, Philips commented that higher mains 
voltages found in Europe (such as 220V and 240V) allow greater 
improvements in efficiency to be obtained by IRL with integrated 
transformers, but such improvements could not be obtained as easily in 
the U.S., where a mains voltage of 120V is used. (Philips, Public 
Meeting Transcript, No. 38.4 at pp. 318-319)
    In response, because the California Stakeholders have demonstrated 
that an integrally-ballasted low-voltage IRL operating on 120V mains is 
technologically feasible, DOE is no longer screening out this 
technology option in its screening analysis. However, because one of 
the tested prototypes (in particular, the only one claimed to meet 
TSL5) combined the low-voltage capsule with a developmental silverized 
reflector (see section V.B.5.d), DOE believes that there is significant 
uncertainty regarding the actual efficacies when such a product is 
manufactured on large scales. In addition, as stakeholders did not 
provide the lifetime of their tested prototypes, DOE cannot confirm 
that the resulting efficacies represent products with lifetimes similar 
to the baseline lamps DOE analyzed. Therefore, although DOE recognizes 
the potential of integrally-ballasted low-voltage IRL to reach high 
efficacies, due to the lack of definitive data DOE cannot base the 
establishing of max tech or the adoption of any other TSL on the test 
data provided.
3. Lamp Lifetime
    Because lamp lifetime affects lamp efficacy, certain commenters 
suggested that the max-tech level should reflect a typical baseline 
lamp with a lifetime of between 1,000 and 2,000 hours. (CA 
Stakeholders, No. 63 at p. 15) ADLT acknowledged that a relationship 
exists between lamp lumens and lifetime in which, all other things 
remaining equal, one cannot be changed without affecting the other. 
ADLT suggested that DOE should analyze lamps with lifetimes between 
2,000 and 3,000 hours, which represents lifetimes commonly found in the 
commercial and residential markets. (ADLT, No. 72 at p. 3)
    DOE agrees that the max-tech level should be based on a lamp with a 
lifetime typical to the baseline lamp, and it conducted its rulemaking 
analyses accordingly. As discussed in Chapter 5 of the TSD and 
consistent with ADLR's recommendation, DOE believes typical lifetimes 
of IRL regulated by this rulemaking are currently 2,500 to 3,000 hours. 
As discussed in section I.A.2, DOE has already considered that the 
maximum technologically feasible level would incorporate the highest-
efficiency filament design, and such a filament would increase 
operating temperature (and efficacy) to a point that would result in a 
lifetime equivalent to the baseline lamp lifetime. However, because 
this level requires the use of the proprietary silverized reflector, 
DOE rejected this level as not economically-justified.
    In addition, DOE has reevaluated whether TSL5 represents the 
maximum technologically feasible level not dependent on a single 
proprietary technology. In the April 2009 NOPR, DOE based TSL5 on a 
commercially-available IRL which employs a proprietary silver 
reflector, an improved (but not most-efficient) IR coating, and a 
filament design that results in a lifetime of 4,200 hours. However, DOE 
also stated that it believed that other technology pathways (not 
dependent on the proprietary technology) may exist. This belief was 
largely based on advanced IR coated capsules DOE tested (as documented 
in Appendix 5D). However, as discussed in section VI.B.2.a, DOE does 
not have the required certainty regarding these tested efficacies, and, 
therefore, is not considering them in establishing standard levels for 
this final rule. To verify that an alternate technology pathway exists 
to achieving TSL5, DOE evaluated commercially-available lamps at TSL4 
(that generally have lifetimes of 4,000 hours) and modeled their 
efficacies at a reduced life-time similar to the baseline (2,500 
hours). Using the 9th edition of the IESNA Lighting Handbook and by 
developing a relationship between lifetime, lumens,

[[Page 34136]]

and wattage, DOE determined that a reduced lifetime TSL4 lamp (not 
using the proprietary silver reflector) would in fact just meet the 
efficacy requirements of TSL5. Therefore, DOE believes that TSL5 
represents the maximum technologically feasible level not dependent on 
a single proprietary technology, taking into account all lifetime 
considerations.

 C. IRL Lifetime

 1. Baseline Lifetime Scenario
    As discussed earlier, DOE's NOPR analyses were primarily based on 
commercially-available lamps, modeling 4,000-hour-lifetime and 4,200-
hour-lifetime lamps at TSL4 and TSL5. DOE received a number of comments 
on the anticipated availability of IRL of various lifetimes under 
amended standards. Specifically, NEMA stated that it is possible to 
achieve higher efficacy levels (e.g., TSL4 and TSL5), but that only 
shorter-lifetime lamps are likely to be offered at those levels. NEMA 
also argued that PAR halogen lamps must have lifetimes of at least 
2,000 hours (and more typically 3,000 hours) in order to be 
economically viable to consumers. (NEMA, No. 81 at pp. 5, 31) In 
addition, ADLT commented that the market determines the appropriate 
combination of efficacy and lifetime, it predicted that, in the future, 
higher-efficacy lamps would have shorter lifetimes than those proposed 
by DOE at TSL4 and TSL5 in the April 2009 NOPR. (ADLT, No. 72 at p. 3-
4) The CA Stakeholders also disagreed with DOE's selection of longer-
lifetime lamps at TSL4 and TSL5. They stated that on a technology 
basis, lamp lifetime does not necessarily increase with the use of 
improved halogen technology. The CA Stakeholders believed that because 
manufacturers will be able to produce lamps with different combinations 
of lamp life and efficacy at TSL4 and TSL5, DOE's shipment analysis 
should not assume any change in average lamp life at those levels. (CA 
Stakeholders, No. 63 at p. 28)
    Although DOE acknowledges that there is a technology trade-off 
between IRL lifetime and efficacy, based on the current stock of 
commercially-available product, DOE has concluded that lamp lifetimes 
of 4,000 hours and 4,200 hours are technologically feasible at TSL4 and 
TSL5, respectively. However, DOE also recognizes that given the issues 
regarding proprietary technologies, some manufacturers may choose to 
meet these higher efficacy levels by reducing lifetime to 2,500 hours 
and 3,000 hours. In addition, DOE also agrees with the CA Stakeholders, 
that beyond issues regarding proprietary technologies, given their 
ability to provide similar offerings of lamp lifetime, manufacturers 
will likely choose to offer lamps at lifetime similar to the baseline 
lamps (2,500 to 3,000 hours). Finally, DOE agrees with stakeholders 
that such an assumption will likely change the impacts of amended 
standards on consumers and manufacturers from those presented in the 
April 2009 NOPR.
    For this reason, DOE developed a Baseline Lifetime scenario (in 
which it analyzed LCC savings, NPV, and manufacturer impacts) to 
investigate the effects of shorter lamp lifetime at TSL4 and TSL5. DOE 
determined it was not necessary to apply this scenario to TSL1 through 
TSL3, because at those levels, DOE already analyzes lamps with 
lifetimes similar to those of the baseline lamp lifetimes. However, for 
this scenario at TSL4, for each of the three baseline lumen packages, 
DOE analyzed an additional IRL with a lifetime equivalent to the 
baseline lamp's lifetime (2500 hours for the 90W lumen package, 2500 
hours for the 75W lumen package, 3000 hours for the 50W lumen package). 
The efficacy and wattages of the additional IRL were the same as those 
analyzed at TSL4 in the April 2009 NOPR. In addition, as DOE had no 
indication that a less-costly technology could be utilized to meet TSL4 
at these lower lifetimes, DOE modeled that the price of these 
additional lamps would be the same as the long-lifetime TSL4 lamps.
    For the Baseline Lifetime scenario at TSL5, as discussed in section 
VI.B.3, DOE's calculations indicate that the operating temperature of 
the 4,000 hour TSL4 lamp could be increased so as to result in a 2,500 
hour lifetime lamp with an efficacy that would just meet TSL5. 
Therefore, at TSL5, DOE models three additional lamps (one for each 
baseline lumen package) which have lifetimes of 2,500 hours, the same 
prices of the TSL4 lamps (since these lamps would use the same 
technologies), and the same wattages and efficacies of the previously 
analyzed TSL5 lamps. The results of this Baseline Lifetime scenario are 
presented with the Commercial Product Lifetime scenario in sections 
VII.B, VII.C.1, VII.C.2 and VII.C.3.
 2. Minimum Lamp Lifetime Requirement
    Some stakeholders expressed concern regarding the possibility of 
extremely low lifetime lamps entering the market if DOE were to adopt 
TSL4 or TSL5. As mentioned above, NEMA stated that a PAR halogen lamp 
must have a lifetime of at least 2,000 hours, and more typically 3,000 
hours, to be economically viable. (NEMA, No. 81 at p. 31) NEMA stated 
that shorter-lifetime lamps are unacceptable for long-life applications 
and negatively impacted the environment, because more lamps must be 
manufactured, transported, and disposed of. (NEMA, No. 81 at pp. 5, 31) 
Thus, NEMA commented that DOE should have considered a minimum lamp 
life when setting efficacy standards. (NEMA, Public Meeting Transcript, 
No. 38.4 at pp. 104, 111-112) Edison Electric Institute recommended 
that DOE should consider setting a minimum lifetime standard for IRL, 
as was done for CFL via the Energy Policy Act of 2005 (EPACT 2005). 
(EEI, Public Meeting Transcript, No. 38.4 at p. 117)
    While DOE acknowledges that EPACT 2005 set a minimum lifetime 
standard for CFL based on the August 9, 2001 version of the Energy Star 
Program Requirements for Compact Fluorescent Lamps (42 U.S.C. 
6295(bb)), DOE does not have the authority to set minimum lifetime 
standards for incandescent reflector lamps, because lamps lifetime is 
not an energy efficiency metric. Under 42 U.S.C. 6291(6), ``energy 
conservation standard'' is defined as: (1) A performance standard which 
prescribes a minimum level of energy efficiency or a maximum quantity 
of energy use; or (2) a design requirement (only for specifically 
enumerated products, which do not include incandescent reflector 
lamps). Because a standard for lamp lifetime would not fall under the 
definition of ``energy conservation standard'' as defined by 42 U.S.C. 
6291(6), DOE cannot adopt a minimum lifetime requirement for IRL in 
this final rule.
 3. 6,000-Hour-Lifetime Lamps
    In response to these comments, DOE notes that it selected IRL 
designs for its Commercial Product Lifetime scenario that would 
preserve the lifetime of the baseline IRL analyzed in this rulemaking, 
even though DOE understands that manufacturers can increase IRL 
efficacy by reducing IRL lifetime. 73 FR 13620, 13650 (March 13, 2008). 
DOE notes that improved HIR lamps, as well as lamps introduced to meet 
TSL5 in the April 2009 NOPR have lifetimes greater than 4,000 hours, 
demonstrating that longer-life lamps can meet higher standard levels. 
DOE also believes that the life-cycle cost analysis results presented 
in this rulemaking accurately indicate the economic benefits to 
consumers, as the life-cycle cost analysis inherently considers lamp 
lifetime as well as the time value of money. Furthermore, in the April 
2009

[[Page 34137]]

NOPR, DOE expressed its belief that lamp lifetime is an economic issue 
rather than a utility issue because lifetime does not change the light 
output of the lamp. 74 FR 16920, 16939 (April 13, 2009). Nevertheless, 
DOE analyzed whether long-life lamps would be available at higher TSLs. 
At TSL5, DOE has determined that manufacturers can provide lamps with a 
lifetime of at least 4,200 hours, but is unable to confirm that they 
could offer lamps with a lifetime of 6,000 hours. However, at TSL4, DOE 
believes that manufacturers can achieve lifetimes of 6,000 hours by 
decreasing the efficacy of a lamp compliant with TSL5. Thus, 6,000-
hour-lifetime lamps would not be eliminated at this standard level.
    In summary, DOE understands that lifetime and IRL efficacy are 
related, but believes that the selection of an IRL lifetime by a lamp 
designer does not automatically determine the efficacy of the lamp. 
There are a variety of methods that lamp designers can utilize to meet 
DOE's standard levels, and these methods are analyzed in this 
rulemaking. DOE considers how lamp lifetime affects consumers in its 
LCC analysis.

 D. Impact on Competition

 1. Manufacturers
    DOE received several comments related to the impact of IRL 
standards on industry competition. Philips believed that because most 
technologies employed to manufacture advanced IR coatings were 
proprietary, the adoption of IRL standards that required such a 
technology would adversely affect competition among lamp manufacturers. 
(Philips, Public Meeting Transcript, No. 38.4 at pp. 111-112)
    ADLT disagreed that advanced IR coatings required proprietary 
technology. (ADLT, Public Meeting Transcript, No. 38.4 at p. 112) The 
CA Stakeholders also disagreed and instead supported DOE's assertion in 
appendix 5D that advanced IR coatings were not a developmental product, 
and were presently not patented and were available to all lamp 
manufacturers. (CA Stakeholders, No. 63 at p. 17) ADLT confirmed that 
the uncoated burner tested by DOE for appendix 5D has been in 
production for several years in the United States. Furthermore, the 
coating applied to this burner has been in production in Europe on 12V 
burners for several years. (ADLT, No. 72 at p. 3)
    The California Stakeholders asserted that adoption of a high 
standard level for IRL would not cause a significant lessening of 
competition. They commented that because manufacturers invest in new 
technologies at different times in competition with rivals, 
manufacturers currently offer products of different efficacies. The 
California Stakeholders added further that manufacturers have already 
invested significant capital to develop efficient burners and 
reflectors, which is reflected by the fact that they offer products 
currently meeting TSL 4 and TSL 5. (California Stakeholders, No. 63 at 
pp. 24-25)
    In response, DOE does not believe that the adoption of a high 
standard level will adversely affect competition between lamp 
manufacturers. Consumers purchase lamps for a variety of utility 
features (size, color, dimming capability, directional light, lifetime, 
etc.) other than efficacy. Because consumer choice among these many 
features will remain unrestricted by this final rule, manufacturers 
have many grounds on which to compete. Furthermore, continued 
innovation in incandescent technology--driven, in part, by the desire 
to maintain a schedule of margins based on efficiency (as opposed to 
simply the utility features noted above)--is likely to maintain or even 
promote competition. DOE also acknowledges the proprietary silverized 
reflector technology at issue. As discussed in section VI.A, DOE 
believes there are alternative technologies to meeting higher efficacy 
levels and therefore believes that this final rule does not provide for 
any technological advantage that doesn't already exist in the 
marketplace. A more detailed discussion of the impact of the adopted 
IRL standard on industry competition is contained in section VII.C.5.
    DOE also received comment regarding the impact of the effective 
date for IRL standards on industry competition. To DOE's knowledge, two 
of the three major manufacturers of IRL currently sell a full product 
line (across common wattages) that meet TSL4. However, it is DOE's 
understanding that OSI employs a technology platform that, due to the 
positioning of the filament in the HIR capsule, is inherently less 
efficient. Therefore, it is likely that in order to meet TSL4, OSI 
would have to make considerably higher investments than the other 
manufacturers, placing it at a competitive disadvantage. OSI commented 
that they required one additional year to obtain the requisite 
approval, design, build, and install equipment, and stabilize high 
volume production if DOE were to adopt TSL4. (OSI, No. 84 at p. 1)
    While DOE recognizes the challenges inherent in gaining access to 
technology and building capacity needed to begin production, as 
detailed in section VI.I of this notice DOE does not have the statutory 
authority to extend the implementation period. OSI did not provide the 
detailed information which DOE would need to appreciate why what is 
achievable in 4 years cannot be accomplished in the 3 years lead time 
specified by EPCA. For example DOE believes that proprietary 
technologies are not required to meet TSL 4 and that suppliers could 
provide HIR capsules if these could not be manufactured in-house. 
Furthermore it is unclear how it might be possible to stabilize high 
volume production without producing high volumes of lamps. For this 
reason DOE believes that a 3 year lead time will be sufficient to 
ensure that the IRL market is supplied.
2. Suppliers
    DOE also received several comments related to the potential impact 
of the adopted IRL standard on the competition between technology 
suppliers. The Applied Coatings Group (ACG) expressed concern regarding 
the adoption of an IRL standard that could only be met using an 
advanced IR coating manufactured by ADLT (this coating is described in 
appendix 5D of the TSD). ACG believed that such an action may create a 
monopoly for DSI, a subsidiary of ADLT, which would be detrimental for 
the lighting industry and consumers. (ACG, No. 52 at p. 2)
    Conversely, the CA Stakeholders believed that there is already 
competition to manufacture advanced coatings for lamps. They provided a 
list of companies that had either already invested in the technology or 
were considering such an investment. (CA Stakeholders, No. 63 at p. 18) 
DSI, a U.S. company which is owned by ADLT, applies coatings using a 
sputtering process in a vacuum chamber. Auer Lighting, a German company 
also owned by ADLT, manufactures a similar coating of comparable 
efficiency and price using plasma impulse chemical vapor deposition 
(PICVD). Furthermore, a patent is pending on a third process to apply 
an IR coating to improve lamp efficacy (CA Stakeholders, No. 63 at pp. 
17-18) The CA Stakeholders believe that the IRL standards adopted by 
this rulemaking and the GSIL standards imposed by EISA 2007 will only 
increase the level of competition in the advanced coatings industry. 
(CA Stakeholders, No. 63 at pp. 18-19)
    DOE agrees with the CA Stakeholders that the adopted standard for 
IRL will not create a monopoly for DSI because sufficient competition 
exists in the advanced coatings industry. As

[[Page 34138]]

discussed above, other companies are currently investing in advanced IR 
coating technology or are considering such an investment prior to DOE 
adopting revised IRL standards in this final rule. Furthermore, 
technology pathways exist other than advanced IR coatings that can meet 
or exceed the highest efficacy level. Thus, it is extremely unlikely 
for one company to become a monopoly as a result of DOE's adopted 
standards because there is more than one technology pathway to meet the 
most efficient level. For these reasons, DOE believes that the IRL 
standards adopted in today's final rule will not adversely impact 
competition among technology suppliers.

E. Xenon

    In response to the March 2008 ANOPR, DOE received comments 
regarding the price and availability of xenon. Manufacturers believed 
that because of xenon's high price and limited supply, it should not be 
considered for use as a higher efficiency inert fill gas. (NEMA, No. 21 
at p. 9) Although price is not considered in the screening analysis, 
DOE did conduct an in-depth market assessment of the supply of xenon, 
and the potential impact of xenon supply limitations on IRL standard 
levels. DOE determined that although xenon is a rare gas, its supply is 
sufficiently large to incorporate into all IRL and that the xenon 
supply would not affect IRL product availability (see appendix 3B of 
the TSD for more details). As such, in the April 2009 NOPR, DOE 
believed that the use of xenon as a higher efficiency inert fill gas 
satisfied the screening criteria and considered it as a design option 
when developing efficacy levels.
    The CA Stakeholders agreed with DOE's analysis and conclusions in 
appendix 3B of the TSD that xenon is not likely to impact 
manufacturers' ability to produce IRL at higher standard levels. (CA 
Stakeholders, No. 63 at p. 22) NEMA agreed with DOE's observations 
regarding the fluctuating demand for xenon and its price being affected 
by demand in other industries. However, NEMA reiterated that DOE must 
consider the increased cost of xenon in its LCC analysis because NEMA 
estimates these costs to be substantial ($0.50 to $0.75 per lamp). 
(NEMA, No. 81 at p. 20)
    In response, DOE did consider the impact of the price of xenon on 
LCC savings in the April 2009 NOPR and has updated its analysis with 
NEMA's inputs. DOE performed an analysis, described in appendix 3B, in 
which it calculated how much the price of xenon would have to increase 
before LCC savings became negative. DOE concluded that, in general, the 
price of xenon could approximately triple before it significantly 
negatively impacted LCC savings. However, DOE notes that when examining 
LCC savings for lamps modeled in the Baseline Lifetime scenario (see 
section VI.C.1), the economic benefits of moving to higher efficacy 
lamps is much reduced. Therefore, increases in the price of xenon could 
in fact turn LCC savings to LCC increases for some consumers. DOE also 
maintains its conclusion that the availability of xenon will not be 
impacted by this final rule because historical evidence shows that 
supply slowly increases until it meets demand. For more details, see 
appendix 3B of the TSD.

F. IRL Hot Shock

    In interviews, manufacturers of IRL expressed concern that halogen 
and HIR IRL are susceptible to a premature failure mode known as ``hot 
shock'' when installed in energized sockets, which could reduce LCC 
savings for consumers. The hot shock condition occurs when the lamp 
filament contacts another part of itself due to vibration or torque, 
causing an electrical short within the lamp. In written comments, both 
NEMA and GE expressed that hot shock is a significant concern for 
efficacious IRL, especially in the residential sector, where IRL in 
recessed ceiling cans of multi-floor houses may experience hot shock 
due to vibrations caused by the movement of people on the upper floors 
shared by the ceilings where IRL are installed. (NEMA, No. 81 at p. 6, 
p. 10, pp. 27-28; GE, No. 80 at p. 7-8) In contrast, the California 
Stakeholders provided three reasons why they believed that the hot 
shock failure mode is not prevalent enough to prevent DOE from 
selecting a standard level that may require higher efficiency 
technologies. (California Stakeholders, No. 63 at pp. 21-22) Firstly, 
the California Stakeholders stated that in product documentation, 
manufacturers describe simple ways to avoid hot shock, primarily by 
avoiding installing or directing lamps while circuits are on. Secondly, 
the California Stakeholders stated that a patented technology 
(specifically a voltage reduction circuit) exists that claims to 
eliminate the risk of hot shock. Lastly, the California Stakeholders 
argued that as manufacturers have been selling halogen and HIR lamps 
for many years, if hot shock was a significant concern, there would be 
a noticeable adverse market response and mentioning of consumer 
dissatisfaction (of which their research found neither).
    DOE acknowledges that halogen and HIR IRL are susceptible to hot 
shock during installation in energized sockets or due to vibration that 
occurs during operation. DOE cannot set standards that necessitate the 
usage of a proprietary technology due to the adverse impacts on 
manufacturers and industry competition that may result. Thus, DOE is 
not considering the patent described by the California Stakeholders as 
a feasible way of preserving LCC savings. See section VI.B.1 for 
further details. DOE does agree, however, that halogen and HIR products 
are readily available on the market despite the risk of hot shock. DOE 
was unable to determine the prevalence of hot shock in the commercial 
or residential sectors due to a lack of available data, so DOE 
determined at what lifetime a standards-compliant lamp purchased by a 
commercial or residential consumer would experience negative LCC 
savings. The results are shown in Table VI.1 for commercial consumers 
and Table VI.2 for residential consumers. Entries of ``N/A'' represent 
lamps that already give negative LCC savings to consumers. DOE also 
notes, as discussed in the April 2008 NOPR, during interviews 
manufacturers stated hot shock could decrease lifetime by 25 to 30 
percent.

                   Table VI.1--IRL Lifetime for Negative LCC Savings in the Commercial Sector
----------------------------------------------------------------------------------------------------------------
                                                                               IRL lifetime (hours)
                         Efficacy level                          -----------------------------------------------
                                                                   90W baseline    75W baseline    50W baseline
----------------------------------------------------------------------------------------------------------------
EL1.............................................................             N/A             N/A             N/A
EL2--6,000 hr...................................................            2587            2587            3277
EL2--3,000 hr...................................................            2242            2242             N/A
EL3.............................................................            1897            1897            2932
EL4.............................................................            1897            2242            3277

[[Page 34139]]

 
EL5.............................................................            1897            1897            3277
----------------------------------------------------------------------------------------------------------------


                   Table VI.2--IRL Lifetime for Negative LCC Savings in the Residential Sector
----------------------------------------------------------------------------------------------------------------
                                                                               IRL lifetime (hours)
                         Efficacy level                          -----------------------------------------------
                                                                   90W baseline    75W baseline    50W baseline
----------------------------------------------------------------------------------------------------------------
EL1.............................................................            2443             N/A             N/A
EL2--6,000 hr...................................................            2355            2532            3233
EL2--3,000 hr...................................................            1999            2177            2977
EL3.............................................................            1644            1821            2621
EL4.............................................................            1733            1910            2977
EL5.............................................................            1644            1910            3243
----------------------------------------------------------------------------------------------------------------

G. Rare Earth Phosphors

    During manufacturer interviews, manufacturers asserted that higher 
TSLs for GSFL would require substantially larger amounts of triphosphor 
to attain those efficiency levels. As compared to halophosphor, 
triphosphor is composed of more expensive rare earth elements that 
increase many performance features of GSFL, including efficacy, lumen 
maintenance, and color rendition. Manufacturers commented that a 
standards-induced increase in triphosphor demand would drive up prices 
for the rare earth elements used to make triphosphor, and might 
potentially exceed what the market could supply. In response, for the 
April 2009 NOPR, DOE conducted a market assessment of the rare earth 
phosphor industry (see April 2009 NOPR TSD Appendix 3C). DOE focused on 
the key rare earth elements used in high-efficacy GSFL--yttrium, 
terbium, and europium--because they are major cost drivers of 
triphosphor and were the subject of manufacturer concerns over 
availability. After completing the assessment, DOE did not believe it 
had sufficient information to project phosphor prices by modeling 
future supply and demand curves. Instead, DOE compared the LCC savings 
of consumers purchasing high-efficacy lamps to potential increases in 
the incremental first cost of rare-earth-based 800-series lamps that 
would result from higher rare earth phosphor prices. In general, DOE 
found that in most commercial and residential purchase events, consumer 
LCC savings was sufficiently high to remain positive even in the face 
of potentially dramatic increases in phosphor prices. DOE also stated 
that higher prices were likely to attract mining firms into the market 
and make less-concentrated rare earth deposits economically viable. 74 
FR 16920, 16974 (April 13, 2009)
    NEMA disagreed with DOE's analysis in the April 2009 NOPR and 
conclusion on four major points: First, DOE underestimated the increase 
in standards-induced triphosphor demand; second, DOE did not 
appropriately consider the problems with supply in the industry; third, 
higher efficacy levels will have a negative environmental impact due to 
the required increase in mining operations; fourth, the cumulative 
effect of the above factors would lead to dramatic increases in costs 
to manufactures and consumers.
    Specifically, on the magnitude of standards-induced triphosphor 
demand, NEMA argued that TSL 1 or TSL 2 would prohibit halophosphor 
lamps, which would double manufacturer triphosphor demand. NEMA 
commented that shifting all lamps to TSL 4 or TSL 5 would increase the 
industry's triphosphor needs by an additional factor of three. In sum, 
NEMA estimated TSL 1, TSL 2, TSL 3, TSL 4, and TSL 5 would require 175 
percent, 200 percent, 230 percent, 250 percent, and 350 percent of 
current triphosphor usage, respectively. (Philips, Public Meeting 
Transcript, No 38.4 at pp. 247-248, 251-252; NEMA, No. 81 at pp. 3, 18-
19) Conversely, NRDC argued that the conversion of T12 lamps to T8 and 
T5 lamps would mitigate the increase in phosphor demand. (NRDC, No. 82 
at p. 3)
    In response to all comments, DOE conducted additional research on 
the rare earth industry, including several interviews with agents along 
the triphosphor value chain and other industry experts. Based on these 
interviews, manufacturer comments, further research and analysis of 
additional data obtained, DOE reevaluated its rare earth phosphor 
market analysis and assumptions.
    To determine how much trisphosphor demand would increase at each 
TSL, DOE determined the amount of triphosphor required in each lamp 
type at each TSL, using assumptions from manufacturer interviews and 
industry interviews. For example, DOE used Philips' estimate that high 
performance 800-series lamps require three to four times as much 
triphosphor as standard 700-series lamps to establish the difference in 
triphosphor weight between the two phosphor series. DOE then multiplied 
these amounts by its shipments projections (see section V.D.2) for each 
phosphor series. (See TSD appendix 3C for a more detailed discussion of 
DOE's methodology.)
    Based on this analysis, DOE agrees with the industry commenters 
that amended standards will lead to significant increases in 
manufacturers' need for triphosphor, and by extension, europium (Eu), 
terbium (Tb), and yttrium (Y). DOE estimates that at TSL 3, TSL 4, and 
TSL 5, manufacturer demand for triphosphor in covered products in 2012 
would be 171 percent, 183 percent, and approximately 230 percent of 
base-case usage, respectively. These ranges reflect DOE's upper-bound 
and lower-bound energy savings scenarios, which DOE used to capture the 
effect of consumers selecting different phosphor series lamps in 
response to standards. In the lower-bound scenario, triphosphor usage 
actually declines from TSL 3 to TSL 4, as the increase in triphosphor 
usage due to higher-efficacy lamps is offset by the decline in usage 
from the elimination of high-efficacy T12 lamps. At TSL 5, there is a 
large incremental jump in usage under any scenario.

[[Page 34140]]

    DOE believes its own estimate of the standards-induced triphosphor 
demand differs from NEMA's estimate for several reasons. First, DOE's 
estimate is relative to the 2012 market as opposed to current usage. 
DOE's analysis attempts to isolate the impact on triphosphor usage from 
the energy conservation standards under consideration in this 
rulemaking, net of the expected increase between now and the effective 
date. As such, DOE accounts for a currently-ongoing trend toward 
triphosphor lamps in the base case due to the increased penetration of 
triphosphor T8 lamps relative to halophosphor T12 lamps. Supporting 
this base-case increase in triphosphor usage, one industry supplier 
told DOE it expected triphosphor demand for linear GSFL to double in 
five to six years in the base case. Another said it expects continued 
double-digit growth in terbium demand. Second, DOE's estimate does not 
assume that all T8 lamps are 700-series in the 2012 base case. For 
example, 22 percent of 4-foot medium bipin lamps T8 are 800-series or 
high-performance 800-series lamps.
    Regarding NEMA's second point regarding the total available supply 
of rare earth phosphors, Philips commented that Rhodia, a major 
phosphor supplier, told them in 2006 that there was only a 14-year 
terbium supply left in the ground, meaning that if demand doubled due 
to standards, the lamp industry would struggle to obtain sufficient 
amounts of terbium in six to seven years. NEMA commented that Rhodia 
predicted that even without changes to DOE's energy conservation 
standards, terbium, and europium would be in short supply within five 
years. (Philips, Public Meeting Transcript, No 38.4 at pp. 254-255, 
258-259, 263)
    NEMA also highlighted China's monopolistic position in the rare 
earth market as a threat to supply. NEMA stated that China, in an 
attempt to move manufacturing of products such as GSFL to their 
country, is setting production caps, reducing export quotas and 
licenses, and placing taxes on exports of rare earth commodities. 
According to NEMA, Chinese mine operators will not flood the market 
with the more abundant elements because that would depress their value. 
(NEMA, No. 81 at pp. 16-18)
    NEMA also rejected the notion that mines outside China, induced by 
higher phosphor prices, could augment supply by the amount China is 
restricting it. NEMA asserted that DOE should focus not on rare earths 
in general but rather those that are important to GSFL, particularly 
terbium and europium, because they represent only a tiny fraction of 
the rare earth mined. NEMA stated that DOE's list of potential mines in 
the April 2009 NOPR TSD (appendix 3b) does not indicate the presence of 
significant phosphor elements needed for GSFL manufacturing. For 
example, one mine DOE had listed as a potential source is in Mountain 
Pass, California. However, NEMA stated that its ore contained only 0.2 
percent europium and no measure of terbium, according to the U.S. 
Geological Survey. (NEMA, No. 81 at p. 16-19) Even if other mines 
eventually go into production, Philips argued, they will not come 
online quickly enough to meet standards-induced demand. (Philips, 
Public Meeting Transcript, No 38.4 at pp. 253, 259) NEMA commented that 
DOE's conclusion that higher rare earth prices will attract additional 
mining operations is not supported by the record or anyone with 
knowledge of the subject. (NEMA, No. 81 at p. 19)
    As it relates to the physical availability of Y, Tb, and Eu, DOE 
reevaluated its analysis on the supply and demand of the key rare 
earths to the lighting industry given manufacturer comments. DOE agrees 
that the availability of rare earth phosphors (particularly with regard 
to terbium and europium) is a serious issue. As stated above, DOE 
agrees that manufacturers will most likely require large increases in 
rare earth phosphors to meet the standard established by this final 
rule. DOE interviewed industry experts and suppliers along the 
triphosphor value chain about the quantity of the key elements likely 
to be available over the near, intermediate, and long term. DOE 
received conflicting reports from those within the field regarding 
future supplies of these key materials. Many factors obscure the amount 
of recoverable rare earth that will be available to manufacturers, 
including future Chinese policy and strategic priorities, policies of 
countries outside China, demand from other applications, reclamation 
efforts, and lack of transparency in the industry. Industry experts 
have suggested there are sufficient amounts available to meet expected 
demand for anywhere from 15 years to indefinitely. That is not to say 
that a supply shortage of these key elements and other rare earths is 
unlikely. Indeed, many of those experts that DOE interviewed expect 
shortages of most rare earths--not because of this rulemaking, but 
because of Chinese policy. Based on its interviews and research, DOE 
has concluded that the pivotal issue governing the risk to the physical 
availability of rare earths is Chinese policy. China currently supplies 
some 95 percent of the rare earth market and has taken steps to 
restrict the exportation of rare earths resources. Many in the field, 
as noted by manufacturers, consider this to be more a reflection of 
China's strategic decision to compel rare earth-dependent industries 
(which tend to be burgeoning high-technology fields) to host operations 
in China,\56\ rather than an indication of limitation in terms of the 
physical availability of the resource.\57\ DOE does not dispute such a 
strategy could restrict rare earth phosphor supplies. However, DOE 
again notes this is substantially not a function of this final rule, 
but of external factors that may or may not affect industry in the base 
case as well as the standards case.
---------------------------------------------------------------------------

    \56\ Latimer, Cole; Kim, Jieun, Kim; Tahara-Stubbs, Mia; Wang, 
Yumin, ``China's Rare Earth Monopoly Threatens Global Suppliers, 
Rival Producers Claim,'' Financial Times (May 29, 2009).
    \57\ Richardson, Ed, Thomas & Skinner, ``High Performance 
Magnets,'' Strategic Minerals Conference (April 2009).
---------------------------------------------------------------------------

    In terms of other mining operations outside China, DOE found 
differing opinions on whether such operations have the potential to 
appreciably increase the supply of the key rare earths. DOE understands 
the key difference between those elements critical to the lighting 
industry and rare earths in general (discussed below) and agrees with 
NEMA that simply increasing production of rare earths is not sufficient 
to meet the specific needs of lamp manufacturers. While DOE also agrees 
that new projects outside of China could take years to come online, 
industry experts related that part of the reason for this is the threat 
of China increasing supply, thereby reducing prices, just as other 
facilities embark on the large capital costs required to develop mines. 
While this does imply a limited role for non-Chinese suppliers, it 
necessarily also implies an increase in rare earth phosphor supply.
    DOE continues to believe that any sharp increase in demand over the 
long term will send strong price signals to rare earth suppliers and 
potential suppliers around the globe, thereby increasing investment in 
the exploration and recovery of rare earths, as discussed in appendix 
3B of the TSD. Another view common to the industry is that nations 
outside China will be forced to view rare earths as a strategic 
resource and take steps to secure access. The United States Geological 
Survey estimates that 58 percent of rare earth reserves base are in 
China,\58\ meaning

[[Page 34141]]

there could be other sources of rare earths, although reserves of those 
specific rare earth elements key to lighting use may be more highly 
concentrated in China than all rare earths. (Please see appendix 3C of 
the TSD for a list of potential rare earth development projects.) Two 
potential domestic rare earth sources are the Mountain Pass, California 
site and the Pea Ridge iron ore mine in Missouri. NEMA and Philips 
noted that while 20,000 tons of rare earths could potentially be mined 
at Mountain Pass, only 0.2% was europium. Regardless of the likelihood 
of the mine in Mountain Pass reopening, DOE notes that that amount 
equates to 40 tons of europium annually, a figured DOE confirmed by 
interviews with the mine's operators. Production could in fact be 
higher, and such an amount is not insignificant amount given that 
estimated total worldwide demand for europium was 300 tons in 2007 and 
was projected to be 420 tons in 2012.\59\ While estimates vary, a 
Rhodia presentation estimates terbium demand to be 420 tons in 2012, 
not the 600 tons NEMA noted. The company also told DOE that it expects 
supply and demand to be in balance in the near term for terbium and 
europium. Reports of the Pea Ridge resource indicate it is relatively 
rich in the rare earths key to the lighting industry, including 
terbium.\60\ Molycorp, the company that owns the Mountain Pass site, 
also told DOE that it is currently exploring four other sites outside 
China that have significant concentrations of the heavy rare earths 
(the group to which the critical rare earths such as terbium belong).
---------------------------------------------------------------------------

    \58\ Hedrick, James B., Mineral Commodity Summaries, United 
States Geological Survey (Jan. 2009).
    \59\ Cuif. Jean-Pierre, Rhodia Silcea--Electronics BU, ``Is 
there enough rare earth for the ``green switch'' and flat Tvs?'', 
Phosphor Global Summit 2008 (March 2008).
    \60\ Available at: http://www.wingsironore.com/data/wings_enterprises_reo_quick_summary.pdf
---------------------------------------------------------------------------

    NEMA also commented on phosphor reclamation as another source of 
rare earth supply. Philips stated that Rhodia has said there physically 
will not be enough phosphor beyond 2015 without reclamation. NEMA 
argued that while reclamation could augment supply, it would require 
significant infrastructure investment and still bring issues such as 
mercury contamination into play with regard to international transport 
(as many phosphor manufacturers are overseas). Such infrastructure and 
systems of collection and handling currently do not exist. Therefore, 
NEMA argued, while it expects recycling to emerge in response to the 
impending shortage, it is ``entirely speculative'' to assume 
reclamation can impact the rare earth phosphor shortage in this decade. 
Philips stated that only one of the two types of the green phosphor can 
currently be recycled; the type commonly used in CFLs cannot. In 
addition, GE stated that at TSL 4 and TSL 5, reclamation will not 
enlarge supply because reclaimed phosphor does not perform well enough 
to meet those levels. (Philips, Public Meeting Transcript, No 38.4 at 
pp. 261, 262; NEMA, No. 81 at p. 18)
    Based on interviews, DOE believes that reclamation efforts can play 
a significant role in augmenting supply, but only in the longer term. 
Rhodia estimates that by 2015 there will be more than 250 tons of rare 
earth oxide in recycled lamps.\61\ Rhodia already has reclamation 
ability and is ramping up its capacity, but technical and economic 
challenges of commercial-scale operations remain. First, the 
infrastructure to collect recycled GSFL must be in place. With this 
infrastructure, a commercial-scale, technically-viable process for 
distilling the rare earths from the other lamp materials--glass, 
alumina, halophosphate, etc.--must be established. This will have to 
include chemical treatments, mercury removal, and waste disposal.
---------------------------------------------------------------------------

    \61\ Rhodia, ``Phosphor Recycling: Dream or New Source of Rare 
Earths?'' Presentation at Phosphor Global Summit 2009 (March 2009).
---------------------------------------------------------------------------

    While DOE agrees that reclaimed phosphor is too degraded to be used 
at TSL 4 or TSL 5, DOE notes that Rhodia stated that it can still meet 
the needs of high-performance lamps because the company refines the 
triphosphor back down into its original elements (e.g., terbium, 
europium) and then remanufactures the triphosphor. Because this process 
clearly adds cost to the reclaimed triphosphor, it is likely only 
higher price points will trigger additional supply via reclamation.
    The attractiveness of reclamation will depend not only on the cost 
of the process versus the price of normal rare earth acquisition, but 
also the amount of rare earth available for recovery in the retiring 
lamp stock. Currently, the universe of retiring lamps was installed 
several years ago; they are mostly halophosphor lamps. Therefore, the 
yield of rare earth oxides from recycling these lamps would be unlikely 
to make commercial-scale reclamation economically attractive in the 
very near future. As such, in light of the other details, DOE agrees 
that large-scale reclamation is unlikely to occur before 2015. However, 
in several years, Rhodia expects the amount of recoverable useful rare 
earth to grow significantly as high-performance GSFL become 
commonplace.\62\ Just as energy conservation standards will increase 
the demand for rare earth phosphor in 2012, they will provide larger 
volumes available for reclamation when they retire. At such time, it is 
entirely possible that reclamation eventually could augment supply.
---------------------------------------------------------------------------

    \62\ Rhodia, ``Phosphor Recycling: Dream or New Source of Rare 
Earths?'', Presentation at Phosphor Global Summit 2009 (March 2009).
---------------------------------------------------------------------------

    On its third point regarding the impact of rare earth mining, NEMA 
argued that those who think TSL 5 is environmentally sound are not 
considering the environmental impact that will arise from such an 
increase in demand. Philips argued that the goal of the U.S. should not 
be to quadruple strip mining operations around the world. According to 
Philips, TSL 5 would increase mining by 300 percent relative to TSL 3, 
depleting natural resources more rapidly and increasing the cost to the 
consumer. (Philips, Public Meeting Transcript, No 38.4 at pp. 253, 259; 
NEMA, No. 81 at p. 19)
    DOE agrees with NEMA and Philips that increased demand could 
require additional mining operations. However, mining for rare earths 
reflects a small portion of all global mining operations. DOE does not 
believe that the increase in global demand resulting from this final 
rule will come close to requiring the mining increase suggested by 
Philips as industry experts also noted that rare earths in many 
instances could be mined as byproducts and, therefore, not create the 
same footprint as an entirely new project.
    On its fourth point, NEMA and Philips argued that a massive price 
spike in rare earth phosphors will occur in 2012 when manufacturers 
supplying the U.S. market have to double their requirements as China 
continues to reduce quotas. GE commented that this would lead to very 
expensive lamps for consumers. (GE, Public Meeting Transcript, No 38.4 
at pp. 256; Philips, Public Meeting Transcript, No 38.4 at pp. 248-249; 
NEMA, No. 81 at p. 18) Conversely, the California Stakeholders 
commented that they agreed with DOE's April 2009 NOPR analysis related 
to rare earth phosphors, stating that rare earth phosphor prices and 
availability would not affect product availability or consumers' life 
cycle cost savings. (California Stakeholders, No. 63 at p. 11) ACEEE 
commented that it does not expect the availability of rare earth 
phosphors to result in excessive price volatility. (ACEEE, No. 76 at p. 
2)
    In response, as discussed in the April 2009 NOPR, DOE believes that 
the standards case, all other things being

[[Page 34142]]

equal, will result in higher prices for yttrium, europium, and terbium. 
(74 FR 16920, 16974 (April 13, 2009) As in the April 2009 NOPR, DOE 
does not believe is it possible to generate reasonable price forecasts, 
particularly given the historical volatility in rare earth prices, 
trade restrictions, trade policies, lack of publically-available data 
from China, and potential supply sources coming online. As an example 
of the price volatility, terbium prices on May 20, 2009 were roughly 
half what they averaged in 2008,\63\ this after increasing dramatically 
in previous years.
---------------------------------------------------------------------------

    \63\ See http://lynascorp.com/page.asp?category_id=1&page_id=25.
---------------------------------------------------------------------------

    However, given that DOE believes standards-induced demand increase 
has the potential to affect the worldwide demand of europium, terbium, 
and yttrium, DOE has concluded that it is possible prices will rise for 
these elements, all other things being equal. To broadly gauge the 
potential impact of standards on prices, DOE assessed the standards-
induced increase of their demand in the context of the international 
market for these materials, as these key rare earths have many 
applications and are transacted in a global market. DOE estimates that 
this final rule will increase worldwide demand for terbium and europium 
relative to the 2012 base case by roughly 10 percent. DOE used Rhodia 
estimates for the 2012 base case.\64\
---------------------------------------------------------------------------

    \64\ Cuif. Jean-Pierre, Rhodia Silcea--Electronics BU, ``Is 
there enough rare earth for the ``green switch'' and flat Tvs?'', 
Phosphor Global Summit 2008 (March 2008).
---------------------------------------------------------------------------

    DOE's interviews and research showed that there are many value-
added processes in the supply chain of triphosphor. Some of the cost 
attendant to these processes is not directly driven by the demand (and 
scarcity) of these rare earth elements themselves, but by the mining, 
chemical processing and concentrating, and blending costs that are 
inherent to triphosphor production. According to interview 
participants, these processes are highly driven by energy costs, which 
will be mostly equivalent in the base case and standards cases. This is 
supported by the fact that despite the prospect of increasing demand, 
the prices of the key rare earths declined significantly from summer 
2008 to spring 2009, more in line with oil and other commodity prices. 
Other important cost drivers to manufacturers include a 25-percent 
tariff on the export of key rare earths from China, which will also be 
the same in the base case and standards cases.
    As it did in the April 2009 NOPR, DOE conducted a sensitivity 
analysis for this final rule to address the potential increases in end-
user lamp prices attributable to higher rare earth input costs. And 
despite the fact that price increases in the key rare earth elements 
are unlikely to be equal to triphosphor costs (because of the many 
other cost inputs), to be conservative, DOE assumed that such a 
relationship existed. That is, if Eu, Y, and Tb prices--weighted for 
their proportional use in triphosphor--doubled, DOE assumed the price 
of triphosphor also doubled. DOE used the analysis to determine how 
robust consumer LCC savings are at TSL 3, TSL 4, and TSL 5. DOE 
compares the LCC savings due to purchasing higher-efficacy GSFL (as 
calculated in chapter 8) to LCC savings under scenario with higher 
phosphor prices. As discussed in appendix 3C of the TSD, DOE determined 
the quantity of each rare earth phosphor required to manufacture each 
phosphor series of GSFL. DOE then estimated how a range of prices for 
the key rare earth phosphors would affect manufacturing lamp costs. 
Next, by applying manufacturer and retail markups, DOE analyzed how 
increases in rare earth phosphor prices may affect LCC savings for a 
consumer of each lamp type.
    DOE found that for most commercial and residential purchase events, 
consumer LCC savings were sufficiently high to remain positive even if 
there were dramatic increases in triphosphor prices and manufacturers 
were forced to pass those cost increases on to the consumer with 
current markup levels. In fact, all events that yield positive LCC 
savings at TSL 4 at current triphosphor prices would maintain positive 
LCC savings despite dramatic increases in trisphosphor prices (as a 
result of rare earth price increases). By the same token, DOE 
calculated that the dramatic decline in rare earths prices since the 
summer of 2008 likely did not significantly affect consumer LCC 
savings.
    In conclusion, regardless of the differences between DOE and NEMA's 
phosphor usage estimates, it is worth noting that moving from TSL 3 to 
TSL 4 results in a much smaller increase in triphosphor usage than any 
other incremental step up in efficacy levels, according to each 
estimate. As noted above, NEMA estimates a relatively small increase in 
usage at TSL 4 relative to TSL 3 (250 percent vs. 230 percent) and both 
show a much larger increase in moving to TSL 5 (350 percent). Given 
that NEMA commented that TSL 3 could be implemented in terms of 
triphosphor, despite more than doubling domestic usage, DOE believes 
the relatively small incremental demand increase of moving to TSL 4 
works to justify the latter, higher efficacy level. (NEMA, No. 81 at p. 
2; GE, Public Meeting Transcript, No 38.4 at pp. 254-255) Similarly, 
while it is impossible to guarantee the amount of recoverable rare 
earth in the ground, or predict the supply impacts of Chinese policy, 
DOE does not believe the slight incremental impact of TSL 4 relative to 
TSL 3 significantly exacerbates these concerns. However, given the 
large increases in rare earth phosphor required at TSL 5 relative to 
TSL 4, DOE is concerned about the impact of TSL 5 on product 
availability as well as the potential environmental impact of producing 
the necessary rare earth resources.
    For all of these reasons--a relative small increase in triphosphor 
needs at TSL4 relative to TSL 3, which industry acknowledged was 
acceptable; continued LCC savings for the consumer even with higher 
triphosphor prices and tariffs; greater potential for additional supply 
resources and reclamation with higher rare earth prices; and, 
significantly, the fact that the major factors in rare earth 
availability and prices are largely independent of this rulemaking--DOE 
concludes that TSL 1 through TSL 4 are appropriate with respect to rare 
earth phosphor availability, prices, and environmental impact.

H. Product and Performance Feature Availability

1. Dimming Functionality
    NEMA expressed concern about the loss of dimming capability as IRL 
consumers migrate to other technologies. NEMA acknowledged that 
although no data exists to characterize the dimming market, industry 
believes there is ``considerable overlap'' between dimmer and IRL 
installations. Thus, for both the commercial and residential sector, 
NEMA believes that a significant number of installed halogen lamps are 
used in combination with dimmers. NEMA commented that at TSL4 and TSL5 
specifically, the high price of covered IRL will likely force consumers 
to buy lower cost, but non-dimmable technologies. NEMA argued this 
would disappoint end-users, especially those in the residential sector, 
as they are more likely to purchase a lamp based on its first cost. 
Furthermore, NEMA argued that because a significant percentage of 
installed halogen lamps are used in dimming applications (and therefore 
consume less energy when dimmed), the energy saving benefit of an 
alternative non-dimmable replacement is reduced. (NEMA, No. 81 at p. 
29-30) Lutron also urged DOE to account for this functional loss in its

[[Page 34143]]

analysis. (Lutron, No. 38.4 at p. 316) Similarly, IALD commented that 
IRL provide utility, such as high CRI and dimming capability, that is 
unlikely to be met with emerging technologies and used in special 
applications, such as auditorium and art gallery lighting. (IALD, No. 
71 at p. 2)
    In response, DOE believes that it has already accounted for dimming 
functionality in its analysis. First, DOE's efficacy levels do not 
eliminate any dimming capability from the market. Thus, DOE is not 
assuming this functionality must be met with emerging technologies. 
Covered IRL are available at every TSL for use in dimming applications. 
Second, DOE's emerging and existing scenarios already incorporate the 
effect of consumers who make purchasing decisions based only on a 
lamp's first cost. Third, DOE disagrees that the percentage of covered 
lamps used in dimming applications would affect DOE's projected energy 
savings. While DOE agrees with NEMA that when lamps are dimmed they 
consume less energy, DOE expects the usage of dimmers to remain the 
same in both the base and standards case. It is unlikely that a 
consumer would dim a lamp more or less only because he/she is using a 
standards-compliant lamp. Lastly, DOE believes consumers who would be 
``greatly disappointed'' without dimming functionality would not be 
deterred from an incrementally higher first cost associated with 
retaining that functionality. For these reasons, DOE has already 
accounted for dimming functionality in its analysis.
2. GSFL Product Availability
    NEMA wrote that TSL4 and TSL5 cannot be economically justified, 
partly because these efficacy levels would preserve T8 lamps that are 
mostly incompatible with today's installed base of T8 ballasts; NEMA 
also stated that higher standards for U-shaped lamps would negatively 
impact competition and eliminate energy-efficient U-shaped lamps with 
6-inch spacing. (NEMA, Public Meeting Transcript, No. 38.4 at pp. 24, 
38, NEMA, No. 81 at pp. 2-3)
    DOE disagrees with NEMA that TSL 3 would remove nearly all T12 
lamps from the market by the effective date. Certain T12 lamps still 
meet TSL 3, as presented in NOPR, a point that NEMA does not dispute. 
Moreover, given the magnitude of the current T12 shipments, 
particularly in the residential sector, where, as NEMA has noted, the 
most common residential magnetic ballast is exempted, DOE believes that 
T12 lamps will remain on the market at TSL 3.
    Next, DOE has accounted for compatibility with existing ballasts, 
as well as the need for a new ballast purchases (when applicable), in 
all its analyses, as discussed in the April 2009 NOPR. While DOE agrees 
TSL 4 or higher may eliminate T12 lamps from the market, as presented 
in DOE's market share matrices, at least five T8 lamps meet TSL 4, and 
two providing residential consumers with product options. Therefore, 
DOE does not believe this final rule presents a possibility of product 
shortages.

I. Alternative Standard Scenarios

    In the April 2009 NOPR, DOE noted that although it was proposing 
TSL3, serious consideration would be given to a more stringent standard 
level for GSFL in the final rule. Accordingly, DOE requested comment on 
alternative scenarios for GSFL standards that could achieve greater 
energy savings than the proposed TSL3. In addition to consideration of 
a standard that would eliminate T12 lamps as presented in TSL4 and 
TSL5, DOE also provided two examples of alternative standard scenarios 
that may be considered: (1) A standard with a delayed implementation 
date (i.e., extended lead time); and (2) a standard with differentiated 
residential and commercial levels. 74 FR 16920, 17017, 17025 (April 13, 
2009). In response, DOE received several comments on these example 
scenarios.
1. Tiered Standard
    ACEEE, the California stakeholders, NEMA, and NEEP all recommended 
various forms of tiered standards. (ACEEE, No. 55 at pp. 1-3; NEEP, No. 
61 at p. 4; NEMA, No. 81 at p. 23, 24; California Stakeholders, No. 2 
at p. 2) ACEEE and the California Stakeholders also argued that DOE set 
a precedent for such a tiered, phased-in standard in 2001 with 
residential clothes washers, when DOE issued a final rule making one 
efficiency level effective in 2004 and second level effective in 2007. 
(California Stakeholders, No. 61 at p. 9; ACEEE, No. 55 at p. 2)
    DOE analyzed the impacts of a tiered, phased-in standard, as 
suggested by many stakeholders. Under such approach, DOE's analysis 
showed a mitigation of manufacturer INPV, similar to a delayed 
effective date alternative scenario but to a lesser extent. Again, the 
lower capital costs (due to more time for the base-case migration away 
from T12s), time value of money effects, and longer retention of 
higher-margin sales, all mitigate the negative INPV impacts. DOE, 
however, again carefully reviewed the governing statute and has 
determined that it does not have the authority to implement tiered, 
phased-in standards under EPCA.
    DOE carefully evaluated the legality of tiered standards based on 
the language in EPCA. 42 U.S.C. 6295(i)(3) requires amended standards 
for GSFL and IRL to apply to products manufactured ``on or after'' the 
36-month period beginning on the date such final rule is published. DOE 
interprets this provision to mean that the standard will be in place 
for covered lamps that are manufactured precisely three years after 
publication of the final rule and prospectively thereafter. DOE 
reasoned that it would be illogical to give separate meaning to the 
terms ``on'' and ``after'', an interpretation that could conceivably 
allow for a second-tier standard effective at some point subsequent to 
the date 36 months after the publication date of the rule, because this 
interpretation would also allow for a rule that requires compliance 
with the established standards on only the exact date 36 months from 
the publication date. Therefore, DOE concluded that section 6295(i)(3) 
of EPCA does not allow tiered standards for the final GSFL and IRL 
rule. This is in contrast to EPCA's general service lamps provisions at 
42 U.S.C. 6295(i)(6)(A)(iv), where Congress explicitly directed DOE to 
consider phased-in effective dates. DOE notes that 42 U.S.C. 
6295(i)(5), relating to ``additional'' GSFL lamps, contains a different 
formulation providing that the standards shall apply to products 
manufactured ``after'' a date that is 36 months after the date the rule 
is published. However, it is DOE's understanding that the 
``additional'' GSFL covered by subsection (i)(5) are not those products 
which significantly alter INPV or consumer LCC savings in this 
rulemaking. In light of the above, DOE chose not to adopt tiered 
standards for these lamps.
2. Delayed Effective Date
    ACEEE and the California Stakeholders, as well as NEMA and Osram 
Sylvania, stated that DOE should consider various delayed effective 
dates, although the California Stakeholders suggested that this should 
be a last resort. (California Stakeholders, No. 61 at p. 4; ACEEE, No. 
55 at p. 2; NEMA, No. 81 at pp. 2, 24-26; Osram Sylvania, No. 84 at p. 
2)
    DOE carefully evaluated the legality of delayed implementation 
dates based on the language in EPCA. DOE concluded that a delayed 
effective date which sets no standards for compliance on or about June 
30, 2012, which is the anticipated date ``on or after the 36-month 
period beginning on the date

[[Page 34144]]

such final rule is published,'' would not be permissible under EPCA (42 
U.S.C. 6295(i)(3)). As in the discussion above for tiered standards, 
DOE interprets the language of 42 U.S.C. 6295(i)(3) to mean that a 
standard will be in place for covered lamps that are manufactured 
precisely three years after publication of the final rule and 
prospectively thereafter. This is again in contrast to EPCA's general 
service lamps provisions at 42 U.S.C. 6295(i)(6)(A)(iv), where Congress 
explicitly directed DOE to consider phased-in effective dates. DOE also 
carefully considered 42 U.S.C. 6295(i)(5), which provides that the 
final rule for ``additional'' GSFL shall apply to products 
``manufactured after a date which is 36 months after the date such rule 
is published'' and could potentially support a later effective date for 
``additional'' GSFL. However, it is DOE's understanding that 
``additional'' GSFL are not those products which significantly alter 
INPV or consumer LCC savings in this rulemaking. In light of the above, 
DOE chose not to use delayed effective dates for those lamps as 
recommended by commenters.
3. Residential Exemption
    NEEP, GE and NEMA recommended various forms of residential 
exemptions and/or labeling for T12 lamps as alternate standard 
scenarios. (NEEP, No. 61 at p. 4; NEMA, No. 81 at pp. 2, 24-26; (GE, 
No. 80 at pp. 1-3) ACEEE and the California Stakeholders opposed 
separate treatment for the residential sector through a bifurcated 
standard. (California Stakeholders, No. 61 at p. 9; ACEEE, No. 55 at p. 
3; NEMA, No. 81 at pp. 2, 24-26)
    DOE considered the option of having differentiated standards for 
residential consumers and commercial consumers. Absent a specific 
statutory directive (e.g., one conveying product labeling or packaging 
authority), it has long been DOE's position that it regulates 
equipment, rather than product use. In general, DOE has sought to avoid 
interfering with manufacturing decisions related to product use, 
marketing, or packaging. This approach is also reflective of the 
inherent difficulties in enforcing product usage requirements and the 
potential loopholes that may be created.
    In the present case, DOE notes that in contrast to situations where 
it sets product classes whose efficiency-related differences (e.g., in 
terms of utility, capacity, type of energy use) warrant different 
standard levels, the lamps under consideration here have no significant 
technical differences as would support different standard levels. Given 
the identical nature of T12 lamps used in residential and commercial 
settings, it would be potentially easy for commercial customers to 
purchase and install T12 lamps marketed for residential use. DOE is 
concerned that this option could significantly undermine the energy 
savings potential to the Nation of the lamps standard. Therefore, DOE 
has decided not to consider such an approach further.
4. Conclusions Regarding Alternative Standard Scenarios
    In considering whether to adopt a more stringent standard for GSFL 
than the proposed TSL3, DOE sought to explore various approaches (e.g., 
tiered standards, delayed effective dates) to mitigate the impacts on 
manufacturers and certain consumers. However, after careful examination 
of the relevant provisions of EPCA, for the reasons explained above, 
DOE has determined that none of these options is available. 
Accordingly, the effective date of this final rule for all covered 
product classes will be three years from the date of publication.

J. Benefits and Burdens

    Since DOE opened the docket for this rulemaking, it has received 
more than 80 written comments, with hundreds of signatories, from a 
diverse set of parties, including manufacturers and their 
representatives, state attorney generals, members of Congress, energy 
conservation advocates, consumer advocacy groups, private citizens, and 
electric and gas utilities. DOE also received more than 20,000 email 
form letter submissions recommending DOE strengthen the proposed energy 
conservation standards. All substantive comments on the analytic 
methodologies DOE used are discussed heretofore in sections of this 
final rule notice. DOE also received many comments related to the 
relative merits of various TSLs. Generally, these comments either 
stated a certain TSL was economic justified, technologically feasible, 
and maximized energy, or they argued how DOE should weight the various 
factors that go into making that determination. See section VII for a 
discussion of DOE's analytic results and how it weighed those factors 
in establishing today's final rule.
    PSI stated that DOE should adopt GSFL and IRL standards that align 
with or surpass the European Union's ``Eco-Design Standards for Energy-
Using Product (EuP) Directive.'' On the other hand, a private citizen 
wrote to DOE expressing that DOE's proposed standards for GSFL and IRL 
will not save significant energy, will negatively impact the work of 
lighting designers, and may have a negative impact on the quality of 
work and living spaces; the citizen expressed that conservation in 
other areas could yield greater reduction in energy usage. (Private 
Citizen, No. 48 at pp. 1-3)

VII. Analytical Results and Conclusions

A. Trial Standard Levels

    DOE analyzed the costs and benefits of five TSLs each for the GSFL 
and IRL covered in today's final rule. Table VII.1 and Table VII.2 
present the TSLs and the corresponding product class efficacy 
requirements for GSFL and IRL. See the engineering analysis in section 
V.B.4 of this final rule for a more detailed discussion of the efficacy 
levels. In this trial standard levels section, DOE presents the 
analytical results for the TSLs of all product classes that DOE 
analyzed, including scaled product classes. See chapter 5 of the final 
rule TSD for further information on representative and scaled product 
class efficacy levels.
1. General Service Fluorescent Lamps
    As discussed in section V.B.2, the following lamps with a CCT less 
than 4,500K compose the five representative GSFL product classes: (1) 
4-foot medium bipin; (2) 8-foot single pin slimline; (3) 8-foot 
recessed double contact HO lamps; (4) 4-foot miniature bipin T5 SO; and 
(5) 4-foot miniature bipin T5 HO lamps. U-shaped lamps with a CCT less 
than 4,500K are a scaled product class. The six lamp types (including 
U-shaped lamps) with CCTs greater than or equal to 4500K compose six 
additional product classes, which are also scaled product classes. DOE 
developed TSLs that generally follow a trend of increasing efficacy by 
using higher-quality phosphors. The TSLs also represent a general move 
from higher-wattage technologies to lower-wattage, lower-diameter lamps 
with higher efficacies. Table VII.1 shows the TSLs for GSFL. DOE 
composed each TSL utilizing the same methodology employed in the April 
2009 NOPR. TSL5 represents all maximum technologically feasible GSFL 
efficacy levels, as in the April 2009 NOPR. 74 FR 16920, 16980 (April 
13, 2009).
    For this final rule, DOE revised the efficacy levels for 4-foot T5 
MiniBP standard-output and high-output lamps to reflect testing at 
25[deg] C as well as manufacturing variability. The April 2009 NOPR EL1 
requirements for T5 standard-output lamps have thus been revised from 
103 lm/W to 86 lm/W, and the April 2009 NOPR EL2 requirements have been 
revised from 108 lm/W to 90 lm/W. The April 2009 NOPR EL1

[[Page 34145]]

requirements for T5 high-output lamps have been revised from 89 lm/W to 
76 lm/W. 74 FR 16920, 16980 (April 13, 2009). The EPCA standard for 
GSFL in the representative product classes of this final rule are shown 
in Table I.3. Trial standard levels for all GSFL product classes in 
this final rule are shown in Table VII.1.

            Table VII.1--Trial Standard Levels for GSFL--Efficacy Levels for all GSFL Product Classes
----------------------------------------------------------------------------------------------------------------
                                                                              Trial standard level
                 CCT                          Lamp type        -------------------------------------------------
                                                                    1         2         3         4         5
----------------------------------------------------------------------------------------------------------------
<=4,500K.............................  4-foot medium bipin            78        81        85        89        93
                                        (representative).
                                       2-foot U-shaped........        70        72        76        84        87
                                       8-foot single pin              86        92        95        97        98
                                        slimline
                                        (representative).
                                       8-foot recessed double         83        86        88        92        95
                                        contact HO
                                        (representative).
                                       4-foot T5 miniature            86        86        86        86        90
                                        bipin SO
                                        (representative).
                                       4-foot T5 miniature            76        76        76        76        76
                                        bipin HO
                                        (representative).
>4,500K and <=7,000K.................  4-foot medium bipin....        77        79        82        88        92
                                       2-foot U-shaped........        65        67        71        81        85
                                       8-foot single pin              83        87        91        93        94
                                        slimline.
                                       8-foot recessed double         80        83        84        88        91
                                        contact HO.
                                       4-foot T5 miniature            81        81        81        81        85
                                        bipin SO.
                                       4-foot T5 miniature            72        72        72        72        72
                                        bipin HO.
----------------------------------------------------------------------------------------------------------------

2. Incandescent Reflector Lamps
    As discussed in section V.B.4, DOE has established five efficacy 
levels based on an equation relating efficacy to lamp wattage. As also 
discussed in section V.B.2, DOE only directly analyzed the standard-
spectrum IRL with a diameter greater than 2.5 inches and voltage less 
than 125 volts; DOE then scaled minimum efficacy requirements to other 
product classes. This is consistent with what DOE did for the April 
2009 NOPR. 74 FR 16920, 16981 (April 13, 2009).
    The EPCA standard for IRL is shown in Table I.4. The efficacy 
levels for all IRL product classes are shown as coefficients for the 
efficacy level requirement equation A*P[caret]0.27 in Table VII.2 for 
the TSLs to which they correspond, where A is the coefficient shown in 
the table for a specific product class and TSL, and P represents the 
rated wattage of the lamp. TSL5 represents the maximum technologically 
feasible level, as in the April 2009 NOPR. 74 FR 16920, 16981-2 (April 
13, 2009). For this final rule, DOE revised the April 2009 NOPR 
efficacy levels for the representative IRL product class in order to 
account for IRL manufacturing variability, as described in chapter 5 of 
the TSD.

                         Table VII.2--Trial Standard Levels for IRL-Coefficients of Efficacy Levels for all IRL Product Classes
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                 Diameter                             Trial standard level
                 Lamp wattage                             Lamp type                 (in       Voltage  -------------------------------------------------
                                                                                  inches)                   1         2         3         4         5
--------------------------------------------------------------------------------------------------------------------------------------------------------
40W-205W.....................................  Standard-spectrum..............       > 2.5      >=125V       5.3       5.5       6.2       6.8       7.4
                                                                                              <125V\1\       4.6       4.8       5.4       5.9       6.4
                                                                                     <=2.5      >=125V       4.7       4.9       5.5       5.7       6.2
                                                                                                 <125V       4.0       4.2       4.8       5.0       5.4
40W-205W.....................................  Modified-spectrum..............        >2.5      >=125V       4.5       4.7       5.3       5.8       6.3
                                                                                                 <125V       3.9       4.1       4.6       5.0       5.4
                                                                                     <=2.5      >=125V       4.0       4.1       4.6       4.9       5.3
                                                                                                 <125V       3.4       3.6       4.0       4.2       4.6
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\(Representative.)

    At the public meeting, Energy Solutions suggested that DOE present 
efficacy levels for IRL in terms of lumen output rather than wattage 
because lumen output is a more appropriate measure of the functional 
performance of a lamp. (Energy Solutions, Public Meeting Transcript, 
No. 38.4 at pp. 94-95) DOE understands that the primary function of a 
lamp is to provide light for the consumers' applications. Market 
research indicated that the most common IRL baselines on the market 
today provide three distinct levels of initial lumen output: 1,310 
lumens from a 90W baseline, 1,050 lumens from a 75W baseline, and 630 
lumens from a 50W baseline, respectively. Based on this understanding, 
DOE utilized a ``lumen package'' perspective in the April 2009 NOPR to 
select and analyze more-efficacious replacements for these three IRL 
baselines such that their lumen output is no greater than 10% below the 
baseline lumen output. 74 FR 16920, 16944 (April 13, 2009). DOE 
believes that the usage of lumen classes allows DOE to take into 
account consumers' interests in light output when developing efficacy 
levels based on IRL wattage. Thus, DOE has not changed its presentation 
of efficacy levels for the final rule.

B. Significance of Energy Savings

    To estimate the energy savings through 2042 due to potential 
standards, DOE compared the energy consumption of GSFL and IRL under 
the base case (no standards) to energy consumption of these products 
under each standards case (each TSL that DOE has considered). Table 
VII.3 and Table VII.4 show the forecasted national energy savings 
(including rebound effect and HVAC interactions where applicable) in

[[Page 34146]]

quads (quadrillion BTU) at each TSL for GSFL and IRL. As discussed in 
section V.D.1, DOE models two base-case shipment scenarios and several 
standards-case shipment scenarios. For each lamp type, these scenarios 
combined produce eight possible sets of NES results. The tables below 
present the results of the two scenarios that represent the maximum and 
minimum energy savings resulting from all the scenarios analyzed.
    For GSFL, DOE presents ``Existing Technologies, High Lighting 
Expertise, Shift'' and ``Emerging Technologies, Market Segment-Based 
Lighting Expertise, Roll-Up'' in Table VII.3 as the scenarios that 
produce the maximum and minimum energy savings, respectively. Due to a 
larger reduction in the installed stock of lamps affected by standards, 
the Emerging Technologies base-case forecast results in lower energy 
savings than the Existing Technologies base-case forecast. In addition, 
because a portion of consumers purchasing non-energy-saving, higher-
lumen-output systems in the Market Segment-Based Lighting Expertise 
scenario, it results in lower energy savings than the High Lighting 
Expertise scenario. Finally, because in the Shift scenario more 
consumers move to higher-efficacy lamps than in the Roll-Up scenario, 
the Shift scenario results in higher energy savings than the Roll-Up 
scenario.
    Table VII.3 presents total national energy savings for each TSL 
(labeled as ``Total'' savings). The table also reports national energy 
savings due to individually regulating each type of GSFL (presented 
next to the lamp type names), assuming no amended standard on all other 
lamp types. However, it is important to note that individual lamp type 
energy savings (due to separate regulation) do not sum to equal total 
energy savings achieved at the trial standard levels due to standards-
induced substitution effects between lamp types. Instead, these savings 
are provided merely to illustrate the approximate relative energy 
savings of each lamp type under a TSL. Please see the NOPR for a 
discussion of the affect of various TSLs on NES. 74 FR 16920, 17005-06 
(April 13, 2009).

                       Table VII.3--Summary of Cumulative National Energy Savings for GSFL
----------------------------------------------------------------------------------------------------------------
                                                                            National energy savings  (quad btu)
                                                                         ---------------------------------------
                                                                                                   Emerging
                  TSL/EL                              Lamp type                Existing          technologies,
                                                                          technologies, high    market segment-
                                                                               lighting         based lighting
                                                                           expertise, shift   expertise, roll-up
----------------------------------------------------------------------------------------------------------------
1.........................................  4-foot MBP..................                0.89                0.61
                                            8-foot SP Slimline..........                0.25                0.25
                                            8-foot RDC HO...............                0.17                0.02
                                            4-foot MiniBP SO............                0.69                0.11
                                            4-foot MiniBP HO............                0.96                0.53
                                            2-foot U-Shaped.............                0.04                0.03
                                           ---------------------------------------------------------------------
                                               Total....................                3.01                1.54
----------------------------------------------------------------------------------------------------------------
2.........................................  4-foot MBP..................                0.99                0.75
                                            8-foot SP Slimline..........                0.28                0.27
                                            8-foot RDC HO...............                0.22                0.19
                                            4-foot MiniBP SO............                0.69                0.11
                                            4-foot MiniBP HO............                0.96                0.53
                                            2-foot U-Shaped.............                0.05                0.03
                                           ---------------------------------------------------------------------
                                               Total....................                3.19                1.88
----------------------------------------------------------------------------------------------------------------
3.........................................  4-foot MBP..................                4.17                1.81
                                            8-foot SP Slimline..........                0.32                0.32
                                            8-foot RDC HO...............                0.23                0.19
                                            4-foot MiniBP SO............                0.69                0.11
                                            4-foot MiniBP HO............                0.96                0.53
                                            2-foot U-Shaped.............                0.19                0.08
                                           ---------------------------------------------------------------------
                                               Total....................                6.59                3.06
----------------------------------------------------------------------------------------------------------------
4.........................................  4-foot MBP..................                6.96                2.30
                                            8-foot SP Slimline..........                0.37                0.23
                                            8-foot RDC HO...............                0.56                0.56
                                            4-foot MiniBP SO............                0.69                0.11
                                            4-foot MiniBP HO............                0.96                0.53
                                            2-foot U-Shaped.............                0.32                0.10
                                           ---------------------------------------------------------------------
                                               Total....................                9.94                3.83
----------------------------------------------------------------------------------------------------------------
5.........................................  4-foot MBP..................                8.79                3.32
                                            8-foot SP Slimline..........                0.37                0.24
                                            8-foot RDC HO...............                0.62                0.57
                                            4-foot MiniBP SO............                0.82                0.26
                                            4-foot MiniBP HO............                0.96                0.53

[[Page 34147]]

 
                                            2-foot U-Shaped.............                0.40                0.15
                                           ---------------------------------------------------------------------
                                               Total....................               12.00                5.08
----------------------------------------------------------------------------------------------------------------

    For IRL, DOE presents ``Existing Technologies, R-CFL Production 
Substitution, Shift'' and ``Emerging Technologies, BR Product 
Substitution, Roll-Up'' in Table VII.4 as the scenarios that produce 
the maximum and minimum energy savings, respectively. Similar to GSFL, 
the Existing Technologies base-case forecast results in higher energy 
savings than the Emerging Technologies base-case forecast due to the 
greater installed stock of IRL affected by standards. The BR Product 
Substitution scenario, which includes migration to exempted BR lamps 
but not to R-CFL, results in lower energy savings than the R-CFL 
Product Substitution scenario, which accounts for the reverse effect. 
In addition, while the effect is greater for GSFL than for IRL, the 
Shift scenario (only affecting commercial consumers because DOE assumes 
residential consumers always purchase the lowest first-cost lamp) also 
represents higher energy savings than the Roll-Up scenario for IRL. As 
seen in the table below, TSL 5 achieves maximum energy savings for both 
scenarios. As discussed in section VI.C.1, DOE also analyzed a 
``Baseline Lifetime Scenario.'' Although this scenario considers 
shortened lifetimes as TSL 4 and TSL 5, national energy savings do not 
change because shipments remain the same as the normal lifetime 
scenario.

     Table VII.4--Summary of Cumulative National Energy Savings for
                      Incandescent Reflector Lamps
------------------------------------------------------------------------
                                      National energy savings  (quads)
                                   -------------------------------------
                                         Existing           Emerging
                TSL                  technologies, R-   technologies, BR
                                       CFL product          product
                                      substitution,      substitution,
                                          shift             roll-up
------------------------------------------------------------------------
1.................................               0.45               0.16
2.................................               1.09               0.40
3.................................               1.91               0.81
4.................................               2.39               0.94
5.................................               2.72               1.12
------------------------------------------------------------------------

C. Economic Justification

1. Economic Impact on Consumers
a. Life-Cycle Costs and Payback Period
    Consumers affected by new or amended standards usually experience 
higher purchase prices and lower operating costs. Generally, these 
impacts are best captured by changes in life-cycle costs. DOE designed 
the LCC analysis around lamp purchasing events and calculated the LCC 
savings relative to the baseline for each lamp replacement event 
separately in each lamp product class, as done for the April 2009 NOPR. 
74 FR 16920, 16982 (April 13, 2009). The separate computation of the 
impacts on each event and each product class allowed DOE to view the 
results of many subgroup populations in the LCC analyses. The following 
discussion presents salient results from the LCC analysis. When a 
standard results in ``positive LCC savings,'' the life cycle cost of 
the standards-compliant lamp or lamp-and-ballast system is less than 
the life cycle cost of the baseline lamp or lamp-and-ballast system, 
and the consumer benefits economically. When a standard results in 
``negative LCC savings,'' the life cycle cost of the standards-
compliant lamp or lamp-and-ballast system is higher than the life cycle 
cost of the baseline lamp or lamp-and-ballast system, and the consumer 
is adversely affected economically. The results at some efficacy levels 
are presented as ranges, which reflect the results of multiple systems 
(i.e., multiple lamp-ballast pairings) that consumers could purchase to 
meet those specific efficacy levels.
    The LCC results shown in this notice reflect a subset of all of the 
lamp purchasing events analyzed by DOE, although they represent the 
most prevalent purchasing events. As done in the April 2009 NOPR, DOE 
is also presenting the installed prices of the lamp-and-ballast systems 
in order to allow comparisons of the up-front costs that consumers must 
bear when purchasing baseline or standards-case systems. 74 FR 16920, 
16982 (April 13, 2009). All of the LCC results shown in this notice 
were generated using the April 2009 AEO2009 reference case electricity 
price trend (which includes the impact of ARRA) as well as medium-range 
lamp and ballast prices. In many cases, DOE omitted Events IB (Lamp 
Failure: Lamp & Ballast Replacement) and IV (Ballast Retrofit) in this 
notice, because DOE believes these lamp purchase events to be 
relatively less frequent. In addition, DOE has chosen not to present 
detailed PBP results by efficacy level in this final rule notice 
because DOE believes that LCC results are a better measure of cost-
effectiveness. However, a full set of both LCC and PBP results for the 
systems DOE analyzed is available in chapter 8 and appendix 8B of the 
TSD. Chapter 8 presents LCC results for all lamp

[[Page 34148]]

purchasing events analyzed by DOE. Furthermore, chapter 8 includes the 
LCC results presented in this notice along with additional presented 
details, such as system design option details, start-year operating 
cost savings, and payback periods. Appendix 8B presents Monte Carlo 
simulation results performed by DOE as part of the LCC analysis and 
also presents sensitivity results, such as LCC savings under the 
AEO2009 high-economic-growth and low-economic-growth cases.
i. General Service Fluorescent Lamps
    Table VII.5 through Table VII.12 present the results for the 
baseline lamps in each of the five GSFL product classes DOE analyzed 
(i.e., 4-foot medium bipin, 4-foot miniature bipin SO, 4-foot miniature 
bipin HO, 8-foot single pin slimline, and 8-foot recessed double 
contact HO). Not all baselines have suitable replacement options for 
every lamp purchasing event at every efficacy level. For instance, 
because DOE assumed that consumers wish to purchase systems or lamp 
replacements with a lumen output within 10 percent of their baseline 
system output, in some cases, the only available replacement options 
produce less light than this. Thus, the replacement options are 
considered unsuitable substitutions. These cases are marked with ``LL'' 
(less light) in the LCC results tables below. In some cases, when 
consumers who currently own a T12 system need to replace their lamps, 
no T12 energy saving lamp replacements are available. In these cases, 
in order to save energy, the consumers must switch to other options, 
such as a T8 lamp and appropriate ballast. These cases are marked with 
``NER'' (no energy-saving replacement) in tables.
    Because some baseline lamps already meet higher efficacy levels 
(e.g., the baseline 32W 4-foot T8 MBP lamp achieves EL2), LCC savings 
at the levels below the baseline are zero. In these cases, ``BAE'' 
(baseline above efficacy level) is listed in the tables to indicate 
that the consumer makes the same purchase decision in the standards-
case as they do in the base-case. Also, not all lamp purchase events 
apply for all baseline lamps or efficacy levels. For example, DOE 
assumed that the standards-induced retrofit event does not apply to the 
32W T8 system, because it is already the most efficacious 4-foot medium 
bipin GSFL system. For these events, an ``EN/A'' (event not applicable) 
exists in the table. Finally, because LCC savings are not relevant when 
no energy conservation standard is established, ``N/A'' (not 
applicable) exists in the LCC savings column for the baseline system.
    Overall, based on the NIA model, DOE estimates that at TSL4 and 
TSL5 in 2012, approximately 2 percent of 4-foot MBP shipments result in 
negative LCC savings, and 9 percent of shipments are associated with 
the high installed price increases due to forced retrofits. At TSL5, 
all 4-ft T5 miniature bipin standard output shipments result in 
positive LCC savings; For 8-foot SP slimline at TSL4 and TSL5, 
approximately 24 percent of 2012 shipments would result in negative LCC 
savings, and 65 percent of shipments would be associated with the high 
installed price increases due to forced retrofits. DOE estimates that 
at TSL5 in 2012, approximately 33 percent of 8-foot RDC HO shipments 
would result in negative LCC savings, and 86 percent of shipments would 
be associated with the high installed price increases due to forced 
retrofits.
    For 4-foot MiniBP T5 standard-output lamps, TSL4 would require 
these lamps to meet EL1, resulting in positive LCC savings of $1.10 for 
lamp replacement and $43.30 for new construction or renovation (seen in 
Table VII.9). At TSL5 (EL2 for standard output T5 lamps), all consumers 
have available lamp designs which result in positive LCC savings of 
$1.10 (for lamp replacement) and $45.67 to $47.49 (for new construction 
or renovation).
    For 4-foot MiniBP T5 high-output lamps, TSL4 and TSL5 have 
identical life-cycle cost impacts: Consumers of high-output lamps who 
need only a lamp replacement would experience negative LCC savings of -
$3.03 (approximately 44 percent of shipments, according the NIA model). 
However, purchasing a T5 high-output system for new construction or 
renovation would result in positive LCC savings of $65.69 to $67.06.
    Table VII.5 presents the findings of an LCC analysis on various 3-
lamp 4-foot medium bipin GSFL systems operating in the commercial 
sector. The analysis period (based on the longest-lived baseline lamp's 
lifetime) for this product class in the commercial sector is 5.5 years. 
As seen in the table, DOE analyzes three baseline lamps: (1) 40W T12; 
(2) 34W T12; and (3) 32W T8. For a complete discussion of the 4-foot 
MBP LCC results, see chapter 8 of the TSD and the April 2009 NOPR. 74 
FR 16920, 16984 (April 13, 2009).
BILLING CODE 6450-01-P

[[Page 34149]]

[GRAPHIC] [TIFF OMITTED] TR14JY09.000

BILLING CODE 6450-01-C
    Table VII.7 presents the LCC results for a 4-foot medium bipin 
system operating in the residential sector under average operating 
hours. Under average operating hours, only the ballast failure event 
(Event III) applies because the ballast and fixture reach the end of 
their 15 year life before the baseline lamp (which would otherwise have 
a lifetime of 19 years when operated for 791 hours per year) fails. DOE 
uses a 15-year analysis period, based on the effective service life of 
the lamp (limited by the fixture or ballast life). 74 FR 16920, 16985 
(April 13, 2009).

[[Page 34150]]



  Table VII.6--LCC Results for a 2-Lamp Four-Foot Medium Bipin GSFL System Operating in the Residential Sector
                                          With Average Operating Hours
----------------------------------------------------------------------------------------------------------------
                                                                LCC savings              Installed price
                                                          ------------------------------------------------------
                                                                   2008$                      2008$
             Baseline                   Efficacy level    ------------------------------------------------------
                                                            Event III: Ballast
                                                                 failure*          Event III: Ballast  failure
----------------------------------------------------------------------------------------------------------------
40 Watt T12.......................  Baseline.............  N/A.................  51.38.
                                    EL1..................  7.03 to 10.25.......  49.04 to 56.19.
                                    EL2..................  6.82 to 19.17.......  50.51 to 56.39.
                                    EL3..................  1.06 to 18.86.......  52.66 to 60.19.
                                    EL4..................  18.57 to 24.36......  52.96 to 56.15.
                                    EL5..................  20.21 to 22.32......  53.13 to 54.04.
----------------------------------------------------------------------------------------------------------------
*Analysis period is 15.0 years.
N/A: Not Applicable.

    In addition to conducting the LCC analysis under average operating 
hours, DOE also computed residential LCC results under high operating 
hours (1,210 hours per year) in order to analyze the economic impacts 
of the lamp failure event (Event I). Table VII.7 presents these LCC and 
installed-price results for a 2-lamp four-foot medium bipin GSFL system 
under the lamp failure event and high operating hours. As seen in Table 
VII.7, DOE divides the residential GSFL lamp failure event into Events 
IA (Lamp Failure: Lamp Replacement) and IB (Lamp Failure: Lamp and 
Ballast Replacement). Event IA, presented also in the commercial sector 
analysis, solely models a lamp purchase (in response to lamp failure) 
in both the base case and standards case. With high operating hours, 
DOE calculates that the baseline lamp initially purchased with a 
ballast fails after 12.4 years. Thus, a replacement lamp will operate 
for only 2.6 additional years before the fixture is removed. To compute 
the results shown in Table VII.7, DOE assumes that residential-sector 
GSFL consumers will discard their replacement lamp when the fixture is 
removed and therefore uses a 2.6 year analysis period.

         Table VII.7--LCC Results for a 2-Lamp Four-Foot Medium Bipin GSFL System Operating in the Residential Sector With High Operating Hours
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                            Efficacy level                                             Installed price
                                  ----------------------------------------------------------------------------------------------------------------------
                                                                            2008$                                           2008$
             Baseline                                   ------------------------------------------------------------------------------------------------
                                        LCC savings         Event IA: Lamp      Event IB: Lamp and      Event IA: Lamp      Event IB: Lamp and ballast
                                                             replacement*      ballast replacement*      replacement                replacement
--------------------------------------------------------------------------------------------------------------------------------------------------------
40 Watt T12......................  Baseline............  N/A.................  N/A.................  4.13...............  4.13.
                                   EL1.................  LL..................  EN/A................  LL.................  EN/A.
                                   EL2.................  LL..................  EN/A................  LL.................  EN/A.
                                   EL3.................  -5.53...............  EN/A................  12.94..............  EN/A.
                                   EL4.................  NR..................  -4.13 to -2.04......  NR.................  52.96 to 56.15.
                                   EL5.................  NR..................  -3.52 to -2.87......  NR.................  53.13 to 54.04.
--------------------------------------------------------------------------------------------------------------------------------------------------------
*Analysis period is 2.6 years.
N/A: Not Applicable; LL: Available Options Produce Less Light; EN/A: Event Not Applicable; NR: No Replacement.

    As discussed in section V.C.8, DOE analyzed additional residential-
sector GSFL lamp failure LCC scenarios for this final rule based on the 
understanding that some residential-sector GSFL consumers may preserve 
their lamps during fixture end-of-life and then install those lamps on 
a new fixture instead of discarding them. Consumers exhibiting this 
behavior can operate lamps for their full lifetimes and thus will 
eventually experience a lamp failure even when operating with average 
operating hours. When operated for average operating hours, the 
baseline lamp has a lifetime of 19 years; therefore, DOE uses 19 years 
as the analysis period. This analysis shows that some residential 
consumers with T12 systems do in fact obtain LCC savings when forced to 
retrofit their T12 ballast with a T8 system at EL4 and EL5. However, 
DOE also notes that the results of this analysis are highly dependent 
on the remaining years of lifetime left on the T12 ballast when the 
lamp is replaced. Therefore, as seen in Table VII.8 DOE computes LCC 
savings for several scenarios of remaining ballast life at the time of 
lamp replacement. At EL3, under the scenario where consumers retain 
their lamp upon ballast replacement, consumers obtain LCC savings. At 
EL4, consumers can achieve positive LCC savings if their ballast have 
less than 8 years of life remaining at the point of lamp failure. In 
other words, consumers who would need to purchase a ballast within 8 
years after replacing their lamp would benefit from a standard at EL4. 
At EL5, standards-case consumers can achieve positive LCC savings if 
their fixtures have less than 7 years of life remaining.

[[Page 34151]]

[GRAPHIC] [TIFF OMITTED] TR14JY09.001

    Table VII.9 presents the results for an electronically-ballasted 4-
foot T5 miniature bipin standard-output, baseline system operating in 
the commercial sector. Table VII.10 presents the results for an 
electronically-ballasted 4-foot T5 miniature bipin high-output baseline 
system operating in the industrial sector. For further discussion on 
the 4-foot MiniBP LCC results see the April 2009 NOPR and Chapter 8 of 
the TSD. 74 FR 16920, 16987 (April 13, 2009).

             Table VII.9--LCC Results for a 2-Lamp Four-Foot Miniature Bipin Standard Output GSFL System Operating in the Commercial Sector
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                         LCC savings                                  Installed price
                                                          ----------------------------------------------------------------------------------------------
                                                                            2008$                                          2008$
             Baseline                   Efficacy level    ----------------------------------------------------------------------------------------------
                                                                                 Event V: New
                                                            Event IA: Lamp       construction/      Event IA: Lamp       Event V: New  construction/
                                                             replacement*         renovation*         replacement                 renovation
--------------------------------------------------------------------------------------------------------------------------------------------------------
28 Watt T5........................  Baseline.............               N/A  N/A.................              9.75  71.87.
                                    EL1..................               NER  43.30...............             13.66  75.78.
                                    EL2..................              1.10  45.67 to 47.49......             15.44  77.56 to 78.06.
--------------------------------------------------------------------------------------------------------------------------------------------------------
*Analysis period is 5.5 years.
N/A: Not Applicable; NER: No Energy-Saving Replacement.


               Table VII.10--LCC Results for a 2-Lamp Four-Foot Miniature Bipin High Output GSFL System Operating in the Industrial Sector
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                         LCC savings                                  Installed price
                                                          ----------------------------------------------------------------------------------------------
                                                                            2008$                                          2008$
             Baseline                   Efficacy level    ----------------------------------------------------------------------------------------------
                                                                                 Event V: New
                                                            Event IA: Lamp       construction/      Event IA: Lamp       Event V: New  construction/
                                                             replacement*         renovation*         replacement                 renovation
--------------------------------------------------------------------------------------------------------------------------------------------------------
54 Watt T5........................  Baseline.............               N/A  N/A.................             10.84  74.09.
                                    EL1..................             -3.03  65.69 to 67.06......             20.61  79.31 to 83.87.
--------------------------------------------------------------------------------------------------------------------------------------------------------
* Analysis period is 3.9 years.
N/A: Not Applicable; NER: No Energy-Saving Replacement.

    Table VII.11 presents the results for an 8-foot single-pin slimline 
GSFL system operating in the commercial sector. The analysis period is 
4 years. For this product class, DOE analyzes three baseline lamps: (1) 
75W T12; (2) 60W T12; and (3) 59W T8. For further discussion on the 8-
foot SP slimline LCC results, see the April 2009 NOPR and chapter 8 of 
the TSD. 74 FR 16920, 16988 (April 13, 2009).

[[Page 34152]]

[GRAPHIC] [TIFF OMITTED] TR14JY09.002

    Table VII.12 shows LCC results for an 8-foot recessed double-
contact GSFL system operating in the industrial sector. The analysis 
period for this product class is 2.3 years. DOE analyzes 110W T12 and 
95W T12 baseline lamps on magnetic ballasts. For further discussion on 
the 8-foot RDC HO LCC results see the April 2009 NOPR and chapter 8 of 
the TSD. 74 FR 16920, 16990 (April 13, 2009).

[[Page 34153]]

[GRAPHIC] [TIFF OMITTED] TR14JY09.003

ii. Incandescent Reflector Lamps
    Table VII.13 shows the commercial and residential sector LCC 
results for IRL. The results are based on the reference case April 2009 
AEO2009 electricity price forecast (which includes the impact of the 
ARRA) and medium-range lamp prices. The analysis period is 3.4 years 
for the residential sector and 0.9 years for the commercial sector. In 
general, the results of the LCC analysis are consistent with those 
presented in the April 2009 NOPR. 74 FR 16920, 16991 (April 13, 2009). 
As discussed in section VI.C.1, DOE analyzed an additional scenario, 
called the Baseline Lifetime scenario, for the LCC analysis, NIA and 
MIA that modeled lamps at EL4 and EL5 with similar lifetimes to that of 
the baseline lamp lifetimes. The LCC results for both the Baseline 
Lifetime scenario and the Commercial Lifetime scenario (in which lamps 
at EL4 and EL5 have lifetimes of 4,000 hours and 4,200 hours, 
respectively) are shown as ranges at EL4 and EL5. As seen in Table 
VII.13, the lower range of LCC savings, representing the Baseline 
Lifetime scenario lamps, are negative for the 50W baseline in both 
sectors at EL5 and only in the commercial sector at EL4.

[[Page 34154]]



                                               Table VII.13--LCC Results for Incandescent Reflector Lamps
--------------------------------------------------------------------------------------------------------------------------------------------------------
 
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                    LCC savings (2008$)
                                                              Installed price (2008$)
                                                                         -------------------------------------------------------------------------------
                      Baseline                          Efficacy level          Event I: Lamp replacement/event V: New construction and renovation
                                                                         -------------------------------------------------------------------------------
                                                                             Commercial *       Residential **        Commercial          Residential
--------------------------------------------------------------------------------------------------------------------------------------------------------
90 Watt PAR38.......................................           Baseline                 N/A                 N/A                6.43                5.33
                                                                      EL1             -0.12                0.14                7.41                6.31
                                                                      EL2      3.72 to 6.12        3.19 to 4.94        7.88 to 8.06        6.78 to 6.96
                                                                      EL3              6.01                5.81                8.06                6.96
                                                                      EL4      2.61 to 7.95        3.78 to 7.45                9.43                8.33
                                                                      EL5      4.26 to 9.14        5.65 to 9.10       9.43 to 10.02        8.33 to 8.92
75 Watt PAR38.......................................           Baseline                 N/A                 N/A                6.43                5.33
                                                                      EL1             -0.40               -0.17                7.41                6.31
                                                                      EL2      3.17 to 5.76        2.57 to 4.54        7.88 to 8.06        6.78 to 6.96
                                                                      EL3              4.64                4.25                8.06                6.96
                                                                      EL4      1.51 to 6.85        2.54 to 6.20                9.43                8.33
                                                                      EL5      2.42 to 7.30        3.56 to 7.01       9.43 to 10.02        8.33 to 8.92
50 Watt PAR30.......................................           Baseline                 N/A                 N/A                5.80                4.70
                                                                      EL1             -0.37               -0.29                6.78                5.68
                                                                      EL2     -0.07 to 2.74        0.11 to 2.36        7.25 to 7.43        6.15 to 6.33
                                                                      EL3              0.63                0.92                7.43                6.33
                                                                      EL4     -0.25 to 1.81        0.11 to 1.75                8.80                7.70
                                                                      EL5     -3.17 to 1.36       -1.64 to 1.51        8.80 to 9.39       7.70 to 8.29
--------------------------------------------------------------------------------------------------------------------------------------------------------
* Analysis period is 0.9 years.
 **Analysis period is 3.4 years.

b. Consumer Subgroup Analysis
    Certain consumer subgroups may be disproportionately affected by 
standards. As done for the April 2009 NOPR, DOE performed LCC subgroup 
analyses as part of its proposal for low-income consumers, institutions 
of religious worship, and institutions that serve low-income 
populations. 74 FR 16920, 16991 (April 13, 2009). See section V.C for a 
review of the inputs to the LCC analysis. DOE found the impacts on 
these consumer subgroups to be generally consistent with those 
presented in the April 2009 NOPR with one exception: for institutions 
that serve low-income populations, with updates to electricity prices 
in this final rule, consumers who in the base case purchase a 75W T12 
replacement lamp, no longer obtain LCC savings. 74 FR 16920, 16996 
(April 13, 2009). For further detail on the consumer subgroup analysis, 
see chapter 12 of the TSD.
2. Economic Impact on Manufacturers
    DOE estimated the impact of amended energy conservation standards 
for covered products on the INPV of the industries that manufacture the 
products. The impact of amended standards on INPV consists of the 
difference between the INPV in the base case and the INPV in the 
standards case. INPV is the primary metric used in the MIA and 
represents one measure of the fair value of the GSFL and IRL industries 
in 2008$. For each industry affected by today's rule, DOE calculated 
INPV by summing all of the net cash flows, discounted at the industry's 
cost of capital or discount rate.
    Table VII.14 through Table VII.17 show the changes in INPV that 
bound the range of impacts that DOE estimates would result from the 
TSLs considered for this final rule.

  Table VII.14--Manufacturer Impact Analysis for GSFL With the Flat Markup Scenario Under the Existing Technology Base Case--High Lighting Expertise--
                                                            Shift in Efficiency Distributions
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                 Trial standard level
                                                              Units                Base case -----------------------------------------------------------
                                                                                                   1           2           3           4           5
--------------------------------------------------------------------------------------------------------------------------------------------------------
INPV..........................................  (2008$ millions)................         639         697         695         721         635         671
Change in INPV................................  (2008$ millions)................  ..........          58          56          82          -4          33
                                                (%).............................  ..........       9.11%       8.83%      12.82%      -0.64%       5.09%
Amended Energy Conservation Standards Product   (2008$ millions)................  ..........         3.3         8.8         8.8        11.6        29.6
 Conversion Costs.
Amended Energy Conservation Standards Capital   (2008$ millions)................  ..........        38.5        60.5       104.5       181.5       181.5
 Conversion Costs.
                                                                                 -----------------------------------------------------------------------
    Total Investment Required.................  (2008$ millions)................  ..........        41.8        69.3       113.3       193.1       211.1
--------------------------------------------------------------------------------------------------------------------------------------------------------


 Table VII.15--Manufacturer Impact Analysis for GSFL With the Four-Tier Markup Scenario Under the Emerging Technology Base Case--Market Segment Lighting
                                                      Expertise--Rollup in Efficiency Distributions
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                 Trial standard level
                                                              Units                Base case -----------------------------------------------------------
                                                                                                   1           2           3           4           5
--------------------------------------------------------------------------------------------------------------------------------------------------------
INPV..........................................  (2008$ millions)................         527         662         629         432         365         316

[[Page 34155]]

 
Change in INPV................................  (2008$ millions)................  ..........         134         102         -95        -162        -211
                                                (%).............................  ..........      25.47%      19.29%     -18.08%     -30.74%     -40.04%
Amended Energy Conservation Standards Product   (2008$ millions)................  ..........         3.3         8.8         8.8        11.6        29.6
 Conversion Costs.
Amended Energy Conservation Standards Capital   (2008$ millions)................  ..........        38.5        60.5       104.5       181.5       181.5
 Conversion Costs.
                                                                                 -----------------------------------------------------------------------
    Total Investment Required.................  (2008$ millions)................  ..........        41.8        69.3       113.3       193.1       211.1
--------------------------------------------------------------------------------------------------------------------------------------------------------


   Table VII.16--Manufacturer Impact Analysis for IRL Under the Existing Technologies Base Case--No Product Substitution Scenario--Shift in Efficiency
                                                                      Distribution
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                 Trial standard level
                                                              Units                Base case -----------------------------------------------------------
                                                                                                   1           2           3           4           5
--------------------------------------------------------------------------------------------------------------------------------------------------------
INPV..........................................  (2008$ millions)................         301         293         233         221         199         190
Change in INPV................................  (2008$ millions)................  ..........         (8)        (68)        (81)       (102)       (111)
                                                (%).............................  ..........      -2.80%     -22.71%     -26.78%     -34.02%     -36.90%
Amended Energy Conservation Standards Product   (2008$ millions)................  ..........          $3          $3          $2          $3          $7
 Conversion Costs.
Amended Energy Conservation Standards Capital   (2008$ millions)................  ..........         $32         $83        $134        $167        $185
 Conversion Costs.
                                                                                 -----------------------------------------------------------------------
    Total Investment Required.................  (2008$ millions)................  ..........         $35         $87        $137        $170        $192
--------------------------------------------------------------------------------------------------------------------------------------------------------


  Table VII.17--Manufacturer Impact Analysis for IRL Under the Emerging Technology Base Case--Product Substitution--Roll-Up in Efficiency Distributions
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                 Trial standard level
                                                              Units                Base case -----------------------------------------------------------
                                                                                                   1           2           3           4           5
--------------------------------------------------------------------------------------------------------------------------------------------------------
INPV..........................................  (2008$ millions)................         221         205         158         139         123         117
Change in INPV................................  (2008$ millions)................  ..........        (15)        (63)        (81)        (98)       (104)
                                                (%).............................  ..........      -6.87%     -28.58%     -36.80%     -44.36%     -47.18%
Amended Energy Conservation Standards Product   (2008$ millions)................  ..........          $3          $3          $2          $3          $7
 Conversion Costs.
Amended Energy Conservation Standards Capital   (2008$ millions)................  ..........         $29         $77        $125        $155        $172
 Conversion Costs.
                                                                                 -----------------------------------------------------------------------
    Total Investment Required.................  (2008$ millions)................  ..........         $33         $81        $127        $158        $179
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The April 2009 NOPR provides a detailed discussion of the estimated 
impact of amended standards for GSFL and IRL on INPVs. 74 FR 16920, 
16999-17003 (April 13, 2009). This qualitative discussion on the 
estimated impacts of amended GSFL and IRL standards in INPVs for the 
final rule can be found in chapter 13 of the TSD.
a. Industry Cash Flow Analysis Results for the IRL Lifetime Sensitivity
    For the final rule, DOE analyzed the effects of the Baseline 
Lifetime scenario as a sensitivity. The impacts of this scenario on 
INPV are presented below. For a full description of the scenario, see 
section VI.C.1 of today's final rule.

  Table VII.18--Manufacturer Impact Analysis for IRL Under the Existing Technologies Base Case--BR Substitution
                    Scenario--Roll-Up in Efficiency Distribution--Baseline Lifetime Scenario*
----------------------------------------------------------------------------------------------------------------
                                                                                       Trial standard level
                                                  Units              Base case   -------------------------------
                                                                                         4               5
----------------------------------------------------------------------------------------------------------------
INPV..................................  (2008$ millions)........             301             281             258
Change in INPV........................  (2008$ millions)........  ..............            (21)            (43)
                                        (%).....................  ..............          -6.81%         -14.24%
Amended Energy Conservation Standards   (2008$ millions)........  ..............              $3              $7
 Product Conversion Costs.

[[Page 34156]]

 
Amended Energy Conservation Standards   (2008$ millions)........  ..............            $167            $167
 Capital Conversion Costs.
                                                                 -----------------------------------------------
    Total Investment Required.........  (2008$ millions)........  ..............            $170            $174
----------------------------------------------------------------------------------------------------------------
* The scenarios that bound the INPV results in the sensitivity scenario are different than the scenarios that
  bound the INPV results in the normal standards cases.


    Table VII.19--Manufacturer Impact Analysis for IRL Under the Emerging Technology Base Case--R-CFL Product
                  Substitution--Shift in Efficiency Distributions--Baseline Lifetime Scenario*
----------------------------------------------------------------------------------------------------------------
                                                                                       Trial standard level
                                                  Units              Base case   -------------------------------
                                                                                         4               5
----------------------------------------------------------------------------------------------------------------
INPV..................................  (2008$ millions)........             221             160             171
Change in INPV........................  (2008$ millions)........  ..............            (61)            (49)
                                        (%).....................  ..............         -27.52%         -22.35%
Amended Energy Conservation Standards   (2008$ millions)........  ..............              $3              $7
 Product Conversion Costs.
Amended Energy Conservation Standards   (2008$ millions)........  ..............            $155            $155
 Capital Conversion Costs.
                                                                 -----------------------------------------------
    Total Investment Required.........  (2008$ millions)........  ..............            $158            $162
----------------------------------------------------------------------------------------------------------------
* The scenarios that bound the INPV results in the sensitivity scenario are different than the scenarios that
  bound the INPV results in the normal standards cases.

    The sensitivity results show that decreasing the lifetime of the 
standards-compliant lamps at TSL 4 and TSL 5 lowers the estimated range 
of INPV impacts relative to the no sensitivity results. In the base 
case, the lamps that meet TSL 4 and TSL 5 are premium products with 
longer life than standard HIR lamps. If manufacturers decreased the 
lifetime of the lamps in response to the energy conservation standards, 
the industry revenues in the standards case are greater due to higher 
total shipments at TSL 4 and TSL 5. The higher revenues help to 
mitigate the impacts of the significant capital conversion costs 
required to comply with the energy conservation standards.
b. Cumulative Regulatory Burden
    The April 2009 NOPR notes that one aspect of DOE's assessment of 
manufacturer burden is the cumulative impact of multiple regulatory 
actions that affect manufacturers. 74 FR 16920, 17003 (April 13, 2009). 
In addition to DOE's energy conservation regulations for GSFL and IRL, 
DOE identified other requirements that manufacturers face for these and 
other products and equipment they manufacture in the three years before 
and after the anticipated effective date of the amended DOE 
regulations. Id. DOE believes that the EISA 2007 requirements for GSIL 
are significant and could have the greatest cumulative burden on 
manufacturers, but that they will not pose insurmountable challenges. 
Id.
    Chapter 13 of the TSD addresses in greater detail the issue of 
cumulative regulatory burden.
c. Impacts on Employment
    As discussed in the April 2009 NOPR, and for today's final rule, 
DOE believes that amended energy conservation standards will not alter 
domestic employment levels of the GSFL industry. 74 FR 16920, 17003 
(April 13, 2009). During interviews with manufacturers, DOE learned 
that GSFL are produced on high-speed, fully-automated lines. Production 
workers are not involved in the physical assembly of the final product 
(e.g., in inserting components, transferring partly assembled lamps, 
soldering lamp bases). The employment levels required for these tasks 
are a function of the total volume of the facility, not the labor 
content of the product mix produced by the plant. Since higher TSLs 
involve using more-efficient phosphors, employment will not be impacted 
because standards will not change the overall scale of the facility.
    As discussed in the April 2009 NOPR, and for today's final rule, 
DOE believes that amended energy conservation standards will not 
significantly impact IRL direct employment. 74 FR 16920, 17004 (April 
13, 2009). The impact that new standards will have on employment is far 
less significant than the potential impact from emerging technologies. 
Both scenarios show that the absolute magnitudes of employment impacts 
due to standards are small. Whether standards have a positive or 
negative impact on employment is largely determined by the extent to 
which consumers elect to substitute IRL with other lamp technologies 
(such as R-CFL or exempted IRL) in the standards case.
    Further support for these conclusions is set forth in chapter 13 of 
the TSD.
d. Impacts on Manufacturing Capacity
    DOE stated its view in the April 2009 NOPR, 74 FR 16920, 17004 
(April 13, 2009), that amended standards would not significantly affect 
GSFL production capacity. Over the long-term, any redesign of GSFL 
needed to meet standards would largely be a materials issue that would 
not affect manufacturing capacity. In the short term, although higher 
are expediting the shift from T12 shipments to T8 shipments and require 
shutting down and retooling production lines, manufacturers are able to 
temporarily ramp up production before shutdowns occur to maintain 
shipments during retooling. For today's final rule, DOE maintains its 
belief that amended energy conservation standards for GSFL will

[[Page 34157]]

not significantly impact manufacturing capacity.
    In the NOPR, DOE stated it did not believe there would be a 
capacity constraint at the proposed standard level. DOE stated that 
manufacturers could install additional coaters, purchase infrared 
burners from a supplier, and use existing excess capacity. These 
options would allow IRL manufacturers to maintain production capacity 
levels and continue to meet market demand. 74 FR 16920, 17004 (April 
13, 2009). In response to the April 2009 NOPR, manufacturers did raise 
concerns that the energy conservation standards in today's final rule 
could result in a constrained market. However, none of the comments DOE 
received indicated that that the energy conservation standards would 
result in the unavailability of standards-compliant products. At worst, 
the energy conservation standards could result in a short-term 
disruption in which the one manufacturer that requested additional time 
in between the announcement and effective date does not supply covered 
IRL. DOE did not receive comment that would indicate the other 
manufacturers would not have the necessary volume of standards-
compliant lamps by the effective date of the final rule. For today's 
final rule, DOE maintains its belief that manufacturers will be able to 
maintain production capacity of covered IRLs and will be able to meet 
market demand.
e. Impacts on Manufacturers That Are Small Businesses
    As discussed in the April 2009 NOPR, 74 FR 16920, 17004 (April 13, 
2009), DOE identified no small manufacturers of IRL but did identify 
one small manufacturer that produces covered GSFL and is unlikely to be 
significantly affected by today's final rule.\65\ In response to the 
April 2009 NOPR, one small business requested it be included in DOE's 
small business manufacturer impact analysis. For today's final rule, 
DOE re-analyzed its list of potential small business manufacturers, 
including those that submitted comments. DOE still has not identified 
any small manufacturer of covered IRL. However, DOE continues to 
identify the one small manufacturer that produces covered GSFL. For a 
discussion of the impacts on small business manufacturers, see chapter 
13 of the TSD and section VIII.B of today's notice.
---------------------------------------------------------------------------

    \65\ As discussed in the April 2009 NOPR, 74 FR 17004-05, DOE 
identified only manufacturer of covered GSFL or IRL that met the 
criteria to be classified as a small business. For further detail on 
DOE's inquiry regarding small manufacturers, please see section 
VIII.B on the review under the Regulatory Flexibility Act.
---------------------------------------------------------------------------

3. National Net Present Value and Net National Employment
    The NPV analysis is a measure of the cumulative benefit or cost of 
standards to the Nation, discounted to $2008 dollars. In accordance 
with the OMB's guidelines on regulatory analysis,\66\ DOE calculated 
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 to 
private capital in the U.S. economy, and reflects the returns to real 
estate and small business capital, as well as corporate capital. DOE 
used this discount rate to approximate the opportunity cost of capital 
in the private sector because recent OMB analysis has found the average 
rate of return to capital to be near this rate. DOE also used the 3-
percent rate to capture the potential effects of standards on private 
consumption (e.g., through higher prices for equipment and the purchase 
of reduced amounts of energy). This rate represents the rate at which 
society discounts future consumption flows to their present value. This 
rate can be approximated by the real rate of return on long-term 
government debt (i.e., yield on Treasury notes minus annual rate of 
change in the Consumer Price Index), which has averaged about 3 percent 
on a pre-tax basis for the last 30 years.
---------------------------------------------------------------------------

    \66\ OMB Circular A-4, section E (Sept. 17, 2003).
---------------------------------------------------------------------------

    The tables below show the forecasted net present value at each 
trial standard level for GSFL and IRL. As shown above for NES results, 
Table VII.20 presents the ``Existing Technologies, High Lighting 
Expertise, Shift'' scenario and the ``Emerging Technologies, Market 
Segment-Based Lighting Expertise, Roll Up'' scenario as the maximum and 
minimum NPVs for GSFL, respectively. In general, the NPV results at 
each trial standard level are a reflection of the life-cycle cost 
savings at the corresponding efficacy levels. As seen in section 
VII.C.1.a, for most lamp purchasing events and most baseline lamps, 
increasing efficacy levels generally result in increased LCC savings. 
See the April 2009 NOPR and chapter 11 of the TSD for a description of 
the effect of various TSLs on NPV. 74 FR 16920, 17006-07 (April 13, 
2009).

                         Table VII.20--Summary of Cumulative Net Present Value for GSFL
----------------------------------------------------------------------------------------------------------------
                                                                              NPV (billion 2008$)
                                                             ---------------------------------------------------
                                                               Existing technologies,    Emerging technologies,
                                                              high lighting expertise,    market segment-based
           TSL/EL                      Product class                    shift           lighting expertise, roll-
                                                             --------------------------            up
                                                                                       -------------------------
                                                              7% Discount  3% Discount  7% Discount  3% Discount
----------------------------------------------------------------------------------------------------------------
1...........................  4-foot MBP....................         3.30         6.86         1.11         2.88
                              8-foot SP Slimline............         0.55         1.40         0.51         1.34
                              8-foot RDC HO.................         0.54         0.88        -0.19        -0.24
                              4-foot MiniBP SO..............         1.47         3.37         0.08         0.26
                              4-foot MiniBP HO..............         2.22         4.81         1.19         2.63
                              2-foot U-Shaped...............         0.15         0.31         0.05         0.13
                                                             ---------------------------------------------------
                                 Total......................         8.24        17.63         2.75         7.00
----------------------------------------------------------------------------------------------------------------
2...........................  4-foot MBP....................         2.63         5.99         0.75         2.60
                              8-foot SP Slimline............         0.60         1.53         0.58         1.50
                              8-foot RDC HO.................         0.68         1.09         0.77         1.20
                              4-foot MiniBP SO..............         1.47         3.37         0.08         0.26
                              4-foot MiniBP HO..............         2.22         4.81         1.19         2.63

[[Page 34158]]

 
                              2-foot U-Shaped...............         0.12         0.27         0.03         0.12
                                                             ---------------------------------------------------
                                 Total......................         7.73        17.07         3.41         8.31
----------------------------------------------------------------------------------------------------------------
3...........................  4-foot MBP....................         9.40        20.06         2.68         7.05
                              8-foot SP Slimline............         0.82         1.82         0.82         1.82
                              8-foot RDC HO.................         0.32         0.59         0.22         0.39
                              4-foot MiniBP SO..............         1.47         3.37         0.08         0.26
                              4-foot MiniBP HO..............         2.22         4.81         1.19         2.63
                              2-foot U-Shaped...............         0.43         0.91         0.12         0.32
                                                             ---------------------------------------------------
                                 Total......................        14.81        31.80         5.18        12.60
----------------------------------------------------------------------------------------------------------------
4...........................  4-foot MBP....................        18.66        37.88         6.34        14.22
                              8-foot SP Slimline............         0.84         1.97         0.24         0.91
                              8-foot RDC HO.................         1.87         3.17         1.87         3.17
                              4-foot MiniBP SO..............         1.47         3.37         0.08         0.26
                              4-foot MiniBP HO..............         2.22         4.81         1.19         2.63
                              2-foot U-Shaped...............         0.85         1.72         0.29         0.65
                                                             ---------------------------------------------------
                                 Total......................        26.31        53.53        10.02        21.84
----------------------------------------------------------------------------------------------------------------
5...........................  4-foot MBP....................        22.79        45.79         6.12        14.24
                              8-foot SP Slimline............         0.84         1.97         0.33         1.07
                              8-foot RDC HO.................         1.98         3.36         1.81         3.10
                              4-foot MiniBP SO..............         1.91         4.29         0.32         0.91
                              4-foot MiniBP HO..............         2.22         4.81         1.19         2.63
                              2-foot U-Shaped...............         1.04         2.08         0.28         0.65
                                                             ---------------------------------------------------
                                 Total......................        30.93        62.55        10.05        22.57
----------------------------------------------------------------------------------------------------------------

    For IRL, DOE presents the ``Existing Technologies, R-CFL Product 
Substitution, Shift'' and ``Emerging Technologies, BR Product 
Substitution, Roll-Up'' scenarios as the maximum and minimum NPVs, 
respectively. As seen in Table VII.21, NPV increases with TSL, 
consistent with LCC savings generally increasing with efficacy level. 
In particular, for the BR Product Substitution scenario, the negative 
NPV at TSL1 results because the life-cycle cost savings at EL1 (the 
associated EL) are primarily negative. However, as seen in the R-CFL 
Product Substitution scenario, TSL1 achieves positive NPV due to 
primarily the increased movement to highly cost-effective R-CFLs. For 
further discussion of the NPV results see the April 2009 NOPR and 
chapter 11 of the TSD. 74 FR 16920, 17006-07 (April 13, 2009).

             Table VII.21--Summary of Cumulative Net Present Value for Incandescent Reflector Lamps
----------------------------------------------------------------------------------------------------------------
                                                                        NPV (billion 2008$)
                                                 ---------------------------------------------------------------
                                                   Existing technologies, R-CFL      Emerging technologies, BR
                       TSL                          product substitution, shift    product substitution, roll-up
                                                 ---------------------------------------------------------------
                                                    7% Discount     3% Discount     7% Discount     3% Discount
                                                       rate            rate            rate            rate
----------------------------------------------------------------------------------------------------------------
1...............................................            0.45            1.11           -0.09           -0.04
2...............................................            4.59            8.94            2.08            3.93
3...............................................            6.34           12.50            3.04            5.84
4...............................................            9.06           17.81            4.20            8.02
5...............................................           10.16           20.01            4.90            9.38
----------------------------------------------------------------------------------------------------------------

    As discussed in section VI.C, DOE developed a Baseline Lifetime 
scenario (which it analyzed the LCC savings, NPV, and manufacturer 
impacts) to investigate the effects of shorter lamp lifetime at TSL4 
and TSL5. DOE did not feel it necessary to apply this scenario to TSL1 
through TSL3 because DOE already analyzes lamps with lifetimes similar 
to that of the baseline lamp lifetimes. Relative to the normal lifetime 
scenario, NPV decreases due to the significant increase in incremental 
equipment costs, since more lamps need

[[Page 34159]]

to be shipped as they have shorter lifetimes.

   Table VII.22--Summary of Cumulative Net Present Value for Incandescent Reflector Lamps--``Baseline Lifetime
                                                   Scenario''
----------------------------------------------------------------------------------------------------------------
                                                                        NPV (billion 2008$)
                                                 ---------------------------------------------------------------
                                                   Existing technologies, R-CFL      Emerging technologies, BR
                       TSL                          product substitution, shift    product substitution, roll-up
                                                 ---------------------------------------------------------------
                                                    7% Discount     3% Discount     7% Discount     3% Discount
                                                       rate            rate            rate            rate
----------------------------------------------------------------------------------------------------------------
4...............................................            5.22           10.81            1.83            3.78
5...............................................            4.86           10.13            2.53            5.12
----------------------------------------------------------------------------------------------------------------

    DOE also estimated the national employment impacts that would 
result from each TSL. In addition to considering the direct employment 
impacts for the manufacturers of products covered in this rulemaking 
(discussed above), DOE also developed estimates of the indirect 
employment impacts of energy conservation standards on the economy in 
general. As Table VII.23 and Table VII.24 show, DOE estimates that any 
net monetary savings from GSFL and IRL standards would be redirected to 
other forms of economic activity. DOE also expects these shifts in 
spending and economic activity would affect the demand for labor. DOE 
estimated that net indirect employment impacts from energy conservation 
standards for GSFL and IRL would be positive (see Tables below), but 
very small relative to total national employment. This increase would 
likely be sufficient to fully offset any adverse impacts on employment 
that might occur in the lamp products industries. Earthjustice 
commented that the value of this additional employment should be 
monetized using a wage rate and included in the justification of the 
TSL selected. (Earthjustice, No. 60 at pg 6) However, this would double 
count the consumer savings that are the source of the job creation. DOE 
believes it more appropriate to consider job benefits separately from 
the direct benefits of energy savings similar to DOE's approach for 
considering environmental emissions benefits. For details on the 
employment impact analysis methodology and results, see chapter 15 of 
the TSD accompanying this notice.

 Table VII.23--Net National Change in Indirect Employment for GSFL, Jobs
                                 in 2042
------------------------------------------------------------------------
                                         Net national change in jobs
                                                 (thousands)
                                   -------------------------------------
                                                            Emerging
       Trial standard level              Existing        technologies,
                                      technologies,     roll-up, market
                                       shift, high       segment based
                                        expertise          expertise
------------------------------------------------------------------------
1.................................               12.0                6.5
2.................................               12.2                5.5
3.................................               15.1               10.7
4.................................               18.4               13.3
5.................................               19.6               15.5
------------------------------------------------------------------------


 Table VII.24--Net national change in indirect employment for IRL, jobs
                                 in 2042
------------------------------------------------------------------------
                                         Net national change in jobs
                                                 (thousands)
                                   -------------------------------------
       Trial standard level              Existing           Emerging
                                      technologies,      technologies,
                                       shift, R-CFL     roll-up, BR lamp
                                       substitution       substitution
------------------------------------------------------------------------
1.................................                1.7                0.7
2.................................                4.3                2.5
3.................................                6.9                4.8
4.................................                9.5                6.0
5.................................               10.4                6.8
------------------------------------------------------------------------

4. Impact on Utility or Performance of Products
    As indicated in sections IV.D.d and VI.B.4 of the April 2009 NOPR, 
DOE has concluded that TSLs it considered for GSFL and IRL would not 
lessen the utility or performance of any GSFL or IRL covered by this 
rulemaking. 74 FR 16920, 17009 (April 13, 2009)
5. Impact of Any Lessening of Competition
    As discussed in the April 2009 NOPR, 74 FR 16920, 16936, 17009 
(April 13, 2009), and in section IV.D.e of this preamble, DOE considers 
any lessening

[[Page 34160]]

of competition likely to result from standards; the Attorney General 
determines the impact, if any, of any such lessening of competition.
    The DOJ concluded that the GSFL standards contained in the proposed 
rule would not likely lead to a lessening of competition. DOJ has not 
determined the impact on competition of more stringent standards than 
those proposed in the April 2009 NOPR (DOJ, No. 77 at p. 1). Although 
DOJ did not evaluate the impacts on competition of TSL 4 for GSFL, DOE 
believes that TSL 4 does not raise competitive issues. For all product 
classes analyzed DOE found that all manufacturers offered product at 
TSL 4. Further, the product modifications needed to reach TSL 4 involve 
the use of more efficient phosphor blends which do not entail 
proprietary barriers.
    For IRL, DOJ concluded that the proposed TSL 4 could adversely 
affect competition. IRL standards proposed in the April 2009 NOPR would 
increase the minimum efficiency levels to the second highest level 
under consideration in this rulemaking. DOJ commented that the IRL 
market is highly concentrated, with three domestic manufacturers. Based 
on its review, DOJ stated that it appears that only two of the large 
manufacturers identified may currently manufacture IRLs that would meet 
the new standard and that these firms produce only limited quantities 
of such products for high-end applications. The current producers may 
not have the capacity to meet demand. In addition, one of these 
manufacturers uses proprietary technology currently unavailable to 
other manufacturers. Given the capital investments new entrants or 
providers would be required to make, and the potential that 
manufacturers may have to obtain proprietary technology, there is a 
risk that one or more IRL manufacturers will not produce products that 
meet the proposed standard. Note also that the National Impact Analysis 
does not consider the possibility of lessened competition effects, and 
so, depending on their magnitude, such effects may negatively impact 
the Net Present Value of the standards. DOJ requested that DOE consider 
the possibility of new technology in this area as it settles on 
standards in this field. (DOJ, No. 77 at pp. 1-2)
    DOE agrees with DOJ that the IRL market is highly concentrated, 
with three major manufacturers supplying the vast majority of the U.S. 
market. However, for the April 2009 NOPR, DOE stated that all 
manufacturers produced at least one lamp that met TSL 4, even though 
one manufacturer did not produce a full line of product at this 
efficacy. 74 FR 16920, 17003 (April 13, 2009).
    In the NOPR, DOE indicated that it believed manufacturers could 
maintain production capacity levels and continue to meet market demand 
at the proposed IRL standard (TSL 4). DOE noted that the current volume 
of these improved HIR lamps is many times lower than the volume of 
standard halogen lamps for all three major manufacturers. DOE used 
market research and analysis of HIR capsule production, and interviews 
with manufacturers of lamps and suppliers of HIR capsules and coating 
decks to analyze if manufacturers of IRL would be able to supply the 
market if lamp manufacturers outsourced all or part of their capsule 
production. In the NOPR, DOE stated it did not believe there would be a 
capacity constraint at the proposed standard level. DOE stated that 
manufacturers could install additional coaters, purchase infrared 
burners from a supplier, and use existing excess capacity. All these 
stated options would allow IRL manufacturers to maintain production 
capacity levels and continue to meet market demand for all IRL standard 
levels. 74 FR 16920, 17004 (April 13, 2009).
    For today's final rule, DOE did not receive comments that indicated 
that the energy conservation standards would result in the 
unavailability of standards-compliant products. DOE did receive 
comments about the potential for a short-term market disruption. One 
major manufacturer requested additional time in between the 
announcement and effective date to allow more time to stabilize 
improved HIR manufacturing before the regulation mandates the improved 
technology. (OSI, No. 84 at p. 1) Another major manufacturer responded 
to April 2009 NOPR by commenting that TSL 4 allows the continued 
manufacture and sale of energy efficient products to the market and 
that these products have also been proven manufacturable by at least 
two major lighting companies. (Philips, No. 75 at p. 1) In its 
individual comment, the third major manufacturer did not comment on its 
intention to make the required capital investments. DOE believes that 
this manufacturer will not have difficulty supplying at least part of 
the market at the proposed standards because this manufacturer 
currently has a full line of products at both TSL 4 and TSL 5. Although 
DOE received comments that there could be a constrained market, other 
comments suggest that this constraint will at worst be a short-term 
problem. However, since all three large manufacturers currently 
manufacture product at the efficacies required by today's final rule, a 
short-term constraint would not be a competitive issue.
    DOE does not believe manufacturers will have to obtain proprietary 
technology to meet the energy conservation standards set forth by 
today's rule. As stated in section VI.B.2, all major manufacturers have 
access to alternative technology pathways to meet TSL 4 without the use 
of proprietary technology. In the April 2009 NOPR, DOE stated that all 
major manufacturers produce two or more lamps that exceed TSL 4, some 
of which are not dependent on proprietary technology. DOE listed 
alternative technologies to meet TSL 4 including other non-patented 
types of improved reflectors and higher-efficiency IR coatings. 74 FR 
16920, 16945 (April 13, 2009). DOE did not receive additional 
information or comments that would indicate that the identified 
alternative technologies necessary to meet energy conservation 
standards set forth by today's final rule will lead to any lessening of 
competition. Section VI.B of today's final rule further discusses 
alternative technology pathways and proprietary technology.
    The Attorney General's response is reprinted at the end of today's 
rulemaking.
6. Need of the Nation To Conserve Energy
    Improving the energy efficiency of GSFL and IRL, where economically 
justified, would likely improve the security of the Nation's energy 
system by reducing overall demand for energy, thus reducing the 
Nation's reliance on foreign sources of energy. Reduced demand might 
also improve the reliability of the electricity system, particularly 
during peak-load periods. As a measure of this reduced demand, DOE 
expects the energy savings from the adopted standards to eliminate the 
need for approximately 1.8 to 6.2 gigawatts (GW) of generating capacity 
for GFSL and up to 200 to 1,100 megawatts (MW) for IRL by 2042.
    Enhanced energy efficiency also produces environmental benefits in 
the form of reduced emissions of air pollutants and greenhouse gases 
associated with energy production. Table VII.25 and Table VII.26 
provide DOE's estimate of cumulative CO2, NOX, 
and Hg emissions reductions that would result from the TSLs considered 
in this rulemaking. The expected energy savings from these GSFL and IRL 
standards may also reduce the cost of maintaining nationwide emissions 
standards and constraints. In the environmental assessment (EA; chapter

[[Page 34161]]

16 of the TSD accompanying this notice), DOE reports estimated annual 
changes in CO2, NOX, and Hg emissions 
attributable to each TSL.

                                                 Table VII.25--Summary of Emissions Reductions for GSFL
                                               [Cumulative reductions for products sold from 2012 to 2042]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                               TSL1            TSL2            TSL3            TSL4            TSL5
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                (i) Existing Technologies, Shift, High Lighting Expertise
--------------------------------------------------------------------------------------------------------------------------------------------------------
CO2 (MMT)..................................  ...........................           130.3           133.9           296.6           487.6           552.0
NOX (kt)...................................  ...........................            11.7            10.0            17.0            36.8            58.1
Hg (t).....................................  low........................             0.0             0.0             0.0             0.0             0.0
Hg (t).....................................  high.......................             2.0             2.4             4.8             7.3             8.8
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                         Emerging Technologies, Roll Up, Market Segment Based Lighting Expertise
--------------------------------------------------------------------------------------------------------------------------------------------------------
CO2 (MMT)..................................  ...........................            66.4            86.0           148.3           174.6           262.0
NOX (kt)...................................  ...........................             1.9             5.1             7.3            11.0            12.9
Hg (t).....................................  low........................             0.0             0.0             0.0             0.0             0.0
Hg (t).....................................  high.......................             1.2             1.4             2.3             2.8             4.0
--------------------------------------------------------------------------------------------------------------------------------------------------------


                                                  Table VII.26--Summary of Emissions Reductions for IRL
                                              [(Cumulative reductions for products sold from 2012 to 2042)]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                               TSL1            TSL2            TSL3            TSL4            TSL5
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                    Existing Technologies, Shift, R-CFL Substitution
--------------------------------------------------------------------------------------------------------------------------------------------------------
CO2 (MMT)..................................  ...........................            19.8            48.9            85.1           105.7           118.1
NOX (kt)...................................  ...........................             1.9             5.5             7.6             8.4             9.3
Hg (t).....................................  low........................             0.0             0.0             0.0             0.0             0.0
Hg (t).....................................  high.......................             0.3             0.7             1.3             1.7             1.8
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                  Emerging Technologies, Roll Up, BR Lamp Substitution
--------------------------------------------------------------------------------------------------------------------------------------------------------
CO2 (MMT)..................................  ...........................             7.5            19.1            37.8            44.0            53.3
NOX (kt)...................................  ...........................             1.3             3.2             5.4             6.4             8.1
Hg (t).....................................  low........................             0.0             0.0             0.0             0.0             0.0
Hg (t).....................................  high.......................             0.1             0.3             0.6             0.7             0.8
--------------------------------------------------------------------------------------------------------------------------------------------------------
MMt = million metric tons.
kt = thousand metric tons.
t = metric tons.
Note: The derivation for the emission ranges are described below.

    As discussed in section IV.I of this final rule, DOE does not 
report SO2 emissions reductions from power plants because 
reductions from an energy conservation standard would not affect the 
overall level of SO2 emissions in the United States due to 
the emissions caps for SO2.
    NOX emissions from 28 eastern States and the District of 
Columbia (DC) are limited under the Clean Air Interstate Rule (CAIR), 
published in the Federal Register on May 12, 2005.\67\ Although CAIR 
has been remanded to EPA by the D.C. Circuit, it will remain in effect 
until it is replaced by a rule consistent with the Court's December 23, 
2008, opinion in North Carolina v. EPA.\68\ Because all States covered 
by CAIR opted to reduce NOX emissions through participation 
in cap-and-trade programs for electric generating units, emissions from 
these sources are capped across the CAIR region.
---------------------------------------------------------------------------

    \67\ 70 FR 25162 (May 12, 2005).
    \68\ North Carolina v. EPA, 550 F.3d 1176 (DC Cir. 2008).
---------------------------------------------------------------------------

    For the 28 eastern States and D.C. where CAIR is in effect, no 
NOX emissions reductions will occur due to the permanent 
cap. Under caps, physical emissions reductions in those States would 
not result from the energy conservation standards under consideration 
by DOE, but standards might have produced an environmentally related 
economic impact in the form of lower prices for emissions allowance 
credits, if they were large enough. However, DOE determined that in the 
present case, such standards would not produce an environmentally 
related economic impact in the form of lower prices for emissions 
allowance credits, because the estimated reduction in NOX 
emissions or the corresponding allowance credits in States covered by 
the CAIR cap would be too small to affect allowance prices for 
NOX under the CAIR. In contrast, new or amended energy 
conservation standards would reduce NOX emissions in those 
22 States that are not affected by CAIR. As a result, the NEMS-BT does 
forecast emission reductions from the proposed amended standards 
considered in today's final rule.
    In the April 2009 NOPR, however, DOE provided a different estimate 
of NOX reductions because DOE assumed that the CAIR rule had 
been vacated. This is because the CAIR rule was vacated by the U.S. 
Court of Appeals for the District of Columbia Circuit (DC Circuit) in 
its July 11, 2008 decision in North Carolina v. Environmental 
Protection Agency.\69\ Although the D.C. Circuit, in a December 23, 
2008, opinion,\70\ decided to allow the CAIR rule to remain in effect 
until it is replaced by a rule consistent with the

[[Page 34162]]

court's earlier opinion, DOE retained its analysis of NOX 
emissions reductions based on an assumption that the CAIR rule was not 
in effect because: (1) The NOPR rulemaking was sufficiently advanced at 
the time that the December 23, 2008, opinion was issued that revisiting 
the analysis would have caused undue delays; and (2) neither the July 
11, 2008, nor the December 23, 2008, decisions of the D.C. Circuit 
changed the standard-setting proposals offered in the NOPR.
---------------------------------------------------------------------------

    \69\ 531 F.3d 896 (D.C. Cir. 2008).
    \70\ See North Carolina v. EPA, 550 F.3d 1176 (DC Cir. 2008).
---------------------------------------------------------------------------

    Thus, for the April 2009 NOPR, DOE established a range of 
NOX reductions based on low and high emission rates (in 
metric kilotons of NOX emitted per terawatt-hour (TWh) of 
electricity generated) derived from the AEO2008. DOE anticipated that, 
in the absence of the CAIR Rule's trading program, the new or amended 
conservation standards would reduce NOX emissions nationwide 
not just in 22 statues.
    As noted in section IV.I, DOE was able to estimate the changes in 
Hg emissions associated with an energy conservation standard as 
follows. DOE notes that the NEMS-BT model used for the NOPR, used as an 
integral part of today's rulemaking, does not estimate Hg emission 
reductions due to new energy conservation standards, as it assumed that 
Hg emissions would be subject to EPA's CAMR.\71\ CAMR would have 
permanently capped emissions of mercury for new and existing coal-fired 
plants in all States by 2010. As with SO2 and 
NOX, DOE assumed that under such a system, energy 
conservation standards would have resulted in no physical effect on 
these emissions, but might have resulted in an environmentally related 
economic benefit in the form of a lower price for emissions allowance 
credits if those credits were large enough. DOE estimated that the 
change in the Hg emissions from energy conservation standards would not 
be large enough to influence allowance prices under CAMR.
---------------------------------------------------------------------------

    \71\ 70 FR 28606 (May 18, 2005).
---------------------------------------------------------------------------

    On February 8, 2008, the DC Circuit issued its decision in New 
Jersey v. Environmental Protection Agency \72\ to vacate CAMR. In light 
of this development and because the NEMS-BT model could not be used to 
directly calculate Hg emission reductions, DOE used the Hg emission 
rates discussed below to calculate emissions reductions in the NOPR. 
This same methodology is used for the Final Rule as well due to the 
continued fluid environment ``* * * with many States planning to enact 
new laws or make existing laws more stringent.'' \73\ The NEMS-BT has 
only rough estimates of mercury emissions, and it was felt that the 
range of emissions used in the NOPR remain appropriate given these 
circumstances.
---------------------------------------------------------------------------

    \72\ 517 F.3d 574 (DC Cir. 2008).
    \73\ Energy Information Administration, Annual Energy Outlook 
2009 (March 2009), page 18.
---------------------------------------------------------------------------

    Therefore, rather than using the NEMS-BT model, DOE established a 
range of Hg rates to estimate the Hg emissions that could be reduced 
through standards. DOE's low estimate assumed that future standards 
would displace electrical generation only from natural gas-fired power 
plants, thereby resulting in an effective emission rate of zero. (Under 
this scenario, coal-fired power plant generation would remain 
unaffected.) The low-end emission rate is zero because natural gas-
fired power plants have virtually zero Hg emissions associated with 
their operation. Earthjustice stated that basing the low end of the 
range on the displacement of only gas-fired power plants was 
inconsistent with DOE's utility impact analysis (Earthjustice, No. 60 
at pg. 8-9). DOE believes that the estimate should provide the full 
range of possible outcomes and has selected the low and high values to 
bracket the uncertainties associated with estimating mercury emission 
reductions.
    DOE's high estimate, which assumed that standards would displace 
only coal-fired power plants, was based on an estimate of the 2006 
nationwide mercury emission rate from AEO2008. (Under this scenario, 
DOE assumed that gas-fired power plant generation would remain 
unaffected and that no future reductions in the rate of mercury 
emissions from such sources would occur.) Because power plant emission 
rates are a function of local regulation, scrubbers, and the mercury 
content of coal, it is extremely difficult to identify a precise high-
end emission rate. Therefore, the most reasonable high estimate is 
based on the assumption that all displaced coal generation would have 
been emitting at the 2006 average emission rate for coal generation as 
specified by the April Update to AEO2009. This is viewed as a high 
estimate because it is likely that future emission controls will be 
installed at coal-fired power plants which will reduce their average 
emission rate. As noted previously, because virtually all mercury 
emitted from electricity generation is from coal-fired power plants, 
DOE based the emission rate on the tons of mercury emitted per TWh of 
coal-generated electricity. Based on the emission rate for 2006, DOE 
derived a high-end emission rate of 0.0255 tons per TWh. To estimate 
the reduction in mercury emissions, DOE multiplied the emission rate by 
the reduction in coal-generated electricity due to the standards 
considered in the utility impact analysis. These changes in Hg 
emissions are small, ranging from 0.2 to 1.0 percent of the national 
base-case emissions forecast by NEMS-BT for GFSL, depending on the TSL 
and scenario, and less than 0.2 percent for all IRL levels.
    In the April 2009 NOPR, DOE considered accounting for a monetary 
benefit of CO2 emission reductions associated with 
standards. To put the potential monetary benefits from reduced 
CO2 emissions into a form that would likely be most useful 
to decision makers and interested parties, DOE used the same methods it 
used to calculate the net present value of consumer cost savings. DOE 
converted the estimated yearly reductions in CO2 emissions 
into monetary values that represented the present value, in that year, 
of future benefits resulting from that reduction in emissions, which 
were then discounted from that year to the present using both 3-percent 
and 7-percent discount rates.
    In the April 2009 NOPR, DOE proposed to use the range $0 to $20 per 
ton for the year 2007 in 2007$. 74 FR 16920, 17012 (April 13, 2009). 
These estimates were originally derived to represent the lower and 
upper bounds of the costs and benefits likely to be experienced in the 
United States. The lower bound was based on an assumption of no benefit 
and the upper bound was based on an estimate of the mean value of 
worldwide impacts due to climate change that was reported by the 
Intergovernmental Panel on Climate Change (IPCC).\74\ DOE expected that 
such domestic values would be 10% or less of comparable global values; 
however, there were no consensus estimates for the U.S. benefits likely 
to

[[Page 34163]]

result from CO2 emission reductions. Because U.S.-specific 
estimates were unavailable, DOE used the global mean value as an upper 
bound U.S. value.
---------------------------------------------------------------------------

    \74\ During the preparation of its review of the state of 
climate science, the IPCC identified various estimates of the 
present value of reducing CO2 emissions by 1 ton over the 
life that these emissions would remain in the atmosphere. The 
estimates reviewed by the IPCC spanned a range of values. Absent a 
consensus on any single estimate of the monetary value of 
CO2 emissions, DOE used the estimates identified by the 
study cited in ``Summary for Policymakers,'' prepared by Working 
Group II of the IPCC's ``Fourth Assessment Report,'' to estimate the 
potential monetary value of CO2 reductions likely to 
result from standards considered in this rulemaking. According to 
IPCC, the mean social cost of carbon (SCC) reported in studies 
published in peer-reviewed journals was $43 per ton of carbon. This 
translates into about $12 per ton of CO2. The literature 
review (Tol 2005) from which this mean was derived did not report 
the year in which these dollars were denominated. However, DOE 
understands this estimate was for the year 1995 denominated in 
1995$. Updating that estimate to 2007$ yields a SCC for the year 
1995 of $15 per ton of CO2.
---------------------------------------------------------------------------

    Given the uncertainty surrounding estimates of the social cost of 
carbon, DOE previously concluded that relying on any single estimate 
may be inadvisable because that estimate will depend on many 
assumptions. Working Group II's contribution to the ``Fourth Assessment 
Report'' of the IPCC notes the following:

    The large ranges of SCC are due in the large part to differences 
in assumptions regarding climate sensitivity, response lags, the 
treatment of risk and equity, economic and non-economic impacts, the 
inclusion of potentially catastrophic losses, and discount 
rates.\75\
---------------------------------------------------------------------------

    \75\ ``Climate Change 2007--Impacts, Adaptation and 
Vulnerability.'' Contribution of Working Group II to the ``Fourth 
Assessment Report'' of the IPCC, 17. Available at www.ipcc.ch/
ipccreports/ar4-wg2.htm (last accessed Aug. 7, 2008).

    Because of this uncertainty, DOE used the SCC value from Tol 
(2005), which was presented in the IPCC's ``Fourth Assessment Report'' 
and provided a comprehensive meta-analysis of estimates for the value 
of SCC. 74 FR 16920, 17012 (April 13, 2009).
    NRDC and Earthjustice and NY et al. commented that DOE should use 
global, rather than U.S. based estimates for CO2 values 
(NRDC, Issue Paper, No. 82 at p. 13 and NY et al., Attachment, No. 88 
at p. 3). NY et al. recommended DOE use $80 per short ton 
CO2 ($88 metric) in 2009$ based on recent meta-analysis of 
GHG abatement cost analyses published by international agencies and 
multinational consultancies. NY et al., also criticized the range of 
CO2 values used in the NOPR and recommended the use of a 
long-run marginal abatement cost of CO2 for monetizing 
CO2 emission reductions, rather than the damage costs given 
the highly uncertain nature of the latter (NY et al., No. 88, p. 9-10).
    DOE continues to use SCC values in today's final rule. DOE has not 
adopted using an abatement cost because the actual costs of reducing 
CO2 emissions are highly variable. They range from negative 
costs, such as energy efficiency improvement measures that produce net 
economic benefits, to hundreds of dollars per ton of CO2, 
such as emission reductions that might require the early abandonment of 
large capital investments in power plants, industrial facilities or 
buildings. In order to identify a specific marginal cost per ton of 
CO2 reduced usually requires the establishment of key 
parameters, such as the scope of the emissions covered, the quantity of 
emission reductions to be achieved and the timeframe for the 
achievement of these reductions. These parameters must be determined 
through legislative or regulatory processes. Moreover, the use of SCC 
is consistent with the IPCC Fourth Assessment Report. However, if a 
nationwide regulatory mandate is established to limit or reduce U.S. 
greenhouse gas emissions, the marginal costs of reducing emissions that 
are imposed by such a mandate might be the basis for valuing such 
emission reductions in the future.
    For today's final rule, DOE is relying on an updated range of 
values consistent with that presented in the Model Year 2011 fuel 
economy standard final rule issued by the National Highway Traffic 
Safety Administration (NHTSA): $2, $33 and $80 per ton. In the MY 2011 
fuel economy standard final rule, NHTSA relied on a range of estimates 
representing the uncertainty surrounding global values of the SCC, 
while also encompassing, at the low end, possible domestic values. 
These three values encompass much of the variability in the estimates 
of the global value of the SCC. The lower end of this range, $2, also 
approximates possible mean value for domestic benefits. The middle of 
the range, $33, is equal to the mean value in Tol (2008) and the high 
end of the range, $80, represents one standard deviation above the mean 
global value. 74 FR 14196, 14346 (March 30, 2009).
    The global value of $33 is based on Tol's (2008) expanded and 
updated survey of 211 estimates of the global SCC.\76\ Tol's 2008 
survey encompasses a larger number of estimates for the global value of 
reducing carbon emissions than its previously-published counterpart, 
Tol (2005), and continues to represent the only recent, publicly-
available compendium of peer-reviewed estimates of the SCC that has 
itself been peer-reviewed and published.
---------------------------------------------------------------------------

    \76\ Richard S.J. Tol (2008), The social cost of carbon: Trends, 
outliers, and catastrophes, Economics--the Open-Access, Open-
Assessment E-Journal, 2 (25), 1-24.
---------------------------------------------------------------------------

    The domestic value ($2) was developed by NHTSA by using the mean 
estimate of the global value of reduced economic damages from climate 
change resulting from reducing CO2 emissions as a starting 
point; estimating the fraction of the reduction in global damages that 
is likely to be experienced within the U.S.; and applying this fraction 
to the mean estimate of global benefits from reducing emissions to 
obtain an estimate of the U.S. domestic benefits from lower GHG 
emissions. NHTSA constructed the estimate of the U.S. domestic benefits 
from reducing CO2 emissions using estimates of U.S. domestic 
and global benefits from reducing greenhouse gas emissions developed by 
EPA and reported in EPA's Technical Support Document accompanying its 
advance notice of proposed rulemaking on motor vehicle CO2 
emissions.\77\
---------------------------------------------------------------------------

    \77\ U.S. EPA, Technical Support Document on Benefits of 
Reducing GHG Emissions, June 12, 2008.
---------------------------------------------------------------------------

    A complete discussion of NHTSA's analysis is available in Chapter 
VIII of the Final Regulatory Analysis of the Corporate Average Fuel 
Economy for MY 2011 Passenger Cars and Light Trucks (NHTSA, March 
2009).
    After considering comments and the currently available information 
and analysis, which was reflected in the approach employed by NHTSA, 
DOE concluded that it was appropriate to consider the global benefits 
of reducing CO2 emissions, as well as the domestic benefits. 
Consequently, DOE considered in its decision-process for this final 
rule the potential benefits resulting from reduced CO2 
emissions valued at $2, $33 and $80. The resulting range is based on 
current peer-reviewed estimates of the value of SCC and, DOE believes, 
fairly represents the uncertainty surrounding the global benefits 
resulting from reduced CO2 emissions and, at the $2 level, 
also encompasses the likely domestic benefits, DOE also concluded, 
based on the most recent Tol analysis, that it was appropriate to 
escalate these values at 3% \78\ per year to represent the expected 
increases, over time, of the benefits associated with reducing 
CO2 and other greenhouse gas emissions.
---------------------------------------------------------------------------

    \78\ Estimates of SCC are assumed to increase over time since 
future emissions are expected to produce larger incremental damages 
as physical and economic systems become more stressed as the 
magnitude of climate change increases. Although most studies that 
estimate economic damages caused by increased GHG emissions in 
future years produce an implied growth rate in the SCC, neither the 
rate itself nor the information necessary to derive its implied 
value is commonly reported. Given the limited amount of debate thus 
far about the appropriate growth rate of the SCC, applying a rate of 
3%/yr seems appropriate at this stage. This value is consistent with 
the range recommended by IPCC (2007).
---------------------------------------------------------------------------

    The tables below present the resulting estimates of the potential 
range of net present value benefits associated with reducing 
CO2 emissions.

[[Page 34164]]



   Table VII.27--Estimates of Value of CO2 Emissions Reductions for GSFL Under Trial Standard Levels at Seven-Percent and Three-Percent Discount Rates
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                  Value of estimated CO2 emission reductions (billion      Value of estimated CO2 emission reductions
                                   Estimated                  2008$) at 7% discount rate                      (billion 2008$) at 3% discount rate
          GSFL  TSL             cumulative CO2  --------------------------------------------------------------------------------------------------------
                                (MMt) emission   CO2 value of $2/  CO2 value of $33/ CO2 value of $80/ CO2 value of $2/   CO2 value of     CO2 value of
                                  reductions          ton CO2           ton CO2           ton CO2          ton CO2        $33/ton CO2      $80/ton CO2
--------------------------------------------------------------------------------------------------------------------------------------------------------
1............................  66 to 130.......  0.1 to 0.1......  1.1 to 2.1......  2.6 to 5.1......  0.1 to 0.3.....  2.3 to 4.5.....  5.6 to 10.9.
2............................  86 to 134.......  0.1 to 0.1......  1.5 to 2.2......  3.6 to 5.3......  0.2 to 0.3.....  3.0 to 4.6.....  7.2 to 11.2.
3............................  148 to 297......  0.2 to 0.3......  2.5 to 4.9......  6.1 to 11.9.....  0.3 to 0.6.....  5.1 to 10.3....  12.5 to 24.9.
4............................  175 to 488......  0.2 to 0.5......  3.1 to 8.4......  7.5 to 20.4.....  0.4 to 1.0.....  6.0 to 16.9....  14.7 to 40.9.
5............................  262 to 552......  0.3 to 0.6......  4.6 to 9.6......  11.1 to 23.4....  0.6 to 1.2.....  9.1 to 19.1....  22.0 to 46.4.
--------------------------------------------------------------------------------------------------------------------------------------------------------


   Table VII.28--Estimates of Value of CO2 Emissions Reductions for IRL Under Trial Standard Levels at Seven-Percent and Three-Percent Discount Rates
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                  Value of estimated CO2 emission reductions (billion      Value of estimated CO2 emission reductions
                                   Estimated                  2008$) at 7% discount rate                      (billion 2008$) at 3% discount rate
           IRL TSL              cumulative CO2  --------------------------------------------------------------------------------------------------------
                                (MMt) emission   CO2 value of $2/  CO2 value of $33/ CO2 value of $80/ CO2 value of $2/   CO2 value of     CO2 value of
                                  reductions          ton CO2           ton CO2           ton CO2          ton CO2        $33/ton CO2      $80/ton CO2
--------------------------------------------------------------------------------------------------------------------------------------------------------
1............................  7 to 20.........  0.0 to 0.0......  0.1 to 0.3......  0.3 to 0.8......  0.0 to 0.0.....  0.3 to 0.7.....  0.6 to 1.7.
2............................  19 to 49........  0.0 to 0.1......  0.4 to 0.8......  0.8 to 2.1......  0.0 to 0.1.....  0.7 to 1.7.....  1.6 to 4.1.
3............................  38 to 85........  0.0 to 0.1......  0.7 to 1.5......  1.7 to 3.6......  0.1 to 0.2.....  1.3 to 2.9.....  3.2 to 7.1.
4............................  44 to 106.......  0.0 to 0.1......  0.8 to 1.8......  1.9 to 4.4......  0.1 to 0.2.....  1.5 to 3.7.....  3.7 to 8.9.
5............................  53 to 118.......  0.1 to 0.1......  1.0 to 2.0......  2.3 to 4.9......  0.1 to 0.2.....  1.8 to 4.1.....  4.5 to 9.9.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    DOE is well aware that scientific and economic knowledge about the 
contribution of CO2 and other green house gas emissions 
(GHG) 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 likely change.
    The Department of Energy, together with other Federal agencies, is 
reviewing various methodologies for estimating the monetary value of 
reductions in CO2 and other greenhouse gas emissions. This 
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, such as whether the appropriate 
values should represent domestic U.S. benefits, as well as global 
benefits (and costs). Given the complexity of the many issues involved, 
this review is ongoing. However, consistent with DOE's legal 
obligations, and taking into account the uncertainty involved with this 
particular issue, DOE has included in this final rule the most recent 
values and analyses employed in a rulemaking by another Federal agency.
    DOE also investigated the potential monetary benefit of reduced 
SO2, NOX, and Hg emissions from the TSLs it 
considered. As previously stated, DOE's initial analysis assumed the 
presence of nationwide emission caps on SO2 and Hg, and caps 
on NOX emissions in the 28 States covered by CAIR. In the 
presence of these caps, DOE concluded that no physical reductions in 
power sector emissions would occur, but that the standards could put 
downward pressure on the prices of emissions allowances in cap-and-
trade markets. Estimating this effect is very difficult because of 
factors such as credit banking, which can change the trajectory of 
prices. DOE has concluded that the effect from energy conservation 
standards on SO2 allowance prices is likely to be negligible 
based on runs of the NEMS-BT model. See chapter 16 of the TSD 
accompanying this notice for further details.
    Because the courts have decided to allow the CAIR rule to remain in 
effect, projected annual NOX allowances from NEMS-BT are 
relevant.\79\ As noted above, standards would not produce an economic 
impact in the form of lower prices for emissions allowance credits in 
the 28 eastern States and D.C. covered by the CAIR cap. New or amended 
energy conservation standards would reduce NOX emissions in 
those 22 States that are not affected by CAIR. For the area of the 
United States not covered by CAIR, DOE estimated the monetized value of 
NOX emissions reductions resulting from each of the TSLs 
considered for today's final rule based on environmental damage 
estimates from the literature. Available estimates suggest a very wide 
range of monetary values for NOX emissions, ranging from 
$370 per ton to $3,800 per ton of NOX from stationary 
sources, measured in 2001$ (equivalent to a range of $432 per ton to 
$4,441 per ton in 2007$).\80\
---------------------------------------------------------------------------

    \79\ The Update to the AEO2009 based version of NEMS-BT includes 
the representation of CAIR.
    \80\ 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 (2006).
---------------------------------------------------------------------------

    For Hg emissions reductions, DOE estimated the national monetized 
values resulting from the TSLs considered for today's rule based on 
environmental damage estimates from the literature. DOE conducted 
research for today's final rule and determined that the impact of 
mercury emissions from power plants on humans is considered highly 
uncertain. However, DOE identified two estimates of the environmental 
damage of mercury based on two estimates of the adverse impact of 
childhood exposure to methyl mercury on IQ for American children, and 
subsequent loss of lifetime economic productivity resulting from these 
IQ losses. The high-end estimate is based on an estimate of the current 
aggregate cost of the loss of IQ in American children that results from 
exposure to mercury of U.S. power plant origin ($1.3 billion per year 
in year 2000$), which works out to $32.6 million per ton emitted per 
year

[[Page 34165]]

(2007$).\81\ The low-end estimate is $0.66 million per ton emitted (in 
2004$) or $0.729 million per ton (in 2007)$. DOE derived this estimate 
from a published evaluation of mercury control using different methods 
and assumptions from the first study, but also based on the present 
value of the lifetime earnings of children exposed.\82\ Table VI.28 and 
Table VI.29 present the resulting estimates of the potential range of 
present value benefits associated with reduced national NOX 
and Hg emissions from the TSLs DOE considered.
---------------------------------------------------------------------------

    \81\ Trasande, L., et al., ``Applying Cost Analyses to Drive 
Policy that Protects Children,'' 1076 Ann. N.Y. Acad. Sci. 911 
(2006).
    \82\ Ted Gayer and Robert Hahn, ``Designing Environmental 
Policy: Lessons from the Regulation of Mercury Emissions,'' 
Regulatory Analysis 05-01, AEI-Brookings Joint Center for Regulatory 
Studies, Washington, DC (2004). A version of this paper was 
published in the Journal of Regulatory Economics in 2006. The 
estimate was derived by back-calculating the annual benefits per ton 
from the net present value of benefits reported in the study.

                    Table VII.29--Estimates of Savings From NOX Emissions Reductions for GSFL
----------------------------------------------------------------------------------------------------------------
                                                                 Value of estimated NOX   Value of estimated NOX
                                         Estimated cumulative     emission reductions      emission reductions
                 TSL                      NOX (kt) emission      (million 2008$) at 7%    (million 2008$) at 3%
                                              reductions             discount rate            discount rate
----------------------------------------------------------------------------------------------------------------
1....................................  1.9 to 11.7............  $0.7 to $23.8..........  $0.8 to $34.5.
2....................................  5.1 to 10.0............  $1.5 to $21.9..........  $1.9 to $30.4.
3....................................  7.3 to 17.0............  $2.2 to $41.1..........  $2.7 to $54.7.
4....................................  11.0 to 36.8...........  $4.2 to $107.2.........  $4.6 to $132.4.
5....................................  12.9 to 58.1...........  $5.0 to $125.6.........  $5.5 to $173.9.
----------------------------------------------------------------------------------------------------------------


                    Table VII.30--Estimates of Savings From NOX Emissions Reductions for IRL
----------------------------------------------------------------------------------------------------------------
                                                                 Value of estimated NOX   Value of estimated NOX
                                         Estimated cumulative     emission reductions      emission reductions
                 TSL                      NOX (kt) emission      (million 2007$) at 7%    (million 2007$) at 3%
                                              reductions             discount rate            discount rate
----------------------------------------------------------------------------------------------------------------
1....................................  1.3 to 1.9.............  $0.3 to $4.6...........  $0.4 to $6.0.
2....................................  3.2 to 5.5.............  $0.8 to $13.8..........  $1.1 to $17.9.
3....................................  5.4 to 7.6.............  $1.5 to $19.7..........  $1.9 to $25.2.
4....................................  6.4 to 8.4.............  $1.8 to $24.4..........  $2.2 to $30.0.
5....................................  8.1 to 9.3.............  $2.2 to $27.0..........  $2.7 to $33.1.
----------------------------------------------------------------------------------------------------------------


                    Table VII.31--Estimates of Savings From Hg Emissions Reductions for GSFL
----------------------------------------------------------------------------------------------------------------
                                                                 Value of estimated Hg    Value of estimated Hg
                                       Estimated cumulative Hg    emission reductions      emission reductions
                 TSL                       (tons) emission       (million 2007$) at 7%    (million 2007$) at 3%
                                              reductions             discount rate            discount rate
----------------------------------------------------------------------------------------------------------------
1....................................  0.0 to 2.0.............  $0 to $16.5............  $0 to $32.7.
2....................................  0.0 to 2.4.............  $0 to $20.3............  $0 to $39.6.
3....................................  0.0 to 4.8.............  $0 to $41.4............  $0 to $80.2.
4....................................  0.0 to 7.3.............  $0 to $67.7............  $0 to $125.6.
5....................................  0.0 to 8.8.............  $0 to $84.5............  $0 to $154.4.
----------------------------------------------------------------------------------------------------------------


                     Table VII.32--Estimates of Savings From Hg Emissions Reductions for IRL
----------------------------------------------------------------------------------------------------------------
                                                                 Value of estimated Hg    Value of estimated Hg
                                       Estimated cumulative Hg    emission reductions      emission reductions
                 TSL                       (tons) emission       (million 2007$) at 7%    (million 2007$) at 3%
                                              reductions             discount rate            discount rate
----------------------------------------------------------------------------------------------------------------
1....................................  0.0 to 0.3.............  $0 to $2.7.............  $0 to $5.2.
2....................................  0.0 to 0.7.............  $0 to $6.7.............  $0 to $12.5.
3....................................  0.0 to 1.3.............  $0 to $11.7............  $0 to $22.1.
4....................................  0.0 to 1.7.............  $0 to $15.0............  $0 to $28.1.
5....................................  0.0 to 1.8.............  $0 to $16.0............  $0 to $30.2.
----------------------------------------------------------------------------------------------------------------

7. Other Factors
    EPCA allows the Secretary of Energy, in determining whether a 
standard is economically justified, to consider any other factors that 
the Secretary deems to be relevant. (42 U.S.C. 6295(o)(2)(B)(i)(VII) 
and 6316(e)(1)) In adopting today's standards, the Secretary considered 
the potential for GSFL and IRL standards to adversely affect low-income 
consumers, institutions of religious worship, historical facilities, 
institutions that serve low-income populations, and consumers of T12 
electronic ballasts.

D. Conclusion

    EPCA contains criteria for prescribing new or amended energy 
conservation standards. It provides that any such standard for GSFL and 
IRL must 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)) As stated above, 
in determining whether a standard is economically justified, the 
Secretary must determine whether the benefits of the standards exceed 
its burdens considering the seven factors discussed

[[Page 34166]]

in section IV.D. (42 U.S.C. 6295(o)(2)(B)(i)) A determination of 
whether a standard level is economically justified is not made based on 
any one of these factors in isolation. The Secretary must weigh each of 
these seven factors in total in determining whether a standard is 
economically justified. Further, the Secretary may not establish an 
amended standard if such standard would not result in ``significant 
conservation of energy,'' or ``is not technologically feasible or 
economically justified.'' (42 U.S.C. 6295(o)(3)(B))
    As discussed in section V.A.1, DOE established a separate set of 
TSLs for GSFL and for IRL. Therefore, DOE analyzed each lamp type (GSFL 
or IRL) separately when considering various TSLs and eventually 
proposing standards. The following discussion briefly explains the 
development of the TSLs, consideration of the TSLs (starting with the 
most stringent) under the statutory factors, and the conclusion as to 
the GSFL standards and IRL standards that most improve energy 
efficiency that DOE has determined would most improve energy-efficiency 
and would be technologically feasible and economically justified.
    For GSFL, DOE considered five TSLs in the April 2009 NOPR, with 
TSL5 being the most stringent level for which DOE performed full 
analyses. 74 FR 16920, 16979-82 (April 13, 2009). It is noted that DOE 
also considered the potential for a standard level beyond TSL5 that 
would require GSFL to use a higher-efficiency gas fill composition, 
which would have been the maximum technologically feasible level. 
Although more-efficient fill gases (often including higher molecular 
weight gases) are appropriate for and are currently used in some lamp 
applications, DOE is also aware employing this technology can cause 
lamp instability resulting in striations or flickering in some 
circumstances. DOE's research indicated that a potential standard level 
that would require the use of higher-efficiency fill gases would 
significantly reduce (or in some cases eliminate) the utility and 
performance of the covered GSFL. DOE concluded on this basis that a 
level with such an adverse impact on product utility would not be 
economically justified.\83\ (42 U.S.C. 6295(o)(2)(B)(i)(IV) and (3)(B)) 
Having made this determination, there was no need to perform additional 
analyses relevant to the other statutory criteria. (See section I.A.2 
for additional detail.) Consequently, TSL5 represents the most-
efficient level analyzed for GSFL.
---------------------------------------------------------------------------

    \83\ DOE notes that it did not eliminate higher-efficiency fill 
gases from further consideration as a technology under the screening 
analysis, because that technology may be appropriate for low-wattage 
lamp applications.
---------------------------------------------------------------------------

    For IRL, DOE's engineering analysis considered the maximum 
technologically feasible level, which would require the use of a silver 
reflector. However, this level utilized a proprietary technology that 
represents a unique pathway to achieving that efficiency level. 
Accordingly, DOE determined that such level was likely to have 
significant anti-competitive effects on the markets for such lamps and 
ultimately concluded that it is not economically justified. (42 U.S.C. 
6295(o)(3)(B)) Therefore, TSL5, which does not require installation of 
the proprietary silver reflector, represents the most efficient level 
analyzed for IRL. (See sections VI.B and VII.A.2 of this notice for 
more information on maximum technologically feasible levels and other 
efficacy levels DOE analyzed.)
    DOE then considered the impacts of standards at each trial standard 
level that was identified and analyzed, beginning with the most 
efficient level, to determine whether the given level was economically 
justified. DOE then considered less efficient levels until it reached 
the highest level that meets the key statutory criteria in terms of 
being technologically feasible, economically justified, and saving a 
significant amount of energy.
    DOE discusses the benefits and/or burdens of each trial standard 
level in the following sections. DOE bases its discussion on 
quantitative analytical results for each trial standard level 
(presented in section VII) such as national energy savings, net present 
value (discounted at 7 percent and 3 percent), emissions reductions, 
industry net present value, life-cycle cost, and consumers installed 
price increases. In addition to providing a summary of results, DOE 
discusses below the life-cycle cost and consumer installed price 
increase results for each product class and baseline, where 
appropriate. Beyond the quantitative results, DOE also considers other 
burdens and benefits that affect economic justification, including how 
the impacts of standards on competition, supply constraints, and lamp 
input prices may affect the economic benefits and burdens presented.
1. General Service Fluorescent Lamps Conclusion
    In addition to the results presented above, DOE also calculates the 
annualized benefits and costs of each TSL. The table below presents 
these values for GSFL.

                              Table VII.33--Annualized Benefits and Costs for GSFL
----------------------------------------------------------------------------------------------------------------
                                                  Primary estimate        Low estimate          High estimate
   TSL         Category             Unit       -----------------------------------------------------------------
                                                    7%         3%         7%         3%         7%         3%
----------------------------------------------------------------------------------------------------------------
1.......                                                 Benefits
         -------------------------------------------------------------------------------------------------------
          Annualized         2008$............     650        741        445        504        855        978
           Monetized
           ($millions/year).
         -------------------------------------------------------------------------------------------------------
          Annualized         CO2 (Mt).........       2.73       2.98       1.83       2.01       3.64       3.96
           Quantified.
                             NOX (kT).........       0.37       0.28       0.17       0.10       0.57       0.46
                             Hg (T)...........       0.02       0.03       0.00       0.00       0.05       0.06
         -------------------------------------------------------------------------------------------------------
                                                           Costs
         -------------------------------------------------------------------------------------------------------
          Annualized         2008$............     123         80        181        128         64         31
           Monetized
           ($millions/year).
         -------------------------------------------------------------------------------------------------------
                                                    Net Benefits/Costs
         -------------------------------------------------------------------------------------------------------
          Annualized         2008$............     527        661        264        375        791        946
           Monetized
           ($millions/year).
----------------------------------------------------------------------------------------------------------------

[[Page 34167]]

 
2.......                                                 Benefits
         -------------------------------------------------------------------------------------------------------
          Annualized         2008$............     761        842        586        633        936       1051
           Monetized
           ($millions/year).
         -------------------------------------------------------------------------------------------------------
          Annualized         CO2 (Mt).........       3.22       3.41       2.68       2.73       3.76       4.08
           Quantified.
                             NOX (kT).........       0.45       0.33       0.38       0.25       0.52       0.40
                             Hg (T)...........       0.03       0.04       0.00       0.00       0.07       0.07
         -------------------------------------------------------------------------------------------------------
                                                           Costs
         -------------------------------------------------------------------------------------------------------
          Annualized         2008$............     224        160        255        186        192        134
           Monetized
           ($millions/year).
         -------------------------------------------------------------------------------------------------------
                                                    Net Benefits/Costs
         -------------------------------------------------------------------------------------------------------
          Annualized         2008$............     537        683        330        448        744        918
           Monetized
           ($millions/year).
----------------------------------------------------------------------------------------------------------------
3.......                                                 Benefits
         -------------------------------------------------------------------------------------------------------
          Annualized         2008$............    1528       1663       1017       1089       2038       2237
           Monetized
           ($millions/year).
         -------------------------------------------------------------------------------------------------------
          Annualized         CO2 (Mt).........       6.50       6.89       4.51       4.67       8.49       9.11
           Quantified.
                             NOX (kT).........       0.76       0.55       0.55       0.37       0.98       0.73
                             Hg (T)...........       0.07       0.07       0.00       0.00       0.14       0.15
         -------------------------------------------------------------------------------------------------------
                                                           Costs
         -------------------------------------------------------------------------------------------------------
          Annualized         2008$............     577        484        522        417        633        550
           Monetized
           ($millions/year).
         -------------------------------------------------------------------------------------------------------
                                                    Net Benefits/Costs
         -------------------------------------------------------------------------------------------------------
          Annualized         2008$............     950       1179        495        671       1405       1688
           Monetized
           ($millions/year).
----------------------------------------------------------------------------------------------------------------
4.......                                                 Benefits
         -------------------------------------------------------------------------------------------------------
          Annualized         2008$............    2302       2420       1329       1387       3275       3452
           Monetized
           ($millions/year).
         -------------------------------------------------------------------------------------------------------
          Annualized         CO2 (Mt).........      10.48      10.60       5.76       5.69      15.20      15.52
           Quantified.
                             NOX (kT).........       1.78       1.19       1.03       0.63       2.54       1.76
                             Hg (T)...........       0.11       0.11       0.00       0.00       0.22       0.23
         -------------------------------------------------------------------------------------------------------
                                                           Costs
         -------------------------------------------------------------------------------------------------------
          Annualized         2008$............     582        425        378        230        786        621
           Monetized
           ($millions/year).
         -------------------------------------------------------------------------------------------------------
                                                    Net Benefits/Costs
         -------------------------------------------------------------------------------------------------------
          Annualized         2008$............    1720       1994        951       1158       2489       2831
           Monetized
           ($millions/year).
         -------------------------------------------------------------------------------------------------------
                                      Incremental Net Benefits/Costs Relative to TSL3
         -------------------------------------------------------------------------------------------------------
          Annualized         2008$............     770        815        456        487       1084       1143
           Monetized
           ($millions/year).
----------------------------------------------------------------------------------------------------------------
5.......                                                 Benefits
         -------------------------------------------------------------------------------------------------------
          Annualized         2008$............    2850       2988       1738       1811       3961       4165
           Monetized
           ($millions/year).
         -------------------------------------------------------------------------------------------------------
          Annualized         CO2 (Mt).........      12.95      13.07       8.33       8.41      17.57      17.73
           Quantified.
                             NOX (kT).........       2.10       1.53       1.21       0.75       2.98       2.31
                             Hg (T)...........       0.14       0.14       0.00       0.00       0.27       0.28
         -------------------------------------------------------------------------------------------------------
                                                           Costs
         -------------------------------------------------------------------------------------------------------
          Annualized         2009$............     911        737        783        613       1039        861
           Monetized
           ($millions/year).
         -------------------------------------------------------------------------------------------------------
                                                    Net Benefits/Costs
         -------------------------------------------------------------------------------------------------------
          Annualized         2009$............    1939       2251        955       1197       2922       3304
           Monetized
           ($millions/year).
         -------------------------------------------------------------------------------------------------------
                                      Incremental Net Benefits/Costs Relative to TSL4
         -------------------------------------------------------------------------------------------------------
          Annualized         2008$............     219        257          4         39        433       473
           Monetized
           ($millions/year).
----------------------------------------------------------------------------------------------------------------
Note: Annualized values are for the period from 2012 to 2042.


[[Page 34168]]

a. Trial Standard Level 5
    For GSFL, DOE first considered the most efficient level, TSL5, 
which would save an estimated total of 5.1 to 12.0 quads of energy 
through 2042--a significant amount of energy. For the Nation as a 
whole, TSL5 would have a net savings of $10.0 billion to $30.9 billion 
at a 7-percent discount rate and $22.6 billion to $62.6 billion at a 3-
percent discount rate. The emissions reductions at TSL5 are estimated 
at 262 to 552 MMt of CO2, 13 to 58 kt of NOX, up 
to 9 metric tons of Hg. Total generating capacity in 2042 is estimated 
to decrease compared to the reference case by 2.7 to 7.3 GW under TSL5. 
The monetized values of emissions reductions are estimated at $5.0 to 
$125.6 million for NOX and up to $84.5 million for Hg at a 
7-percent discount rate and $5.5 to $173.9 million for NOX 
and up to $154.4 million for Hg at a 3-percent discount rate. The 
estimated benefits of reducing CO2 emissions using the mid-
range of the CO2 value (using $33 per ton) is $4.6 to $9.6 
billion and $9.1 to $19.1 billion at 7-percent and 3-percent discount 
rates respectively. The full range of likely benefits of CO2 
emission reductions is $0.3 billion to $23.4 billion at a 7-percent 
discount rate and $0.6 billion to $46.4 billion at a 3-percent discount 
rate.
    The impacts on manufacturers at TSL5 result from the 
commoditization of high-efficacy lamps and the need to convert all T12 
lines to T8 lines, requiring a capital investment of $211 million. The 
projected change in industry value ranges from a decrease of $211 
million to an increase of $33 million. The extent of the industry 
impacts is driven primarily by how successful manufacturers will be in 
maintaining their current gross margins at near their current levels as 
efficient products become commoditized. Currently, manufacturers obtain 
higher margins for more-efficient products; therefore, to avoid the 
higher end of the anticipated impacts, manufacturers are likely to have 
to find new ways to differentiate GSFL to maintain full product lines. 
At TSL5, DOE recognizes the risk of very large negative impacts if the 
high end of the range of impacts is reached, resulting in a net loss of 
40 percent in INPV.
    At TSL5, DOE projects that most GSFL consumers would experience 
life-cycle cost savings. The following discussion summarizes the 
specific life-cycle cost impacts of TSL5 on the separate product 
classes and baseline lamps.
    Table VII.5 presents the findings of an LCC analysis on various 
three-lamp, 4-foot medium bipin GSFL systems operating in the 
commercial sector. Regardless of the baseline lamp currently employed, 
consumers have lamp designs available which result in positive LCC 
savings at TSL5. At this standard level, users of 40W or 34W 4-foot MBP 
T12 baseline lamps installed on a magnetic ballast who need to replace 
their lamp would incur the cost of a lamp and ballast replacement 
($65.96 to $73.94) because no T12 lamp currently meets the efficacy 
requirements of TSL5. Comparing this cost of lamp-and-ballast 
replacements to the cost of only baseline lamp replacements ($11.65 to 
$14.50) results in installed price increases of $52.83 to $59.44. These 
ranges in prices depend on the specific baseline lamps previously owned 
by consumers and the specific combinations of lamps and ballasts they 
select in the standards case. However, over the life of the lamp, these 
consumers would save $13.93 to $24.16.
    Table VII.6 presents LCC results for a two-lamp 4-foot MBP system 
operating in the residential sector under average operating hours. The 
results are presented for a system operating 40W T12 lamps with a 
magnetic ballast, as this configuration is typical of the installed 
base of residential GSFL systems. As discussed in the NOPR, DOE 
believes that the vast majority of lamps sold in the residential market 
are sold with new ballasts or luminaires. 74 FR 16920, 16951 (April 13, 
2009) At TSL5, residential consumers are expected to purchase T8 lamps 
with electronic ballasts in lieu of the T12 lamps with magnetic 
ballasts that they would purchase absent standards. These consumers 
would see LCC savings of $20.21 to $22.32. DOE recognizes that not all 
residential GSFL lamps would be sold in conjunction with a new ballast 
or luminaire in the base case. In particular, consumers with higher 
operating hours or consumers who choose to not discard their lamps upon 
fixture or ballast replacement may need to replace their lamp on an 
existing system. However, at TSL5, there are no standards-compliant T12 
replacement lamps available. As seen in Table VII.8, the consumer 
economics of retrofitting a T12 system with a T8 system for a 
residential 4-foot MBP system depend on the remaining life of the T12 
ballast. For those consumers who replace a T12 system with less than 7 
years of life remaining in 2012, the LCC savings are positive. Those 
consumers who have greater than 7 years of life remaining in their T12 
systems in 2012 will experience negative LCC savings. Considering an 
average system life of 15 years, and estimating that 10 percent of T12 
lamps sold to residential sector are replacement lamps, DOE calculates 
that fewer than 6 percent of current purchasers of T12 lamps in the 
residential sector will experience increases in LCC. The first-costs 
increase for residential consumers forced to retrofit to T8 systems 
would be $49.00 to $49.91 ($53.13 to $54.04 for an installed T8 system 
compared to $4.13 for two new T12 lamp).
    With regard to 4-foot MBP consumer subgroups, all consumer 
subgroups analyzed achieve similar LCC savings to the average consumer 
with the exception of commercial consumers who own 40W or 34W 4-foot 
MBP T12 lamps installed on electronic ballasts. These consumers, upon 
lamp failure, are forced to retrofit their existing ballasts, resulting 
in negative LCC savings of -$12.43 to -$7.00. Overall, based on the 
NIA, DOE estimates that at TSL5 in 2012, less than 2 percent of 4-foot 
MBP shipments result in negative LCC savings, and 9 percent of 
shipments are associated with the high installed price increases due to 
forced retrofits.
    Table VII.11 presents the findings of an LCC analysis on various 
two-lamp, 8-foot SP slimline GSFL systems operating in the commercial 
sector. Except for consumers who purchase reduced-wattage 60W T12 lamps 
absent standards (and experience a lamp failure), all other consumers 
have available lamp designs that result in positive LCC savings at 
TSL5. At this standard level, users of 75W or 60W 8-foot SP slimline 
T12 baseline lamps installed on a magnetic ballast who need to replace 
their lamp would incur the cost of a lamp and ballast replacement 
($97.41 to $98.80) because no T12 lamp currently meets the efficacy 
requirements of TSL5. Comparing the cost of a lamp-and-ballast 
replacement to the cost of only a baseline lamp replacement ($11.77 to 
$16.79) results in an installed price increase of $82.01 to $87.03. In 
addition, users of 60W T12 lamps who need to replace their lamp 
experience negative LCC savings of -$15.81 to -$13.89. On the other 
hand, over the life of the lamp, users of 75W T12 lamps who require a 
lamp replacement would save $9.68.
    With regard to 8-foot SP slimline consumer subgroups, all consumer 
subgroups analyzed achieve similar LCC savings to the average consumer 
with the exception of consumers of T12 lamps operating in religious 
institutions, consumers of T12 lamps

[[Page 34169]]

operating in institutions that serve low-income populations, and users 
of T12 lamps installed on electronic ballasts. These consumers, upon 
lamp failure, are forced to retrofit their existing ballasts, resulting 
in negative LCC savings. In particular, consumers in institutions of 
religious worship (which have low operating hours in comparison with 
the average commercial-sector consumer) and consumers in institutions 
serving low income populations (experience negative LCC savings of -
$30.56 to -$0.44. Consumers with T12 lamps installed on electronic 
ballasts experience negative LCC savings of -$33.55 to -$15.82. 
Overall, based on the NIA model, DOE estimates that at TSL5 in 2012, 
approximately 24 percent of 8-foot SP slimline shipments would result 
in negative LCC savings, and 65 percent of shipments would be 
associated with the high installed price increases due to forced 
retrofits.
    Table VII.12 presents the findings of an LCC analysis on various 
two-lamp, 8-foot RDC HO GSFL systems operating in the industrial 
sector. With the exception of consumers who purchase reduced-wattage 
95W T12 lamps absent standards (and purchase a lamp in response to a 
lamp failure), all other consumers have available lamp designs that 
result in positive LCC savings at TSL5. At this standard level, users 
of 110W or 95W 8-foot RDC HO T12 baseline lamps installed on a magnetic 
ballast who need to replace their lamp would incur the cost of a lamp 
and ballast replacement ($131.38) because no T12 lamp currently meets 
the efficacy requirements of TSL5. Comparing the cost of a lamp-and-
ballast replacement to the cost of only a baseline lamp replacement 
($14.46 to $20.51) results in an installed price increase of $110.87 to 
$116.92. Users of 95W T12 lamps who need to replace their lamp 
experience negative LCC savings of -$7.97. On the other hand, over the 
life of the lamp, users of 110W T12 lamps who require a lamp 
replacement would save $13.07.
    With regard to 8-foot RDC HO consumer subgroups, all consumer 
subgroups analyzed achieve similar LCC savings to the average consumer 
except consumers who own T12 lamps installed on electronic ballasts. 
These consumers, upon lamp failure, are forced to retrofit their 
existing ballasts, resulting in negative LCC savings of -$20.50 to -
$5.31. Overall, based on the NIA model, DOE estimates that at TSL5 in 
2012, approximately 33 percent of 8-foot RDC HO shipments would result 
in negative LCC savings, and 86 percent of shipments would be 
associated with the high installed price increases due to forced 
retrofits.
    Table VII.9 and Table VII.10 present the LCC analyses on two-lamp 
4-foot MiniBP T5 standard-output and high-output systems, respectively. 
The standard-output system is modeled as operating in the commercial 
sector, and the high-output system is modeled as operating in the 
industrial sector. The baseline lamps for these systems are the model 
28W and 54W halophosphor lamps, respectively, as discussed in section 
V.B.3. At TSL5 (EL2 for standard output T5 lamps), all consumers of 
standard output lamps have available lamp designs which result in 
positive LCC savings of $1.10 (for lamp replacement) and $45.67 to 
$47.49 (for new construction or renovation). At TSL5 (EL1 for high 
output T5 lamps), consumers of high-output lamps who need only a lamp 
replacement would experience negative LCC savings of -$3.03. However, 
purchasing a T5 high-output system for new construction or renovation 
would result in positive LCC savings of $65.69 to $67.06.
    At TSL 5, the demand for rare-earth phosphors is significantly 
increased compared to current levels. DOE understands that it is 
difficult to predict the effects of new energy conservation standards 
on rare earth phosphor demand. However, DOE is sensitive to the trade 
vulnerability inherent in the concentrated geographical location of 
these resources and the possible incentives for manufacturers to 
relocate production (and associated employment) outside the U.S. It is 
particularly challenging to draw a line below which the risks are 
manageable and above which the risks become unacceptable. DOE notes 
that in its comments, NEMA views TSL 3 as a level that allows 
manufacturers to retain the flexibility needed to manage the impact of 
increased worldwide rare earth phosphor usage. In their comments, NEMA 
provided their estimate of the relative increase in rare earth phosphor 
demand for each TSL. This analysis showed the impacts at TSL 3 and TSL 
4 to be very similar, increases of 230 percent and 250 percent, 
respectively. In contrast, the impacts at estimated by NEMA at TSL 5 
are shown to be significantly larger at 350 percent. DOE concludes from 
this that NEMA perceives considerably larger risks at TSL 5 than at TSL 
4 or TSL 3.
    At TSL 5, product availability is also a concern, particularly the 
elimination of reduced-wattage 25W lamps, due to increased standard 
levels. DOE agrees with comments received that 25W lamps are valuable 
energy-saving products, because they provide a simple pathway to energy 
savings that does not require ballast replacements or design 
assistance. (California Stakeholders, No. 63 at p. 9) As demonstrated 
in DOE's national impact analysis, the level of expertise required to 
implement certain design choices is a key factor in determining energy 
savings, as well as consumer and national NPV benefits.
    In summary, after carefully considering the analysis discussed 
above and weighing the benefits and burdens of TSL5, the Secretary has 
determined the following: At TSL 5, the benefits of energy savings, 
emissions reductions (both in terms of physical reductions and the 
monetized value of those reductions, including the likely U.S. and 
global benefits of reduced emissions of CO2), and the 
positive net economic savings to the Nation (over 31 years) is 
outweighed by the economic burden on some consumers (as indicated by 
the large increase in total installed cost), the potentially large 
reduction in INPV for manufacturers resulting from large conversion 
costs and reduced gross margins, the elimination of certain low-wattage 
lamps, and the risks associated with significantly increased demand for 
rare-earth phosphors. Consequently, the Secretary has concluded that 
TSL 5 is not economically justified.
b. Trial Standard Level 4
    Next, DOE considered TSL 4, which would save an estimated total of 
3.8 to 9.9 quads of energy through 2042--a significant amount of 
energy. For the Nation as a whole, TSL4 would have a net savings of 
$10.0 billion to $26.3 billion at a 7-percent discount rate and $21.8 
billion to $53.5 billion at a 3-percent discount rate. The emissions 
reductions at TSL4 are estimated at 175 to 488 MMt of CO2, 
11 to 37 kt of NOX, and up to 7.3 metric tons of Hg. Total 
generating capacity in 2042 is estimated to decrease compared to the 
reference case by 1.8 to 6.2 GW under TSL4. The monetized values of 
emissions reductions are estimated at $4.2 to $107.2 million for 
NOX and up to $67.7 million for Hg at a 7-percent discount 
rate and $4.6 to $132.4 million for NOX and up to $125.6 
million for Hg at a 3-percent discount rate. The estimated benefits of 
reducing CO2 emissions using the mid-range of the 
CO2 value (using $33 per ton) is $3.1 to $8.4 billion and 
$6.0 to $16.9 billion at 7-percent and 3-percent discount rates 
respectively. The full range of likely benefits of CO2 
emission reductions is $0.2 billion to $20.4 billion at a 7-percent 
discount rate and $0.4 billion to

[[Page 34170]]

$40.9 billion at a 3-percent discount rate.
    Similar to TSL5, the level of impacts on manufacturers would depend 
primarily on their ability to differentiate their product offerings to 
offset the reduced range of efficacy levels. TSL 4 would also require a 
complete conversion of all T12 4-foot MBP, 8-foot SP slimline, and 8-
foot RDC HO lines to T8 lines, a capital investment of $193 million. 
The projected change in industry value ranges from a decrease of $162 
million to a decrease of $4 million. Because manufacturers have a 
broader range of efficiency available at TSL 4 than at TSL 5 (thereby 
permitting greater product differentiation and increased gross 
margins), DOE believes the impacts at TSL 4 will be significantly less 
than at TSL 5 and that the high range of impacts is less likely to 
occur.
    As seen in Table VII.5 through Table VII.12, at TSL4, DOE projects 
that 4-foot MBP, 8-foot SP slimline, and 8-foot RDC HO consumers would 
experience similar life-cycle cost savings and increases as they would 
experience at TSL5. Like TSL5, most consumers who own T12 ballasts 
prior to 2012 at TSL4 would likely experience negative economic 
impacts, either through life-cycle cost increases or by large increases 
in total installed cost. For 4-foot MiniBP T5 standard-output lamps, 
TSL4 would require these lamps to meet EL1, resulting in positive LCC 
savings of $1.10 for lamp replacement and $43.30 for new construction 
or renovation (seen in Table VII.9). For 4-foot MiniBP T5 high-output 
lamps, TSL4 would require the same efficacy level (EL1) as TSL5, 
resulting in identical life-cycle cost impacts.
    At TSL 4, the demand for rare-earth phosphors, although 
significantly increased compared to current levels, is similar to the 
demand at TSL 3, a level that manufacturers have suggested would allow 
them to retain the flexibility needed to manage the impacts of 
increased worldwide rare earth phosphor usage. In consideration of the 
small increased demand of rare-earth phosphors over a level that 
industry has indicated to be acceptable, DOE believes that risks of 
trade vulnerability and potential relocation of lamp production 
overseas in response to a standard adopted at TSL4 are low.
    In contrast to TSL5, at TSL 4, consumers have several energy-saving 
lamp options including the reduced-wattage 25W and 30W 4-foot MBP 
lamps. The presence of these lamps on the market provides consumers 
with more simple pathways to achieving energy savings. As demonstrated 
in DOE's national impact analysis, the level of expertise required to 
implement certain design choices is a key factor in determining energy 
savings, as well as consumer and national NPV benefits.
    In summary, after carefully considering the analysis discussed 
above and weighing the benefits and burdens of TSL4, the Secretary has 
determined the following: At TSL4, the benefits of energy savings, 
emissions reductions (both in terms of physical reductions and the 
monetized value of those reductions, including the likely U.S. and 
global benefits of reduced emissions of CO2), and the 
positive net economic savings to the Nation (over 31 years) outweighs 
the economic burden on some consumers (as indicated by the large 
increase in total installed cost), the potential reduction in INPV for 
manufacturers, and the risks associated with increased demand for rare 
earth phosphors. Consequently, the Secretary has concluded that TSL4 
offers the maximum improvement in efficacy that is technologically 
feasible and economically justified, and will result in significant 
conservation of energy. Therefore, DOE is adopting the energy 
conservation standards for GSFL at trial standard level 4.
2. Incandescent Reflector Lamps Conclusion
    In addition to the results presented above, DOE also calculates the 
annualized benefits and costs of each TSL. The table below presents 
these values for GSFL.

                               Table VII.34--Annualized Benefits and Costs for IRL
----------------------------------------------------------------------------------------------------------------
                                                  Primary estimate        Low estimate          High estimate
   TSL         Category             Unit       -----------------------------------------------------------------
                                                    7%         3%         7%         3%         7%         3%
----------------------------------------------------------------------------------------------------------------
1.......                                                 Benefits
         -------------------------------------------------------------------------------------------------------
          Annualized         2008$............     120        130         68         72        173        188
           Monetized
           ($millions/year).
         -------------------------------------------------------------------------------------------------------
          Annualized         CO2 (Mt).........       0.43       0.43       0.24       0.24       0.62       0.63
           Quantified.
                             NOX (kT).........       0.09       0.07       0.07       0.05       0.11       0.08
                             Hg (T)...........       0.00       0.00       0.00       0.00       0.01       0.01
         -------------------------------------------------------------------------------------------------------
                                                           Costs
         -------------------------------------------------------------------------------------------------------
          Annualized         2008$............     103        100         77         74        129        127
           Monetized
           ($millions/year).
         -------------------------------------------------------------------------------------------------------
                                                    Net Benefits/Costs
         -------------------------------------------------------------------------------------------------------
          Annualized         2008$............      18         29         -9         -2         44         61
           Monetized
           ($millions/year).
         -------------------------------------------------------------------------------------------------------
2.......                                                 Benefits
         -------------------------------------------------------------------------------------------------------
          Annualized         2008$............     293        313        176        182        410        443
           Monetized
           ($millions/year).
         -------------------------------------------------------------------------------------------------------
          Annualized         CO2 (Mt).........       1.1        1.1        0.66       0.63       1.53       1.56
           Quantified.
                             NOX (kT).........       0.26       0.19       0.21       0.14       0.32       0.23
                             Hg (T)...........       0.01       0.01       0.00       0.00       0.02       0.02
         -------------------------------------------------------------------------------------------------------
                                                           Costs
         -------------------------------------------------------------------------------------------------------
          Annualized         2008$............     -33        -39        -28        -32        -39        -46
           Monetized
           ($millions/year).
         -------------------------------------------------------------------------------------------------------

[[Page 34171]]

 
                                                    Net Benefits/Costs
         -------------------------------------------------------------------------------------------------------
          Annualized         2008$............     326        352        203        215        449        489
           Monetized
           ($millions/year).
         -------------------------------------------------------------------------------------------------------
3.......                                                 Benefits
         -------------------------------------------------------------------------------------------------------
          Annualized         2008$............     531        603        349        389        712        817
           Monetized
           ($millions/year).
         -------------------------------------------------------------------------------------------------------
          Annualized         CO2 (Mt).........       1.97       1.98       1.29       1.25       2.66       2.7
           Quantified.
                             NOX (kT).........       0.42       0.3        0.37       0.26       0.47       0.33
                             Hg (T)...........       0.02       0.02       0.00       0.00       0.04       0.04
         -------------------------------------------------------------------------------------------------------
                                                           Costs
         -------------------------------------------------------------------------------------------------------
          Annualized         2008$............      72         71         52         50         92         92
           Monetized
           ($millions/year).
         -------------------------------------------------------------------------------------------------------
                                                    Net Benefits/Costs
         -------------------------------------------------------------------------------------------------------
          Annualized         2008$............     459        532        297        339        620        725
           Monetized
           ($millions/year).
         -------------------------------------------------------------------------------------------------------
4.......                                                 Benefits
         -------------------------------------------------------------------------------------------------------
          Annualized         2008$............     650        696        406        424        894        968
           Monetized
           ($millions/year).
         -------------------------------------------------------------------------------------------------------
          Annualized         CO2 (Mt).........       2.39       2.4        1.51       1.45       3.28       3.35
           Quantified.
                             NOX (kT).........       0.51       0.35       0.45       0.31       0.58       0.4
                             Hg (T)...........       0.02       0.02       0.00       0.00       0.05       0.05
         -------------------------------------------------------------------------------------------------------
                                                           Costs
         -------------------------------------------------------------------------------------------------------
          Annualized         2008$............     118        106        227        218          9         -6
           Monetized
           ($millions/year).
         -------------------------------------------------------------------------------------------------------
                                                    Net Benefits/Costs
         -------------------------------------------------------------------------------------------------------
          Annualized         2008$............     532        590        179        207        885        973
           Monetized
           ($millions/year).
         -------------------------------------------------------------------------------------------------------
                                      Incremental Net Benefits/Costs Relative to TSL3
         -------------------------------------------------------------------------------------------------------
          Annualized         2008$............      73         58       -118       -132        265        248
           Monetized
           ($millions/year).
         -------------------------------------------------------------------------------------------------------
5.......                                                 Benefits
         -------------------------------------------------------------------------------------------------------
          Annualized         2008$............     750        802        480        502       1020       1103
           Monetized
           ($millions/year).
         -------------------------------------------------------------------------------------------------------
          Annualized         CO2 (Mt).........       2.76       2.76       1.83       1.76       3.69       3.75
           Quantified.
                             NOX (kT).........       0.59       0.4        0.54       0.37       0.65       0.44
                             Hg (T)...........       0.02       0.03       0.00       0.00       0.05       0.05
         -------------------------------------------------------------------------------------------------------
                                                     Incremental Costs
         -------------------------------------------------------------------------------------------------------
          Annualized         2008$............     126        116        232        222         26          9
           Monetized
           ($millions/year).
         -------------------------------------------------------------------------------------------------------
                                                    Net Benefits/Costs
         -------------------------------------------------------------------------------------------------------
          Annualized         2008$............     621        687        247        280        994       1093
           Monetized
           ($millions/year).
         -------------------------------------------------------------------------------------------------------
                                      Incremental Net Benefits/Costs Relative to TSL4
         -------------------------------------------------------------------------------------------------------
          Annualized         2008$............      89         97         68         73        109       120
           Monetized
           ($millions/year).
----------------------------------------------------------------------------------------------------------------
Note: Annualized values are for the period from 2012 to 2042.

a. Trial Standard Level 5
    For IRL, DOE first considered the most efficient level, TSL5, which 
would save an estimated total of 1.12 to 2.72 quads of energy through 
2042--a significant amount of energy. For the Nation as a whole, TSL5 
would have a net savings of $4.9 billion to $10.2 billion at a 7-
percent discount rate and $9.4 billion to $20.0 billion at a 3-percent 
discount rate. The emissions reductions at TSL5 are estimated at 53 to 
118 MMt of CO2, 8 to 9 kt of NOX, and up to 2 
metric tons of Hg. Total generating capacity in 2042 is estimated to 
decrease compared to the reference case by 300 to 1400 MW under TSL5. 
The monetized values of emissions reductions are estimated at $2.2 to 
$27.0 million for NOX and up to $16.0 million for Hg at a 7-
percent discount rate and $2.7 to $33.1 million for NOX and 
up to $30.2 million for Hg at a 3-percent

[[Page 34172]]

discount rate. The estimated benefits of reducing CO2 
emissions using the mid-range of the CO2 value (using $33 
per ton) is $1.0 to 2.0 billion and $1.8 to $4.1 billion at 7-percent 
and 3-percent discount rates respectively. The full range of likely 
benefits of CO2 emission reductions is $0.1 billion to $4.9 
billion at a 7-percent discount rate and $0.1 billion to $9.9 billion 
at a 3-percent discount rate.
    As seen in Table VII.13, regardless of the baseline lamp purchased 
absent standards, commercial-sector consumers have available lamp 
designs at TSL5 which would result in positive LCC savings ranging from 
$1.36 to $9.14, while residential-sector consumers have available lamp 
designs which would result in positive LCC savings ranging from $1.51 
to $9.10.
    The projected change in industry value at TSL5 would range from a 
decrease of $104 million to $111 million, or a net loss of 37 to 47 
percent in INPV. The range in impacts is attributed in part to 
uncertainty concerning the future share of emerging technologies in the 
IRL market, as well as the expected migration to R-CFL and exempted IRL 
technologies under standards.
    DOE based TSL5 on commercially-available IRL which employ a silver 
reflector, an improved IR coating, and a filament design that results 
in a lifetime of 4,200 hours. To DOE's knowledge, only one manufacturer 
currently sells products that meet TSL5. In addition, it is DOE's 
understanding that the silver reflector is a proprietary technology 
that all manufacturers may not be able to employ. However, DOE 
considered TSL5 in its analysis because it believes that there is an 
alternate, non-proprietary pathway to achieve this level. This pathway 
consists in redesigning the filament to achieve higher-temperature 
operation and, thus, reducing lifetime to 2,500 hours.
    DOE conducted a complete set of analyses to capture the economic 
impacts of a TSL5 lamp designed to operate with a lifetime of 2500 
hours instead of 4200 hours. Whereas the energy savings and emission 
reductions do not change for the Nation as a whole, a reduced-life lamp 
would result in much reduced net savings (NPV) of $2.53 billion to 
$4.86 billion at a 7-percent discount rate and $10.1 billion to $5.1 
billion at a 3-percent discount rate. As seen in Table VII.13, as 
compared to one of the baseline lamps purchased absent standards, 
consumers would experience negative LCC savings, ranging from -$3.17 
(in the commercial sector) to -$1.64 (in the residential sector), at 
TSL5. Because reduced lamp life results in greater IRL shipments, the 
projected change in industry value would be greatly reduced to a 
decrease of $43 million to $49 million, or a net loss of 14 to 22 
percent in INPV.
    The reduced LCC savings at TSL 5 for the reduced-life lamps brings 
added concern to the issue of hot shock, which is when vibrations that 
occur while the lamp is energized cause premature lamp failure. It is 
DOE's understanding that hot shock can reduce lamp life by 25 percent 
to 30 percent for some consumers. For a lamp rated at 2500 hours, this 
means that service life could be reduced to 1750 hours. As demonstrated 
in Tables Table VI.1 and Table VI.2, DOE expects that a lamp with price 
and efficacy associated with TSL5 and a lifetime of 1750 hours would 
result in negative LCC savings for the vast majority of consumers.
    Furthermore, DOE is also concerned about the possible lessening of 
competition at TSL5. Only one manufacturer currently sells product that 
meets TSL5. This commercially-available product employs a proprietary 
technology, and while DOE has some evidence that alternative non-
proprietary technologies may be used to meet this level, these 
alternative technologies have not been manufactured in large quantities 
and questions remain as to their cost and performance, as discussed 
above. Because DOE has not been able to verify manufacturer costs 
associated with these alternative technologies, it is possible that 
these approaches may not be cost-competitive with the currently-
available product employing the proprietary technology. While DOE 
recognizes that a 2500-hour lamp at TSL 5 is technologically feasible 
and would not require the use of proprietary technologies, the LCC 
results show that these shortened-life lamps are likely to be less 
attractive to consumers and, therefore, at a competitive disadvantage.
    In summary, after carefully considering the analysis discussed 
above and weighing the benefits and burdens of TSL5, the Secretary has 
determined the following: At TSL5, the benefits of energy savings, 
emissions reductions (both in terms of physical reductions and the 
monetized value of those reductions, including the likely U.S. and 
global benefits of reducing CO2 emissions), the positive net 
economic savings to the Nation (over 31 years) is outweighed by the 
large capital conversion costs that could result in a reduction in INPV 
for manufacturers, possible negative LCC savings for some consumers of 
2500-hour lamps, and the possible lessening of competition. 
Consequently, the Secretary has concluded that TSL5 is not economically 
justified.
b. Trial Standard Level 4
    Next, DOE considered TSL4, which would save an estimated total of 
0.94 to 2.39 quads of energy through 2042--a significant amount of 
energy. For the Nation as a whole, TSL4 would have a net savings of 
$4.20 billion to $9.06 billion at a 7-percent discount rate and $17.8 
billion to $8.0 billion at a 3-percent discount rate. The emissions 
reductions at TSL4 are estimated at 44 to 106 MMt of CO2, 
6.4 to 8.4 kt of NOX, and up to 2 metric tons of Hg. Total 
generating capacity in 2042 is estimated to decrease compared to the 
reference case by 200 to 1,100 MW under TSL4. The monetized values of 
emissions reductions are estimated at $1.8 to $24.4 million for 
NOX and up to $15.0 million for Hg at a 7-percent discount 
rate and $2.2 to $30.0 million for NOX and up to $28.1 
million for Hg at a 3-percent discount rate. The estimated benefits of 
reducing CO2 emissions using the mid-range of the 
CO2 value (using $33 per ton) is $0.8 to $1.8 billion and 
$1.5 to $3.7 billion at 7-percent and 3-percent discount rates 
respectively. The full range of likely benefits of CO2 
emission reductions is $50 million to $4.4 billion at a 7-percent 
discount rate and $0.1 billion to $8.9 billion at a 3-percent discount 
rate.
    The projected change in industry value at TSL4 would range from a 
decrease of $98 million to $102 million, or a net loss of 34 to 44 
percent in INPV. The range in impacts is attributed in part to 
uncertainty concerning the future share of emerging technologies in the 
IRL market, as well as the expected migration to R-CFL and exempted IRL 
technologies under standards.
    As seen in Table VII.13, regardless of the baseline lamp currently 
employed, commercial-sector consumers have available lamp designs at 
TSL4 which would result in positive LCC savings ranging from $1.81 to 
$7.95, while residential-sector consumers have available lamp designs 
which would result in positive LCC savings ranging from $1.75 to $7.45.
    DOE does not believe TSL4 requires the use of a single proprietary 
technology. To DOE's knowledge, two manufacturers currently sell a 
full-range of lamp wattages that meet TSL4. Unlike TSL5, where it is 
possible that some manufacturers would not be able to achieve the level 
without lowering lamp lifetime, DOE believes that the existence of 
multiple technology pathways to TSL4 would not necessarily result in 
the reduction in lamp lifetime at TSL4. However, DOE also recognizes 
that

[[Page 34173]]

manufacturers may choose to sell products with reduced lifetimes. 
Therefore, DOE conducted a complete set of analyses to capture the 
economic impacts of a TSL4 lamp designed to operate with a lifetime of 
2500 hours and 3000 hours instead of 4000 hours. Whereas the energy 
savings and emission reductions do not change for the Nation as a 
whole, a reduced-life lamp would result in much reduced net savings 
(NPV) of $1.83 billion to $5.22 billion at a 7-percent discount rate 
and $10.8 billion to $3.8 billion at a 3-percent discount rate. As seen 
in Table VII.13, as compared to one of the baseline lamps purchased 
absent standards, commercial consumers would experience small negative 
LCC savings of -$0.25 at TSL4. Because reduced lamp life results in 
greater IRL shipments, the projected change in industry value would be 
greatly reduced to a decrease of $21 million to $61 million, or a net 
loss of 7 to 28 percent in INPV.
    Hot shock is less of a concern at TSL4 than at TSL5. DOE 
understands that manufacturers may choose to reduce their negative 
impacts by providing lamps with lifetimes less than 4000 hours at TSL4. 
However, because 4000-hour TSL4 lamps can be produced without the use 
of proprietary technologies, manufacturers may be able to implement 
technological changes in their lamps to prevent hot shock, while 
retaining lifetimes above 3000 hours.
    In addition, competitive impacts are less severe at TSL4 than at 
TSL5. To DOE's knowledge, two of the three major manufacturers of IRL 
currently sell a full product line (across common wattages) that meet 
this potential standard level. It is DOE's understanding that the third 
manufacturer employs a technology platform that, due to the positioning 
of the filament in the HIR capsule, is inherently less efficient. 
Therefore, it is likely that in order to meet TSL4, this manufacturer 
would have to make higher investments than the other manufacturers, 
placing it at a competitive disadvantage. This manufacturer has 
commented that it could manufacture products at TSL4 if the standards 
implementation lead time were extended by an additional one year. While 
DOE recognizes the challenges inherent in gaining access to technology 
and building capacity needed to begin production, as detailed in 
section VI.D.1 of this notice, DOE does not have the statutory 
authority to extend the implementation period.
    In summary, after considering the analysis discussed above and 
comments on the April 2009 NOPR, and weighing the benefits and burdens 
of TSL4, the Secretary has determined the following: At TSL4, the 
benefits of energy savings, emissions reductions (both in terms of 
physical reductions and the monetized value of those reductions, 
including the likely U.S. and global benefits of reduced CO2 
emissions), the positive net economic savings to the Nation (over 31 
years), and positive life-cycle cost savings outweighs the reduction in 
INPV for manufacturers. Consequently, the Secretary has concluded that 
TSL4 offers the maximum improvement in efficacy that is technologically 
feasible and economically justified, and will result in significant 
conservation of energy. Therefore, DOE is adopting the energy 
conservation standards for IRL at trial standard level 4.

VIII. Procedural Issues and Regulatory Review

A. Review Under Executive Order 12866

    Section 1(b)(1) of Executive Order 12866, ``Regulatory Planning and 
Review,'' 58 FR 51735 (Oct. 4, 1993), requires each agency to identify 
the problem it intends to address that warrants agency action such as 
today's final rule (including, where applicable, the failures of 
private markets or public institutions), and to assess the significance 
of that problem in evaluating whether any new regulation is warranted. 
DOE included a description of market failures in its April 2009 NOPR. 
74 FR 16920, 17018-19 (April 13, 2009). DOE believes, in this final 
rule, that these market failures continue to persist.
    In addition, because today's regulatory action is a significant 
regulatory action under section 3(f)(1) of Executive Order 12866, 
section 6(a)(3) of that Executive Order requires DOE to prepare and 
submit for review to the Office of Information and Regulatory Affairs 
(OIRA) in the Office of Management and Budget (OMB) an assessment of 
the costs and benefits of today's rule. Accordingly, DOE presented to 
OIRA for review the draft final rule and other documents prepared for 
this rulemaking, including a regulatory impact analysis (RIA). These 
documents are included in the rulemaking record and are available for 
public review in the Resource Room of DOE's Building Technologies 
Program, 950 L'Enfant Plaza, SW., 6th Floor, Washington, DC 20024, 
(202) 586-9127, between 9:00 a.m. and 4:00 p.m., Monday through Friday, 
except Federal holidays.
    Carlins Consulting stated that regulations were not necessary for 
consumers to adopt energy efficient lighting because the marketplace 
has provided the consumer with adequate options to choose a proper 
light source for any application given many variables. Specifically, 
the commenter cited the shift in office lighting from incandescent to 
fluorescent, then from T12 fluorescent lamps to T8 fluorescent lamps, 
the extinction of mercury vapor lamps after the introduction of metal 
halide lamps, and most recently--the popularity of lighting controls as 
evidence of the marketplace and economic incentives leading to the 
creation of energy efficient products. (Carlins Consulting, No. 57 at 
p. 1)
    In response, the April 2009 NOPR contained a summary of the RIA, 
which evaluated the extent to which major alternatives to standards for 
GSFL and IRL could achieve significant energy savings at reasonable 
cost, as compared to the effectiveness of the proposed rule. 74 FR 
16920, 17019-22 (April 13, 2009). The complete RIA (Regulatory Impact 
Analysis for Proposed Energy Conservation Standards for General Service 
Fluorescent Lamps and Incandescent Reflector Lamps) is contained in the 
TSD prepared for today's rule. The RIA consists of: (1) A statement of 
the problem addressed by this regulation, and the mandate for 
government action; (2) a description and analysis of the feasible 
policy alternatives to this regulation; (3) a quantitative comparison 
of the impacts of the alternatives; and (4) the national economic 
impacts of today's standards.
    DOE sought additional information to further develop its analysis 
(i.e., information to verify estimates of the percentages of consumers 
purchasing efficient lighting and the extent to which consumers will 
continue to purchase more-efficient lighting in future years), and to 
conduct additional analyses in support of its conclusions (i.e., data 
on the correlation between the efficacy of existing lamps, usage 
patterns, and associated electricity price), but received no additional 
information or data in response to the April 2009 NOPR.
    The major alternatives to the standards that DOE analyzed are: (1) 
No new regulatory action; (2) consumer rebates; (3) consumer tax 
credits; (4) manufacturer tax credits; (5) voluntary energy-efficiency 
targets; (6) bulk government purchases; and (7) early replacement. Each 
of these alternatives was analyzed in the RIA, with the exception of 
early replacement, because DOE found that the lifetimes of the lamps 
analyzed are too short for early replacement to result in significant 
savings. As explained in the April 2009 NOPR, DOE determined that none 
of

[[Page 34174]]

these alternatives would save as much energy or have an NPV as high as 
the proposed standards, TSL3 for GSFL and TSL4 for IRL. That same 
conclusion applies to the standards in today's rule. DOE has determined 
that none of the alternatives save as much energy or have an NPV as 
high as the adopted standards, TSL4 for GSFL and TSL4 for IRL. (DOE 
further notes that for GSFL, the final rule standard set at TSL4 would 
save more energy and have a higher NPV than the proposed standard at 
TSL3.) Also, several of the alternatives would require new enabling 
legislation, since authority to carry out those alternatives does not 
presently exist. Additional detail on the regulatory alternatives is 
found in the RIA report in the TSD.

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 for any rule 
that by law must be proposed for public comment, and a final regulatory 
flexibility analysis for any such rule that an agency adopts as a final 
rule, unless the agency certifies that the rule, if promulgated, will 
not have a significant economic impact on a substantial number of small 
entities. A regulatory flexibility analysis examines the impact of the 
rule on small entities and considers alternative ways of reducing 
negative impacts. Also, as required by Executive Order 13272, ``Proper 
Consideration of Small Entities in Agency Rulemaking,'' 67 FR 53461 
(August 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://www.gc.doe.gov.
    The Small Business Administration (SBA) classifies manufacturers of 
GSFL and IRL as small businesses if they have 1,000 or fewer 
employees.\84\ DOE used this small business size standard, published at 
65 FR 30386 (May 15, 2000) and codified at 13 CFR part 121, to 
determine whether any small entities would be required to comply with 
today's rule. The size standard is listed by North American Industry 
Classification System (NAICS) code and industry description. GSFL and 
IRL manufacturing are classified under NAICS 335110, ``Electric Lamp 
Bulb and Part Manufacturing.''
---------------------------------------------------------------------------

    \84\ See http://www.sba.gov/idc/groups/public/documents/sba_homepage/serv_sstd_tablepdf.
---------------------------------------------------------------------------

    As explained in the April 2009 NOPR, DOE reviewed the proposed rule 
under the provisions of the Regulatory Flexibility Act and the 
procedures and policies published on February 19, 2003 (68 FR 7990). On 
the basis of that review, DOE certified that the proposed rule, if 
promulgated, ``would not have a significant economic impact on a 
substantial number of small entities.'' 74 FR 16920, 17022-23 (April 
13, 2009). Therefore, DOE did not prepare an initial regulatory 
flexibility analysis for the proposed rule. DOE set forth its 
certification to the Chief Counsel for Advocacy of the SBA and the 
statement of factual basis for that certification.
    DOE received comments from Tailored Lighting Inc. in response to 
the Regulatory Flexibility Act discussion in the April 2009 NOPR. 
Tailored Lighting Inc. stated that DOE incorrectly characterizes the 
small business manufactures in the market by not including Tailored 
Lighting Inc. and possibly other businesses like it. (Tailored Lighting 
Inc., No. 73 at p. 2)
    For the April 2009 NOPR, DOE conducted an extensive 
characterization of the GSFL and IRL industries and presented its 
findings for review and comment. In its characterization, DOE found 
that the majority of covered GSFL and IRL are manufactured by three 
large companies. A very small percentage of the market is manufactured 
by either large or small companies that primarily specialize in lamps 
not covered by this rulemaking. 74 FR 16920, 17022-23 (April 13, 2009).
    During its market survey for the April 2009 NOPR, DOE created a 
list of every company that manufactures covered and non-covered GSFL 
and IRL for sale in the United States. DOE also asked stakeholders and 
industry representatives if they were aware of any other small 
manufacturers. DOE then reviewed publicly-available data and contacted 
companies on its list, as necessary, to determine whether they met the 
SBA's definition of a small business manufacturer in the GSFL or IRL 
industries. In total, DOE contacted 57 companies that could potentially 
be small businesses. During initial review of the 57 companies in its 
list, DOE either contacted or researched each company to determine if 
it sold covered GSFL and IRL. Research included reviewing each 
company's product catalogs and reviewing company's independent research 
reports.\85\ Based on its research, DOE screened out companies that did 
not offer lamps covered by this rulemaking or if research reports 
indicated they were large manufacturers. Initially, DOE estimated that 
only 12 out of 57 companies listed were potentially small business 
manufacturers of covered products. 74 FR 16920, 17023 (April 13, 2009). 
Out of those 12 companies, DOE interviewed the four companies that 
consented to be interviewed. From these interviews, DOE determined that 
one manufacturer was not a small business. Two of the companies sold 
covered products, but were not manufacturers. The remaining company was 
the small business manufacturer DOE identified in the NOPR.
---------------------------------------------------------------------------

    \85\ Dun and Bradstreet provides independent research regarding 
company cash flows, revenues, employees, and credit-worthiness.
---------------------------------------------------------------------------

    For today's final rule, DOE contacted the remaining eight companies 
again and conducted additional research. Out of the eight other 
companies, DOE determined that seven did not manufacture covered 
products or were not the manufacturer of the covered products that they 
offered. DOE was unable to determine if the remaining company was a 
small business manufacturer.
    DOE also reviewed the product offerings of Tailored Lighting to 
determine whether that company is a small business manufacturer 
impacted by this rule. DOE determined that Tailored Lighting Inc is not 
a ``small business'' manufacturer within the context of the present 
rulemaking because it does not currently manufacture covered products.
    For the final rule, DOE continued to indentify the small GSFL 
manufacturer discussed in the April 2009 NOPR as the only small 
business manufacturer of products covered by this rulemaking. In the 
April 2009 NOPR, DOE found that the small manufacturer of covered GSFL 
shared some of the same concerns about energy conservation standards as 
large manufacturers. DOE summarized the key issues in the April 2009 
NOPR. 74 FR 16920, 16974-75 (April 13, 2009). However, the small 
manufacturer was less concerned about the potential of standards to 
severely harm its business. Because the small manufacturer is more 
focused on specialty products not covered by this rulemaking, covered 
GSFL represents a smaller portion of its revenue and product portfolio. 
In addition, this manufacturer stated that it is possible to pass along 
cost increases to consumers, thereby limiting margin impacts due to 
energy conservation standards.
    DOE could not use the GSFL GRIM to model the impacts of energy 
conservation standards on the small business manufacturer of covered 
GSFL.

[[Page 34175]]

The GSFL GRIM models the impacts on GSFL manufacturers if concerns 
about margin pressure and significant capital investments necessitated 
by standards are realized. The small manufacturer did not share these 
concerns, and, therefore, the GRIM model would not be representative of 
the identified small business manufacturer. Like large manufacturers, 
the small business manufacturer stated that more-efficient products 
earn a premium; however, unlike larger manufacturers, the small 
manufacturer stated that it could pass costs along to its customers (a 
statement expected to apply to both the proposed TSL3 and the final 
rule's TSL4). Since the GSFL GRIM models the financial impact of the 
standards commoditizing premium products, it is not representative of 
the small business manufacturer because the small business manufacturer 
did not share these concerns. Because of its focus on specialized 
products, the small manufacturer was more concerned about being able to 
offer the products to their customers than the impact on its bottom 
line. For further information about the scenarios modeled in the GRIM, 
see section V.F of today's notice and chapter 13 of the TSD.
    DOE reviewed the standard levels considered in today's final rule 
under the provisions of the Regulatory Flexibility Act and the 
procedures and policies published on February 19, 2003. On the basis of 
the foregoing, DOE reaffirms the certification. Therefore, DOE has not 
prepared a final regulatory flexibility analysis for this rule.

C. Review Under the Paperwork Reduction Act

    DOE stated in the April 2009 NOPR that this rulemaking would impose 
no new information and recordkeeping requirements, and that OMB 
clearance is not required under the Paperwork Reduction Act (44 U.S.C. 
3501 et seq.). 74 FR 16920, 17023 (April 13, 2009). DOE received no 
comments on this in response to the April 2009 NOPR, and, as with the 
proposed rule, today's rule imposes no information and recordkeeping 
requirements. Therefore, DOE has taken no further action in this 
rulemaking with respect to the Paperwork Reduction Act.

D. Review Under the National Environmental Policy Act

    DOE prepared an environmental assessment of the impacts of today's 
standards, which it published as chapter 16 within the TSD for the 
final rule. DOE found the environmental effects associated with today's 
standards for GSFL and IRL to be not significant, and, therefore, it is 
issuing a Finding of No Significant Impact (FONSI) pursuant to the 
National Environmental Policy Act of 1969 (NEPA) (42 U.S.C. 4321 et 
seq.), the regulations of the Council on Environmental Quality (40 CFR 
parts 1500-1508), and DOE's regulations for compliance with the NEPA 
(10 CFR part 1021). The FONSI is available in the docket for this 
rulemaking.

E. Review Under Executive Order 13132

    Executive Order 13132, ``Federalism,'' 64 FR 43255 (August 4, 
1999), imposes certain requirements on agencies formulating and 
implementing policies or regulations that preempt State law or that 
have Federalism implications. In accordance with DOE's statement of 
policy describing the intergovernmental consultation process it will 
follow in the development of regulations that have Federalism 
implications, 65 FR 13735 (March 14, 2000), DOE examined the proposed 
rule and determined that the rule would not have a substantial direct 
effect on the States, on the relationship between the National 
Government and the States, or on the distribution of power and 
responsibilities among the various levels of government. 74 FR 16920, 
17023 (April 13, 2009). DOE received no comments on this issue in 
response to the April 2009 NOPR, and its conclusions on this issue are 
the same for the final rule as they were for the proposed rule. This 
statement remains true even though DOE has adopted energy conservation 
standards for GSFL in this final rule (TSL4) that are at a higher level 
than those proposed (TSL3). Therefore, DOE is taking no further action 
in today's final rule with respect to Executive Order 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 Executive Order 12988, 
``Civil Justice Reform,'' 61 FR 4729 (Feb. 7, 1996), 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. Section 3(b) of Executive Order 
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 Executive Order 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, the final regulations meet the relevant standards of 
Executive Order 12988.

G. Review Under the Unfunded Mandates Reform Act of 1995

    As indicated in the April 2009 NOPR, DOE reviewed the proposed rule 
under Title II of the Unfunded Mandates Reform Act of 1995 (Pub. L. 
104-4) (UMRA), which imposes requirements on Federal agencies when 
their regulatory actions will have certain types of impacts on State, 
local, and Tribal governments and the private sector. 74 FR 16920, 
17024 (April 13, 2009). DOE concluded that, although this rule would 
not contain an intergovernmental mandate, it may result in expenditure 
of $100 million or more in one year by the private sector. Id. 
Therefore, in the April 2009 NOPR, DOE addressed the UMRA requirements 
that it prepare a statement as to the basis, costs, benefits, and 
economic impacts of the proposed rule, and that it identify and 
consider regulatory alternatives to the proposed rule. Id. DOE received 
no comments concerning the UMRA in response to the April 2009 NOPR, and 
its conclusions on this issue are the same for the final rule as they 
were for the proposed rule. This statement remains true even though DOE 
has adopted energy conservation standards for GSFL in this final rule 
(TSL4) that are at a higher level than those proposed (TSL3). 
Therefore, DOE is taking no further action in today's final rule with 
respect to the UMRA.

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

    DOE determined that, for this rulemaking, it need not prepare a 
Family Policymaking Assessment under Section 654 of the Treasury and 
General Government Appropriations Act, 1999 (Pub. L. 105-277). Id. DOE 
received no comments concerning Section 654 in response to the April 
2009 NOPR, and, therefore, takes no further action in today's final 
rule with respect to this provision.

[[Page 34176]]

I. Review Under Executive Order 12630

    DOE determined, under Executive Order 12630, ``Governmental Actions 
and Interference with Constitutionally Protected Property Rights,'' 53 
FR 8859 (March 18, 1988), that the proposed rule would not result in 
any takings which might require compensation under the Fifth Amendment 
to the U.S. Constitution. 74 FR 16920, 17024 (April 13, 2009). DOE 
received no comments concerning Executive Order 12630 in response to 
the April 2009 NOPR, and, today's final rule also would not result in 
any takings which might require compensation under the Fifth Amendment. 
Therefore, DOE takes no further action in today's final rule with 
respect to this Executive Order.

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

    Section 515 of the Treasury and General Government Appropriations 
Act, 2001 (44 U.S.C. 3516 note) provides for agencies to review most 
disseminations of information to the public under guidelines 
established by each agency pursuant to general guidelines issued by 
OMB. The 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 final rule 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 the 
OIRA a Statement of Energy Effects for any significant energy action. 
DOE determined that the proposed rule was not a ``significant energy 
action'' within the meaning of Executive Order 13211 because the rule, 
which sets energy efficiency standards for covered GSFL and IRL, would 
not have a significant adverse effect on the supply, distribution, or 
use of energy, nor has it been designated as a significant energy 
action by the Administrator of OIRA. 74 FR 16920, 17024 (April 13, 
2009). Accordingly, DOE did not prepare a Statement of Energy Effects 
on the proposed rule. DOE received no comments on this issue in 
response to the April 2009 NOPR. As with the proposed rule, DOE has 
concluded that today's final rule is not a significant energy action 
within the meaning of Executive Order 13211. This statement remains 
true even though DOE has adopted energy conservation standards for GSFL 
in this final rule (TSL4) that are at a higher level than those 
proposed (TSL3). Accordingly, DOE has not prepared a Statement of 
Energy Effects on the rule.

L. Review Under the Information Quality Bulletin for Peer Review

    On December 16, 2004, the OMB, in consultation with the Office of 
Science and Technology, issued its Final Information Quality Bulletin 
for Peer Review (the Bulletin). 70 FR 2664 (Jan. 14, 2005). The purpose 
of the Bulletin is to enhance the quality and credibility of the 
Government's scientific information. The Bulletin establishes that 
certain scientific information shall be peer reviewed by qualified 
specialists before it is disseminated by the Federal Government. As 
indicated in the April 2009 NOPR, this includes influential scientific 
information related to agency regulatory actions, such as the analyses 
in this rulemaking. 74 FR 16920, 17024-25 (April 13, 2009).
    As more fully set forth in the April NOPR, DOE conducted formal 
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. The ``Energy 
Conservation Standards Rulemaking Peer Review Report,'' dated February 
2007, has been disseminated and is available at: http://www.eere.energy.gov/buildings/appliance_standards/peer_review.html.

M. Congressional Notification

    As required by 5 U.S.C. 801, DOE will submit to Congress a report 
regarding the issuance of today's final rule. DOE also will submit the 
supporting analyses to the Comptroller General in the U.S. Government 
Accountability Office (GAO) and make them available to each House of 
Congress.

IX. Approval of the Office of the Secretary

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

List of Subjects in 10 CFR Part 430

    Administrative practice and procedure, Confidential business 
information, Energy conservation, Household appliances, Imports, 
Incorporation by reference, Intergovermental relations, Small 
businesses.

    Issued in Washington, DC, on June 26, 2009.
Cathy Zoi,
Assistant Secretary, Energy Efficiency and Renewable Energy.

0
For the reasons set forth in the preamble, chapter II, subchapter D, of 
Title 10, Code of Federal Regulations, Parts 430 is amended as set 
forth below:

PART 430--ENERGY CONSERVATION PROGRAM FOR CONSUMER PRODUCTS

0
1. The authority citation for part 430 continues to read as follows:

    Authority: 42 U.S.C. 6291-6309; 28 U.S.C. 2461 note.


0
2. Section 430.2 is amended by revising the definition of ``colored 
fluorescent lamp,'' ``fluorescent lamp,'' and ``rated wattage'' to read 
as follows:


Sec.  430.2  Definitions.

* * * * *
    Colored fluorescent lamp means a fluorescent lamp designated and 
marketed as a colored lamp and not designed or marketed for general 
illumination applications with either of the following characteristics:
    (1) A CRI less than 40, as determined according to the method set 
forth in CIE Publication 13.3 (incorporated by reference; see Sec.  
430.3); or
    (2) A correlated color temperature less than 2,500K or greater than 
7,000K as determined according to the method set forth in IESNA LM-9 
(incorporated by reference; see Sec.  430.3).
* * * * *
    Fluorescent lamp means a low pressure mercury electric-discharge 
source in which a fluorescing coating transforms some of the 
ultraviolet energy generated by the mercury discharge into light, 
including only the following:
    (1) Any straight-shaped lamp (commonly referred to as 4-foot medium 
bipin lamps) with medium bipin bases of nominal overall length of 48 
inches and rated wattage of 25 or more;
    (2) Any U-shaped lamp (commonly referred to as 2-foot U-shaped 
lamps) with medium bipin bases of nominal overall length between 22 and 
25 inches and rated wattage of 25 or more;
    (3) Any rapid start lamp (commonly referred to as 8-foot high 
output lamps) with recessed double contact bases of nominal overall 
length of 96 inches;
    (4) Any instant start lamp (commonly referred to as 8-foot slimline 
lamps) with single pin bases of nominal overall length of 96 inches and 
rated wattage of 52 or more;
    (5) Any straight-shaped lamp (commonly referred to as 4-foot

[[Page 34177]]

miniature bipin standard output lamps) with miniature bipin bases of 
nominal overall length between 45 and 48 inches and rated wattage of 26 
or more; and
    (6) Any straight-shaped lamp (commonly referred to 4-foot miniature 
bipin high output lamps) with miniature bipin bases of nominal overall 
length between 45 and 48 inches and rated wattage of 49 or more.
* * * * *
    Rated wattage means:
    (1) With respect to fluorescent lamps and general service 
fluorescent lamps:
    (i) If the lamp is listed in ANSI C78.81 (incorporated by 
reference; see Sec.  430.3) or ANSI C78.901 (incorporated by reference; 
see Sec.  430.3), the rated wattage of a lamp determined by the lamp 
designation of Clause 11.1 of ANSI C78.81 or ANSI C78.901;
    (ii) If the lamp is a residential straight-shaped lamp, and not 
listed in ANSI C78.81 (incorporated by reference; see Sec.  430.3), the 
wattage of a lamp when operated on a reference ballast for which the 
lamp is designed; or
    (iii) If the lamp is neither listed in one of the ANSI standards 
referenced in (1)(i) of this definition, nor a residential straight-
shaped lamp, the electrical power of a lamp when measured according to 
the test procedures outlined in Appendix R to subpart B of this part.
    (2) With respect to general service incandescent lamps and 
incandescent reflector lamps, the electrical power measured according 
to the test procedures outlined in Appendix R to subpart B of this 
part.
* * * * *

0
3. Section 430.3 is amended by:
0
A. Removing paragraph (c)(1);
0
B. Redesignating paragraphs (c)(2) through (13) as (c)(1) through (12);
0
C. Revising newly redesignated paragraph (c)(1); and
0
D. In newly redesignated paragraph (c)(5), add ``430.32,'' after 
``430.2,''.
    The revision reads as follows:


Sec.  430.3  Materials incorporated by reference.

* * * * *
    (c) * * *
    (1) ANSI C78.3-1991 (``ANSI C78.3''), American National Standard 
for Fluorescent Lamps-Instant-start and Cold-Cathode Types-Dimensional 
and Electrical Characteristics, approved July 15, 1991; IBR approved 
for Sec.  430.32.
* * * * *

0
4. Appendix R to Subpart B of Part 430 is amended by adding paragraphs 
4.1.2.3, 4.1.2.4, and 4.1.2.5 to read as follows:

Appendix R to Subpart B of Part 430--Uniform Test Method for Measuring 
Average Lamp Efficacy (LE) and Color Rendering Index (CRI) of Electric 
Lamps

* * * * *
    4.1.2.3 8-foot slimline lamps shall be operated using the 
following reference ballast settings:
    (a) T12 lamps: 625 volts, 0.425 amps, and 1280 ohms.
    (b) T8 lamps: 625 volts, 0.260 amps, and 1960 ohms.
    4.1.2.4 8-foot high output lamps shall be operated using the 
following reference ballast settings:
    (a) T12 lamps: 400 volts, 0.800 amps, and 415 ohms.
    (b) T8 lamps: 450 volts, 0.395 amps, and 595 ohms.
    4.1.2.5 4-foot miniature bipin standard output or high output 
lamps shall be operated using the following reference ballast 
settings:
    (a) Standard Output: 329 volts, 0.170 amps, and 950 ohms.
    (b) High Output: 235 volts, 0.460 amps, and 255 ohms.
* * * * *
0
5. Section 430.32 is amended by revising paragraph (n) to read as 
follows:


Sec.  430.32  Energy and water conservation standards and effective 
dates.

* * * * *
    (n) General service fluorescent lamps and incandescent reflector 
lamps. (1) Except as provided in paragraphs (n)(2) and (n)(3) of this 
section, each of the following general service fluorescent lamps 
manufactured after the effective dates specified in the table shall 
meet or exceed the following lamp efficacy and CRI standards:

----------------------------------------------------------------------------------------------------------------
                                                                     Minimum
                                  Nominal lamp                    average lamp
           Lamp type                 wattage       Minimum CRI   efficacy  (lm/           Effective date
                                                                       W)
----------------------------------------------------------------------------------------------------------------
4-foot medium bipin............            >35W              69            75.0  Nov. 1, 1995.
                                          <=35W              45            75.0  Nov. 1, 1995.
2-foot U-shaped                            >35W              69            68.0  Nov. 1, 1995.
8-foot slimline................           <=35W              45            64.0  Nov. 1, 1995.
                                           >65W              69            80.0  May 1, 1994.
                                           >65W              45            80.0  May 1, 1994.
8-foot high output.............           >100W              69            80.0  May 1, 1994.
                                         <=100W              45            80.0  May 1, 1994.
----------------------------------------------------------------------------------------------------------------

    (2) The standards described in paragraph (n)(1) of this section do 
not apply to:
    (i) Any 4-foot medium bipin lamp or 2-foot U-shaped lamp with a 
rated wattage less than 28 watts;
    (ii) Any 8-foot high output lamp not defined in ANSI C78.81 
(incorporated by reference; see Sec.  430.3) or related supplements, or 
not 0.800 nominal amperes; or
    (iii) Any 8-foot slimline lamp not defined in ANSI C78.3 
(incorporated by reference; see Sec.  430.3).
    (3) Each of the following general service fluorescent lamps 
manufactured after July 14, 2012, shall meet or exceed the following 
lamp efficacy standards shown in the table:

------------------------------------------------------------------------
                                                               Minimum
                                                               average
             Lamp type                  Correlated color         lamp
                                           temperature         efficacy
                                                                (lm/W)
------------------------------------------------------------------------
4-foot medium bipin................  <=4,500K..............           89
                                     >4,500K and <=7,000K..           88
2-foot U-shaped....................  <=4,500K..............           84

[[Page 34178]]

 
                                     >4,500K and <=7,000K..           81
8-foot slimline....................  <=4,500K..............           97
                                     >4,500K and <=7,000K..           93
8-foot high output.................  <=4,500K..............           92
                                     >4,500K and <=7,000K..           88
4-foot miniature bipin standard      <=4,500K..............           86
 output.
                                     >4,500K and <=7,000K..           81
4-foot miniature bipin high output.  <=4,500K..............           76
                                     >4,500K and <=7,000K..           72
------------------------------------------------------------------------

    (4) Except as provided in paragraph (n)(5) of this section, each of 
the following incandescent reflector lamps manufactured after November 
1, 1995, shall meet or exceed the lamp efficacy standards shown in the 
table:

------------------------------------------------------------------------
                                                        Minimum average
                 Nominal lamp wattage                  lamp efficacy (lm/
                                                               W)
------------------------------------------------------------------------
40-50................................................               10.5
51-66................................................               11.0
67-85................................................               12.5
86-115...............................................               14.0
116-155..............................................               14.5
156-205..............................................               15.0
------------------------------------------------------------------------

    (5) Each of the following incandescent reflector lamps manufactured 
after July 14, 2012, shall meet or exceed the lamp efficacy standards 
shown in the table:

----------------------------------------------------------------------------------------------------------------
                                                                                                 Minimum average
         Rated lamp wattage                Lamp spectrum        Lamp diameter    Rated voltage    lamp efficacy
                                                                   (inches)                           (lm/W)
----------------------------------------------------------------------------------------------------------------
40-205.............................  Standard Spectrum.......             >2.5           >=125V      6.8*P\0.27\
                                                                                          <125V      5.9*P\0.27\
                                                                         <=2.5           >=125V      5.7*P\0.27\
                                                                                          <125V      5.0*P\0.27\
40-205.............................  Modified Spectrum.......             >2.5           <=125V      5.8*P\0.27\
                                                                                          <125V      5.0*P\0.27\
                                                                         <=2.5           >=125V      4.9*P\0.27\
                                                                                          <125V      4.2*P\0.27\
----------------------------------------------------------------------------------------------------------------
Note 1: P is equal to the rated lamp wattage, in watts.
Note 2: Standard Spectrum means any incandescent reflector lamp that does not meet the definition of modified
  spectrum in 430.2.

    (6) (i)(A) Subject to the exclusions in paragraph (n)(6)(ii) of 
this section, the standards specified in this section shall apply to ER 
incandescent reflector lamps, BR incandescent reflector lamps, BPAR 
incandescent reflector lamps, and similar bulb shapes on and after 
January 1, 2008.
    (B) Subject to the exclusions in paragraph (n)(6)(ii) of this 
section, the standards specified in this section shall apply to 
incandescent reflector lamps with a diameter of more than 2.25 inches, 
but not more than 2.75 inches, on and after June 15, 2008.
    (ii) The standards specified in this section shall not apply to the 
following types of incandescent reflector lamps:
    (A) Lamps rated at 50 watts or less that are ER30, BR30, BR40, or 
ER40 lamps;
    (B) Lamps rated at 65 watts that are BR30, BR40, or ER40 lamps; or
    (C) R20 incandescent reflector lamps rated 45 watts or less.

Appendix

    [The following letter from the Department of Justice will not 
appear in the Code of Federal Regulations.]

Department of Justice, Antitrust Division, Main Justice Building, 
950 Pennsylvania Avenue, NW., Washington, DC 20530-0001, (202) 514-
2401/(202) 616-2645(f), [email protected], http://www.usdoj.gov/atr.

June 15, 2009.

Warren Belmar, Esq.,
Deputy General Counsel for Energy Policy, Department of Energy, 
Washington, DC 20585.

    Dear Deputy General Counsel Belmar: I am responding to your 
letter seeking the views of the Attorney General about the potential 
impact on competition of proposed amended energy conservation 
standards for general service fluorescent lamps (``GSFL'') and 
incandescent reflector lamps (``IRL''). Your request was submitted 
pursuant to Section 325(o)(2)(B)(i)(V) of the Energy Policy and 
Conservation Act, as amended, (``ECPA''), 42 U.S.C. 
6295(o)(B)(i)(V), which requires the Attorney General to make a 
determination of the impact of any lessening of competition that is 
likely to result from the imposition of proposed energy conservation 
standards. The Attorney General's responsibility for responding to 
requests from other departments about the effect of a program on 
competition has been delegated to the Assistant Attorney General for 
the Antitrust Division in 28 CFR 0.40(g).
    In conducting its analysis the Antitrust Division examines 
whether a proposed standard may lessen competition, for example, by 
substantially limiting consumer choice, leaving consumers with fewer 
competitive alternatives, placing certain manufacturers of a product 
at an unjustified competitive disadvantage compared to other 
manufacturers, or by inducing avoidable inefficiencies in production 
or distribution of particular products.
    We have reviewed the proposed standards contained in the Notice 
of Proposed Rulemaking (``NOPR'') (74 FR 16920, April 13, 2009) and 
the supplementary information submitted to the Attorney General, and 
attended the February 3, 2009 public hearing on the proposed 
standards.
    Based on this review, the Department of Justice does not believe 
that the proposed standard for GSFLs would likely lead to a 
lessening of competition. Our review has focused upon the standards 
DOE has

[[Page 34179]]

proposed adopting; we have not determined the impact on competition 
of more stringent standards than those proposed in the NOPR.
    With respect to IRLs, the Department is concerned that the proposed 
Trial Standard Level 4 could adversely affect competition. The NOPR 
would increase the minimum efficiency levels for IRLs to the second 
highest level under consideration in this rulemaking. The IRL market is 
highly concentrated, with three domestic manufacturers. Based on our 
review, it appears that only two of these firms may currently 
manufacture IRLs that would meet the new standard. It is our 
understanding that these firms produce only limited quantities of such 
products for high-end applications. The current producers may not have 
the capacity to meet demand. In addition, one of these manufacturers 
uses proprietary technology currently unavailable to other 
manufacturers.
    Given the capital investments new entrants or providers would be 
required to make, and the potential that manufacturers may have to 
obtain proprietary technology, there is a risk that one or more IRL 
manufacturers will not produce products that meet the proposed 
standard. We request that the Department of Energy consider the 
possibility of new technology in this area as it settles on standards 
in this field.

    Sincerely,

Christine A. Varney,
Assistant Attorney General.
[FR Doc. E9-15710 Filed 7-13-09; 8:45 am]
BILLING CODE 6450-01-P